FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)f
O’Cleary & Vukasin (No 2) [2024] FedCFamC1F 660
File number: SYC 4005 of 2020 Judgment of: CAMPTON J Date of judgment: 30 September 2024 Catchwords: FAMILY LAW – MAJOR COMPLEX FINANCIAL PROCEEDING – EQUITABLE RELIEF – ACCRUED JURISDICTION – Property adjustment pursuant to s 79 of the Family Law Act 1975 (Cth) – Where the intervener seeks that the Federal Circuit and Family Court of Australia (Division 1) exercise its accrued jurisdiction to determine his claim in the s 79 proceeding – Where the husband made significant direct financial contributions at the commencement of cohabitation, including by way of an interest in a prosperous trading enterprise – Where the intervener claims a 30 per cent interest in that enterprise as recorded in two written agreements made between he and the husband, one of which was entered years before the marriage – Where the husband concedes the claim of the intervener – Where the wife contends that the two written agreements made between the husband and the intervener purporting to allocate 30 per cent of the husband’s interest to the intervener were “fabricated and not genuine” – Claim of the intervener established – Where the nature of the relationship between the husband and the wife was to some extent commercial and characterised by arm’s length dealings, including the clear maintenance of separate financial identities – Where the wife has attempted to machine aspects of her case, including evidence, to obtain a forensic advantage – Where homemaking contributions do not loom large – Where the wife has failed to adhere to her disclosure obligations – Where the wife will have the first opportunity to retain a real property in specie – Orders made adjusting the property of the husband and the wife 83.5 per cent to the husband and 16.5 per cent to the wife. Legislation: Corporations Act 2001 (Cth) s 1274B
Evidence Act 1995 (Cth) s 140
Family Law Act 1975 (Cth) ss 75, 79
Income Tax Assessment Act 1936 (Cth) Div 7A
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) ch 6, r 7.26
Cases cited: Barboutis v The Kart Centre Pty Ltd (No 2) [2020] WASCA 41
Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34
Embedded Claims Pty Ltd v Litigation Finance (Australia) Pty Ltd [2023] FCAFC 30
Edgehill & Edgehill [2007] FamCA 1102
Galati v Deans & Ors [2023] NSWCA 13
Hatziminas v Hatziminas [2024] VSC 513
Horrigan & Horrigan [2020] FamCAFC 25
Jabour & Jabour (2019) FLC 93-898; [2019] FamCAFC 78
Koprivnjak v Koprivnjak [2023] NSWCA 2
Laird v Vallance [2023] VSCA 138
Pierce v Pierce (1999) FLC 92-844; [1998] FamCA 74
Rose v Watson (1864) 10 HLC 672
Shepherd v Doolan & Ors; Shepherd v Doolan & Anor; Est. Doolan [2005] NSWSC 42
Stanford v Stanford (2012) 247 CLR 108; [2012] HCA 52
The Queen v Australian Broadcasting Tribunal; ex parte Hardiman (1980) 144 CLR 13; [1980] HCA 13
Valceski v Valceski (2007) FLC 93-312; [2007] NSWSC 440
Vetter v Lake Macquarie City Council (2001) 202 CLR 439; [2001] HCA 12
Warby & Warby (2001) FLC 93-091; [2001] FamCA 1469
Watson v Foxman (1995) 49 NSWLR 315
Weir and Weir (1993) FLC 92-338; [1992] FamCA 69
Division: Division 1 First Instance Number of paragraphs: 268 Date of hearing: 9-13, 27 September 2024 Place: Sydney Counsel for the Applicant: Mr Condon SC with Ms Carr Solicitor for the Applicant: Juris Cor Legal Counsel for the Respondent: Mr Puckey KC with Mr Levett Solicitor for the Respondent: Jeffrey Choy Legal Counsel for the Intervener: Mr Barnett with Ms Cunliffe Solicitor for the Intervener: Newnhams Solicitors ORDERS
SYC 4005 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS O’CLEARY
Applicant
AND: MR VUKASIN
Respondent
MR PASSERINI
Intervener
ORDER MADE BY:
CAMPTON J
DATE OF ORDER:
30 SEPTEMBER 2024
THE COURT DECLARES THAT:
1.Mr Vukasin (“the husband”) holds 30 per cent of the share capital (“Shares”) and any dividends and/or distributions associated or connected with those shares of Vukasin Pty Ltd (currently, 150 ordinary shares) on trust for Mr Passerini.
THE COURT ORDERS THAT:
2.The husband delivers up or transfers the Shares to Mr Passerini or his nominee at a time as agreed in writing between the husband and Mr Passerini no later than 31 December 2026.
3.The husband and Mr Passerini in their capacity of director and/or shareholder of Vukasin Pty Ltd will do all things and sign all documents required to assign to the husband the choses in action constituted by all loans and said to be owing to Vukasin Pty Ltd by Ms O’Cleary (“the wife”) and/or F Pty Ltd and the husband shall:
(a)Pay and indemnify the wife and F Pty Ltd in respect of any such liability, to the intent that they not pay any monies under or by reference to such loans; and
(b)Release and discharge the wife and F Pty Ltd from all liability under or by reference to such loans or any other loan he claims is otherwise due to him.
4.On or before 28 October 2024 the husband shall do all things to cause the mortgage secured over the property at G Street, Suburb H (“the G Street property”) to be discharged and indemnify the wife in relation to same, and the wife shall sign all such documents as are necessary to facilitate the husband’s compliance with this order.
5.On or before 25 November 2024 the wife shall pay to the husband sum of to $3,679,350.
6.Pending compliance with Orders 5, 8, 9, 10 and 11, whichever is the earlier, the wife:
(a)Is restrained from doing any act or thing to transfer, encumber, mortgage, or adversely affect her interest in the G Street property save as to facilitate compliance with Order 5; and
(b)Is to do all things as are necessary to keep and maintain the G Street property in good order and condition.
7.In the event the wife fails or neglects to comply with Order 5, the husband may elect by notice in writing to the wife to be served within seven days of such default to require the wife to transfer to him all her interest in the G Street property.
8.In the event the husband makes the election in writing pursuant to Order 7 then:
(a)On or before 23 December 2024, the husband shall pay to the wife the sum of $2,420,650; and
(b)Simultaneously upon receipt of such sum, the wife shall execute all documents prepared by the husband at his expense for the wife to transfer to the husband all her interest in the G Street property and the wife shall provide the husband with vacant possession of the G Street property.
9.In the event the wife fails to comply with Order 5 and the husband does not exercise the election pursuant to Order 7, the husband and wife shall do all such things as are necessary to list for sale the G Street property on terms they agree in writing or failing to so agree in writing for more than 14 days, on the following terms:
(a)To list for auction with an agent agreed upon by them in writing within 14 days and failing agreement the agent be appointed by the President of the Real Estate Institute of New South Wales or his or her nominee;
(b)Give such instructions to a solicitor to act on the sale of the property agreed upon in writing within 14 days, and failing agreement as to the identify of the solicitor, the solicitor be appointed by the President of the Law Society of New South Wales or his or her nominee;
(c)Market the G Street property for sale by public auction to be held on-site within six weeks of the date this order comes into operation at a reserve price to be agreed by them in writing seven days prior to auction and failing such agreement at a reserve price determined by single real property valuation expert who opined as to the value of the G Street property for trial;
(d)Attend the auction and in the event that the reserve price set for the auction is not reached negotiate with the highest and second highest bidder and accept any offer to purchase that is the highest made within five per cent of the reserve price set for that auction unless the parties otherwise agree in writing; and
(e)Execute the contract for sale and in the event they fail to agree on the terms of the contract for sale, the terms recommended by the solicitor acting on the sale shall be adopted.
10.Upon the completion of the sale of the G Street property, the husband and wife shall do all things to apply the proceeds of the sale in the following manner and priority:
(a)In payment of any outstanding land tax, council rates, and water rates;
(b)In payment of fees for the nomination of an agent or solicitor pursuant to these orders, if any;
(c)In payment of the valuers fees, if any;
(d)In payment of the real estate agent’s commission, selling expenses, and auction expenses incurred on the sale;
(e)In payment of conveyancing legal costs associated with the sale;
(f)In the amount of 60 per cent of the remaining balance to the husband; and then
(g)In payment of the balance to the wife.
11.In the event of the husband exercising the election pursuant to Order 7 and the husband failing to comply with Order 8(a), the G Street property shall be listed for sale and sold on the terms provided for in Order 9 and the proceeds of sale applied as provided for in Order 10.
12.As between the husband and the wife, each shall be responsible for and shall pay one half of the joint and several costs orders payable by them up until 2022 as made in the New South Wales District Court and New South Wales Court of Appeal and shall indemnify the other in respect of the remaining half balance payable pursuant to those costs orders.
13.Otherwise than as provided for in these orders, each of the husband and the wife be and is hereby declared to be the sole and absolute owner to the exclusion of the other of all items of property currently standing in his or her name or otherwise being in his or her possession custody or control.
14.In the event that the husband or the wife fails, neglects or refuses to sign or execute any document required by or to give effect to these orders, then the Registrar of the Federal Circuit and Family Court of Australia (Division 1), Sydney Registry, is authorised, empowered, and directed to sign and execute such document on behalf of the party in default upon being satisfied of such failure or neglect by way of affidavit evidence, and the signature of the Registrar shall thereafter be deemed to be the signature of such party.
15.Except as provided for by these orders, save as to costs, all outstanding applications and responses are otherwise dismissed.
16.Should any party wish to pursue or make an application for costs, they are to file and serve within 28 days of the date of these orders an Application in a Proceeding specifying the orders sought as to costs, and any affidavit in support thereof. In the event of the filing of such application, orders will be made in chambers as to the filing of material in response and as to the listing of the application.
17.In the event no application of costs is filed pursuant to Order 16, any outstanding applications as to costs are dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym O’Cleary & Vukasin has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
CAMPTON J
By way of an Initiating Application filed on 22 June 2020, Ms O’Cleary (“the wife”) commenced proceedings for the adjustment of property pursuant to s 79 of the Family Law Act 1975 (Cth) (“the Act”). By way of a Response to an Initiating Application filed on 20 August 2020, Mr Vukasin (“the husband”) sought different orders for the adjustment of property. On 29 September 2023 the proceedings were placed into the Major Complex Financial Proceedings list. On 13 December 2023 Mr Passerini intervened and was joined to the proceedings.
The husband and the wife are in dispute as to the date they commended cohabitation prior to their marriage in 2013. They are also in dispute as to the date of their separation, save that it occurred in 2019. They were divorced in 2021. There are no children of the relationship.
The husband is the sole legal owner of the issued shareholding in Vukasin Pty Ltd. He is the sole director of Vukasin Pty Ltd. Mr Passerini claims the husband beneficially holds for him 30 per cent of his [the husband’s] interest in Vukasin Pty Ltd. He seeks relief to implement that beneficial arrangement. The husband concedes Mr Passerini’s claim. The wife resists it. The husband and the wife disagree as to the extent and value of the husband’s interests in Vukasin Pty Ltd.
The husband and wife each seek to retain a real property at G Street, Suburb H (“the G Street property”) in specie. The husband did not oppose the wife having the first opportunity to retain that property.
The wife seeks payment from the husband of an adjusting sum whereby she receives 40 per cent of what she contends to be the value of the property of she and the husband. The husband proposes to pay to the wife an adjusting sum whereby she receives 15 per cent of what he contends is a different valued pool of the property of he and the wife.
For the reasons that follow a declaration is made that the husband holds 30 per cent of his interest in Vukasin Pty Ltd on trust for the benefit of Mr Passerini. Consequential orders will be made to implement that determination. The property of the husband and the wife will be adjusted as to 83.5 per cent to the husband and 16.5 per cent to the wife. The husband shall discharge the G Street property mortgage. The wife shall have the opportunity to retain the G Street property provided she pays to the husband an adjusting sum of $3,679,350. Should the wife fail or neglect to pay the adjusting sum, the husband may elect in writing to pay to the wife an adjusting sum of $2,420,650, and simultaneously upon receipt the wife shall transfer to him her interest in the G Street property. If he fails to elect such course in writing, or he fails to pay the adjusting sum after electing to do so, the G Street property will be sold. Upon completion of the sale, the proceeds, after payment of selling costs, will be distributed as to 60 per cent to the husband and the remainder to the wife.
THE RELIEF SOUGHT BY EACH PARTY
By way of his Reply to a Response to Final Orders sealed on 19 January 2024, Mr Passerini sought:
1.A declaration that the [husband] holds 30% of the share capital (Shares) and any dividends and/or distributions associated or connected with those shares of [Vukasin Pty Ltd] (Company) (currently, 150 ordinary shares) on trust for [Mr Passerini] ([Passerini])
2.Alternatively, a declaration that the [husband] holds the Shares and any dividends and/or distributions associated or connected with those shares on constructive trust for [Mr Passerini].
