Oliver and Hughes
[2018] FamCA 731
•14 September 2018
FAMILY COURT OF AUSTRALIA
| OLIVER & HUGHES | [2018] FamCA 731 |
| FAMILY LAW – PROPERTY – competing applications for adjustment of interests in matrimonial property – Where the duration of the marital relationship is very much an issue – Where the wife asserts the parties lived together for five years – Where the husband asserts the parties lived together for 17 years with short periods of separation – Where the husband provided for the welfare and financial support for the wife, the parties’ child and the wife’s three children – Where the husband was unaware that the wife was in receipt of single parent Commonwealth benefits and of child support from her former husband during the relationship – Where the wife did not make full disclosure of her financial position – Where contributions favour the husband – Where has a higher income earning capacity - Where it is just and equitable to make an adjustment – Orders made adjusting property interests 55/45 percent in favour of the husband – Splitting order made – Where the matter was referred to the Commonwealth Director of Public Prosecutions for investigation and prosecution of any offence. |
| Family Law Act 1975 (Cth) |
| Bevan & Bevan [2013] FamCAFC 116 Stanford & Stanford (2012) 247 CLR 108 |
| APPLICANT: | Ms Oliver |
| RESPONDENT: | Mr Hughes |
| FILE NUMBER: | PAC | 5262 | of | 2015 |
| DATE DELIVERED: | 14 September 2018 |
| PLACE DELIVERED: | Parramatta |
| PLACE HEARD: | Parramatta |
| JUDGMENT OF: | Cleary J |
| HEARING DATE: | 23-24 July 2018 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Ms Lioumis |
| SOLICITOR FOR THE APPLICANT: | A B Mezzanotte Lawyers |
| COUNSEL FOR THE RESPONDENT: | Ms Haughton |
| SOLICITOR FOR THE RESPONDENT: | Brydens Lawyers Pty Ltd |
Orders
That each of the parties forthwith sign necessary documents and provide all such authorities to B Lawyers to authorise release of funds [held in their trust account on behalf of the parties] to the husband, or as the solicitors for the husband direct in writing.
That the wife shall re-finance in her sole name or discharge the existing mortgage registered on the title of the property at C Street, Suburb D (“the Suburb D property”).
That contemporaneously with Order 2:
3.1The husband shall do all acts and things and sign all necessary documents to transfer to the wife his right, title and interest in the Suburb D property;
3.2The wife shall pay to the husband the sum of $100,769.
That in the event that the wife fails or neglects to comply with Orders 2 and 3 then forthwith upon such default the Applicant and Respondent shall do all acts and things and sign all documents necessary so as to cause the property to be sold and for the purposes of effecting that sale the parties agree:
4.1The property shall be listed for sale by way of public auction;
4.2The auctioneer shall be agreed between the parties. Failing agreement, the auctioneer shall be nominated by the president of the Real Estate Institute of New South Wales;
4.3The reserve price shall, unless otherwise agreed upon between the parties, be as proposed by the auctioneer;
4.4The said property shall be listed for sale by public auction with such real estate agent or agents as may be agreed upon between the parties and failing agreement such real estate agent or agents as are nominated by the president of the Real Estate Institute of New South Wales;
4.5The auction shall take place within six (6) weeks from the day it is listed with the agent.
In the event that the property is not sold by public auction in accordance with Order 4 then the parties agree that they shall cause the Suburb D property to be submitted to sale by private treaty with the same real estate agent detailed in Order 4.4 at a price agreed upon between the parties or in default of agreement as to a selling price, at a price to be determined to be a fair market price by the president of the Real Estate Institute of New South Wales, or their nominee whose decision shall be final and binding upon the parties.
That upon the sale of the Suburb D property the proceeds of sale be disbursed in the following manner and priority:
6.1In discharge of the mortgage presently encumbering the property;
6.2The costs, expenses, commissions, advertising fees and disbursements of the agent and/or auctioneer conducting the sale of the property;
6.3The costs and fees of any legal fees and expenses arising from the sale of the respective property;
6.4In payment to:
6.4.1The husband of a sum representing 20 per cent of the net proceeds of sale;
6.4.2The remainder thereafter to the wife.
Each of the parties may attend the auction and bid to purchase.
