Norgrove and McClintock
[2020] FCCA 1120
•11 May 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| NORGROVE & MCCLINTOCK | [2020] FCCA 1120 |
| Catchwords: FAMILY LAW – De facto relationship lasting four years and nine months – parties living under the one roof for four months – where one party loses capacity – property pool – contributions – future needs – justice and equity – guardianship – trustees – proceedings in the Supreme Court of Queensland stayed pending finalisation of these proceedings in the Federal Circuit Court of Australia. |
| Legislation: Family Law Act 1975, ss.90RD, 90SF, 90SM Succession Act 1981 (Qld), s.15B Trusts Act 1973 (Qld), ss.80, 90 Evidence Act 1995 (Cth), s.140 |
| Cases cited: KCR [2017] QCAT; KCR [2018] QCAT 185 Briginshaw v Briginshaw (1938) 60 CLR 336 |
| Applicant: | MS NORGROVE |
| Respondent: | MR MCCLINTOCK |
| File Number: | BRC 5457 of 2018 |
| Judgment of: | Judge Howard |
| Hearing dates: | 9 & 10 December 2019 and 12 March 2020 |
| Date of Last Submission: | 12 March 2020 |
| Delivered at: | Brisbane |
| Delivered on: | 11 May 2020 |
REPRESENTATION
| The Applicant attended as a self-represented litigant on 12 March 2020 |
| Counsel for the Applicant: | Mr Hanlon appeared on 9 December 2019 |
| Solicitors for the Applicant: | Cecil Black Mediation & Family Law on 9 & 10 December 2019 |
| Counsel for the Respondent: | Dr Sayers |
| Solicitors for the Respondent: | Peter J Sheehy Solicitor |
ORDERS
On 10 December 2019 the Court made the following declaration:-
THE COURT DECLARES:
That pursuant to s.90RD of the Family Law Act 1975, a de facto relationship existed between the Applicant and Respondent in this matter from period of 2013 until 22 March 2018.
On 12 March 2020, the Court made the following Orders:-
That the real property situated at A Street, Suburb B in the State of Queensland more particularly described as Lot … on Registered Plan …, Title Reference … (“the A Street, Suburb B property”) shall be sold. The parties shall attempt to sell the A Street, Suburb B Property by private treaty in the first instance and for that purpose:-
(a)The property shall be listed for sale with a real estate agent to be agreed by the parties and failing agreement, by a real estate agent to be appointed by the President of the Real Estate Institute of Queensland; and
(b)The property shall be sold at a price to be agreed between the parties and failing agreement, the parties shall request the President of the Real Estate Institute of Queensland to nominate a Registered Valuer. Once the valuation is provided by the Registered Valuer the parties shall agree the sale price and in the absence of an agreement as to the price – the parties shall request that the President of the Real Estate Institute of Queensland nominate a selling price taking into account the valuation prepared by the Registered Valuer.
That should the parties fail to sell the property by private treaty pursuant to the preceding Order, the A Street, Suburb B property shall be sold at a public auction and for the that purpose:-
(a)The property shall be sold by a real estate agent to be agreed by the parties and failing agreement, by the real estate agent to be appointed pursuant to paragraph 1 of this Order; and
(b)The property shall be sold at a reserve price to be agreed between the parties and failing agreement, the President of the Real Estate Institute of Queensland shall set the reserve price upon consideration of the valuation provided by the Registered Valuer pursuant to paragraph 1 of this Order.
That upon the sale of the A Street, Suburb B property, the “net sale proceeds” shall be disbursed as follows:-
(a)The Public Trustee of Queensland shall be paid $284,003;
(b)The Respondent’s credit card debt shall be paid in the sum of $33,617;
(c)The Applicant shall be paid from the remainder of the pool (referred to as “the net pool”) the sum of $700,000 or 60% of the net pool, whichever is the higher;
(d)The balance of the pool then outstanding should be paid to the Public Trustee of Queensland as Trustee for the estate of the Respondent.
The net sale proceeds is the sale price of the A Street, Suburb B property after the deduction of commission, conveyancing fees, outstanding rates and any other unforeseen fees associated with the sale of the A Street, Suburb B property.
That in the event the “net property pool” does not realise an amount which allows for the payment of $700,000 to the Applicant pursuant to paragraph 3 c) of these Orders, the Applicant shall receive the nearest amount to $700,000 that can be made available to her from “the net property pool.”
That the parties have liberty to apply in relation to the wording of the Orders and in relation to the machinery relating to the operation of the Orders.
IT IS NOTED:
(A)On 12 March 2020 the Court noted that in the event that the Respondent were to pass away before the sale of the A Street, Suburb B property, then these Orders bind any executor or personal representative of the Respondent’s will.
(B)That Mr McClintock died in 2020. This Notation was added subsequently.
(C)The Public Trustee of Queensland is the Trustee who appeared on behalf of the Respondent.