3.Alternatively, a declaration that the Contract (as defined below) is valid and enforceable and ought to be specifically performed.
4.A declaration that the [husband] is estopped from denying [Mr Passerini]’s entitlement to the Shares.
5.An order that the [husband] delivers up or transfers the Shares to [Mr Passerini] or his nominee at a time as agreed by the [husband] and [Mr Passerini] no later than 31 December 2026.
6.Alternatively, an order that the [husband] specifically performs the Contract (as defined below) and takes all steps necessary to convey the Shares to [Mr Passerini] at a time as agreed by the [husband] and [Mr Passerini] no later than 31 December 2026.
7.In lieu of specific performance, damages.
8.Interest.
9.Costs.
The wife sought the relief contained in at Annexure A to her Case Outline (Exhibit 2), being:
1. The Respondent Husband exercise his rights as director and shareholder of [Vukasin Pty Ltd] (‘the Company’) to cause it forgive all debts asserted by him to be payable to the Company by the Wife and/or [F Pty Ltd].
2. The Respondent Husband release the Wife and [F Pty Ltd] from all indebtedness he alleges they have to him.
3. The Respondent Husband within 28 days pay to National Australia Bank (‘the Bank’) the balance owing to the Bank on the mortgage over the property at [G Street], [Suburb H] in New South Wales or alternatively, indemnify the wife in relation to that debt.
4. An order that the Husband indemnify the Wife and keep her harmless against:
a. such debts as the Wife and/or [F Pty Ltd] allegedly owe the Company;
b. such liability as the Wife has to the Bank in respect to the mortgage over the property at [G Street], [Suburb H]
5. The Wife to retain all real property in her name including:
(a) [G Street], [Suburb H] in NSW
(b) [J Street] [Suburb K] in NSW
(c) [L Street], [Suburb M] in NSW
(d) [N Street], [Suburb O] in NSW
6. The Respondent Husband pay to the wife such further sum as may be necessary to effect a division of the net matrimonial asset pool as to 40% to the Applicant Wife and 60% to the Respondent Husband.
7. Orders in accordance with orders 3-7 (to the extent necessary to give effect to these orders) and order 8 of the Amended Initiating Application
The husband initially sought orders as contained in his Case Outline (Exhibit 3) including for the wife transfer to him the G Street property, for he to discharge the mortgage on the G Street property, and for he to pay the wife an adjusting sum of $2 million.
The terms of relief sought by each of the husband and the wife was in part superseded by the terms of broad agreement on some subject matters achieved during submissions. These included the regime of orders providing sequential opportunities for one of them to retain or achieve the G Street property, dependent upon the terms and value of the s 79 adjusting sum. Portions of those agreements were reduced to writing in Exhibit 44 implementing the intent of paragraphs 1, 2 and 4 as sought by the wife in Annexure A to Exhibit 2 (at [8]).
ACCRUED JURISDICTION
This Court has accrued jurisdiction by which, dependent upon the circumstances of the case, it has jurisdiction to hear and determine non-federal issues (Warby & Warby (2001) FLC 93-091; Valceski v Valceski (2007) FLC 93-312).
The parties agreed that the Court’s accrued jurisdiction ought to be engaged to determine the non-federal relief sought by Mr Passerini as to the fact and value of his interest in Vukasin Pty Ltd. Jurisdiction cannot be accrued by way of consent alone.
The property interests of the husband in Vukasin Pty Ltd are the subject of the non-federal claim by Mr Passerini. Identification of the husband’s property interests is critical to the resolution of the federal s 79 claims made by each of the husband and the wife (Stanford v Stanford (2012) 247 CLR 108 (“Stanford”)). The determination of the interests of Mr Passerini in Vukasin Pty Ltd is hence a relevant consideration in a determination of the adjustment of property interests between the husband and the wife. Mr Passerini’s claim is wholly consumed in that same determination. A common substratum of facts spans both claims. The non- severable nature of the claims and the common substratum of facts identify a single justiciable controversy. This conclusion is reinforced by this forum having sufficient remedy to deal with both claims if accrued jurisdiction is attracted. I am satisfied that an accrued jurisdiction is engaged to determine the non-federal claim of Mr Passerini.
BACKGROUND AND FINDINGS
The husband was born in 1976. He is currently 47 years old. The wife was born in 1982. She is currently 42 years old.
The husband and Mr Passerini met at school in 1983. In 1997 they commenced trading in a partnership as P Company. That partnership was dissolved in 2000. From 2000 they commenced importing goods from Country Q. This ceased in or about 2005.
In 2000 the husband purchased R Street, Suburb K (“the R Street property”) for $317,000, with Ms S. The husband held 99 per cent of the property and Ms S held one per cent. The property was subject to a mortgage.
In 2002 the husband purchased T Street, Suburb U (“the T Street property”) for $262,000, with Ms S. The husband held 99 per cent of the property and Ms S held one per cent. The property was subject to a mortgage.
In 2004 Ms S transferred her interests in the R Street property and the T Street property to the husband for nil consideration.
Vukasin Trading Pty Ltd was incorporated in 2006. The husband was, and remains, the sole legal owner of the 500 issued shares and is the sole director. In 2017 its name was changed to Vukasin Pty Ltd.
Vukasin Pty Ltd operates a business across multiple online platforms in addition to the company’s own websites. It specialises in the import and sale of products. Vukasin Pty Ltd employs a number of staff across multiple departments. The husband is a senior executive. He is responsible for the overall management of the business. Mr Passerini is responsible for the day-to-day management of the business and leading the heads of departments.
Both the husband and Mr Passerini travelled to Country V in 2006 for work with Ms W. The husband was then in a personal relationship with Ms W. Both the husband and Mr Passerini determined that a commercial opportunity presented to purchase and import products from Country V into Australia for resale.
Mr Passerini and the husband said they entered an agreement, reduced to writing, in 2006 (Exhibit 26). The gravamen of the 2006 agreement is for Mr Passerini to make a one-off payment of $20,000 to the husband and for the husband to “immediately give” Mr Passerini 30 per cent ownership of Vukasin Trading (as it was then known). It provides for the husband to “handle selecting, purchasing and importing of products to sell [online]” and for Mr Passerini to “handle storage of stock, listing products [online] including […] customer service for those products.” In 2006 products ordered during the trip to Country V arrived in Australia. Vukasin Pty Ltd commenced trading online under the name “[X Company]”. The wife put into issue the fact of the 2006 agreement and its terms.
Mr Passerini and the husband also said they entered a “Confirmation of Business Ownership Agreement” in writing in 2013 (Exhibit 27). The wife put into issue the fact of the 2013 agreement and its terms.
In 2007 the husband purchased 1 Y Street, Suburb U (“the 1 Y Street property”) for $755,000. The property was subject to a mortgage.
In 2009 the wife commenced full time employment as a medical professional.
In 2009 the wife purchased L Street, Suburb M (“the Suburb M property”) for $300,000. The wife said she funded the acquisition by way of her savings of $30,000 and the balance by way of mortgage. The wife’s mother said that she paid the $30,000 deposit. Nothing turns on a finding as to the source of the deposit.
In 2009 the husband purchased Z Street, Suburb BB (“the Suburb BB property”) for $1.2 million. The property was subject to a mortgage.
In 2009 the husband purchased 2 Y Street, Suburb U (“the 2 Y Street property”) for either $1,065,000 or $1,006,500. Nothing turns a finding as to the purchase price. The property was subject to a mortgage.
The Vukasin Family Trust was established by deed in 2010. The trust deed was varied in 2019. Vukasin Investment Pty Ltd was incorporated in 2010. It is the corporate trustee of the Vukasin Family Trust. The husband is the sole shareholder and director of the trustee. The husband is the principal of the trust and has the power to appoint and remove trustees. It was uncontroversial that the trust is the property of the husband amenable to adjustment in these proceedings.
In 2010 either the husband (in the wife’s case) or Vukasin Investment Pty Ltd (in the husband’s case) purchased CC Street, Suburb DD (“the Suburb DD property”) for $2.45 million. Again, nothing turns on this factual dispute, as the wife says that the trustee of the Vukasin Family Trust became the owner in 2011.
In 2010 the wife exchanged contracts to purchase “off-the-plan” J Street, Suburb K (“the J Street property”) for $570,000. The 10 per cent deposit of $57,000 was funded by way of bank guarantee secured by a term deposit with the EE Bank.
In 2011 the wife exchanged a contract for the purchase “off-the-plan” N Street, Suburb O (“the Suburb O property”) for $555,000. She paid a 10 per cent deposit in the sum of $55,000 into the trust account of the vendor’s solicitors.
The dispute as to the date of cohabitation
In her affidavit the wife said:
6. In [mid] 2012, [the husband] and I commenced seeing each other after we met [online].
7. Since or around that time, I was living with my parents at [the [Suburb M] property].
8. In [mid] 2012, [the husband] and I travelled to [Region FF] and during the trip, I had a conversation with [the husband] in the words of the following effect:
[The husband] said: "I really like you. Can you be my girlfriend?"
I said: "Ok."
9. Once [the husband] and I committed our relationship, since [mid] 2012, he has been staying at the [Suburb M] Property with me almost every day until [early] 2013. It was since that time, [the husband] and I were living together.
10. In [late] 2012, I recall that [the husband] and I had a conversation in the words of the following effect:
[The husband] said, "Our relationship is stable. Could you please move into my apartment?"
I said, "Ok. It is a good idea."
11. At that time, [the husband] was living at [the [Suburb DD] property].
12. In [early] 2013, I collected my clothes and other personal belongings and moved them to [the husband’s] address at [the Suburb DD property].
13. In [early] 2013, [the husband] and I commenced cohabitation.
The husband said he and the wife commenced cohabitation when they married in 2013. He said that prior to marriage, in 2012, he stayed at the Suburb M property on “rare” or “few occasions”, and from early 2013, the wife stayed at the Suburb DD property overnight with him, but that it was not every night.
The wife’s affidavit evidence to establish the date of cohabitation as she contends and the subsidiary facts supporting it, is the first of many troubling examples, as recorded in these reasons, which lead to doubt being cast as to the reliability and integrity of her evidence.
I accept the submission of the husband that an underlying theme constructing the presentation of the wife’s case was to adduce evidence in which she had been either reckless as to its content, or which she knew was inaccurate, with the objective of achieving a perceived advantage in securing findings to generate a greater value of the adjustment of property in her favour.
The foundations underscoring the wife’s deceptions or recklessness were on many occasions, as recorded in these reasons, misconceived. As to the date of cohabitation and the date of separation, she appeared to view the relevant factual finding to ground the s 79 discretion as being a function of the length of the relationship, as opposed to identifying and adducing particularised evidence as to contributions by reference to the integers of s 79 of the Act.
The wife said in cross-examination that the difference in her affidavit between “living together” and “cohabitation” was that in 2012 the husband was “living in [the Suburb M property] everyday”, they were “sleeping [in] the same bed and everything”, that the relationship was “not superficial”, but that it was still the “early beginning of the relationship”. She said that early 2013 was the time that she “move[d] everything” and they were “really having a family”. She concluded by saying that “[early 2013] is the time”. She said that she was present at the Suburb DD property from early 2013 “everyday”, and that her mother visited the Suburb DD property on weekends.
The wife later conceded in cross-examination that her evidence was wrong as to “living together” at the Suburb M property from mid-2012, as she and the husband met no earlier than mid-2012. She agreed that the trip to Region FF, when the husband asked her to be his girlfriend, occurred in mid-2012.
The affidavit evidence of the wife’s father was that from mid-2012 he did “not recall that [the husband] did any household duties […]”, when the husband was at the Suburb M property. In cross-examination the wife’s father conceded that his affidavit evidence was wrong, in that he could not have observed the husband at all in the Suburb M property from mid-2012 to late 2012 because he was not in Australia for that period. He agreed that he first met the husband in late 2012 in Country V.
The wife’s evidence as to the date of cohabitation is unreliable and is not accepted. While I prefer the husband’s evidence on this topic for the period prior to early 2013, on either his or the wife’s evidence, they commenced living as a bona fide domestic couple in the Suburb DD property from early 2013. I so find.