That the wife may continue to occupy the Suburb D property until transfer to her of the husband’s interest or sale pursuant to these orders, whichever is the case, on condition that she makes the required mortgage repayments, pays land and water rates and maintains the property in a good condition.
That:
9.1In accordance with s 90MT(1)(a) of the Family Law Act 1975, whenever a splittable payment becomes payable to the Respondent husband from his interest in his E Super (Member Number #08), the Applicant wife is entitled to be paid an amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001, using a base amount $41,950 and that there be a corresponding reduction in the entitlement that the Respondent husband would have had but for these orders;
9.2That the Court allocate, pursuant to s 90MT(4) of the Family Law Act 1975, a base amount of $41,950 to the Applicant wife out of the Respondent husband’s interest in the E Super (Member Number #08);
9.3That having been accorded procedural fairness in relation to the making of these orders, these orders bind the trustee of the Respondent husband’s superannuation fund;
9.4The operative time for these orders is four (4) business days after receiving a sealed copy of the Court orders.
That unless otherwise specified in these orders and except for the purposes of enforcing the payment of any monies under these or any subsequent orders:
10.1Each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the possession of such party as at the date of these orders;
10.2Any money standing to the credit of the parties in a bank account are to be retained by the party in whose name the account appears;
10.3Each party hereby foregoes any claim they may have to any superannuation benefit that is belonging to or owned by the other save as provided for in these orders;
10.4All insurance policies are to become the sole property of the owner named hereon;
10.5Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders.
IT is further ordered
That a Registrar of this Court shall send to the Commonwealth Director of Public Prosecutions copies of the following documents in proceedings number PAC5262/2015 for the purpose of consideration as to whether the Applicant, Ms Oliver, should be charged with and prosecuted for any offence in connection with the receipt of Centrelink Benefits in the period between 2005 and 2013:
(a) These Orders and Reasons for Judgment dated 14 September 2018;
(b)Affidavit of the Applicant Ms Oliver sworn or affirmed on 21 March 2018;
(c)Financial Statement of Ms Oliver sworn 23 March 2017;
(d)Affidavit of the Respondent Mr Hughes sworn 16 March 2018;
(e)Financial Statement of Mr Hughes sworn or affirmed on 25 January 2018;
(f)Documents produced by Centrelink in response to Subpoena [Exhibit 2 in proceedings].
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Oliver & Hughes has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT PARRAMATTA |
FILE NUMBER: PAC 5262 of 2015
| Ms Oliver |
Applicant
And
| Mr Hughes |
Respondent
REASONS FOR JUDGMENT
Introduction
These are competing applications for orders adjusting interests in matrimonial property.
Ms Oliver is the applicant wife aged 47 years. She is unemployed receiving a Newstart Allowance and a weekly payment of Income Insurance.
Mr Hughes is the respondent husband aged 45 years. He is a tradesman in full time employment.
The parties met in 1997. The only child of the marriage was born in mid-1998 and is now aged 20 years. The parties married in 1999. The parties are not divorced.
Length of marital relationship
The duration of the marital relationship is very much an issue and has significance beyond simply being an issue in dispute, for reasons set out below in this judgment.
The wife asserts that the relationship ended in June 2004 when the husband moved out of the family home and that the parties did not thereafter reconcile. Her assertion is that the parties lived together for just over five years, from the date of marriage in 1999 to June 2004.
The husband asserts that the parties separated in January 2015 when he moved to another bedroom and the parties thereafter lived separate lives under the same roof for six months. His evidence, which I accept, is that final separation which ended the marriage, took place in July 2015 when he moved out of the family home.
His assertion is that the parties lived together for 17 years from 1998, when the wife and her three children from a prior marriage moved into his home, until mid-2015. During that time he had worked full time and provided financially for the wife, their child, and the wife’s three children.
The husband qualifies that assertion by stating that during the marriage there were three to five short periods of separation ranging from one to six months. On each of those occasions he moved out of the home with the wife remaining in the home with the children. On more than one of those occasions the wife packed the clothes of the husband in garbage bags and placed them at the front of the house.
During the periods of separation the husband moved to the home of his parents who lived in the same suburb as the parties. On each occasion the parties reconciled and the husband returned to live in the family home.