IT IS NOTED that publication of this judgment under the pseudonym Norgrove & McClintock is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT BRISBANE |
BRC 5457 of 2018
| MS NORGROVE |
Applicant
And
| MR MCCLINTOCK |
Respondent
REASONS FOR JUDGMENT
Background
The matter before the Court involves a de facto property dispute. The proceedings were filed in the Federal Circuit Court of Australia on 22 May 2018.
The first mention of the matter in my docket took place on 18 July 2019.
The matter was given a two-day urgent listing commencing Monday, 9 December 2019 and continuing on 10 December 2019.
The case involves an application seeking an adjustment of property interests following the conclusion of a de facto relationship.
On 10 December 2019 (after the parties had spent most of the first day attempting to negotiate a settlement) the parties requested that the Court make a declaration pursuant to section 90RD of the Family Law Act 1975. Mr Hanlon of Counsel appeared on behalf of the applicant, Ms Norgrove. Dr Sayers of Counsel appeared on behalf of the Trustee for the Respondent, Mr McClintock.
The Court considered the available evidence and heard submissions from the parties and made the following declaration:-
“THE COURT DECLARES:
1. That pursuant to s.90RD of the Family Law Act 1975, a de facto relationship existed between the Applicant and Respondent in this matter from (period of) 2013 until 22 March 2018.” (Parenthesis added).
Mr Hanlon of Counsel then sought leave to withdraw on 10 December 2019. That leave was granted. The wife’s solicitor from the firm Cecil Black Mediation and Family Law continued as the applicant’s lawyer on that day. In any event, the matter was adjourned for further hearing to take place on 12 on 13 March 2020.
Prior to 12 March 2020, Cecil Black Mediation and Family Law ceased to be the solicitors for the wife. The applicant wife therefore attended the trial of the self-represented litigant on 12 March 2020. I will, in these reasons for judgement, use the terminology “wife” and “husband”.
The applicant wife was born in 1946. The respondent husband was born in 1938. The wife lives in a property at A Street, Suburb B.
Until 2020, the husband had been residing at the Suburb C aged care service facility at D Street, Suburb C.
Both parties were widowed and neither party had any children. The applicant wife was an only child and the respondent husband was the only survivor of his siblings.
Ms Norgrove was a retired public servant and had been married for 23 years, but her husband had passed away in 1994.
The respondent had owned a successful business in Sydney and had retired to the Region E. His wife passed away in 2012. They had been married for 50 years.
The parties met in 2013.
At that time the wife lived in a house at F Street, Suburb G and the husband lived at H Street, Suburb J.
In 2013, the husband asked the wife to marry him. In 2013, the wife accepted the proposal. An engagement ring was purchased.
The parties agreed that it would be best to find a new home to live in together.
At that stage the wife had a mortgage of approximately $630,000 on her property at F Street, Suburb G.
The wife sold her house at F Street, Suburb G and the husband sold his house at H Street, Suburb J and together they purchased a property at K Street, Suburb L as joint tenants.
On 27 June 2013, the husband made a will with M Law Firm at Suburb L. Pursuant to that will the wife became the beneficiary of the husband’s estate and the wife was also a joint executor – referred to by the respondent as, "my said wife fiancée Ms Norgrove”. The other joint executor was Mr M, the solicitor who prepared the will.
In the event that the disposition to the applicant wife failed or was revoked, the husband’s estate was left to the N Foundation.
On the same date that the respondent had executed a will (27 June 2013), he also executed an Enduring Power of Attorney and appointed the applicant as his Attorney for his personal/health and financial matters. The husband’s Trustee is the Public Trustee of Queensland. Mr O is a delegate of the Public Trustee and authorised to sign affidavits regarding the affairs of Mr McClintock. Mr O was, effectively, providing instructions as Mr McClintock’s Trustee. Mr O instructed Mr Peter Sheehy, Solicitor. Mr Sheehy briefed Dr Sayers of Counsel.
In the affidavit of Mr O filed on 19 July 2019, he has annexed (M-1) a decision of the Queensland Civil and Administrative Tribunal – Member P. The decision was delivered on 6 March 2018. By that decision the following orders were made:-
“GUARDIANSHIP
1. The appointment of The Public Guardian as guardian for Mr McClintock (the respondent husband) for the following personal matters is continued:
(a) Accommodation;
(b) With whom Mr McClintock has contact and/or visits;
(c) Health care.
2. This appointment remains current until further order of the Tribunal. The appointment is reviewable and is to be reviewed in five (5) years.
ADMINISTRATION
3. The appointment of The Public Trustee of Queensland as administrator for Mr McClintock for all financial matters is continued.