Contributions at the commencement of cohabitation
In her affidavit the wife said her direct financial contributions were:
58. In or around [mid] 2012, I had the following assets:
a. The [Suburb M] Property,
b. Deposit in the sum of $55,500 held by [GG Pty Ltd]'s trust account pending the settlement of the purchase of the [Suburb O] Property.
c. My previous savings of about $88,000.00 as per […] 2012 (I cannot recall the account number holding these savings) ("2012 Savings"),
d. Term Deposit in the sum of $57,000.00 being […42] with [EE Bank] ("2012 Term Deposit"), and
e. Superannuation with [Super Fund 1] ("2012 [Super Fund 1] Super")
…
91. In […] 2012, I had accumulated superannuation in the sum of $33,149.18 with [Super Fund 1]…
(Emphasis removed)
The wife agreed in cross-examination that savings of $88,000 in paragraph 58(c) was a “double count”. I so find. Later in her affidavit the wife said:
76.[In] 2012, I refinanced from the Westpac Banking Corporation in relation to the [Suburb M] Property and I obtained a loan from Westpac in the sum of $250,000.00 and the previous mortgage was discharged [sic].
I find that the loan secured by way of mortgage over the Suburb M property in late 2012 was $250,000.
The wife then said:
77.[In] 2012, I paid a sum of $88,000.00 to reduce the outstanding loan of the [Suburb M] Property and I recall that the source of the funds was from 2012 Savings and the released 2012 Term Deposit as a form of bank guarantee for the [J Street] Property…
This evidence of the wife is rejected consequent upon her concession as to paragraph 58(c). The wife did not reduce the Suburb M mortgage as she asserted at that time.
The husband asserted in the proceeding that in 2013 the wife also held an interest in a property known as HH Street, City JJ (“the City JJ property”). This was denied by the wife. The wife said that she and the husband stayed in the City JJ property at times during the relationship while they visited Country V, but that the property has been owned by her parents since 2002. The husband complained as to the wife delaying disclosure of documents verifying her parent’s ownership of the property sought by him since the proceeding commenced in 2020. At a court event on 18 June 2024, he withdrew his contention as to the wife having an interest in the City JJ property.
I accept the husband’s evidence, coupled with Exhibit 19 and the evidence of the single forensic accounting expert Ms E (Exhibit 12), and find that the husband directly contributed the following assets at or about the date of cohabitation:
·The R Street property subject to a mortgage in an unknown amount;
·The T Street property subject to a mortgage of $272,000;
·The 1 Y Street property. By this time, the loan secured by way of the mortgage loan had been paid out;
·The Suburb BB property. By this time, the loan secured by way of the mortgage loan had been paid out;
·The 2 Y Street property. By this time, the loan secured by way of the mortgage loan had been paid out;
·The Vukasin Family Trust, including the unencumbered Suburb DD property; and
·His interest in Vukasin Trading (later known as Vukasin Pty Ltd). In 2012 Vukasin Pty Ltd employed a number of staff. It had annual sales in the range of just under $25 million with an annual profit before tax of $3 million without adjustment. The single expert opined that the value of Vukasin Pty Ltd as at 2012 was $21,675,223 and 70 per cent of its value at that time was $15,172,656. I so find.
The completion of the J Street property by the wife
The purchase of the J Street property was completed in 2012.
In her affidavit the wife said the balance of the purchase price of $570,000 was funded by way of a mortgage loan secured over the J Street property with Westpac. She further said:
68.Since […] 2012 to date, I applied my savings towards the repayment of the mortgage of the [J Street] Property. [The husband] did not make any payment for any purchase price or any repayment of any mortgage or any rates, fees or tax as a result of acquisition and for maintaining the [J Street] Property…
(Emphasis added)
The second sentence was inaccurate. The wife conceded in cross-examination that completion was achieved through a refinance of the Suburb M property, a mortgage on the J Street property, and a loan from the husband of $10,000. The husband said the loan he provided was for $20,000. The wife did not explain why she omitted from her evidence the fact of the loan from the husband.
As to paragraph 68 of her affidavit, the wife said that she did not consider the loan to be a contribution as she repaid the funds, but that if the husband “gave” her the funds “[she] would consider it a contribution”. She conceded that the husband “did assist” her, and “gave [her] a helping hand”. I prefer the husband’s evidence as to the fact of a loan of $20,000 and so find. His affidavit evidence on this subject matter was not directly challenged. The wife’s cross‑examination on this topic establishes that she knew of the husband’s loan when she swore her affidavit, and she elected to omit that evidence.
The wife’s knowledge of and engagement with husband’s pre-relationship properties
In her affidavit the wife said she caused her solicitors to conduct historical title searches as to the R Street property, the T Street property, the 1 Y Street property, the Suburb BB property, and the 2 Y Street property (at paragraphs 22, 28, 34, 39, and 44 respectively). In relation to the R Street property she said:
27.I am not aware of any other information in relation to the [R Street] Property including its source of funds, destination of the sale proceeds, its previous mortgage(s) or its historical value.
The language of this paragraph is repeated in her affidavit as to the T Street property, the 1 Y Street property, the Suburb BB property, and the 2 Y Street property (at paragraphs 33, 38, 43, and 48 respectively).
In cross-examination the wife conceded that she had no first-hand knowledge as to the terms of the acquisition of these properties, how they were funded, or as to any other particulars about them. She agreed, and I find, that she had not visited any of these properties, at any time, except for one occasion when she attended the Suburb BB property to help “tidy up” in preparation for its sale. The extent of her knowledge of the properties was sourced from title searches obtained by her solicitor. She did not adduce evidence of any knowledge as to the application of the proceeds of sale of these properties.
I find that in 2014 the husband sold the 1 Y Street property for $675,000, sold the 2 Y Street property for $718,000, and sold the R Street property for $817,000. I accept his evidence and find that he applied these sale proceeds to pay a taxation liability of Vukasin Pty Ltd and paid the balance to the Vukasin Family Trust to supplement the acquisition of its current property portfolio.
In 2015 the Vukasin Family Trust acquired LL Street, Suburb MM (“the Suburb MM property”) for $6.6 million funded by a mortgage from Westpac on the condition of the sale of the Suburb BB property. This property was used by Vukasin Pty Ltd. In late 2015 or early 2016 the husband sold the Suburb BB property for $2,542,000. He paid down the mortgage on the Suburb MM property and purchased a new motor vehicle.
In 2015 the Vukasin Family Trust acquired NN Street, Suburb OO for $4 million.
In 2018 the Vukasin Family Trust acquired PP Street, Suburb QQ, obtaining a mortgage from Westpac for the full purchase price of $12,675,000.
In 2023 the husband sold the T Street property for $927,000. The sale proceeds were applied to fund Vukasin Pty Ltd and pay down the husband’s director’s loan, fund his day-to-day expenses and fund his legal costs incurred in these proceedings.
I find that the wife made no direct financial contribution to the real properties held by the husband or the Vukasin Family Trust at the date of cohabitation, or to the real properties held by the Vukasin Family Trust as at the date of trial.
The G Street property and Division 7A loan
In 2013 the G Street property was acquired for $2,235,000. The husband and the wife went to considerable effort in their affidavits to outline the events and conversations between them underscoring the circumstances leading to the wife being recorded as the sole registered owner of the “whole” G Street property. It was agreed during the trial that it was unnecessary to make any factual findings as to those subject matters.
The husband said that the purchase price and associated costs of settlement were sourced from Vukasin Pty Ltd as a loan pursuant to Division 7A of the Income Tax Assessment Act 1936 (Cth). The husband said he was the de facto guarantor and ultimately responsible for the loan repayments, asserting that the wife has never repaid any part of the Division 7A loan. Dispute exists as to how a Division 7A loan account funding the purchase price of the G Street property came to be recorded as payable by the wife in the published financial statements of Vukasin Pty Ltd, as the wife said she never agreed to Vukasin Pty Ltd advancing her funds. It was agreed that having regard to Exhibit 44, it is unnecessary to determine this dispute.
The wife agreed during cross-examination that she did not contribute any funds to the purchase of the G Street property. I find that the husband contributed the whole purchase price, including stamp duty, by way of sourcing a loan account with Vukasin Pty Ltd for which he is responsible. That loan is an asset of Vukasin Pty Ltd.
The parties married in 2013 and moved into the G Street property in late 2013.
Three months after the parties relocated to the G Street property, the wife’s parents also commenced to live at the G Street property for a period, travelling to Country V at varying times throughout that period.
The Suburb RR business
In 2013, the wife incorporated F Pty Ltd. She was, and remains, the sole shareholder and director. Also in 2013, through F Pty Ltd, she settled the purchase of a business (“the Suburb RR business”) located at SS Street, Suburb RR (“the Suburb RR property”) for $950,000. The acquisition was funded by $642,000 sourced by a mortgage from Westpac and $85,000 paid by the wife. The wife said that the balance of $240,000 was sourced from the husband. The husband said that the balance of $253,750 was sourced by way of loan from Vukasin Pty Ltd and that Vukasin Pty Ltd loaned further funds post settlement, bringing the loan total to $258,657. He said that this advance had not been repaid.
The wife did not expressly say that the balance of funds to complete the acquisition were by way of loan. I find implicitly that she accepted that the advance, by way of an arrangement that she understood, included a requirement that the funds be repatriated to their source at some time. In her affidavit she said:
95.In […] 2013, I had a conversation with [the husband] in words to the following effect:
I said, "I don't have enough money to pay the balance owed to the vendor of [the Suburb RR business]. Can you help me with the shortage of funds?"
[The husband] said, "How much do you need?"
I replied, "I had paid $85,000 to the vendor. Westpac will offer a loan. I estimate that I would need probably another $200,000."
[The husband] said, "Don't worry about that. That's not much. I will give you before the settlement."
96. Subsequently, [the husband] actually transferred a total of $240,000 to [F Pty Ltd]'s Westpac bank account ending […]95, with $75,000 [in] 2013, another $75,000 [in] 2013, and the final $90,000 [again in] 2013…
97.I recall that [in] 2013 when [the husband] made the $90,000.00 payment to me, I had a conversation with him in words to the following effect:
I said: "You actually gave me more than I needed."
[The husband] said: "Don 't worry. I love you. New business would likely cost more money than expected. I wish you have an easy start."
…
100.Since then, [the husband] has not asked me or [F Pty Ltd] to pay back the $240,000.
The husband asserts that while he had no day-to-day involvement in the running of the Suburb RR business, he did provide assistance at times.
In her affidavit the wife said:
101.During the entirety of the operation of the [Suburb RR business], [the husband] did not help me at all and I was solely responsible for its entire operation.
(Emphasis added)
The wife’s absolute evidence was inaccurate. She conceded in cross-examination that the husband assisted her with various tasks. I so find. On balance, considering the inaccuracies in the wife’s evidence on this subject matter and other topics as explained in these reasons, I prefer the husband’s evidence as to his work at the business and so find. For those reasons and because the husband’s affidavit identified the precise value of the funds advanced being sourced from other business documents, I accept and find that the value of the sum provided was $258,657.
The completion of the Suburb O property
In her affidavit the wife said:
83.[In] 2014, the purchase of the [Suburb O] Property was settled.
84.On or about the same date, I contributed towards the balance of the purchase price of the [Suburb O] Property by way of a loan from the Westpac Banking Corporation, through a mortgage to be registered over the [Suburb O] Property.
…
90.Since […] 2020, I applied my savings towards the repayment of the mortgage of the [Suburb O] Property. [The husband] did not make any payment for any purchase price or any repayment of mortgage or any rates, fees or tax as a result of acquisition and for maintaining the [Suburb O] Property…
(Emphasis added)
The wife’s evidence in paragraphs 84 and 90 of her affidavit was wrong. She conceded that the husband advanced to her all the balance of funds to complete the purchase of the Suburb O property (Exhibit 9), implicitly by way of loan, and that she had subsequently repaid him approximately one month later, upon obtaining a mortgage from Westpac. A plain evaluation of source documents she recorded in her affidavit self-evidently did not support her evidence. My impression of the wife’s oral evidence on this subject matter did not lead to the conclusion that her evidence on this topic was merely reckless. I find this evidence to be a misleading construction with an objective to achieve an advantage and to avoid a finding of fact perceived to promote the husband’s case.
In 2014 the wife suggested she and the husband rent the spare rooms in the G Street property. The husband purchased and assembled furniture and decorated. The husband said that the wife collected the rental payments in cash. The wife said the cash was put in the “bed side table” and she and the husband used it. Neither party was materially challenged in cross-examination. On balance, I find the version of the wife to be more plausible and so find.
The husband’s engagement with the wife’s pre-relationship properties
Save and except as for the husband’s provision of short-term loan funds to facilitate the wife’s acquisition of each of the J Street property, the Suburb M property, and the Suburb O property, I find that the husband made no direct financial contributions to the real property interests held by the wife at the commencement of cohabitation.
The Suburb TT business
In early 2015, by way of F Pty Ltd, the wife purchased the Suburb TT business for just over $2,800,000 financed by a $3.16 million mortgage loan secured against the G Street property.