I have accepted the evidence of the husband and rejected that of the wife on the issue of date of separation taking into account the following matters:
Child Support
Tendered into evidence were Child Support Assessments relating to the parties’ child Ms X for periods commencing in June 2011. All of the documents refer to the wife having 100 percent care of the child. There had been no parenting orders made allocating parental responsibility or at all. The Department of Human Services did not collect the money. The husband did not pay child support until 2015. There is no document relating to arrears.
The husband conceded seeing such documents at home but had not felt concerned about them. I had the strong impression that the husband is not a man who is engaged by paper work.
I do not accept that the assessments were obtained for the purpose of the wife receiving child support from the husband. I conclude that it suited the wife for another purpose to have assessments done. That purpose was most likely to have been creating the impression that she and the husband were separated.
The husband did pay child support from the date of separation in 2015 asserted by him.
Husband’s tax returns
The husband was taken to his tax returns which were blank on the topic of whether he had a wife/partner. He explained that he had not noticed that before. He said and I accept that his habit was to “give his paperwork to the taxman and sign the return”.
Commencement of proceedings
The first application to the Court was made by the wife in October 2015, about three months after the husband ceased living in the home. There was no application to a Court about property or parenting in 2004 or the years following.
Shared finances
The husband continued to pay the mortgage on the family home throughout the years, together with rates and family expenses.
The parties continued to operate a joint bank account.
In 2005 the wife consented to refinancing of the family home for a second time to enable the purchase of another investment property.
In June 2009 the husband received a gross redundancy payment of $90,000 plus. The wife was upset that the money was paid into an account of the husband. He apologised to her and transferred $20,000 into their joint account so she had access to it. The significant points being that the wife knew about the payment and was clearly operating and viewing accounts at that time. On her evidence, by then the parties had been separated for five years.
In April 2013 the parties purchased land in joint names at Suburb D with an intention to build a home. In May 2015 they took out a joint loan to finance the building of that home.
No evidence of separation
There was no independent documentary evidence of separation at all. The wife did not rely on an affidavit by any third party supporting her contention about separation 14 years ago.
The length of the marital relationship: Receipt by the wife of Commonwealth benefits
Prior to the commencement of trial I raised with the parties the significance of the disputed date of separation in relation to the issue of the receipt by the wife of Commonwealth benefits from 2005 onwards, on the basis of being a single parent.
Both parties indicated through their counsel that they wished to proceed.
I include those remarks here.
a)In paragraphs 56 and 57 of his affidavit sworn 16 March 2018 the husband raises a serious allegation about the conduct of the wife. He asserts that in 2017 he was told by his solicitor that the wife “had been claiming a single parent pension since about June 2005”, a period when he was living with the wife in the family home and meeting all expenses of the family.
b)In paragraph 9 of her affidavit sworn 21 March 2018 the wife asserts that the parties finally separated on 1 June 2004. That date is also stated as the date of final separation in the Initiating Application filed 30 October 2015. In his Amended Response, the husband disputes that date of separation.
c)The wife gives no evidence on the receipt of Commonwealth benefits other than a statement of currently receiving a Newstart Allowance (March 2018).
d)I am not in a position to know at this point whether benefits were received.
e)If the wife did receive those benefits she may be confident that her evidence will be accepted that the marriage broke down on 1 June 2004 finally without subsequent reconciliation.
f)The husband may be confident that his evidence will be accepted that the marriage, whilst characterised by periods of short separation, did not finally break down until 2015. Further, that he was unaware of receipt by the wife of Commonwealth benefits if she did receive them from 2005 onwards.
g)If this hearing proceeds, the parties, and in particular the wife, should be aware that if findings are made that:
i.The wife received Commonwealth benefits as alleged;
ii.The marriage relationship finally broke down in 2015;
The matter may be referred to the Attorney General for consideration of prosecution.
Record of benefits
Tendered into evidence were Centrelink Customer Records for the wife.[1] The records cover the period from May 1996 until May 2013. They reveal that the wife received a pension from date of cohabitation in 1998 until May 1999 (the latter date being the month following her marriage to the husband in these proceedings). Pension payments resumed in June 2005 and continued to date of last record produced in May 2013, a period of eight years.
[1] Exhibit 2
The wife is recorded in those records as having separated in May 1994, presumably from her first husband Mr F, the father of her eldest three children. The wife and Mr F were divorced in February 1997.
Relevantly, the wife is recorded as having married in 1999 and separated on 18 May 2005,[2] which must relate to her current marriage.
