P v N

[2006] QDC 467

DISTRICT COURT OF QUEENSLAND

CITATION:

P  v  N [2006] QDC 467

PARTIES:

P
Plaintiff
v
N
Defendant

FILE NO/S:

61/04

PROCEEDING:

Hearing

ORIGINATING COURT:

District Court, Southport

DELIVERED ON:

22 December 2006

DELIVERED AT:

Southport

HEARING DATE:

7 March 2006, 8 March 2006, 9 March 2006, 24 October 2006, 25 October 2006

JUDGE:

Newton DCJ

ORDER:

1.    N retain the title to the property at 23 Derwent Avenue, Helensvale and the contents thereof free from any claim by P.

2.    N to pay P within 60 days of the date of this order, the sum of $90,324.52.

3.    N to be liable for and indemnify P in respect of any and all debts incurred jointly in the relationship.

4.    Each party be solely entitled to the exclusion of the other to all personalty and other property in their possession.

5.    Each party to retain their respective superannuation entitlements as their sole property.

6.    There be no order as to costs.

CATCHWORDS:

FAMILY LAW AND CHILD WELFARE – DE FACTO RELATIONSHIPS – LEGISLATION – where Part 19 of the Property Law Act 1974 (Qld) came into effect on 21 December 1999 – whether relationship of the parties was extant at that time – quantity – trust and trustees – constitution and classification of trusts generally – classification of trusts in general – implied trust – constructive trust - independent of intention – general process – de facto relationship of 9 years where one property owned solely by the defendant – whether defendant’s property purchased prior to the relationship – whether the parties did not pool their incomes during the de facto relationship – financial and non financial contribution of the parties.

Family Law Act 1975 (Clth)
Property Law Act 1974 (Qld)

S  v  W  BC 200404530
Baumgartner  v  Baumgartner (1987) 164 CLR 137
Mallet  v  Mallet (1984) 156 CLR 605

COUNSEL:

Mr M E Pope for the plaintiff
Ms D C Spence for the defendant

SOLICITORS:

McInnes Wilson for the plaintiff
Evans & Co for the defendant

1. P has made a claim under two alternative heads, one pursuant to Part 19 of the Property Law Act 1974 (“the Act”), and the other being for equitable relief in relation to property which is in the name of N. In essence P claims an entitlement to a half interest in the property situated at 43 Derwent Avenue, Helensvale. Her claim is based upon a de facto relationship of some 9 years.

1. N resists P’s claim under the Act on the basis that the relationship of the parties was not extant as at 21 December 1999 when the relevant provisions of the Act came into operation.

1. The evidence does not establish a single event occurring which brought about the end of the parties’ relationship. However, a combination of factors leads me to conclude that the relationship had ended prior to 21 December 1999. There is uncontradicted evidence that P moved from the residence shared with N from 1990 in August 1999. There had been a deterioration in the relationship during a period of at least two years prior to this date. P informed Centrelink that the relationship had ended by 24 June 1999 and claimed a benefit upon that basis from that time. N withdrew all financial support from P in May 1999. I am satisfied that Part 19 of the Act has no application in the circumstances of this case.

1. The alternative claim asserts that a denial by N of any right, title or interest of P in the disputed property would be unconscionable and such as to give rise to a constructive trust in P’s favour.

1. At the time the parties commenced living together as a couple in a relationship (October 1990) the value of the residential property which N brought into the relationship was $180,000.  N had an equity of $65,000 at that time.  The divisible pool of assets comprises the current market value of the residential property which is $500,000.

1. In his written submissions dated 24 October 2006 counsel for the plaintiff submitted as follows:

“The principles to be applied are set out by Her Honour Justice White in S  v  W  BC 200404530 at paragraphs 29 to 37.  The plaintiff falls within the principles enunciated there by Her Honour, particularly given the admission by the defendant of the subsistence of the de facto relationship.

Each party performed the “duties” that the other party expected of he or she [sic] during the subsistence of the relationship.  That is to say, the defendant generated the income and the plaintiff undertook home duties and assisted in the business.  . . . . . on a property adjustment, she should receive 50% and any trust imposed by the Court would be as to 50%.”

1. Counsel for the defendant submits that the amount sought by the plaintiff seeks to unjustly enrich her at the defendant’s expense, and is not in an amount which could be justified by the application of a constructive trust.

1. I acknowledge that so far as possible, the Court should give effect to “the notion of practical equality, rather than pursue complicated factual enquiries which will result in relatively insignificant differences in contributions and consequential beneficial interest”.  [Baumgartner  v  Baumgartner (1987) 164 CLR 137 at 150]. I further acknowledge that “a wife’s contribution as a homemaker should be recognised in a substantial, and not merely token, way, this being a recognition of the fact that, by her attention to the home and the children, the wife frees her husband to earn income and acquire assets.” [Mallet  v  Mallet (1984) 156 CLR 605 at 623].

1. In giving effect to these principles in the present case, several factors must be considered.  P loaned N $13,000 at the commencement of the relationship and this amount was paid into the mortgage.  However, I accept that this was effectively repaid by N providing board and lodging to P’s mother from when the relationship commenced to her death in 1996.  The loan was evidenced by P having a solicitor draw up promissory notes to the value of the loan.