The wife said that it was the husband who wanted to purchase the Suburb TT business and that it was the subject of argument between them and her parents. The wife said she eventually agreed to the purchase of the Suburb TT business. Her evidence was:
140. However, the pressure from [the husband] ultimately was too much for me. I finally agreed and said to [the husband] words to the effect of “I agree to take on the [business] project you mentioned if you would finance the purchase.”
141. [The husband] replied to me words to the effect of “the [G Street] Property has no mortgage and I have said many times that it would be a waste of investment resources not to mortgage it for a business loan which would make more money. We could arrange a loan application to mortgage the property for a loan and purchase the [business]. When I finally sell [Vukasin Pty Ltd] I would direct more funds to expand the […] business. Besides, I will also help you run the [business].”
In about mid-2014 the wife began exporting goods to Country V. The husband said that the wife expressed an interest in opening a new business as she could not service the demand for exports from just one business. He recounted the exchange between them as:
78. In or about late 2014, I have a conversation with [the wife] as follows or to the following effect:
[The wife]: “I have more orders than I can fill and the suppliers won’t give me enough [goods]. They are limiting how much one [business] can buy[…]. The only way I can get enough is to get another [business].”
I said: “Are you sure you can operate two [businesses]?”
[The wife]: “I can hire other [health professionals]. I don’t need to spend much time […] now with my staff and I can do the same with a new [business]. Can you help me find a [business premises]?”
The husband said that he ceased assisting at the Suburb RR business and commenced assisting at the Suburb TT business until mid-2016. The wife puts his evidence into issue:
154. During the entirety of the operation of the [Suburb TT business], [the husband] did not help me at all, and I was solely responsible for its entire operations with the assistance of my other business partners of [UU Pty Ltd].
In 2017 the husband incorporated VV Pty Ltd. The wife said she assisted in this venture. I accept that evidence and so find.
In 2018 the wife incorporated UU Pty Ltd with two other persons, each holding a one third share. Later in 2018 F Pty Ltd sold the Suburb TT business to UU Pty Ltd, at a loss, for $2,569,414.05. Using the proceeds of that sale the wife discharged the mortgage over the Suburb H property. In 2020 UU Pty Ltd sold the Suburb TT business for $1.85 million. UU Pty Ltd was deregistered in 2021.
The wife contends that the investment in the Suburb TT business was a poor decision generated by pressure from the husband. She said that at the time of acquisition she believed the husband would help her to manage the business, but that he did not offer any assistance, and that the loss of the capital investment in the Suburb TT business was born solely by her. The content and construction of her affidavit evidence purported to assign responsibility for any failure or loss from the venture to the husband. I reject each of the wife’s contentions because:
(a)In cross-examination the wife conceded that shortly after the acquisition of the Suburb TT business, a competitor opened nearby, which she said, “really affected” her business, and “made a big impact”. She did not explain why she omitted this significant fact from her affidavit;
(b)The wife conceded that another factor that impacted on the Suburb TT business was because one of the shareholders was stealing stock. This evidence was also omitted from the wife’s affidavit absent explanation. The wife did not adduce any evidence as to steps taken to remedy, or to seek damages arising from, the theft or deceptive conduct of the co-shareholder; and
(c)The wife agreed that, in addition to achieving income from the Suburb TT business from 2015 over the five-year period to 2020, the net effect of the sale transaction and disposal was not a loss. The sale by UU Pty Ltd occurred after the mortgage secured on the G Street property was discharged. After payment of disposal expenses and after the separation of she and the husband, the wife achieved a cash payment of $179,875 from the sale.
For these reasons I find the wife’s evidence about the Suburb TT business to be unreliable. I do not accept that the husband pressured her into purchasing the Suburb TT business. I prefer the husband’s evidence on this matter and find that it is more likely that the wife’s objective was to expand her export sales, and the husband assisted her in that endeavour as he asserted. I find that the wife attempted to machine her evidence on this subject matter to achieve what she perceived to be an advantage in the proceedings.
Remuneration from Vukasin Pty Ltd
Neither the husband nor Mr Passerini were paid a wage by Vukasin Pty Ltd from 2006 until 2016. The husband and Mr Passerini then each commenced to be paid $80,000 per annum from Vukasin Pty Ltd. In early 2024 the annual salaries received by the husband and Mr Passerini from Vukasin Pty Ltd each increased to $1.1 million.
The renovation of the G Street property
In 2016 a builder was engaged to undertake renovations on the G Street property. In late 2016 the husband and the wife relocated into the granny flat at the G Street property to facilitate the commencement of the works. The renovations were not completed. The works were substandard and non-compliant. The husband said he paid $800,000 to the cost of renovations. The wife did not challenge that evidence or assert otherwise. I so find.
The re-build of the G Street property
The cost of rectification to the defective works was estimated to be more than the cost of a demolition and re-build. In 2018 the husband contracted a business for the removal of the house. In mid-2018 the husband and the wife, together with the husband’s relative, Mr WW, relocated to a rental property at XX Street, Suburb H (“the Suburb H rental property”). The dwelling on the G Street property was demolished in 2018. The demolition cost $30,000 and was paid in instalments on behalf of the husband by Vukasin Pty Ltd.
In 2018 the wife signed a contract to build a new residence on the G Street property. The rebuild was financed by a $1,369,628 loan from the NAB secured by mortgage on the G Street property (“the rebuild loan account”). The husband was the borrower. The wife was the guarantor. The husband commenced to make the periodic monthly instalments for the mortgage.
The wife paid $66,275 to meet consultation and other relevant costs.
The litigation about the G Street property renovation
In 2019 the husband and the wife commenced proceedings in the District Court claiming the repayment of the funds paid to the builder. The wife said she was reluctant to commence proceedings as she did not believe they would be successful. Judgment was delivered in the matter in 2021. The husband and the wife were unsuccessful. They appealed. The wife asserts she was again reluctant to continue the litigation. Judgment in the appeal was delivered in 2023. The husband and wife were jointly and severally ordered to pay the defendant’s costs up to a specified date in 2022 and for the husband to pay costs after that date. The value of each of the costs order up to the specified date in 2022, currently unpaid, is agreed between the husband and wife to be $754,989. The costs payable by the husband after the specified date in 2022 also remain unpaid.
Both the husband and the wife retained legal representatives to conduct the District Court and Court of Appeal litigation. At trial, the wife did not press an any contention as to the conduct of the litigation occasioning a waste. This was confirmed by the agreed approach taken to the costs liability up to the specified date in 2022 as recorded in the series of joint balance sheets (Exhibits 15 and 42) and during submissions.
The date of separation
In 2019 the husband and the wife had a dispute. The husband vacated the Suburb H rental property and stayed in a hotel for four nights. Upon his return to the rental property in 2019, the wife had moved out. The husband asserts the date of separation was 26 January 2019. The wife asserts the date of separation was 14 November 2019.
In early 2019 the husband requested that the wife return they keys for the Suburb H rental property. Later in 2019 the husband arrived home to the Suburb H rental property and found the wife there. She asked to stay at the Suburb H rental property a few nights a week to avoid the long commute between where she where she was staying at the Suburb M property and the Suburb TT business. The husband agreed. The husband said he and the wife thereafter slept in separate the bedrooms and did not have a sexual relationship. He said they each attended to their own domestic tasks. The wife said they slept in the same bedroom, had a sexual relationship, and that she undertook the domestic tasks for she and the husband. I prefer the husband’s evidence on this topic in circumstances where the wife’s evidence as to the date of commencement of cohabitation was unreliable and where she has attempted to garner a longer period of cohabitation in an effort to increase the value of the property she perceives is to be adjusted in her favour. I find that separation occurred between the husband and the wife on 26 January 2019 as asserted by the husband and that they remained separated under one roof from late March 2019 until November 2019. I find that each the husband and the wife attended to their own domestic tasks while living in the same property between March and November 2019.
The wife travelled to Country V with the husband in 2019. The wife said the purpose of this trip was to assist the husband in his business. The husband said the primary purpose of the travel was to facilitate the wife visiting an ill relative. The husband conceded that the wife did assist him with business on this trip, and I so find.
In late 2019 the husband informed the wife that she could no longer stay at the Suburb H rental property and offered to find and fund her rental accommodation for six months. The wife moved out of the Suburb H rental property into an apartment. The husband paid $20,800, being six-months’ rent, in advance. He purchased the wife some furniture for the apartment for $6,889.
After late 2019
In 2020 construction of the new home on the G Street property was completed. Due to COVID‑19 restrictions the keys were left at the rear door. The wife was copied into the completion notification email received by the husband. He received a text message from the wife that said she would leave the keys for the Suburb H Rental property at the back door of the G Street property. When he arrived at the G Street property the keys were not there. He says the wife refused to give him the keys.
The wife commenced to occupy the newly completed G Street property from 2020. She continued to do so to the date of trial, to the exclusion of the husband.
In 2020 the wife’s first child, YY, was born. The father of this child is Mr D. The wife said that she and Mr D “decided to form a family in 2021”. The wife and Mr D’s second child, KK, was born in 2024.
Default notices have issued by the mortgagee of the G Street property from time to time since 2020. In response to one notice, the wife contributed $30,000 towards the mortgage account in 2021. Save as to that payment, the husband met the mortgage repayments on the G Street property from 2020 until the date of trial. They are currently approximately $17,000 a month. It was agreed that a finding could be inferentially made that the value of the mortgage payments made by the husband from 2020 to date are in the range of not less than $900,000. I so find. The wife has paid the outgoings and utilities for the G Street property since 2020. I so find. The value of those paid outgoings is not known.
The ZZ Family Trust
The ZZ Family Trust was established by deed in 2020, four days after the commencement of these proceedings. On that same day, the wife incorporated AB Pty Ltd. It is the trustee of the ZZ Family Trust. The wife and her mother are directors and equal shareholders. They have a joint power as to the appointment and removal of the trustee of the ZZ Family Trust. It was uncontroversial at trial that the trustee has an unfettered discretion to distribute income and capital of the trust to the beneficiaries.
In her affidavit the wife said:
156.I recall that in […] 2020, my mother […] said to me in the words of the effect that “I wished to have a trust set up for our family.”
…
158.Once I understood the general concept of a trust, I recall that I had a conversation with my mother in the words of the following effect:
I said: “The Trust needs to have an appointor or more than one appointor. I understand from my accountant that this is the most important concept of the trust. The appointor can control the trust because it can appoint or remove trustee.”
My mother said: “I want to become the appointor with you. Every decision must be jointly controlled by us.”
162.In […] 2020, I had a conversation with my mother in the words of the following effect:
I said: “You know since I purchased the [Suburb RR business], I was always keen to purchase the commercial land at where the business was operating, being at [SS Street], [Suburb RR] NSW […] (the [Suburb RR] Property). The pandemic may give arise an opportunity to purchase.”
My mother said: “We can use our trust to buy the land.”
I said: “The trustee must borrow money from the bank and we may need use the [J Street] Property and the [Suburb O] Property as further security.”
My mother said: “I agree to use our trust to purchase the [Suburb RR] Property.”
…
170.I always respect my mother and I wish to listen to her directions in relation to [AB Pty Ltd] or its trust holding the [Suburb RR] Property.
(Emphasis in original)
In 2020, the ZZ Family Trust purchased the Suburb RR property for $1.68 million, funded by way of a loan of $1.75 million from EE Bank secured by way of a mortgage over the Suburb RR property and over each of the J Street property, the Suburb O property, and the assets of F Pty Ltd. The wife and her mother provided guarantees and indemnities for the $1.75 million loan.
Chapter 6 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) codifies the obligation of litigants to make full and frank disclosure of all facts and information relevant to the proceeding. The duty of disclosure applies to both information and documents. It is absolute and continuing throughout the litigation process. It is critical to the function of the jurisdiction and fundamental to achieving justice and equity. It extends to all relevant and material facts.
Exhibit 10 is an email from the wife’s solicitors to the husband’s solicitors dated 2020, responding to a request for disclosure from the husband’s solicitors. It says:
Dear Colleague,
For the purpose of financial disclosure, there has been a family trust (“[ZZ Family Trust]”) established with our client as one of the appointers recently. Out client is also holder of 5 ordinary shares in the trustee company [AB Pty Ltd] [sic] Pty Ltd, which currently has no trading activities at all.
We are instructed that our [AB Pty Ltd] is acting as the Trustee for [ZZ Family Trust]. Our client is one of the directors and holding 5 ordinary shares, which represents 50% shareholding of the Trustee company. [ZZ Family Trust] is set up to hold the property/investment, so there are no trading activities. The trust also has not acquired any property/investment yet.
…
(Emphasis added)
This was a calculated non-disclosure by the wife. She knew at the date of the email that the settlement of the acquisition of the Suburb RR property was due to complete, or had completed, on that day. Prior to that day she had provided a raft of mortgage securities to obtain the funds to acquire the property.