[2] Exhibit 2, page 60 of 632
Counsel for the husband put the proposition to the wife that she had applied for a pension during a period of separation and then (after reconciliation) “you just couldn’t give it up”. That may be the explanation. There was no other explanation forthcoming from the wife who resolutely held to her position that the marriage ended in June 2004 and never resumed.
The husband likewise adhered to his position that the marriage broke down in January 2015, there was separation although under one roof, which became final when he moved out of the property in July 2015 and did not return.
The Trial
Both parties were represented by solicitor and counsel. The matter had been allocated three days for trial. It was concluded within two days.
Brief History of Relevant Events
In January 1995, prior to cohabitation with the wife, the husband and his three siblings purchased a property in equal shares at 1 G Street, Suburb H (“1 G Street”). That property was sold about three years later, netting a profit for the husband of $10,000.
In February 1997 the wife was divorced from her first husband Mr F.
In April 1997 the husband purchased another property in G Street Suburb H, number 2 G Street. That property later became the family home.
In the latter part of 1997 the parties conceived the only child of the marriage, who was born in 1998. The wife was dismissive about the significance of the pregnancy “just a drunken night”.
The wife and her three children, then aged eight, seven and three years moved into the property at 2 G Street (“the family home”), that much is agreed.
The wife says she moved in to the property in 1997 as a tenant paying $180 per week rent. She further asserts that cohabitation did not begin until the parties married in 1999. The husband denied it was so.
The husband says the wife and her children moved into the home “on or about 1998”, with him at a time when the wife was pregnant with their child.
I accept his evidence about that, in part because there were no documents to support a tenancy, but in part because the wife was not working at the time. She conceded in cross-examination that her evidence of an agreement for her to “give up work”[3] to care for the child was untruthful. She was not in paid work when the parties met and continued not to be until 2000.
[3] Affidavit of the wife filed 21/03/2018, par 7
Accordingly I conclude that the relationship began in 1997, that the parties began living together as a couple in 1998 and that the husband supported the wife and her children thereafter.
The parties lived in the family home from 1998 until it was sold seventeen years later.
In 2000 the wife returned to work and other than a period of about six months after her mother died in 2013, participated in the paid workforce on a part-time or full-time basis, until August 2014.
On 23 January 2001 the husband transferred to the wife an interest in the family home without consideration. Thereafter, the title was held as a joint tenancy.
In May 2003 the parties bought an investment property at J Street, Suburb K for $350,000. The title was held 99 percent to the husband and 1 percent to the wife.
In May 2005 the wife began receiving Centrelink benefits, namely a pension. I accept the evidence of the husband that he did not become aware of the receipt of these monies by the wife until drawn to his attention by his solicitor in 2017.
In March 2005 the husband, together with a friend Mr L, purchased an investment property in Suburb M for $450,000. The family home was security for the purchase with the consent of the wife.
On 23 March 2007 the husband received a gift of $80,000 from his former employer Mr N.
On 25 June 2009 the husband received a redundancy from G M Baden Pty Ltd, net of $79,269 which was applied to family expenses, other than $20,000 which was made available for the use of the wife through the joint account.
In April 2013 the parties purchased land in joint names at C Street, Suburb D. The purchase price was $292,500. The wife says that she alone provided the funds for the purchase of the land but did not establish what that source of funds could be.[4]
[4] Affidavit of the wife filed 21/03/2018, par 50
In July 2013 the Suburb M property was sold for $465,000. The husband received $110,000 from net proceeds.
On 24 September 2013 the Suburb K property was sold for $447,000 with net proceeds of $90,000.
On 1 February 2013 the wife’s mother died. Later that year the wife received an inheritance of $114,000 not $140,000 as the wife asserted in her affidavit. She received net funds of $80,300, having borrowed approximately $40,000 from her sister which was repaid at that time. The wife purchased a motor vehicle for about $45,000. The balance of the funds were applied to personal items for the wife, such as jewellery, but no doubt also to the expenses of the parties’ daughter.
On 25 June 2014 the settlement of the purchase of the Suburb D land was finalised.