4. The Tribunal dispenses with the requirement for the administrator to provide a financial management plan.
5. The Tribunal directs the administrator to provide accounts to the Tribunal when requested.
6. This appointment of The Public Trustee of Queensland remains current until further order of the Tribunal.
ENDURING POWER OF ATTORNEY
7. The following Enduring Power of Attorney for Mr McClintock is revoked pursuant to s116(d) of the Powers of Attorney Act 1998 and s82(2) of the Guardianship and Administration Act 2000:
(a) The Enduring Power of Attorney dated 27 June 2013 appointing Ms Norgrove (the applicant wife) and Mr M as attorneys for financial, personal and health matters.”
(Italics in parenthesis added)
The decision is cited as KCR [2017] QCAT and KCR [2018] QCAT 185. The matter was heard at F Street, Suburb G over four days in February, May, August and September 2017.
Member P stated at paragraph 20, in relation to the applicant wife’s evidence in the QCAT hearing:-
“[20] I did not find [the applicant wife] a reliable or satisfactory witness. She was evasive in her answers at times and gave contradictory evidence. Examples are outlined in the paragraphs below. They cause me to doubt her reliability and credibility.
[21] [the applicant wife] told me that she did not know whether the matter was going to be heard at the first hearing or not so hadn’t had the opportunity to find a psychiatrist independent of Dr Q. When I questioned her about why she did not think the hearing was going ahead, [the applicant wife] had nothing to offer except that the process was very distressing.
[22] Early in the second hearing [the applicant wife] advised me that she was seeking an adjournment partly because she couldn’t find a suitable lawyer on the Region E, notwithstanding that she had had three months to do so. I found this unconvincing.”
Member P’s findings on credit are not binding on this Court. I observed Ms Norgrove’s evidence in December 2019 and in March 2020. I did not consider that Ms Norgrove was an unreliable witness. Her memory is not as good as it might have been – on occasions – but she was visibly distressed. She stated more than once that there had never been a cross-word between her and “Mr McClintock”. The relationship essentially appears to have petered out after he became unwell and his health declined. This was particularly so after he suffered a fall.
In any event, the QCAT member had access to medical evidence and came to the conclusion, based on the medical evidence:-
“[61] Further, I have concluded that Mr McClintock’s capacity to make decisions about his financial matters was likely to have been impaired from September 2013 but am in no doubt from the medical evidence that he lacked capacity for any of his financial matters from June 2014. I accept Mr R’s submission that there is no substantial evidence of any mental incapacity prior to the fall.”
Given that I did not have the benefit of the medical evidence – and certainly no cross-examination of any medical experts – I consider that it is appropriate for this Court to at least take judicial notice of the finding made by Member P that the respondent husband (based on the medical evidence) “lacked capacity for any of his financial matters from June 2014.”
That finding is one of the matters I have taken into account in assessing what orders, if any, should be made in the current application before the Federal Circuit Court of Australia.
That finding by QCAT is relevant because in July 2015 there was purchased, in the sole name of the applicant wife, the property at A Street, Suburb B– where the wife still resides. That property was purchased solely in the name of the applicant wife. To complete the sale of the A Street, Suburb B property – the property at Suburb B (which the parties had purchased as joint tenants) was sold.
July 2015 is therefore well after the finding made by the QCAT Member that the respondent husband lacked capacity for any of his financial matters (June 2014).
I must say, though, that there is other, independent evidence before the Court which I have had regard to and which leads me to conclude that the wife’s credibility and reliability is not as damaged as found by the QCAT member. The A Street, Suburb B property was purchased in July 2015. There is before the Court an affidavit sworn by a retired Judge of the District Court of Queensland, Mr S. The affidavit was sworn on 11 July 2018. Mr S was not required for cross-examination. His evidence is therefore accepted by this Court. I note that Mr S stated:-
“1. I am a Queen's Counsel and a retired judge of the District Court of Queensland.
2. I knew Ms Norgrove when she resided near me in the gated community called T in which I continue to reside.
3. I first met Mr McClintock in 2013, when Ms Norgrove began a relationship with him. I met him on occasions when he would visit her at the T house in which she was living. I could see that they seemed very happy together.
4. Ms Norgrove told me that they had decided to purchase another house together, in which they would reside as a couple. I was aware, from what Ms Norgrove told me, that Mr McClintock did not want to remain in his house at Suburb J because of its association with his recently deceased wife.
5. I later was aware, from what Mr McClintock told me, that they had purchased a house at K Street, Suburb L, and at her invitation I visited them there on, perhaps, three occasions. I saw that the property was in need of renovation, in the sense that it looked old, on my first visit there, soon after the purchase. On a couple of subsequent visits to that property, I observed that renovations were being carried out, apparently supervised by Ms Norgrove. Substantial work was being undertaken. Ms Norgrove told me she was supervising the work of the tradesmen. I considered that she had a flair for renovating, which Mr McClintock seemed happy to accommodate. I met Mr McClintock on those occasions and had short discussions with him and, in all respects, he appeared to me perfectly normal.