In her affidavit the wife said that, at her mother’s request, she operated her mother’s internet banking to make a $140,000 payment from her mother’s account to the AB Pty Ltd bank account. Her oral evidence was that her mother reminded her that she (her mother) had also paid the deposit.
At some point after the ZZ Family Trust was established, F Pty Ltd issued two redeemable preference shares in addition to its 10 issued ordinary shares. The two redeemable preference shares were issued to the ZZ Family Trust. The wife held the issued shares. Neither the wife nor her mother gave evidence as to the fact or circumstances of this share issue to the ZZ Family Trust, including as to any consideration paid by the trust for the shares.
The single forensic accounting expert’s report dated 12 August 2024 (Exhibit 13) published to the parties on 4 September 2024 (two business days prior to the trial):
(a)Included a table recording that the income distributed by the ZZ Family Trust over the three years to 2023 was sourced from dividends paid by F Pty Ltd (from the conduct of its business) and paid to the wife’s parents in sum of $271,401;
(b)Recorded in 2023 the wife transferred eight of the 10 ordinary issued shares in F Pty Ltd to the ZZ Family Trust; and
(c)Recorded that a salary of $90,000 was paid to the wife’s parents from F Pty Ltd in 2023.
The wife’s financial statement affirmed in 2024 records that that the wife owned 100 per cent of the shares in F Pty Ltd. It does not disclose the transfer of eight of the ordinary shares to the ZZ Family Trust in 2023.
The husband had contended in the proceeding that the entire ZZ Family Trust was the property of the wife amenable for adjustment in the s 79 dispute. The wife put this contention into issue, saying that she held only a half interest in the trust. In 2024 (prior to the publication of Exhibit 13) the husband agreed that the wife had a 50 per cent interest in the ZZ Family Trust.
On 8 September 2024 (immediately after the publication of Exhibit 13) the wife served an affidavit disclosing the transfer of the eight ordinary issued F Pty Ltd shares to the ZZ Family Trust.
In cross-examination, in response to a question as to how much the ZZ Family Trust paid for those eight transferred shares, the wife said “[a]t the moment, nothing”. She did not adduce evidence as to the purpose of the transfer of shares to a trust in which she said she only had a 50 per cent interest, why the transfer occurred for nil consideration, or why she failed or neglected to disclose the transfer for a period of months. I find that, absent the identification of the transfer in Exhibit 13, it is more likely than not that the wife would not have disclosed the transfer of the shares. Again, this does the wife little credit.
The wife’s mother was cross-examined as to the purpose and circumstances of establishing the ZZ Family Trust. She said the purpose was to make sure that members of the family (she, the wife’s father, and the wife) who are the beneficiaries of the trust will be “protected”, to make sure the assets within the trust will be “protected” from any potential implications that might occur from “personal liabilities”, and to ensure that the dividends will be “appropriately” distributed. Her oral evidence as to the reasons for establishing the ZZ Family Trust was given in a detailed and scripted fashion, reflecting her affidavit evidence.
When she was asked questions as to the conduct of the ZZ Family Trust outside of her affidavit evidence, including as to fact and value of the distributions made to she and the wife’s father, she was evasive and vague. In cross-examination she said that there are only two shares in F Pty Ltd held by the ZZ Family Trust. She did not know that the ZZ Family Trust acquired 80 per cent of the issued ordinary shareholding in F Pty Ltd in 2023. I find it incredulous that in her capacity as trustee she would not know that the ZZ Family Trust had received 80 per cent of the shares in the Suburb RR business.
When the wife’s mother was asked whether she and the wife’s father received wages from F Pty Ltd, she said that she received wages in 2020 of $500 each week for a period of “maybe six months”. She initially denied that either she or the wife’s father worked in the business in 2023, but then said she “still can’t remember”. When it was suggested that she did not work in the business, she disagreed, and then proceeded to explain the work that the wife’s father undertook, and said that when she went with him, he “would be very happy”. The highest her evidence reached as to her work in the business was that she would accompany the wife’s father to deliver goods in 2020. She did not know she and the wife’s father had received wages of $90,000 in 2023.
Exhibit 17 was the wife’s mother’s bank statements for a period in 2020. They record a credit of $19,000 in the wife’s mother’s Westpac account in 2020 with the description “Deposit [Motor Vehicle 1]”. The wife’s mother said she could not remember if this was the deposit of the proceeds of sale of Motor Vehicle 1. She conceded that she did not drive and did not own a motor vehicle. She agreed that the wife drove Motor Vehicle 1 which was “owned or registered” under the name of F Pty Ltd. On the balance of probabilities, I find that the $19,000 deposited into the wife’s mothers bank account was the proceeds of sale of Motor Vehicle 1 owned by F Pty Ltd.
Exhibit 17 also records a credit of $70,887.20 deposited in the wife’s mother’s Westpac account in 2020 with the description “Electronic Property Settlement Pexa[…]”. The wife’s mother said she did not remember origins of this deposit. I find that these funds were the balance of balance of the mortgage advance by PEXA for the Suburb RR property.
Exhibit 17 thereafter records that in 2020 $96,000 was debited from the wife’s mother’s Westpac account, and $96,000 was deposited into her Westpac account. The description of the credit is recorded as “lend to daughter”. In cross-examination the wife’s mother conceded that the wife would conduct her online banking transactions for her and said that she lent this money to the daughter, despite not remembering the details of the loan. This deposit appears to form the foundation of part of the recorded loan advance from the wife’s mother to the ZZ Family Trust valued at $140,000.
The wife was cross-examined as to the source of the $140,000 that she had said in her affidavit was sourced from her mother’s bank account to pay to the ZZ Family Trust in 2020. She did not avail herself of the opportunity to disclose that those funds were sourced from the Motor Vehicle 1 sale or the balance of the mortgage funds received from EE Bank for the Suburb RR property.
A balance of consideration of all the evidence on this subject matter implies, and I find, that the wife engaged in a course of using her mother’s bank account to create a fiction that her mother had sourced the $140,000 from her own funds, when in reality, at least the value of Motor Vehicle 1 and the value from PEXA were not funds of her mother. These funds were then asserted to be advanced by her mother to the ZZ Family Trust. The wife’s evidence as to the $140,000 was deceptive by omission. She knew the source of those funds. This finding undermines the integrity of the value of the wife’s mother’s loan account payable by the ZZ Family Trust and as to the contention as to the wife and her mother equally contributing to, and having an equal interest in, the ZZ Family Trust.
The wife said that she has applied her savings to the mortgage payments for the Suburb RR property since 2020. This is wrong. What was applied to the mortgage was the rental proceeds of the real property used by F Pty Ltd to conduct the business, the dividend payments from F Pty Ltd paid to the ZZ Family Trust and notionally distributed to the wife’s parents, and the wages notionally paid by F Pty Ltd to the wife’s parents.
MR PASSERINI’S CLAIM
By way of points of claim forming part of his Reply to Response for Final Orders filed on 19 January 2024, Mr Passerini pleaded his claim by way of cascading causes of action:
(a)Contract for sale or transfer of shares for which the purchase price was paid;
(b)Common intention constructive trust; and
(c)Estoppel.
The husband conceded the claim of Mr Passerini. He has maintained throughout the course of the s 79 proceeding that he beneficially holds 30 per cent of the issued shares in Vukasin Pty Ltd for Mr Passerini. The agitation of the wife during the trial as to the husband and Mr Passerini having the same interest in these proceedings is not accepted. Simplistically, albeit absent good conscience, it is in the husband’s financial interest to deny Mr Passerini’s claim, or for it to be unsuccessful. To do would achieve a 30 per cent uplift from what he says he understands is his interest in Vukasin Pty Ltd. The husband has an obligation to disclose relevant financial conduct. On his disclosed case, he was obliged to concede Mr Passerini’s claim.
The wife submitted that ASIC records the husband as the sole beneficial owner of all issued capital of the Vukasin Pty Ltd. The wife submits that by force of s 1274B of the Corporations Act 2001 (Cth) (“the Corporations Act”), the husband and Mr Passerini bear the onus of proving that a trust or contract of the kind asserted did come into existence.
Mr Passerini accepted that pursuant to s 1274B of the Corporations Act he had the onus of establishing his entitlement to the shares as being contrary to that recorded on the ASIC register. He submitted that he had discharged this onus by providing evidence to the contrary (Embedded Claims Pty Ltd v Litigation Finance (Australia) Pty Ltd [2023] FCAFC 30 at [58]). He submitted that s 1274B, which provides for proof in the absence of evidence to the contrary, is of lesser effect than a prima facie evidence provision or a provision providing that a fact is taken to be established unless the contrary is proved (Barboutis v The Kart Centre Pty Ltd (No 2) [2020] WASCA 41) (“Barboutis”) at [44]). The relevant question is then whether there is evidence to the contrary, not proof to the contrary (Barboutis at [46]). If there is evidence to the contrary, as there is in this matter as outlined above and below, then the ASIC search extract as a mechanism of statutory proof ceases to have effect.
Pivoting the claim of Mr Passerini are documents recording agreements between he and the husband, being:
(a)Exhibit 26, the document entitled “Contract of Business Ownership” dated 2006 and signed by both the husband and Mr Passerini; and
(b)Exhibit 27, the document entitled “Confirmation of Business Ownership Agreement” dated 2013 and signed by both the husband and Mr Passerini and witnessed by Ms W.
The 2006 agreement provides:
[The husband] agrees to immediately give [Mr Passerini] 30% ownership of [Vukasin Trading] Pty Ltd that has ABN […].
[Mr Passerini] must pay [the husband] a one-off payment of $20,000.
[The husband] agrees to handle selecting, purchasing and importing of products to sell [online].
[Mr Passerini] agrees to handle storage of stock, listing products [online] […] and customer service for those products.
The 2013 agreement has a heading “INTENT”, under which it provides:
The intent of the 2006 agreement by [the husband] to give [Mr Passerini] 30% ownership of The Company was to transfer 30% of the shares in The Company to [Mr Passerini] and the right to 30% of all profits, dividends and capital gains generated by The Company since the company was registered in […] 2006. This agreement has not changed, and will not change unless agreed by both [the husband] and [Mr Passerini] in writing.
(As per the original)
The wife’s case and evidence as to Mr Passerini’s interest in Vukasin Pty Ltd
Throughout the proceeding the wife wholly rejected the assertion of both the husband and Mr Passerini that 30 per cent of the shares in Vukasin Pty Ltd are held by the husband for Mr Passerini, and that the husband is contractually obliged to transfer a 30 per cent interest in the shares in Vukasin Pty Ltd to Mr Passerini. She pleaded putting the husband and Mr Passerini “to proof” as to the fact and terms of any agreement at any time between them. Her position was absolute.
The wife pleaded that she denied that $20,000 had been paid by Mr Passerini for the shares of the husband, and further:
(c) says that in […] 2013, the [husband] orally advised the [wife] that [Mr Passerini] did not pay any start-up capital for the Company, and that [Mr Passerini] did not have ownership of the Company; and
(d) says further that the [husband] has been the sole director and beneficially held 100% shares of the Company since […] 2006 to date.
The wife additionally pleaded the serious allegation that both the 2006 agreement and the 2013 agreement were “fabricated and not genuine”. It emerged during the trial that, in reality, the wife alleged a fraud was being occasioned by both the husband and Mr Passerini. She directly put to each Mr Passerini and the husband that each of the 2006 and 2013 agreements were created during the currency of this proceeding. They each denied the assertions.
On 6 September 2024, being the last business day prior to the hearing, the wife filed an affidavit in which she said:
27.I first met the Second Respondent, [Mr Passerini], in late 2012 when [the husband], [Mr Passerini] and I had a dinner at [a] Restaurant. [The husband] referred to [Mr Passerini] as a close business partner. I recall that he said to me with the words to the effect: “[Mr Passerini] is my closest friend. He has helped me a lot in many aspects. That’s why he is the only friend I would not mind sharing the same safe with at the bank. He is a trustworthy and good friend of mine.”
28.[A date in] 2013 was my birthday. I celebrated with my mother, [the husband] and [Mr Passerini] at a restaurant […]. I recall that after [Mr Passerini] left, I had a conversation with [the husband] with the words to the following effect:
I said: “You and [Mr Passerini] are really close. Does [Mr Passerini] have any shares in your company?”
[The husband] said: “I am the sole director. [Mr Passerini] did not pay any money for the start-up capital of [Vukasin] Trading Pty Ltd and he does not have any shares in the company. However, he is my closest friend and helped me a lot in my business. I will give him 30% of the net proceeds of sale if my company is sold.”