In August 2014 the wife says that she began to develop pain, numbness and discomfort to her left shoulder and arm. She ceased work.[5]
[5] Affidavit of the wife filed 21/03/2018, par 12
In January 2015 the husband gives evidence that he moved into a separate room[6] because the whole character of the marriage had changed, their intimate relationship ceased and the wife no longer cooked for him, washed his clothes or otherwise did those things which she had been in the habit of doing during the marriage. However, the husband remained living in the home and perhaps considered that there might be a reconciliation.
[6] Affidavit of the husband filed 16/03/2018, par 33
In March 2015 the parties borrowed $550,000 from O Bank to build a house on the Suburb D land.
Again, the wife asserted that she had obtained the loan[7] but it is apparent that she would have been unable to obtain such a loan alone.
[7] Affidavit of the wife filed 21/03/2018, par 59
In July 2015 the husband moved out of the former matrimonial home. He moved to live within the suburb with his sister, paying $150.00 per week rent. He continued to live there for about 14 months.
In September 2015 the parties sold the family home in Suburb H for $970,000 and placed the net proceeds into a trust account. There was a distribution of $200,000 to the parties, the balance remains as an item in the Balance Sheet.
In October 2015 the construction of the house on the Suburb D land was completed. The wife and the parties’ daughter Ms X moved into the property. The husband continued to meet the mortgage payments and to pay child support until September 2016.
The husband then ceased paying child support and advised the wife that he did not intend to continue to meet the mortgage repayments. The wife, it is apparent, did not meet the mortgage repayments herself.
In February 2017 the husband became aware that the wife had been claiming a single parent pension since June 2005. He commented on it in his affidavit but took no other step.
In March 2017 the parties’ daughter moved to live with her father.
On 15 September 2017 the parties were served with a Statement of Claim issued from the Supreme Court of NSW for possession of the Suburb D property due to default in mortgage payments.
Thereafter, commencing in October 2017, the wife did take on financial responsibility for the repayment of the mortgage and has continued to do so for the ten months since.
Disclosure
The wife did not make full disclosure despite repeated requests for her to do so.[8] Exhibit 6 consists of 13 letters of request for disclosure directed by solicitors for the husband to the wife and two letters in response of 6 November 2015 and 18 July 2018.
[8] Exhibit 6
It was only through repeated calls for information during the course of the cross-examination of the wife that relevant documents were produced which clearly had been in the possession of the wife at all times.
This failure to disclose, together with the wife’s unwillingness to make any concession at all about the husband’s financial contribution to the marriage, either financial or to the welfare of the family, made her an unreliable witness.
The issue of the receipt of the pension also raises the possibility that there are further funds held by the wife undisclosed in the proceedings.
Accordingly, the husband being a reliable and honest witness, wherever their evidence conflicted, I have been inclined to accept the evidence of the husband.
The Evidence
The documents relied on by both parties were as follows:
The Applicant Wife
(a)Initiating Application filed 30/10/2015;
(b)Affidavit of the wife Ms Oliver filed 21/03/2018;
(c)Financial Statement of wife filed 23/3/2017;
The Respondent Husband
(d)Amended Response filed 25/01/2018;
(e)Affidavit of the husband Mr Hughes filed 16/03/2018;
(f)Financial Statement of husband filed 25/01/18;
(g)Affidavit of Mr N (husband’s former employer) filed 16/03/2018.
Approach to alteration of interests in property
In considering applications for alteration of property interests and transfer of property the Court must:
(i)Identify the existing legal and equitable interests of the parties in property;[9]
(ii)Consider whether it would be just and equitable in the particular circumstances to make an alteration;
(iii)
If an alteration should be made, to consider the matters contained in
ss 79(4) and 75(2) of the Act in coming to an adjustment; and
(iv)Analyse and consider whether the adjustment under consideration would be just and equitable.