6. I specifically recall my wife and I were invited there on the night of which was, I recall, on Wednesday 17 June 2015. In my observation that night, to all intents and purposes, Mr McClintock and Ms Norgrove were living together very happily. After dinner, I sat next to Mr McClintock to watch the game. I spoke with him frequently during the game and he was perfectly normal. There was also nothing unusual about his behaviour.
7. It appeared to me that they were in a very happy relationship. On this occasion, as on others, Mr McClintock told me how devoted he was to Ms Norgrove and agreed with everything she was doing to the house. It seemed to me that he left everything for Ms Norgrove to handle and was content to do so. In my view, Mr McClintock was very pleased that he had found someone like Ms Norgrove after the death of his wife, was happy in the relationship, he genuinely appeared to love her and was glad to let her make decisions for the future of them both. In short, to all intents and purposes, they appeared to me as though they were a married couple.
8. I also, on about two occasions, visited the house subsequently purchased at A Street, Suburb B. Ms Norgrove was carrying out renovations and, as before, appeared to be organising and supervising. I do not recall seeing Mr McClintock at that house during my visits.
9. In all the times that I have met and socialised with Mr McClintock I found him to be alert and in charge of himself.”
Crucially, the evidence of Mr S’s notes that on Wednesday, 17 June 2015 he spent the evening at (what obviously appeared to him to be) the parties’ residence watching the football. This was (17 June 2015) – only one month prior to the purchase of the A Street, Suburb B property which was then registered in the sole name of Ms Norgrove.
In the times that Mr S met and socialised with the respondent husband, Mr S found the respondent husband to be “alert and in charge of himself”. It is not surprising therefore that the applicant wife has given evidence to a similar effect.
This Court has before it is a declaration that was made (at the request of the parties) declaring that a de facto relationship existed between the applicant wife and the respondent husband from 2013 until 22 March 2018.
The Court has to determine whether it is appropriate that there should be any adjustment of the property interests and if so to what extent. In this case it is helpful to summarise the pool of assets. I find that the net pool is as follows:-
Assets
Ownership
Value
A Street, Suburb B
Applicant
$1,400,000
Applicant’s Bank Account
Applicant
$54
Respondent’s Bank Account
Respondent
$9,064
Motor Vehicle 1
Applicant
$12,000
Household content at A Street, Suburb B
Joint
$18,000
Jewellery
Applicant
$4,000
Liabilities
QCAT and FCCA legal fees for the Respondent
Respondent
($284,003)
Respondent’s Credit Card
Respondent
($33,617)
Net Property Pool
$1,125,498
I accepted the valuation evidence of A Street, Suburb B because it was the more recent valuation.
I did not allow the applicant’s legal fees in the sum of $180,000 because it is not clear whether that money was spent from post separation income; from capital; was owed as a loan to a third party; or is owing to the applicant’s former lawyers. In the absence of sufficient clarity and proof I am not willing to include that amount in the pool.
Further, I am not willing to include as a liability in the pool the loan which was alleged by the applicant to have been received from Mr U. I am not satisfied that, if monies were advanced by Mr U, that they are in fact monies which the applicant is obligated to repay.
When the matter came before the Court on 12 March 2020, the Court was informed that the respondent husband’s health had deteriorated significantly. He was gravely ill and the Court was informed that the applicant wife had been to see the respondent at a hospital on the Region E on the evening of 11 March 2020. In addition, Counsel for the Trustee informed the Court that the Public Guardian appointed on behalf of the respondent husband had provided information to the effect that the respondent husband was not expected to live longer than one week. The Guardian had been talking to the personnel who are caring for the respondent husband. In fact, Counsel for the respondent informed the Court that the respondent’s demise could occur within hours. It therefore became urgent that the Court concluded the matter. This is the case for a number of reasons.
The declaration that the Court was asked to make (and the Court did make it) on 10 December 2019 had the effect of revoking the respondent husband’s testamentary disposition to the former de facto partner (namely Ms Norgrove). Further, Ms Norgrove’s appointment as Mr McClintock’s executor was also revoked. In this regard, I note section 15B of the Succession Act 1981 (Qld) (‘Succession Act’). That section states, inter alia:-
“15B Effect of end of de facto relationship on a will
(1) The ending of a testator’s de facto relationship revokes—
(a) a disposition to the testator’s former de facto partner made by a will in existence when the relationship ends;
and
(b) an appointment, made by the will, of the former de facto partner as an executor, Trustee, advisory Trustee or guardian; and
(c) any grant, made by the will, of a power of appointment exercisable by, or in favour of, the testator’s former de facto partner.
…
(3) Subsection (1) does not apply if a contrary intention appears in the will.
(4) If a disposition, appointment or grant is revoked by this section, the will takes effect as if the former de facto partner had died before the testator.
