Parke and Parke - [2009] FMCAfam 934

FEDERAL MAGISTRATES COURT OF AUSTRALIA

PARKE & PARKE

[2009] FMCAfam 934

FAMILY LAW – Property – financial contribution mostly by husband.

Family Law Act 1975 (Cth) ss.72, 75(2)

Hickey [2003] FLC 93-143
C v C [2005] FLC 93-220
Pierce v Pierce (1990) FLC 92-844

Applicant:

MS PARKE

Respondent:

MR PARKE

File Number:

DGC 3513 of 2007

Judgment of:

Phipps FM

Hearing date:

12 May 2009

Date of Last Submission:

12 May 2009

Delivered at:

Dandenong

Delivered on:

3 September 2009

REPRESENTATION

Counsel for the Applicant:

Mr P. Davis of Counsel

Solicitors for the Applicant:

Maria Barbayannis & Co.

The Respondent:

In Person

ORDERS

That within 30 days of this date or 14 days after the wife complies with paragraph 2, which ever occurs later, the husband pay the wife the sum of $111,663.
That the wife forthwith withdraw any caveat lodged against the following properties not yet withdrawn:
Property W, Vic
Property J, Qld
Property K, Qld
The wife shall pay the cost of the preparation of the withdrawal of the caveats and the husband pay any fees for or associated with the lodging of he caveats.
Otherwise each party is declared to have no interest in the property, including bank accounts and superannuation, in the possession or name of the other party.

IT IS NOTED that publication of this judgment under the pseudonym Parke & Parke is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
DANDENONG

DGC 3513 of 2007

MS PARKE

Applicant

And

MR PARKE

Respondent

REASONS FOR JUDGMENT

Introduction

The wife is from the Philippines. She travelled to Australia on a tourist visa in 2000, met the husband, lived with him for a time and then married. She returned to the Philippines and then came back to Australia and then the parties separated after a few months. The husband had substantial property in Australia before the parties met. He paid for the purchase, in the wife's name, of a property in the Philippines after they had met.

Issues

The issues are:
a)Did the wife make any contribution to the acquisition maintenance and improvement of the property?
b)What allowance should be made for each party’s needs?
The wife proposes that she receive 35% of the assets. The husband considers she has no or little entitlement.
The issues must be placed in the context of the four step property consideration process.[1] The steps are:
What are the assets and liabilities?
What are the parties’ contributions?
What are the parties future needs?
Is the order just and equitable?
[1] Hickey [2003] FLC 93-143. For superannuation C v C [2005] FLC 93-220

Background

The husband was born in 1950. He is 59. The wife was born in 1970 in the Philippines and is 39.
The wife had been married previously and has four children from her first marriage. They reside in the Philippines.
The wife travelled to Australia in 2000 on a tourist visa. She met the husband and they commenced living together in December 2000. They married in Australia on 7 February, 2003. The wife had to return to the Philippines so that she could apply for a spouse visa. She was granted a spouse visa and she returned to Australia on 4 February 2006. The parties lived together in Australia until separation on 7 August 2006.
The husband has travelled to the Philippines from time to time. In 2004 the husband purchased a property in Property B, Philippines from the wife's parents for the wife. The husband says this was because it was about to be foreclosed upon, and so he purchased it for the wife's family, including her children to live in.
The husband has a [omitted] business, [C], in [omitted]. In a financial statement filed on the 21 July 2009 he gives the weekly income from a business at $600 and its value $5,000. In a financial statement filed