[9] Stanford & Stanford (2012) 247 CLR 108; Bevan & Bevan [2013] FamCAFC 116
1. Identify the assets and liabilities of the parties
The parties’ assets and liabilities are set out in the joint balance sheet:[10]
[10] Exhibit 1 Part F - [Husband’s Balance sheet agreed as Joint Balance Sheet]
| Ownership | Description | Value | |
| 1. | J | C Street, Suburb D | 1,000,000 |
| 2. | J | Net sale proceeds Suburb H property [after payment to each party of $100,000] | 411,631 |
| 3. | W | P Bank accounts | 1,630 |
| 4. | H | Commonwealth Bank accounts | 7,790 |
| 5. | W | 204 Company Q Shares @ $8 | 1,632 |
| 6. | W | Motor vehicle | 30,000 |
| 7. | W | Motor vehicle – manual transmission | 6,000 |
| 8. | H | Motor bike | 3,000 |
| 9. | W | Contents of Suburb D | 18,000 |
| 10. | Each | $100,000 each received by way of interim order | 200,000 |
| TOTAL ASSETS | $1,679,683 | ||
| 11. | J | Mortgage | 519,000 |
| 12. | W | Loan | |
| 13. | J | Council rates | 1,800 |
| 14. | H | Credit card | 2,939 |
| TOTAL LIABILITIES | 523,739 | ||
| NET | $1,115,944 |
| SUPER | |||||
| Member | Fund | type | Wife’s value | Husband’s value | |
| 15. | W | S Super | accumulation | 49,555.85 | 49,555.85 |
| 16. | H | E Super | Accumulation | 89,170 | |
| 17. | H | ANZ | Accumulation | 76,883 | |
| TOTAL | $215,608.85 | ||||
*post separation
Revision of the Joint Balance Sheet
Item 10 - during the course of the trial counsel for the wife advised that the wife no longer pressed for the this item, the distribution of $200,000 in equal shares to be added back into the pool. The husband agreed.
Accordingly the net asset pool is as follows:
Assets
Items 1-9 $1,479,683
Superannuation Assets
Items 15-17 $215,609
Gross Assets $1,695,292
Less Liabilities
Items 11,13,14 $523,739
NET ASSETS $1,171,553
2. Would it be just and equitable to make an adjustment to interests in property
There is no dispute that the parents are now finally separated, although not divorced.
The parties hold real estate, the Suburb D property, in joint names. There is a mortgage secured on that property for which both parties are liable.
The husband is willing for the wife to retain that property if she can. That is her application. However the parties disagree about the division of assets. The wife proposes the use of all of the proceeds of sale of 2 G Street (the former family home) to discharge the mortgage. Those funds are held in trust in the joint names of the parties.
The husband resists that course on the basis that it would be inequitable to him. The husband doubts the capacity of the wife to refinance the property and anticipates that the property will be sold. Nevertheless he is willing for the wife to have that option. He does not seek to acquire the property himself.
Further the husband proposes a superannuation split to address the disproportionate interest of the parties. The wife opposes this course.
It is clearly just and equitable to undertake the statutory exercise of adjusting interests in matrimonial property.
3. Consideration of ss 79(4) and 75(2) of the Act in order to come to a just and equitable adjustment
Contributions under section 79(4)
The parties agree that they met in 1997. They agree about little else regarding the circumstances of their relationship.
On 18 April 1997 the husband took ownership of a property he had purchased at 2 G Street, Suburb H. This property became the family home.
I have found that the relationship between the parties began in 1997.
Assets at cohabitation
The parties were in their mid-twenties when they began living together.
The husband owned the family home. The purchase price was $177,500[11] and the mortgage secured on the property was about $150,000.
[11] Affidavit of the husband filed 16/03/2018, par 11
The husband also held a 25 percent interest in the other property in Suburb H [G Street] which delivered to him $10,000 after its sale in 1998. He otherwise had savings, a motor bike two cars, tools and a superannuation interest of $8000.
The husband was a tradesman. He was working full time.
The wife says she had furniture, a car and savings of “less than $5000”.
Financial contributions
In 1998 the husband, aged 25, took on the responsibility for the financial support of the wife and her three children. He raised no objection to the wife changing the surname of the three children to his surname.
Most significantly he provided them with a home and a comfortable life until each became independent; Mr Y moving out in January 2013 (aged 22) and Mr Z and Ms W in April 2015 (aged 25 and 20).
The evidence suggests that the husband provided willingly and affectionately, “I like to think that I helped raise them, that I had a hand in it.”
His explanation in the witness box for his always being the one to move out of the home during short periods of separation was “Yes. Didn’t want to inconvenience kids and wife.” He found an apprenticeship for the elder boy at 16 years and the younger one worked with him aged 16 years. He attended some of their sports and activities while conceding that he worked long hours and that the wife was more often the one to attend.
The wife did not acknowledge this contribution in her affidavit. In her oral evidence she positively rejected the suggestion “in no way did he support us!”