(5) In this section—
former de facto partner, in relation to a testator, means the person who was the de facto partner of the testator immediately before the ending of the testator’s de facto relationship.”
Subsection 1 of section 15B of the Succession Act does not apply if a contrary intention appears in the will. There is no contrary intention expressed in the will of Mr McClintock.
Stanford v Stanford
In Stanford v Stanford (2012) 247 CLR 108, the High Court of Australia noted that section 79(2) (s.90SM in relation to de facto matters) of the Family Law Act 1975 (Cth) (‘the Act’) 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.” At paragraph 37 of Stanford (supra), the High Court stated:-
“37. First, it is necessary to begin consideration of whether it is just and equitable to make a property settlement order by identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property. So much follows from the text of s 79(1)(a) itself, which refers to “altering the interests of the parties to the marriage in the property” (emphasis added). The question posed by s 79(2) is thus whether, having regard to those existing interests, the court is satisfied that it is just and equitable to make a property settlement order.
38. Secondly, although s 79 confers a broad power on a court exercising jurisdiction under the Act to make a property settlement order, it is not a power that is to be exercised according to an unguided judicial discretion. In Wirth v Wirth , Dixon CJ observed[25] that a power[26] to make such order with respect to property and costs “as [the judge] thinks fit”, in any question between husband and wife as to the title to or possession of property, is a power which “rests upon the law and not upon judicial discretion”. And as four members of this Court observed about proceedings for maintenance and property settlement orders in R v Watson; Ex parte Armstrong [27]:
“The judge called upon to decide proceedings of that kind is not entitled to do what has been described as ‘palm tree justice’. No doubt he is given a wide discretion, but he must exercise it in accordance with legal principles, including the principles which the Act itself lays down.”
39. Because the power to make a property settlement order is not to be exercised in an unprincipled fashion, whether it is “just and equitable” to make the order is not to be answered by assuming that the parties' rights to or interests in marital property are or should be different from those that then exist...”
I also note what was stated by the High Court in Stanford from paragraph 45:-
“45. Contrary to the submissions of the husband in this Court, there may be circumstances other than a voluntary separation of the parties marking the breakdown of their marital relationship in which a court may be satisfied that it is just and equitable to make a property settlement order. For example, demonstration of one party's unmet needs that cannot be answered by a maintenance order may well warrant the conclusion that it is just and equitable to make a property settlement order. It may be that there are circumstances other than need.”
In the present case before the Court – the parties moved into the K Street, Suburb L property together in 2013. The respondent husband had a fall on the stairs in that property and was hospitalised for a head injury. He eventually returned to the K Street, Suburb L house which was to be renovated. The renovation took more than 12 months. However, it was then determined that another property should be purchased for the couple to live in which did not have stairs. The applicant wife found a place in A Street, Suburb B. That property was purchased for $920,000 using funds from both parties. That is, the net proceeds of sale of the K Street, Suburb L property were utilised. I accept the submissions made on behalf of the respondent that the evidence discloses that the applicant brought to the relationship (from the sale of her property at F Street, Suburb G) $264,000 and the respondent, Mr McClintock, (from the sale of his H Street, Suburb J property and other assets) – brought to the relationship $1,592,000. The evidence discloses that the parties, in effect, only lived under one roof for four months. After that time the husband lived with a friend, Mr V and the husband and Mr V would visit the applicant and the applicant would cook for them and the evidence appears to be that this occurred somewhere between two and five nights each week. The applicant would care for the respondent whether it was at the residence that the applicant was living in or the residence that the respondent was living in.
Given that the parties asked the Court and the Court did in fact make the declaration that the de facto relationship ceased in March 2018 and noting that they had not lived together for more than four months – it seems to me in the circumstances just and equitable for the Court to make a property order – in this case under section 90SM.
Contributions
The relationship lasted approximately five years. The parties lived together under the one roof for only four months. However, I do note and accept the evidence of the applicant wife that she did continue to care for Mr McClintock for somewhere between two and five nights per week. The findings made in relation to initial financial contributions reflect a direct financial contribution by the applicant wife at the commencement of the relationship of 15% and a direct financial contribution by the respondent husband at the commencement of the relationship of 85%.
I note the decision of the Full Court of the Family Court In the Marriage of Quinn (1979) FLC 90-677. This case is authority for the principle that when a marriage is of short duration, the Court needs to give added weight to the capital contributions made by the parties at the commencement of the relationship.