4 April 2009 he gives the weekly income as $400 per week and gives it no value.
The wife has been employed, including by [N] as a [healthcare worker]. She has worked in [omitted] and similar establishments. This year she is working part-time and studies part time for a [omitted] qualification. She will finish in February 2010. The study is Monday, Tuesday and Wednesday from 9am until 4 p.m., and then she will be doing on-the-job training. In her financial statement filed 20 April 2009 her income is $423 per week which is salary of $220 per week and study benefits $203 per week.
The husband lives in his own home and has normal outgoings except that the home has significant damage, including structural damage. The wife is paying $120 board per week in addition to her other living expenses. She pays $160 per week on a loan for a motor vehicle. About $29,000 is owed on the loan for the motor vehicle. She has, according to her financial statement, about $46,000 worth of credit card debts. She says that she engaged Debt Busters and pays them $192 per week to manage her debts.
She has significant legal costs and estimates that total debts, including legal costs up to the time of the completion of the hearing are about $110,000.
The husband has been convicted of an assault on the wife. The wife was paid $11,750 through an award from the Victims of Crime Assistance Tribunal to assist her with vocational training. The husband has appealed against his conviction.
The wife’s affidavit contains allegations of numerous instances of violence, but a claim that that should affect assessment of contributions was not pursued at the hearing.

Assets and liabilities

The real estate is agreed. Superannuation is uncontested. The wife has a motor vehicle, which she acquired after separation. The debt for the motor vehicle is $29,000, while the wife values it at $20,000. This is the only value given for the motor vehicle. I will not include it in the assets.
The husband values his 1985 BMW motor vehicle at $600 and a Holden utility at $1500. There is no other value given so I will include his motor vehicles at $2100. He gives a value of $1000 for household contents and I will include that amount. 12 months ago he valued his business at $5,000, but now values it at nothing. From his evidence, the value is its equipment. I will include an amount of $5,000 using the husband’s evidence as an admission against interest.
The husband’s superannuation is $47,000. The wife’s superannuation is $4941.
The assets are
Property W, Vic $270,000.00
Property J, Qld $400,000.00
Property K, Qld $750,000.00
Property B, Philippines $30,000.00
Husbands motor vehicles $2100.00
Husband’s business $5,000.00
Husband’s household contents $1000.00
Husband superannuation $47,000.00
Wife’s superannuation $4941.00
Total $1,510,041.00
The husband paid for the purchase Property B, Philippines. He says that to pay for the property he borrowed $20,000 from a friend, $15,000 from other friends and, to pay for repairs to the Property J property, $5,000 from another friend. He says he borrowed a further $4000 from yet another friend to pay for land taxes on the Queensland properties.
At the times he says he borrowed these monies, he had substantial assets, but all of it in a real estate. The income from his business is modest. There is no doubt he sent a little over $30,000 to the Philippines to pay for the purchase of the Property M property. It is unlikely that he had as much as $30,000 in cash and so probably borrowed it. I find that he did.
The husband says has not had income from the Property J property because of the damage, and again, it seems likely that he borrowed to pay for repairs and to pay land taxes. I find that he did.
The husband says he has substantial credit card debts. In his original financial statement filed 1 October 2007 he puts them at a total of $22,500. By that stage he had legal costs, and probably other expenses incurred since separation. I am not confident that the credit card debts or a substantial part of them were incurred during the marriage, that is prior to separation. I do not include them as part of the assets and liabilities.
Similarly the wife has credit card debts and I make the same finding in relation to them.
Therefore, the liabilities to be included as part of the matrimonial property are $44,000.
In his most recent financial statement the husband included $200,000 borrowed from a bank. Clearly that is post separation. He has borrowed to pay for repairs to Property W. The cost of repairs is taken into account in the value of the property, and so to include the debt would, in any event, be double counting.
The net assets are $1,466,041.