In response to the proposition that the husband, in the conversation in 2013, did not describe the name of the company in full, to include “Pty Ltd”, and that she has “paraphrased or recreated” the words recorded as first-person speech in her affidavit, she said “just make it clear, yes”. The wife did not provide any context to this conversation, other than it occurred after her birthday dinner.
Issue exists as to whether the direct speech evidence of the wife as to a conversation that occurred 11 years ago represents her best efforts to capture the gist of the conversation (see Wild v Meduri [2024] NSWCA 230).
The husband did not accept that in 2013 he would have said to the wife that Mr Passerini did not “pay any money for the start-up capital” or that Mr Passerini would receive a percentage of the “net proceeds of sale”. Having regard to the wife’s concession as to having “paraphrased” the words of the husband in the context of a post-birthday dinner conversation, I prefer the husband’s version of this conversation, including that he did not use language such as “start-up capital” and “net proceeds of sale”. Whilst bearing in mind what was said by McLelland CJ in Watson v Foxman (1995) 49 NSWLR 315, I find that, in reality, the substance of the wife’s evidence carried with it an “artificially precise recollection” as to notions of “start-up capital” and “net proceeds of sale”.
The wife confirmed in oral evidence that the husband “always referred to [Mr Passerini] as a close business partner” and that he told her that he regarded Mr Passerini as being “entitled” to 30 per cent of the company.
At no time during the four years of the proceeding did the wife identify or disclose her knowledge of an agreement or understanding between the husband and Mr Passerini for Mr Passerini to be “entitled” to 30 per cent of the proceeds of any sale of Vukasin Pty Ltd. She did not adduce evidence to explain her secretion of her knowledge of that information or why she provided evidence of her knowledge of this understanding on the business day prior to the trial. She had steadfastly put directly into issue the contention that Mr Passerini has any interest arising from any agreement or understanding at any time in Vukasin Pty Ltd.
It is a reasonable indicator that the wife implicitly knew this information was relevant and material, else it would not have been included in her late affidavit. Her evidence as to her knowledge of an understanding or agreement between the husband and Mr Passerini does not stand on all fours with the case that she had pleaded. The circumstances and content of this evidence adversely impacts on her reliability and credibility on the subject matter of Vukasin Pty Ltd and the husband’s interests therein. I treat her evidence on this subject matter with caution.
In cross-examination the wife said she did not know whether the 2006 and 2013 agreements were fabricated. She said she could not point to any fact grounding the assertion that the documents had been fabricated. She nevertheless maintained her contention that the 2006 agreement and the 2013 agreement were not authentic.
Counsel for Mr Passerini submitted, and I accept, that I am required to exercise caution in evaluating all of the evidence to make serious finding of fraud, and implicitly perjury, as sought by the wife as to the authenticity of the fact of entry and terms of the 2006 agreement and 2013 agreement by the husband, Mr Passerini, and Ms W, who witnessed the signing of the 2013 agreement (s 140(2) Evidence Act 1995 (Cth); Briginshaw v Briginshaw (1938) 60 CLR 336). The graver the consequences at the time of trial, the stronger the evidence required to conclude that the allegation was established on the balance of probabilities.
The originals of the 2006 and 2013 agreements
Both the husband and Mr Passerini said Mr Passerini retained both the original 2006 agreement and the original 2013 agreement after they were executed. Mr Passerini said that the last time he saw the original agreements was in 2020. He had retrieved them at the husband’s request and scanned them for him for the purposes of this proceeding. Mr Passerini gave detailed affidavit evidence as to the moving residences multiple times since last seeing the original documentation and as to them now being lost.
The cases and the evidence as to Mr Passerini’s interest in Vukasin Pty Ltd
I find that the direct financial contributions of the husband at the commencement of cohabitation were overwhelmingly superior to those of the wife. The Full Court in Pierce v Pierce (1999) FLC 92-844 directed that the weight such direct initial financial contributions attract weight is determined when regard is had to the use made of those contributions. I find that the husband’s direct initial financial contributions attract significant weight in that they enabled:
(a)The completion of the acquisition by the wife of the Suburb RR business in 2013. The wife borrowed funds by way of mortgage, applied $85,000 of her funds, and sourced $258,657 by way of the husband accessing from his interests in Vukasin Pty Ltd to complete the acquisition. The wife retains the benefit of this advance of funds. The acquisition of the Suburb RR business increased the wife’s income earning capacity from that she could achieve as an employed medical professional; and
(b)The acquisition of the G Street property in September 2013. The property became their home. This provision enabled the wife to immediately rent her Suburb M property and the J Street property, and then later the Suburb O property, applying the rental income she received from them, together with her business income, to reduce those mortgage debts and to increase her equity in these real properties. By the time of the trial both the Suburb M property and the J Street property were unencumbered. The wife retains the benefit of these now unencumbered pre-relationship real properties in specie; and
(c)The renting out of rooms at the G Street property from 2014 until 2016 by the wife to students produced funds to purchase household supplies and the husband and the wife’s day-to-day living expenses; and
(d)The G Street property to be used to secure the mortgage loan to fund the acquisition of the Suburb TT business in 2015. This enabled the wife to receive income from the Suburb TT business, in addition to that produced by the Suburb RR business, until the Suburb TT business was sold after separation in June 2020. The wife retained $179,874 from the proceeds of sale; and
(e)Accessing from his interests in Vukasin Pty Ltd, the husband paid $800,000 for the renovation to the G Street property. These payments were not recovered in the subsequent litigation with the builder. The husband additionally sourced from Vukasin Pty Ltd $30,000 to pay for the costs of the demolition of the G Street property; and
(f)The G Street property to be used to obtain the rebuild loan account from the NAB of $1,369,628 of which the husband was the borrower, and the wife was the guarantor. The husband made all of the repayments to the rebuild loan account facility except $30,000 paid by the wife.
The husband’s pre-relationship interest in Vukasin Pty Ltd remains in specie.
The proceeds of sale of his pre-relationship real properties, coupled with funds the Vukasin Family Trust has obtained from Vukasin Pty Ltd by way of loan, and the raising of loans secured by way of mortgage on the current real properties held by the Vukasin Family Trust, have funded the acquisition of the current real properties of the trust, now forming Item 1 in the balance sheet. The wife accepts that she did not make any direct or indirect financial contributions to these properties.
The wife’s income, earned through F Pty Ltd from the Suburb RR business and later from the Suburb TT business, together with rental income produced from her Suburb M, J Street and Suburb O real properties, was contributed to pay to or reduce the mortgages on those same real properties. In addition, the wife contributed from her income $66,275 paid towards consultation costs and some of the costs of the rebuild of the G Street property.
I find that the husband’s financial contributions during the marriage were substantially greater those of the wife. This directs further weight in favour of the husband.
Vukasin Pty Ltd
The wife’s involvement in Vukasin Pty Ltd and Vukasin Investment Pty Ltd
The wife prosecuted a case that she provided “assistance to the growth of [Vukasin Pty Ltd]” by way of a contribution that ought to attract significant weight. In her affidavit she said:
178.I assisted [the husband’s] business by fostering and maintaining relationships with [Country V] suppliers. Throughout our relationship, I noticed that his business model focused on sourcing products from [Country V] and selling them primarily through [a particular online platform], as well as on other e‑commerce platforms […].
Her affidavit recorded 27 paragraphs over six pages particularising her asserted role in relationships with Country V suppliers, identifying a large volume of messages to support her evidence. She sought to establish undertaking an important role in contributing to the commercial success of Vukasin Pty Ltd during the relationship.
The husband broadly contended that, save as to limited occasions, the wife had “not been involved in any way in the operation of” Vukasin Pty Ltd. He acknowledged that she had attended with him for seven out of 15 business trips to Country V up until late 2019. In cross‑examination he reluctantly conceded that the wife had translated for him on those occasions with suppliers and on visits in Country V, communicating his instructions and not more, and that she had attended at social functions while in Country V. He said she attended a few social functions when Country V suppliers visited Australia. He denied that the wife arranged these social occasions.
I reject the import of the wife’s evidence as to the nature and extent of her contributions to Vukasin Pty Ltd during the relationship. I find that she constructed or exaggerated her affidavit evidence on this subject matter because:
(a)I accept the evidence of Ms AJ, an employee of Vukasin Pty Ltd. She has been employed on a full-time basis at Vukasin Pty Ltd since 2009. Ms AJ impressed as a straightforward witness. Her evidence was that since 2009 she has dealt with suppliers of Vukasin Pty Ltd. She said she first met the wife in 2012. In her affidavit she said:
11.At all times any texts between us were of a social nature and never related to the business of the Company.
12.At no time was I instructed to provide any information to [the wife] regarding communications with the suppliers of the Company nor was I aware of any involvement by her with any matters relating to the purchases by the Company, which was and remains my responsibility.
(Emphasis added)
I accept the evidence of Ms AJ. As a matter of logic, if the wife were to partake in fostering relationships with Vukasin Pty Ltd suppliers, I find it would not be likely that the wife would not have engaged or dealt with Ms AJ at all on those matters over the six-year period from 2013 until 2019.
(b)Mr AK, another employee of Vukasin Pty Ltd since 2013, gave unchallenged evidence that he has “not ever set up any email or other electronic accounts related to the business” for the wife, and that he has reviewed the records of staff email accounts and system access, none of which show any entries for the wife. I accept his evidence. The wife agreed in cross-examination that she has never had an account on the internal management systems of the company, or a company email account. I find it would by implausible for the wife to meaningfully assist in Vukasin Pty Ltd in the terms or to the extent she asserted in her affidavit evidence without an electronic presence or digital footprint in their internal systems.
(c)The wife gave affidavit evidence that the husband spoke to her about difficulties in arrangements the business had with a supplier in Country V in 2013. The import of that evidence was that her intervention rescued some of Vukasin Pty Ltd quality control problems. After some cross-examination the wife said, and I find, that she relayed to the supplier, by way of translation, the husband’s complaints. The supply relationship between the supplier and Vukasin Pty Ltd was not rectified. It ceased.
(d)The wife gave evidence in her affidavit as to communicating with a significant supplier in Country V for Vukasin Pty Ltd about his frustrations with the Vukasin Pty Ltd utilising an alternate factory to make products “copying” the ideas of his company. I reject the wife’s evidence on this topic. The supplier swore an affidavit in the husband’s case on 2 March 2024. I accept his unchallenged that he has only met the wife on one occasion and “on that occasion, she assisted [his] staff in translating for [the husband]”, and that at “no time did I communicate directly any business matters regarding [Vukasin Pty Ltd] with [the wife]”.
(e)I accept the unchallenged affidavit evidence of the two managing directors of respective Country V origin suppliers of Vukasin Pty Ltd, who both said in their affidavits that they had only met the wife on one occasion and have never communicated with her regarding any business at all.
(f)In cross-examination the wife displayed little knowledge of the ecommerce marketing platforms of Vukasin Pty Ltd. She agreed on two third-party ecommerce platforms. She agreed she was “quite adamant” that her specific description of the names of two “online brand sites” of Vukasin Pty Ltd, displaying objection as to the fact and content of question posed. Immediately following that exchange, she conceded that she had “mistaken” the names of both websites. She did not explain how she could have made such a fundamental error if she was as engaged in the conduct of the Vukasin Pty Ltd enterprise as she asserted.
(g)The wife annexed to her affidavit communications with “various [Country V] suppliers and business partners and associates”. The import of her evidence was that these communications supported that fact of her role contributing to the operations of Vukasin Pty Ltd. These communications were conceded in cross-examination to be social communications.
(h)The wife conceded in cross-examination that suppliers referring to her using a term, which translates to “the boss’ wife”, or “lady boss”, was a traditional term to identify her as the boss’ wife. It did not imply that the suppliers viewed the wife as a “boss” of Vukasin Pty Ltd.
The wife’s evidence as to her role in Vukasin Pty Ltd was machined to achieve a forensic advantage in this proceeding. Nevertheless, I find that her role in translating and attending social functions for up to three weeks on the eight occasions she attended business trips in Country V over six years was valuable to the husband. The husband was dismissive of the wife’s role on the trips to Country V. She attended eight out of the 15 trips that the husband attended over that period. I find that there was a cultural importance for her to attend social functions at those times and for her to have conversations with suppliers of a social nature. I find that her presence on the eight trips and her role was a contribution of value that attracts some weight. I find that on sporadic occasions the wife attended social functions in Australia, although she did not organise them.
I find the husband and the wife discussed over the course of their marriage the vicissitudes of their day or week. I am not satisfied that the wife has established to the requisite degree that the husband spoke to her for advice or as a sounding board regarding the operations of Vukasin Pty Ltd.
Contributions continued
The husband made contributions to the operations of the Suburb RR business, including with various tasks.