Dr Sayers, Counsel on behalf of the respondent, made submissions that the contributions based entitlement of the applicant should be reduced from 15% (her initial contribution) to 5% or 10% as at the date of hearing. I do not accept the submissions made by Dr Sayers in that regard. I find that the wife did care for the respondent husband in this case, even after they were no longer living together. She may not have cared for him every day. He may have been in a care home from November 2016 – but she still visited him. I accept her evidence in relation to homemaking contributions including cooking – this occurred even when the parties were not living under the one roof. I do not consider that there should be a reduction in an assessment of the contributions made for the wife for any of the reasons put forward by Counsel for the respondent – or for any other reason. If a party to a short relationship brings to that relationship an initial financial contribution of 15% – I cannot see that it is equitable to reduce the assessment of her contributions because they were not living under the one roof, or because of a value judgment concerning the nature of the wife’s spending or the fact that the husband moved into a home from November 2016, or for any of the other reasons put forward by Counsel for the respondent.
In fact, the view that I have reached is that in addition to the direct financial contribution of 15% at the commencement of the relationship, the applicant wife – through caring for the husband and especially cooking for him – even when they were not living under the one roof – is sufficient, in my view, for the Court to assess her contributions to the relationship as at the date of the final hearing at 20%. Her non-financial contributions took place not only when they lived under the one roof, but after that point in time. This includes that point in time when the witness (Mr S) saw the parties in mid-2015. The evidence of Mr S is that, I infer, Ms Norgrove was taking care of Mr McClintock.
The contributions based entitlements of the parties as at the date of the final hearing is therefore assessed as 20% to the applicant wife at 80% to the respondent husband.
In relation to any of the arguments put forward on behalf of the Trustee concerning the appropriateness (or otherwise) of the applicant wife’s conduct concerning the issue relating to the vendor finance (provided by the parties to the purchasers of the K Street, Suburb L property) and the submissions concerning the nature of the wife’s spending – I note that there was no submission made that the wife had acted fraudulently. Rather, it seems to be a submission that the wife’s conduct was not appropriate, or that the inference should be drawn that the wife was taking advantage of the husband’s poor state of health. Whatever way the Trustee tries to cast such a submission – it really requires the Court to consider whether or not there is sufficient evidence to make a finding that the applicant wife acted dishonestly. Before this Court could come to such a conclusion due regard must be given to section 140 of the Evidence Act 1995 (Cth) (‘Evidence Act’). Section 140 states:-
“(1) In a civil proceeding, the court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities.
(2) Without limiting the matters that the court may take into account in deciding whether it is so satisfied, it is to take into account:
(a) the nature of the cause of action or defence; and
(b) the nature of the subject‑matter of the proceeding; and
(c) the gravity of the matters alleged.”
Of particular note is section 140 (2)(c). What is being alleged (or at the very least alluded to) is dishonesty on the part of the applicant wife in respect of the respondent husband’s money. Dixon J in Briginshaw v Briginshaw (1938) 60 CLR 336 at 361 – 362 stated:-
“Fortunately … at common law no third standard of persuasion was definitely developed. Except upon criminal issues to be proved by the prosecution, it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding, are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal.”
As Branson J explained in Qantas Airways Ltd v Gama (2008) 167 FCR 537 at 573, Dixon J spoke of “allegations” and was referring to, “the appropriate standard of persuasion in respect of individual allegations of material fact…”. Branson J went on to state:-
“… The tribunal should give consideration to the nature of the allegation and the likely consequences which will follow should it be accepted.” Branson J noted at paragraph 127 that Briginshaw v Briginshaw (supra) “long predated the enactment of the Evidence Act 1995 (Cth), which now sets out the federal rules of evidence.”
But as Branson J goes on to note from paragraph 128 in the Qantas Airways Ltd v Gama (supra) decision – section 140(2) of the Evidence Act “…was intended to reflect the common law position as to the strength of evidence necessary to establish satisfaction on the balance of probabilities.”
The observations made by Branson J in QantasAirways Ltd v Gama (supra) were supported by French and Jacobson JJ in that same decision.
The provision of vendor finance and the question of where the repayments which were received from the purchaser were directed following the sale by the parties of the K Street, Suburb L property; along with the purchase of the A Street, Suburb B property (in July 2015, solely in the name of the applicant wife); and the nature of the applicant wife’s spending habits (between 31 October 2014 and October 2015) must be looked at in the light of the evidence of Mr S. His observations of Mr McClintock in June 2015 are particularly relevant to a consideration by this Court of the reasonableness or otherwise of the wife’s conduct in relation to the issues (amongst others) referred to in the submissions made on behalf of the respondent husband. As noted previously in these Reasons the Judgment, Mr S did not hesitate in concluding that in all the times that he had “met and socialised with Mr McClintock” he found him to be “alert and in charge of himself”. As I say, the evening of Wednesday, 17 June 2015 is particularly noted by Mr S. That date falls fair and square in the middle of those periods of time where it is suggested on behalf of the Trustee that the wife’s conduct was inappropriate and, to be frank, the allegation is that she acted dishonestly. Given the assessment by Mr S, it is reasonable for this Court to conclude that the applicant wife’s assertion that she acted on the basis that she had the agreement of Mr McClintock (to so act) – is a reasonable suggestion. At the very least, the evidence of Mr S suggests to this Court that the assertion of dishonesty is not proved to the appropriate civil standard – having regard to the gravity of the matters alleged. The fact that QCAT came to a conclusion (based on medical evidence) that, in relation to financial matters, the respondent husband did not have capacity after mid-2014 is not conclusive in relation to this Court’s consideration of the allegation of dishonesty. Neither the applicant wife, nor Mr S are medical doctors. The respondent husband appeared alert and content to both of those individuals. Despite this Court taking judicial notice (earlier in these Reasons for Judgment) of the finding made by the QCAT Member – it is the evidence of Mr S which should be given more weight by this Court in relation to the issue of dishonesty by the applicant wife.