Contributions

The husband purchased Property W with his then wife in 1981 for $37,500. It had been transferred to the husband and the mortgage paid off well before the husband met the wife.
The husband purchased Property J, Qld in August 1997 for $62,000. He has used it as a rental property. The whole of the mortgage was payed before he met the wife. Until five or six years ago it was let at $1000 a month. It was damaged by tenants. The husband says that his agents failed to renew the insurance. He has repaired some of the damage but it still requires cabinets, painting and carpet. He says that because of the financial circumstances during the course of the break up with his wife and during the course of the litigation he has not had the money to put it in a condition where it could be tenanted. Therefore he has not been receiving the rent.
Property K is a vacant block of land. The husband purchased it in March 1998 for $53,000. He financed it by borrowing $45,000 from Westpac bank and $19,000 from his own funds. The whole of the mortgage was payed before he met the wife.
The property Property B, Philippines was bought from the wife's parents. The husband agreed to pay for its purchase and transfer into the wife’s name. There is some dispute between the parties about whether it was meant to be owned beneficially by the husband or be a gift to the wife. The husband says the wife told him that he would not be able to own property in the Philippines. The wife says it was a gift. Now it is irrelevant, because the parties agree that the husband paid for the purchase and some renovations, the wife contributed nothing, and the property is matrimonial property for the purpose of a property order under the Family Law Act.
The husband exhibits to an affidavit a statement from the organisation he used to transfer the money to the Philippines. The husband says he transferred $30,264 for the purchase price and $739 for renovations. I find that is correct.
The husband says that he transferred many other amounts of money to the wife while she was in the Philippines, and exhibits documents to substantiate that this is so. The wife disputes the receipt of money from the husband while she was in the Philippines. The documents the husband annexes to his affidavits support his claim and I find that he did. I do not consider it possible to determine the amount.
The wife had a hysterectomy in January 2006. The husband says he paid amounts of money for her medical treatment. The wife disputes this. The wife acknowledges that the husband paid fees to a migration agent when the wife applied for a spouse visa. The husband says he paid air fares for the wife.
During the time when the wife was in Australia she claims she helped the husband in his [omitted] business. She says she assisted as a receptionist, doing book work and administrative work such as filing invoicing and liaising with clients. She says she assisted him in bringing him tools when he worked on [tasks omitted]. She says she prepared all of his meals, making coffee cleaning the office and assisting him to clean the workshop. She says she assisted him for long hours and that regularly they worked on Saturday and sometimes on Sunday.
She says she did much of the domestic work, cleaning, cooking, washing, and generally looking after the husband. She says she occasionally mowed the lawns and worked in the garden.
The husband disputes these claims. He claims that the wife spent much of the time at his business sleeping, and disputes the claims about the amount of domestic work she did.
The wife was employed when she returned to Australia. She worked with [U] as a [omitted], and then with [N] as a [healthcare worker].
The only financial contribution the wife has made to the acquisition and conservation or improvement of the property is her superannuation and some contribution by her or her family in relation to the Philippines property. The wife earned some income, but that went towards living expenses.
She claims a non-financial contribution to the husband's business and assisting him in working. The extent to which she assisted is disputed, but whatever contribution it was small.
She claims she helped with the maintenance of the Property W property. The husband disputes that she helped, but, whatever its extent, it is small.
The wife made no initial contribution. Therefore, I must approach the assessment of contribution on the basis that the husband made all the initial contribution and most of the contribution during the marriage, that is the acquisition of the Philippines property.
The only values I have are those at the time of the hearing. All the initial financial contribution was made by the husband. Most of the contribution during the marriage was made by the husband. The wife contributed her superannuation and some small non financial contribution towards the maintenance of the properties.
The remaining consideration is the wife’s contribution as a home maker. There are no children of the marriage. The wife has four children but they remained in the Philippines. Therefore, I need to look at the contribution made by the wife to the welfare of the family constituted by the parties.
The wife asserts that the period of the relationship and marriage was from October 2000 until 7 August 2006, nearly 6 years. For three years, from February 2003 until February 2006, the wife was living in the Philippines until she received a spouse visa and could return to Australia. She points to statutory declarations of the husband in support of her spouse visa deposing to a continuing and committed relationship.
The husband asserts a much shorter relationship.
This is a case where most of the matrimonial assets are the husband’s initial contribution. In Pierce v Pierce (1990) FLC 92-844 at [28] the Full Court said that in assessing an initial contribution against what has occurred during the period of the marriage the question is what weight is to be attached in all the circumstances to the initial contribution. It is necessary to weigh the initial contribution against all the other relevant factors.
This approach of the Full Court assists in this way in looking at the period of the parties’ relationship. It is not so much whether the relationship is six years, or fewer years, but what occurred during that relationship. The parties lived together for three years of the relationship. The three years they lived apart were brought about by the circumstance that in order to obtain a visa to reside in Australia as the spouse of the husband, the wife had to return to the Philippines. During that time the parties remained committed to each other, but, they were not together, and in particular, they were not together in what became the matrimonial home in Property W, one of the assets.
The wife's contribution to the welfare of the parties to the marriage is small compared to the husband's financial contribution. So too are her financial and non financial contribution. The husband made contribution to the welfare of the parties to the marriage similar to the wife’s. I assess the wife’s contribution at 2½%.