The only concession from the wife was this response:
Q.He allowed you and your children to live there [in the former family home] while he paid the mortgage?”
A.Yes.
The wife did receive child support from her former husband for their children. For the first time documents on the topic were produced by the wife after a call was made during her cross-examination.[12] It appears that between 2 November 1998 and 11 June 2005 the wife received $11,277 in child support. That was the only transaction statement produced.
[12] Exhibit 24
I accept the evidence of the husband that he had not known, until those documents were produced, that the wife had received financial support for the children from her former husband. I do so because he was a generally straightforward and truthful witness and also because it was an agreed fact that the wife managed the banking and bill paying throughout the marriage. She had access to the joint account of the parties and her own accounts which were under her control.
I am unable to determine how much child support was paid to the wife by her former husband nor how the funds were used.
Counsel for the husband urged the Court to acknowledge the significant contribution, financial and emotional which the husband made to these young people as children growing up. I accept that submission. It is a solid contribution to the welfare of children whom the husband had no legal obligation to assist although he was pleased to do so.
Both parties worked, the husband throughout the relationship, the wife from 2000 until 2014. The wife provided the majority of care for the parties’ child and also for her own children. The husband was involved with all four children, when he was able to be, consistent with working long hours.
The initial provision of the family home by the husband and the financial support by him of the wife’s three children until they each became independent are both significant additional contributions.
For those reasons I consider that the contributions favour the husband in a ratio of 65/35 percent.
Relevant factor for adjustment of Interests under section 75(2)
The relevant factors of those set out in the legislation are as follows.
The age and state of health of each of the parties
The parties are in their mid and later forties.
The wife says she began experiencing pain in her left neck and shoulder in August 2014.
The husband raises no complaints about his health.
The income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment
The wife
The wife has weekly income of $573 per week being a combination of Newstart Allowance ($195) and an Insurance Income Protection Payment of ($378).
The wife is living in the Suburb D property. She does not refer to any other occupant. The property has an agreed value of $1 million, net equity of $481,000. The wife has a five year old motor vehicle.
The wife has been meeting mortgage payments on Suburb D since about October 2017. She did not disclose the repayment figure. Her Financial Statement was sworn almost 16 months prior to trial, at a time when the husband was meeting the mortgage payments.
The wife has had a part property payment of $100,000.
The evidence regarding the physical and mental health of the wife was limited to her statements that:
·In August 2014 she began developing severe pain numbness and severe discomfort to her left neck shoulder and arm;[13]
·The income protection insurance payment was being paid “as I am unable to work”.[14]
[13] Affidavit of the wife filed 21/03/2018, par 12
[14] Affidavit of the wife filed 21/03/2018, par 42
Accordingly there is no proper basis for a finding about the capacity of the wife to work in future. She did work, part-time and full-time, in sales, for periods between 2000 and 2014.
Counsel for the husband drew to my attention that when the matter was set down for trial in November 2017 the wife indicated, through her solicitor, that she would be calling three witnesses, one of whom would be her treating practitioner. No medical evidence was provided.
At its highest, the evidence is that the wife says she began developing pain in her upper left side one year ago. I am unable to determine whether the wife is now, and will in future continue to, experience such pain nor the impact on her capacity to work if pain is present and continues.
The husband
The husband has an average weekly income, net of tax, of $1756.
The husband lives in his sister’s home. The parties’ young adult daughter lives with him. The husband pays rent/board.
The husband has an old motor bike and about $8,000 in the bank.
The husband has had a part property payment of $100,000.
The husband has had a specific purpose licence since 1993. He has worked full-time, long hours and will probably continue to do so until retirement age.
He has the capacity to earn at a much higher level than the wife. Some adjustment will be made on that account.
Subject to s 75(2)(3), the eligibility of either party for a pension, allowance or benefit under: (i) any law of the Commonwealth, of a State or Territory or of another country; or (ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia; and the rate of any such pension, allowance or benefit being paid to either party
Both parties have interests in superannuation in the accumulation phase.
The husband has two funds with a total value of $166,053.
The wife has one fund with a value of $49,556.
The parties are of roughly the same age.
It would be unfair to the husband to allocate more of the cash funds to the wife to balance his higher E Superannuation interest in those circumstances. It will be about fifteen years before the parties are eligible to access those funds.