Each of the husband and the wife attempted to minimise the other’s role as to homemaking and domestic tasks. The wife said that after she moved into the Suburb DD property, she “was responsible for almost all of the day-to-day housework”, but said that “on few weekends, we did housework together or did grocery and shopping together”. The wife said that once they were married and moved into the G Street property, her parents “took over the majority of the housework”. She then said since 2014 she “took on majority of the housework”. The husband said in the first few weeks they were living in the G Street property, he “did almost all of the work around the house”. Whilst this is not a case in which contributions of this character loom large, I find that it is more likely than not that both the husband and the wife contributed to limited extents to homemaking and domestic tasks throughout varying periods of their relationship.
From mid-2014 until late 2016 the parties employed a maid to cook, clean and wash four days a week. The husband asserts he paid the maid’s wages of approximately $480 per week in cash and drove her home most evenings. The wife asserts that the maid was employed only for a period in 2016 and that she paid the maid’s wages from rental income. Neither the husband nor the wife were cross-examined on this topic. Having regard to the findings identified in these reasons and as regard to the reliability of the evidence of the husband and the wife, I prefer the husband’s evidence as to the period the maid was engaged and so find.
At times that the maid was not employed, and while living with the husband and the wife, the wife’s parents undertook the domestic and household tasks. During the trial the wife abandoned any submission as to this work of her parents being a non-financial contribution on her behalf.
The husband paid six months of the wife’s rent in advance of $20,800 in late 2019, being and paid $6,889 for furniture her rental property. This weighs in the husband’s favour.
It was agreed that a finding can be made by inference as to the value of the mortgage instalments paid by the husband on the G Street property from 2020 until the date of trial is in the range of not less than $900,000. The wife conceded in cross-examination that since separation she has resided in the property, her parents have lived in the property on the weekends, Mr D has lived in the property and paid no rental payments to her, or any bills, or any living expenses. This is a significant post-separation contribution of the husband weighing in his favour. The wife paid $30,000 towards the rebuild loan account in 2021. This weighs in her favour.
Since separation, the wife has contributed to the source of value of the ZZ Family Trust. This weighs in her favour.
The wife sought a contribution finding as to 30 per cent in her favour and 70 per cent to the husband. The husband sought a contribution finding in his favour as to 85 per cent and 15 per cent to the wife.
It was agreed by the husband and the wife that the requirements of s 79 are met in this matter by approaching the assessment of contributions holistically, analysing the nature, form, characteristics, and origin of the property currently comprising that to which s 79 applies, and, in turn, analysing the nature, form, and extent of the contributions (of all types) contemplated by s 79 across the course of the relationship and in the post-separation period to the point of assessment (Horrigan & Horrigan [2020] FamCAFC 25).
That task is also to be undertaken by reference to the nature and form of this particular marriage.
A holistic assessment requires all contributions to be weighed collectively and not by way of compartmentalising one against others or the remainder. I am mindful that the Full Court in Jabour & Jabour (2019) FLC 93-898 recorded that there can be an overstated importance as to the increase in the value of a piece of property at the expense of “the myriad of other contributions that each of the parties has made during the course of the relationship” (at [43]).
Considering all the contributions identified in these reasons, contributions are assessed as 85 per cent in favour of the husband and 15 per cent in favour of the wife. This will see a disparity between the parties in dollar terms that equates to $38,134,325 to the husband and $6,729,587 to the wife, a difference of $31,404,738.
SECTION 75(2) – ADJUSTMENTS TO CONTRIBUTION FINDING
The husband is aged 47. The wife is aged 42. Both are in good health.
The husband’s income since early 2024 has been $1.1 million per annum. Its recent increase from its historical value of $80,000 per annum is in part a product of sourcing funds to pay legal fees for this proceeding (Exhibit 7). The current profitability of Vukasin Pty Ltd, as opined by the single expert, shadows doubt whether the current salary of the husband can be sustained. That said, there was no suggestion that he will not continue to receive a very healthy income or not dissimilar benefit from Vukasin Pty Ltd going forward. The single forensic accounting expert adjusted the husband’s reasonable renumeration when opining as to the enterprise value of Vukasin Pty Ltd at an annual rate of $395,000 in 2023 and $410,000 in 2024. This evidence was not challenged at trial. There is no evidence as to a dividend being likely to be declared by Vukasin Pty Ltd in the foreseeable future. I find, on balance, that the husband’s future income earning capacity by way of salary from Vukasin Pty Ltd is in the range of that identified by the single forensic accounting expert.
The Vukasin Family Trust receives rental income from its real properties. The single forensic accounting expert’s report records that the Vukasin Family Trust’s expenses incurred for the year ended 2023 was greater than the rental income it received, generating a loss of $37,374. For the prior year ended 2022, it made a profit of $267,967. I find it more likely than not that, going forward the Vukasin Family Trust is likely to produce a positive income flow from its passive investment activities for the husband’s benefit.
The authorities identify two possible consequences of a finding as to the wife’s failure to comply with her disclosure obligations. The first is that there may be unknown items of property, income, or resources available to her of which the Court and the husband have no knowledge. In that circumstance, robust findings may be available on those subject matters in favour of the other party (Weir and Weir (1993) FLC 92-338). The second is that the non- disclosure added costs for the other party in obtaining documents and information (Edgehill & Edgehill [2007] FamCA 1102).
The forensic processes employed during the trial and the agreements the husband and the wife achieved during submissions compromising the fact and values of the items of their property in the final balance sheet conclude that there is no aspect of property not being identified or valued. The income and financial resources of the wife remain clouded. The wife bore the onus to disclose all relevant documents and information to identify her current income and resources and to permit findings to be made on those subject matters.
The income of the wife recorded in her financial statement from her work as a medical professional for one day each week is $1,000, or $52,000 annually. The evidence establishes, and I find, that the wife additionally receives the benefit of the wages allocated to her parents from F Pty Ltd, last recorded in 2003 at $90,000 annually, and the dividends paid by F Pty Ltd distributed to her parents by way of the ZZ Family Trust, being $117,309 for 2023. By rough addition, an aggregation of these sources produces income for the wife in the range of $260,000 annually being achieved if she works as a medical professional one day per week.
In addition, her financial statement records that she currently receives rental income from her real properties in the range of $75,000 per annum, producing a current total income in the range of $335,000 per annum.
The wife says that her current income earning capacity is restricted to working one day each week because she is required to take care of her two young children.
In her affidavit the wife said that she and Mr D, the father of the children, have separated and “agreed” that she “would be solely responsible” for their two children. In cross-examination she conceded that Mr D stays at the G Street property “seven days” each week. Her evidence promoting a conclusion that they do not live in the same household was misleading. She did not adduce evidence as to why he does not assume a greater role in the parenting of their children, enabling her to undertake greater capacity each week working as a medical professional.
In his affidavit Mr D said that he “need[ed]” to pay child support of $37.31. He did not say that he did pay it. The wife said, and I find, that Mr D does not make that payment. The wife said that he does not contribute to the household because “he doesn’t have any money” and is in “a lot of debt”. I find that evidence improbable when cast against the wife’s concession that Mr D drives a large motor vehicle and has an interest in several businesses.
The wife agreed that her parents live in the G Street property on the weekends. The wife’s mother currently occupies the wife’s pre-marriage now unencumbered Suburb M property during the week at no cost. The wife’s current income and resources are sufficient such that she does not require rental income from her Suburb M property or contribution from Mr D to meet her household expenses or those of her children. Her financial circumstances after separation have permitted her to currently hold almost $400,000 in savings in accounts (Item 13 in Exhibit 42).
I find that the fact and circumstances of the marriage has not in any way reduced the income earning capacity of the wife. It has improved it.
While I find that the husband has a superior current income to that of the wife, I find for the reasons recorded earlier that her future income earning capacity will likely improve from her current not insubstantial income, especially should she elect in the circumstances of her relationship with Mr D to undertake greater work as a medical professional, and should she rationalise her use of her Suburb M property. While the value of this improvement cannot be readily quantified because of the wife’s disclosure failures, it is broadly and robustly weighed.
I find that the wife has a financial resource by way of her parents that she would expect to receive if she were to call upon it in the future. The wife’s mother said that said that the wife’s father is the “President of [an] enterprise in [Country V]” from which he earns “high income on an annual basis”. She and the wife’s father own four properties in Country V and one in Suburb M. Her own Suburb M property is leased to tenants, creating rental income, while she occupies the wife’s Suburb M property.
By way of the contribution finding, the property of the husband is vastly superior to that of the wife.
The wife will continue to have the responsibility, together with Mr D, to support her two children.
The wife has superannuation in the sum of $154,712. The husband has superannuation in the cumulative sum of $246,267.
Post-separation the husband and the wife have continued to enjoy a high standard of living. This circumstance will continue for each of them in the future.
The wife sought an adjustment to the contribution finding of 10 per cent in her favour. The husband opposed any adjustment to the contribution finding.
Any adjustment to the contribution finding ought not be a vehicle for social engineering. A holistic consideration of the matters raised above warrants an adjustment from the contribution finding of 1.5 per cent in favour of the wife. In dollar terms, the value of this adjustment to the wife is $672,959, a difference of $1,345,918.
CONCLUSION – JUSTICE AND EQUITY
Accordingly, the property of the parties will be adjusted 16.5 per cent to the wife and 83.5 per cent to the husband.
To achieve 16.5 per cent of the property of the parties identified in the balance sheet the wife ought to receive $7,402,545.
The wife currently has in her possession or will receive the following by way of the proposed orders that she retain the G Street property:
Ownership Description ASSETS 8 Wife [J Street], [Suburb K] NSW 925,000 9 Wife [N Street] [Suburb O] NSW 710,000 10 Wife [L Street], [Suburb M] NSW […] 550,000 11 Wife [G Street], [Suburb H] NSW […] 6,100,000 12 Wife Interest in [F Pty Ltd] 2,295,000 13 Wife Westpac […] Accounts 395,912 14 Wife Household contents 5,000 15 Wife [ZZ Family Trust] – [SS Street business] freehold 1,028,000 Total 12,008,912 LIABILITIES 18 Wife Mortgage over [N Street] [Suburb O] NSW 550,000 21a Wife Building litigation judgment 377,000 Total 927,000 TOTAL ASSETS – LIABILITIES 11,081,912
If she has the property in the table above, upon the basis that the husband discharges the mortgage on the G Street property, she achieves $11,081,912 of the property of the husband and the wife identified in the balance sheet. She therefore is required to make a payment to the husband of $3,679,367, rounded to $3,679,350, to achieve $7,402,545, being 16.5 per cent of that property.
The husband’s overall entitlement to 83.5 per cent of the property of the husband and the wife identified in the balance sheet equates to $37,461,366.
If the wife retains the G Street property and the husband discharges the mortgage on it, the husband has or will receive the following:
Ownership Description ASSETS 1 Husband [Vukasin Family Trust]
[CC Street], [Suburb DD] NSW $3,250,000
[AL Street], [Suburb MM] NSW $18,000,000
[NN Street], [Suburb OO] NSW $9,000,000
[PP Street], [Suburb QQ] NSW […] $18,500,000
[AM Street], [Suburb AN] NSW […] $6,000,00016,037,000 2 Husband Interest in [Vukasin Pty Ltd] 17,089,000 3 Husband Interest in [AO Pty Ltd] 921,000 4 Husband Interest in [AP Company] 22,000 5 Husband Motor vehicles […] 930,000 6 Husband Household contents 20,000 7 Husband Bank Accounts 50,000 Total 35,069,000 LIABILITIES 16 Husband Mortgage over [the G Street] property 910,000 21 Husband Building litigation judgment 377,000 Total 1,287,000 TOTAL ASSETS – LIABILITIES 33,782,000
The husband accordingly currently holds $33,782,000 of the property of he and the wife identified in the balance sheet. He ought to hold $37,461,366. Hence, he requires a payment from the wife of $3,679,367, rounded to $3,679,350, to achieve 83.5 per cent of their property.
The wife will have the first opportunity to retain the G Street property. She has lived there since separation with her children. The husband now lives in a property owned by the Vukasin Family Trust at Suburb QQ.
An order will be made requiring the husband to discharge the mortgage secured over the G Street property within 28 days, prior to the opportunities identified in [259] and [262] coming into operation. The value of the mortgage, when compared to the value of the adjusting sum to be paid to him by the wife, does not identify any prejudice if this course is adopted. That sequence maintains the justice and equity of the proposed orders adjusting property. The order is further indicated because the husband:
(a)Sought to do so by way of his primary relief. He had the capacity to do so;
(b)Agrees that the wife ought to have the first opportunity to retain the property; and
(c)Is the sole borrower of the loan secured by the mortgage.
An order will be made that the wife pay to the husband the sum of $3,679,350 within 56 days. In the event she makes that payment, she will retain the G Street property. If she does not, the opportunity to achieve the G Street property will fall to the husband.