Needs

The relevant s.75(2) matters are:
a)the age and state of health of the parties;
b)the income property and financial resources of each party and the capacity for appropriate gainful employment;
c)commitments of each of the parties necessary to support themselves;
d)the responsibilities of either party to support any other person;
e)a standard of living that in all the circumstances is reasonable;
The husband is 59, the wife of 39. Both are in sufficiently good health to be able to earn income. The husband has substantial assets one of which, the Property J property, when repaired, earns income. He also earns income from his [omitted] business but that is relatively modest. I take into account that the Property W property requires some hundreds of thousands of dollars to repair it and that there are some thousands of dollars in repairs for the Property J property. When repaired it return at least its previous rent of $100 per month.
The wife is studying for a [omitted] qualification. She can support herself, but her income will be modest. She has four children living in the Philippines. The extent to which he is supporting them is not clear, but I accept that if she has any money left over after supporting herself she will be sending it to the Philippines for the support of the children.
The wife owns a residence in the Philippines, which she will retain as part of the property order. Otherwise she has no property other than what she might receive in these proceedings. She has substantial debts including legal costs.
An adjustment of 7.5% in her favour is an amount of $109,553. That is an appropriate adjustment taking into account the husband’s considerably better financial position.

Spousal maintenance

The wife applies for spousal maintenance. She must first satisfy the threshold test in this case that she is, by reason of age or state of health, unable to adequately support herself (s.72 Family Law Act).
The wife is capable of full-time employment. The standard of living while living with the husband was relatively modest. The parties lived in a comfortable suburban house. They lived a normal suburban life. There was no expensive entertainment, no expensive holidays or expensive clothing. In all the circumstances the wife is able to support herself adequately and so is not entitled to spousal maintenance.

Just and equitable

The result is a payment to the wife of 10 % of the net assets. Superannuation is small compared to the value of the other estates and so I include it in the same pool. 10 % of $1,466,041 is $146,604. This is a just and equitable result.
To wife retains the Philippines properly valued at $30,000 and her superannuation of $4941, total $34,941. The husband therefore must pay to wife $111,663.
The order is the husband pay the wife this amount and that otherwise each party retain property in their possession. I will not make an order for sale all of any of the properties in default of payment. The husband has more than adequate security available to enable him to raise the amount of $74,592. I do not consider it would be just and equitable to order a default sale for one of the properties in the circumstances. If it is necessary to sell one of the properties, the husband can determine which one, rather than have it determined by court order.
The wife lodged caveats against each of the properties in the husband’s name. Some have been withdrawn by court order so that the husband could raise funds. The husband will need to borrow to pay the wife and the existence of the caveats has hampered him in the past. Caveats are not necessary to protect the wife’s interest, and she may not have any caveatable interest. The just and equitable approach is to order their removal immediately.

I certify that the preceding fifty nine (59) paragraphs are a true copy of the reasons for judgment of Phipps FM

Associate: Paul Moss

Date: 2 September 2009