Future needs s. 90SM(4) and s. 90SF(3)
The applicant wife is 73 years old and in reasonably good health. Her father is still alive. She will need somewhere appropriate to live, and, it seems to me, an additional cash sum to assist her.
The respondent husband's demise was expected within days. An affidavit from an occupational therapist was filed on behalf the respondent husband just prior to the March hearing dates. Events overtook the evidence of the occupational therapist. Mr McClintock’s health deteriorated rapidly and significantly. After the conclusion of the final hearing the Court was informed that the husband did in fact die on … 2020.
The respondent placed before the Court evidence of the likely cost of smaller residences in the Suburb B area. The value of those residences was in the vicinity of $500,000.
Despite the nature of the submissions on contributions made on behalf of the Trustee – the submission by Counsel on behalf of the Trustee was that the future needs adjustment for the applicant should be in the order of $500,000.
As I stated on the evening of 12 March 2020 when the final order was pronounced – I have come to the conclusion that there should be an overall property adjustment in favour of the applicant wife in the amount of $700,000 or 60% of the net pool – whichever is the higher.
The submission on behalf of the respondent appeared to be that the applicant should be granted somewhere between 40 – 50% of the net pool. The conclusion that the Court has reached is that the applicant should receive 60% of the net pool or a cash amount of $700,000 – whichever is the higher.
Justice and equity
Counsel on behalf of the respondent drew the Court’s attention to the fact that the joint executor, Mr M, had formerly given evidence on behalf of the applicant wife in the QCAT proceedings (and possibly in the Supreme Court proceedings). It was suggested to the Court that Mr M would not be an appropriate person to take over the running of the current proceedings before the Federal Circuit Court of Australia in the event of the demise of Mr McClintock. The very real possibility emerged that there would be no suitable personal representative to continue the matter on behalf of Mr McClintock. Further involvement by the Public Trustee in the event of the demise of Mr McClintock would be discretionary. The proceedings in the Federal Circuit Court of Australia may have been stalled or stayed and the Supreme Court proceedings may have been pursued. The Supreme Court proceedings were commenced by the Trustee against the applicant wife and declarations were sought arguing that the property at A Street, Suburb B was held by Ms Norgrove on a resulting trust for Mr McClintock and the Trustee also sought in the Supreme Court an order under section 80 and under section 90 of the Trusts Act 1973 (Qld) vesting the property at A Street, Suburb B in the Public Trustee of Queensland as Trustee for Mr McClintock. Those proceedings in the Supreme Court had been stayed pending the outcome of these proceedings in the Federal Circuit Court of Australia.
In those circumstances, the Trustee on behalf of the respondent in the current proceedings was understandably keen to see the matter finalised in the Federal Circuit Court of Australia. The applicant was also in favour of that course. The matter, therefore, was finalised on 12 March 2020. After the conclusion of the evidence and the hearing of submissions, the Court made a final order which, essentially, granted to the wife 60% of the net pool of property or $700,000 – whichever was the higher. The Court also ordered the sale of the A Street, Suburb B property and the repayment of the costs and fees and outlays of the Public Trustee in the sum of approximately $284,000.
During the course of the submissions, it was apparent to the Court that Ms Norgrove was in some distress because updates were being received as to the deteriorating health of the respondent husband. The applicant wife was assisted, very ably, by her friend, Ms W. Ms W is a Certified Practising Accountant and assisted Ms Norgrove as a McKenzie friend. Further, Ms W, as the McKenzie friend, was given leave to address the Court on behalf of Ms Norgrove. This is because Ms Norgrove was in some visible distress. (McKenzie & McKenzie [1970] 3 All ER 1034; Cook v Stehbens (1998) 148 FLR 52 (especially at page 53); In the Marriage of Watson (2001) 166 FLR 229).