An order will be made that in the event the wife fails to pay the husband $3,679,350 within that specified time, the husband may elect, within seven days of the wife’s failure or neglect to make that payment to him, to serve written notice requiring her to transfer to him all her interest in the G Street property. In the event the husband makes that election in writing, within 84 days he will pay to the wife the sum of $2,420,650 and she will execute all documents prepared by him at his expense to effect a transfer of her interest in the G Street property to him.
By way of cross check, should the wife not receive the G Street property and in lieu thereof receive $2,420,650, the wife has or will receive:
Ownership Description ASSETS 8 Wife [J Street], [Suburb K] NSW 925,000 9 Wife [N Street] [Suburb O] NSW 710,000 10 Wife [L Street], [Suburb M] NSW […] 550,000 12 Wife Interest in [F Pty Ltd] 2,295,000 13 Wife Westpac […] Accounts 395,912 14 Wife Household contents 5,000 15 Wife [ZZ Family Trust] – [SS Street business] freehold 1,028,000 A Wife Payment from the husband 2,420,650 Total 8,329,562 LIABILITIES 18 Wife Mortgage over [N Street] [Suburb O] NSW 550,000 21a Wife Building litigation judgment 377,000 Total 927,000 TOTAL ASSETS – LIABILITIES 7,402,562
Therefore, the wife will achieve the sum of $7,402,562, which, allowing for rounding, equates to 16.5 per cent of the property of the husband and the wife.
If neither party complies with the sequential opportunities as to the retention or transfer of the G Street property, orders will be made for the property to be sold. Machinery orders will be made to facilitate that process, including by way of auction sale, in the event the parties are unable to agree as to those matters in writing.
As to the distribution of the proceeds of a sale of the G Street property between the husband and the wife if required, and on the basis that the husband has caused the mortgage to be discharged, he was to receive a payment from the wife of $3,679,350. This broadly equates to 60 per cent of the unencumbered value of the G Street property, being $6.1 million. Hence, after payment of selling costs, orders will be made distributing the balance of proceeds of the sale of the G Street property as to 60 per cent to the husband and the balance to the wife. Such orders ensure the maintenance of the justice and equity as between the husband and the wife by way of the proposed orders irrespective of the sale price achieved and costs incurred on disposal of the G Street property.
An order will be made providing that after the husband discharges the mortgage, pending the husband and the wife completing the sequences as to either the retention or transfer of the G Street property or its sale, the wife will be restrained from transferring, encumbering, mortgaging, or otherwise dealing with her interest in the G Street property, and will be required to maintain the property in good order and condition. This order is indicated upon a consideration of the disclosure failures as to the wife’s financial conduct and to reduce the prospects of the ignition of disputes between the parties fuelled by post litigation conduct contrary to the tenor of the proposed adjustive orders pending their implementation.
Notwithstanding that the husband and the wife are jointly and severally liable for the District Court and Appeal Court costs orders payable by them up until 2022, as agreed during submissions, so as to avoid further disputes between them, an order will be made that they each be responsible for and pay one half of the costs orders and indemnify the other in relation to the balance. It was accepted by the husband and the wife at trial that this order would not bind the defendant in the District Court and respondent in the appeal proceedings who has the benefit of the costs orders.
Paragraphs 5, 6, and 7 of Exhibit 44 records agreed orders as between the husband and the wife. Such orders will be generally made with minor amendment.
It is appropriate for the parties to have an opportunity to agitate their relief sought as to costs within a prescribed time frame specifying the terms of any orders sought. If no application in a proceeding is filed as to costs as prescribed, all outstanding applications for costs will be dismissed.
Standing back, I find the distribution of the property of the husband and the wife in the terms identified above is appropriate and otherwise just and equitable. Orders will be made accordingly.
I certify that the preceding two hundred and sixty-eight (268) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Campton. Associate:
Dated:30 September 2024
- AGLC
- O’Cleary & Vukasin (No 2) [2024] FedCFamC1F 660
- Case
- [2024] FedCFamC1F 660
- Decision Date
CaseChat Overview and Summary
Orders
Orders of the court
SYC 4005 of 2020
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:
MS O’CLEARY
Applicant
AND:
MR VUKASIN
Respondent
MR PASSERINI
Intervener
ORDER MADE BY:
CAMPTON J
DATE OF ORDER:
30 SEPTEMBER 2024
THE COURT DECLARES THAT:
1. Mr Vukasin (“the husband”) holds 30 per cent of the share capital (“Shares”) and any dividends and/or distributions associated or connected with those shares of Vukasin Pty Ltd (currently, 150 ordinary shares) on trust for Mr Passerini.
THE COURT ORDERS THAT:
2. The husband delivers up or transfers the Shares to Mr Passerini or his nominee at a time as agreed in writing between the husband and Mr Passerini no later than 31 December 2026.
3. The husband and Mr Passerini in their capacity of director and/or shareholder of Vukasin Pty Ltd will do all things and sign all documents required to assign to the husband the choses in action constituted by all loans and said to be owing to Vukasin Pty Ltd by Ms O’Cleary (“the wife”) and/or F Pty Ltd and the husband shall:
(a) Pay and indemnify the wife and F Pty Ltd in respect of any such liability, to the intent that they not pay any monies under or by reference to such loans; and
(b) Release and discharge the wife and F Pty Ltd from all liability under or by reference to such loans or any other loan he claims is otherwise due to him.
4. On or before 28 October 2024 the husband shall do all things to cause the mortgage secured over the property at G Street, Suburb H (“the G Street property”) to be discharged and indemnify the wife in relation to same, and the wife shall sign all such documents as are necessary to facilitate the husband’s compliance with this order.
5. On or before 25 November 2024 the wife shall pay to the husband sum of to $3,679,350.
6. Pending compliance with Orders 5, 8, 9, 10 and 11, whichever is the earlier, the wife:
(a) Is restrained from doing any act or thing to transfer, encumber, mortgage, or adversely affect her interest in the G Street property save as to facilitate compliance with Order 5; and
(b) Is to do all things as are necessary to keep and maintain the G Street property in good order and condition.
7. In the event the wife fails or neglects to comply with Order 5, the husband may elect by notice in writing to the wife to be served within seven days of such default to require the wife to transfer to him all her interest in the G Street property.
8. In the event the husband makes the election in writing pursuant to Order 7 then:
(a) On or before 23 December 2024, the husband shall pay to the wife the sum of $2,420,650; and
(b) Simultaneously upon receipt of such sum, the wife shall execute all documents prepared by the husband at his expense for the wife to transfer to the husband all her interest in the G Street property and the wife shall provide the husband with vacant possession of the G Street property.
9. In the event the wife fails to comply with Order 5 and the husband does not exercise the election pursuant to Order 7, the husband and wife shall do all such things as are necessary to list for sale the G Street property on terms they agree in writing or failing to so agree in writing for more than 14 days, on the following terms:
(a) To list for auction with an agent agreed upon by them in writing within 14 days and failing agreement the agent be appointed by the President of the Real Estate Institute of New South Wales or his or her nominee;
(b) Give such instructions to a solicitor to act on the sale of the property agreed upon in writing within 14 days, and failing agreement as to the identify of the solicitor, the solicitor be appointed by the President of the Law Society of New South Wales or his or her nominee;
(c) Market the G Street property for sale by public auction to be held on-site within six weeks of the date this order comes into operation at a reserve price to be agreed by them in writing seven days prior to auction and failing such agreement at a reserve price determined by single real property valuation expert who opined as to the value of the G Street property for trial;
(d) Attend the auction and in the event that the reserve price set for the auction is not reached negotiate with the highest and second highest bidder and accept any offer to purchase that is the highest made within five per cent of the reserve price set for that auction unless the parties otherwise agree in writing; and
(e) Execute the contract for sale and in the event they fail to agree on the terms of the contract for sale, the terms recommended by the solicitor acting on the sale shall be adopted.
10. Upon the completion of the sale of the G Street property, the husband and wife shall do all things to apply the proceeds of the sale in the following manner and priority:
(a) In payment of any outstanding land tax, council rates, and water rates;
(b) In payment of fees for the nomination of an agent or solicitor pursuant to these orders, if any;
(c) In payment of the valuers fees, if any;
(d) In payment of the real estate agent’s commission, selling expenses, and auction expenses incurred on the sale;
(e) In payment of conveyancing legal costs associated with the sale;
(f) In the amount of 60 per cent of the remaining balance to the husband; and then
(g) In payment of the balance to the wife.
11. In the event of the husband exercising the election pursuant to Order 7 and the husband failing to comply with Order 8(a), the G Street property shall be listed for sale and sold on the terms provided for in Order 9 and the proceeds of sale applied as provided for in Order 10.
12. As between the husband and the wife, each shall be responsible for and shall pay one half of the joint and several costs orders payable by them up until 2022 as made in the New South Wales District Court and New South Wales Court of Appeal and shall indemnify the other in respect of the remaining half balance payable pursuant to those costs orders.
13. Otherwise than as provided for in these orders, each of the husband and the wife be and is hereby declared to be the sole and absolute owner to the exclusion of the other of all items of property currently standing in his or her name or otherwise being in his or her possession custody or control.
14. In the event that the husband or the wife fails, neglects or refuses to sign or execute any document required by or to give effect to these orders, then the Registrar of the Federal Circuit and Family Court of Australia (Division 1), Sydney Registry, is authorised, empowered, and directed to sign and execute such document on behalf of the party in default upon being satisfied of such failure or neglect by way of affidavit evidence, and the signature of the Registrar shall thereafter be deemed to be the signature of such party.
15. Except as provided for by these orders, save as to costs, all outstanding applications and responses are otherwise dismissed.
16. Should any party wish to pursue or make an application for costs, they are to file and serve within 28 days of the date of these orders an Application in a Proceeding specifying the orders sought as to costs, and any affidavit in support thereof. In the event of the filing of such application, orders will be made in chambers as to the filing of material in response and as to the listing of the application.
17. In the event no application of costs is filed pursuant to Order 16, any outstanding applications as to costs are dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
Background
Background to the litigation
Evidence
Evidence Before The Court
Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
For these reasons I find the wife’s evidence about the Suburb TT business to be unreliable. I do not accept that the husband pressured her into purchasing the Suburb TT business. I prefer the husband’s evidence on this matter and find that it is more likely that the wife’s objective was to expand her export sales, and the husband assisted her in that endeavour as he asserted. I find that the wife attempted to machine her evidence on this subject matter to achieve what she perceived to be an advantage in the proceedings.Remuneration from Vukasin Pty Ltd Neither the husband nor Mr Passerini were paid a wage by Vukasin Pty Ltd from 2006 until 2016. The husband and Mr Passerini then each commenced to be paid $80,000 per annum from Vukasin Pty Ltd. In early 2024 the annual salaries received by the husband and Mr Passerini from Vukasin Pty Ltd each increased to $1.1 million. The renovation of the G Street property In 2016 a builder was engaged to undertake renovations on the G Street property. In late 2016 the husband and the wife relocated into the granny flat at the G Street property to facilitate the commencement of the works. The renovations were not completed. The works were substandard and non-compliant. The husband said he paid $800,000 to the cost of renovations. The wife did not challenge that evidence or assert otherwise. I so find.The re-build of the G Street property The cost of rectification to the defective works was estimated to be more than the cost of a demolition and re-build. In 2018 the husband contracted a business for the removal of the house. In mid-2018 the husband and the wife, together with the husband’s relative, Mr WW, relocated to a rental property at XX Street, Suburb H (“the Suburb H rental property”). The dwelling on the G Street property was demolished in 2018. The demolition cost $30,000 and was paid in instalments on behalf of the husband by Vukasin Pty Ltd. In 2018 the wife signed a contract to build a new residence on the G Street property. The rebuild was financed by a $1,369,628 loan from the NAB secured by mortgage on the G Street property (“the rebuild loan account”). The husband was the borrower. The wife was the guarantor. The husband commenced to make the periodic monthly instalments for the mortgage. The wife paid $66,275 to meet consultation and other relevant costs. The litigation about the G Street property renovation In 2019 the husband and the wife commenced proceedings in the District Court claiming the repayment of the funds paid to the builder. The wife said she was reluctant to commence proceedings as she did not believe they would be successful. Judgment was delivered in the matter in 2021. The husband and the wife were unsuccessful. They appealed. The wife asserts she was again reluctant to continue the litigation. Judgment in the appeal was delivered in 2023. The husband and wife were jointly and severally ordered to pay the defendant’s costs up to a specified date in 2022 and for the husband to pay costs after that date. The value of each of the costs order up to the specified date in 2022, currently unpaid, is agreed between the husband and wife to be $754,989. The costs payable by the husband after the specified date in 2022 also remain unpaid.