The husband proposes a superannuation split on that account of $41,950 for allocation to the wife. I have accepted counsel’s assurance that procedural fairness was afforded to the Trustee of the nominated fund.
The outcome still favours the husband after adjustment. His interest will be reduced to $124,103, the interest of the wife increased to $91,506. It is a reasonable approach to take, given that the husband had an interest in superannuation when the parties began living together. An order will be made accordingly.
Where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable
The wife lived in the family home at Suburb H from 1997 until it was sold in September 2015. Thereafter, she moved into the Suburb D property and has lived there since. For the past 10 months she has made the mortgage payments.
The husband lived in the family home at Suburb H together with the wife, other than for short periods of separation, until July 2015. Since then he has boarded with family members and rented.
The husband made mortgage payments in respect of both properties throughout the relationship and for the period after separation until the parties’ daughter had turned 18 in September 2016.
The current standard of living of the husband is less comfortable and private than that of the wife.
Any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage
I have accepted that the marriage relationship endured until January 2015.
For the 18 months until the parties’ child Ms X turned 18 the husband paid child support as assessed being $2,165 per month. He also continued to meet the mortgage payments until September 2016 when Ms X completed her secondary education.
Ms X is now 20 and lives with her father.
Any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account
The wife has been secretive and unforthcoming about her true financial position.
During the marriage she had two sources of financial support unbeknownst to the husband, Centrelink benefits and irregular Child Support payments from her first husband.
The financial position of the wife is quite unclear.
Conclusion about adjustment
There should be an adjustment to reflect the husband’s higher income earning capacity, moderated by two factors; the fact that the wife had the exclusive use of the home post separation and by the failure of the wife to properly and fully disclose her financial position prior to trial.
Accordingly, the ratio should be adjusted down to 55/45 percent in favour of the husband.
4. Analysis of whether the adjustment contemplated is just and equitable
Applying a ratio of 55/45 to the net assets totalling $1,171,553:
55 percent to the husband $644,354.00
45 percent to the wife $527,199.00
$1,171,553.00
The husband currently has in his possession:
a)
Item 4
CBA account
$7,790
b)
Item 8
Motor bike
$3,000
c)
Items 16
E Super $89,170 reduced by super split
$47,220
d)
Item 17
ANZ
$76,883
e)
Sub-total
$134,893
f)
Less liabilities:
Item 14
Credit card
$2,939
g)
Total
$131,954
In order to receive 55 percent of assets the husband must receive:
$644,354
Less $131,954
$512,400
By way of adjustment the husband shall receive:
Item 2 - $411,631
The balance of $100,769 to be paid as a cash sum from the wife.
The wife currently has in her possession:
a)
Items 1 and 11
Suburb D and debt thereon -
net equity
$481,000
b)
Item 3
P Bank accounts
$1,630
c)
Item 5
Company Q shares
$1,632
d)
Item 6
Motor vehicle
$30,000
e)
Item 7
Motor vehicle (manual)
$6,000
f)
Item 9
Contents of Suburb D
$18,000
g)
Item 15
Super S Super
$49,556
h)
Item 16
(part) Super split from E Super
$41,950
i)
Sub-total
$629,768
j)
Less Liabilities:
Item 13
Council rates
$1,800
k)
Total
$627,968
In order to receive 45 percent of net assets the wife must pay to the husband $100,769.
In the event that the order for sale of the Suburb D property is triggered then the payment to the husband will be 20 percent of the proceeds of sale being the ratio of value of the payment to the net proceeds in order to equate to an overall division of 55 percent/45 percent in favour of the husband. This allows for a proportionate payment from the proceeds of sale of the property at a higher or lower figure.
Receipt of Centrelink Benefits
Having accepted the evidence of the husband as to the date of separation and also of his ongoing financial support of the wife throughout the marriage and for a period after separation I consider it appropriate to refer the matter to the Commonwealth Director of Prosecutions. The referral being for consideration of the receipt of Commonwealth Benefits by the wife in the period 2005 to 2013.
Orders are made accordingly.
I certify that the preceding one hundred and fifty (150) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cleary delivered on 14 September 2018.
Associate:
Date: 14 September 2018
Key Legal Topics
Areas of Law
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Family Law
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Property Law
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Civil Procedure
Legal Concepts
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Remedies
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Costs
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Procedural Fairness
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Jurisdiction
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Charge
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Injunction
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