It was apparent to the Court that, despite her distress, Ms Norgrove’s best interests were better served by the Court pressing ahead on 12 March 2020, finalising the evidence, hearing submissions and making a final order to ensure – as best as possible – that the litigation in all forums was brought to a close. A final order was made on 12 March 2020 and the parties were informed that reasons for judgment would follow. As noted, this approach was supported by the applicant wife. This approach was also supported by the Respondent. Dr Sayers of Counsel on behalf of the respondent Trustee informed the Court that in the event that the Court awarded to the applicant wife a payment in the order of 40 – 50% of the net property pool that it was unlikely that the Trustee would pursue the litigation in the Supreme Court. The Court came to the conclusion that the wife would be entitled to 60% of the net property pool. This Court cannot bind the next step or actions that may or may not be taken by the Public Trustee in the Supreme Court. However, I do note that the conclusion of the Court that the wife in this case should be entitled to 60% of the net pool is not an amount which is very much higher than the concession that had been made by the Trustee (in relation to the continuation of the Supreme Court litigation). Given the very large amount of money that has already been expended by the Trustee (some $284,000) I would seriously question the appropriateness of the Trustee pursuing any further litigation in the Supreme Court of Queensland against Ms Norgrove. As noted, however, it is not the role of this Court to bind or direct to the Public Trustee in relation to that particular matter.
A cash payment of $700,000 will permit the wife to find suitable accommodation in the A Street, Suburb B area (noting the evidence in Exhibit 5) and also leave her with approximately $200,000 by way of cash. Given the short nature of the relationship, it seems to me that a property adjustment order along these lines is just and equitable. The finding made by this Court is that the wife brought into the relationship a direct financial contribution of approximately $264,000. The wife will be leaving the relationship with a financial payment of at least $700,000.
Obviously, such an outcome is unusual, having regard to the short duration of the relationship. The particular circumstances of this case are highly unusual. At the conclusion of the trial – the respondent husband’s demise was imminent. The applicant wife therefore has the much greater claim for future needs in terms of doing justice and equity between the parties and the outcome is therefore justified in this case.
I gave close consideration to the wife’s contention that she should be permitted to retain the A Street, Suburb B property. There are several difficulties with that outcome. They are as follows:
a)The finding by QCAT that the respondent husband lacked capacity for financial matters after June 2014. It will be noted that I have come to the conclusion that the wife did not act dishonestly. Certainly I am not satisfied on the evidence that she acted dishonestly. Nonetheless, the finding made by QCAT still exists;
b)The relationship was of short duration, lasting four years and nine months;
c)The wife came into the relationship with a direct financial contribution of $264,000 and is leaving the relationship with $700,000;
d)The evidence discloses that a proper and appropriate standard of accommodation will be available to the wife in the same postcode (Suburb B);
e)The disposition to the applicant wife under the respondent husband's 2013 will was revoked at the termination of the de facto relationship: section 15B of the Succession Act.
f)The alternative beneficiary under the respondent husband’s will, the N Foundation, has a reasonable and legitimate expectation that the Public Trustee and/or any other potential executor will honour the respondent’s intention of providing a gift to that foundation – in the event that the once intended gift to the applicant wife failed;
g)The QCAT decision makes it clear that the Public Guardian became involved and Mr McClintock came to the attention of the Tribunal as a result of an application made by (or notification made by) Ms X, a social worker from the Region E Hospital. Interim orders were made by QCAT on 22 November 2016 on 12 December 2016 appointing the Public Guardian as guardian for Mr McClintock for decisions concerning accommodation, healthcare and contact (presumably with the applicant wife). Furthermore QCAT on those date or dates appointed the Public Trustee of Queensland, as Mr McClintock’s administrator for all financial matters. The Public Trustee of Queensland has, of course, acted in good faith in pursuing or defending the litigation in QCAT, the Supreme Court of Queensland and the Federal Circuit Court of Australia. Significant costs have been incurred totalling some $284,000. Having acted in good faith it would be unconscionable to expect that the Public Trustees’ costs and fees would go unpaid. The only way that the Trustees’ fees could be paid would be for the Court to order the sale of the property at A Street, Suburb B.
For the reasons stated above, I came to the conclusion that the applicant wife’s submission that she ought to be permitted to retain solely for her own use and benefit the property at A Street, Suburb B would not be an order which, in the circumstances, would do justice and equity between the parties to the litigation. As was stated by the High Court in Stanford (supra) at paragraph 38 – “…although s.79 (90SM) confers a broad power on a court exercising jurisdiction under the Act to make a property settlement order, it is not a power that is to be exercised according to an unguided judicial discretion.” I also note Wirth v Wirth (1956) 98 CLR 228 at 231 and R v Watson; Ex parte Armstrong (1976) 136 CLR 248 at 257.
The orders made on a final basis and pronounced by the Court on 12 March 2020 are noted at the front of the Reasons for Judgment.
I certify that the preceding seventy-three (73) paragraphs are a true copy of the reasons for judgment of Judge Howard
Date: 11 May 2020
Key Legal Topics
Areas of Law
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Family Law
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Property Law
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Evidence
Legal Concepts
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Natural Justice
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Procedural Fairness
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Remedies
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Standing
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Statutory Construction
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