1. P’s role as a homemaker falls to be assessed in circumstances where there were no children of the relationship, where N was absent from the home for six nights each week due to his work commitments as a truck driver and where consequently he ate only a few meals each week at home.

1. On the occasions that N was at home he made a significant contribution to home maintenance which may reasonably be viewed as amounting to an equal contribution to the homemaking duties of the parties.

1. The evidence shows that P’s role as homemaker was not carried out with diligence, even to the point of allowing rates to accrue on the property in a sum of $6,000 without informing N.  Such irresponsibility on her part was sought to be deflected by P as slackness.  It is, however, illustrative of her general approach to the role of homemaker.

1. There can be no doubt that N’s financial contribution far outweighed that of P.  Indeed, during the relationship P earned very little, although no responsibilities relating to her role as homemaker prevented her from working on a part-time basis (as she does presently).

1. Although P did contribute to the welfare of N’s son B from 1991 to 1993, such contribution was relatively insignificant when compared to that made by N to the welfare of P’s son, A, from 1990 to 1998 (excepting a period of some 12 months when A resided in Gosford).

1. I am satisfied on the evidence that approximately $130,600 was transferred from the parties’ joint account to P’s account over a four year period from May 1995 to May 1999.  During this time P had access to a cheque book on the joint account for payment of rates, electricity and telephone accounts, house maintenance costs, registration and insurance on motor vehicles, fuel costs for P’s car and, on occasions, for A’s car.  P testified that she did, in fact, use the cheque book on the joint account for these purposes.  She claimed to have used some $15,000 on gambling and alcohol for herself.  The remaining $115,000 drawn from the joint account and placed in her own account is said by P to have gone to household expenses.  However, after 1998 P was virtually the only person in the house, her mother having died in 1996 and her son having moved out in 1998.  I am unable to accept P’s evidence in relation to this amount. It remains unexplained expenditure on the part of P and is a factor to be considered in determining the percentage to be attributed to P in her homemaker role.

1. In S  v  W BC 200404530 White J, while acknowledging the importance of not disregarding or discounting the non-financial contributions made to the property of parties to a marriage-like relationship, stressed that matters such as the future needs of the parties as provided for in the Queensland legislation and the Family Law Act could not affect a property adjustment order based on common law equitable principles.

1. In the circumstances of this case where N has made the significantly greater initial contribution to the pool and worked extraordinarily hard during the relationship to contribute financially, he should in my view be awarded 75% of the asset pool and P 25% of $500,000, that is $125,000.

1. An adjustment should be made in P’s favour with respect to occupation rent.  This is calculated at 25% of $104,154.96 which yields $26,038.74.  To this is added interest at the rate of 4.5% which produces a further $1,171.74.  The total under this head is therefore $27,210.48 which when added to $125,000 (25% of $500,000) produces a total adjustment in favour of the plaintiff of $152,210.48.

1. From this amount various adjustments in favour of N should be made.  Firstly, an adjustment in respect of mortgage repayments calculated at 25% of $65,000 is appropriate.  This yields $16,250.  Secondly, as an offset to occupation rental, an adjustment in respect of interest paid by N in discharging the mortgage should be made.  This should be assessed at $9,500.  Thirdly, an adjustment in relation to the personal loan for taxation (calculated at 50% of $21,652.93) should be made.  This yields a further sum of $10,862.47.  Fourthly, an adjustment is appropriate to reflect 50% of the tax loan advanced by Madeleine Lawrence.  This yields a further $11,739.08.  Fifthly, an adjustment should be made in respect of Ms Lawrence’s loan for renovations to the house.  This should be calculated at 25% of $54,137.64 which yields $13,534.41.  These adjustments in favour of N total $61,885.96.  The final total adjustment in favour of P is therefore $90,324.52.                   

1. I am unable to accept the submission made on behalf of P that she actually contributed an additional $9,991 at the commencement of the relationship comprising $2,000 from the sale of her house in New South Wales and the balance of $7,991 from the sale of her business.  The evidence, in my view, is of insufficient cogency to support P’s contention.

1. I am also not prepared to accept the submission of N that an adjustment in his favour should be made in relation to a joint Suncorp Metway loan negotiated during the relationship for repairs to the truck which was operated by N.  This vehicle has been retained by N and used to produce income since the parties separated.

1. The claim in respect of arrears of rates made by N should also not be accepted.  It is contended by N that P should contribute 25% of $6,000 in this regard as the arrears were paid by him in mid-July 1999.  However, N would have paid this amount in any case had the rates notices been acted upon as they fell due and his role as bread winner has been acknowledged in the assessment previously made of the asset pool.

1. In the result, then, I make the following orders:

1.          N retain the title to the property at 23 Derwent Avenue, Helensvale and the contents thereof free from any claim by P.

2.          N to pay P within 60 days of the date of this order, the sum of $90,324.52.

3.          N to be liable for and indemnify P in respect of any and all debts incurred jointly in the relationship.

4.          Each party be solely entitled to the exclusion of the other to all personalty and other property in their possession.

5.          Each party to retain their respective superannuation entitlements as their sole property.

6.          There be no order as to costs.