PARKHILL & RAYNE

[2020] FCCA 1989

FEDERAL CIRCUIT COURT OF AUSTRALIA

PARKHILL & RAYNE [2020] FCCA 1989

Catchwords:
FAMILY LAW – Application for property settlement – small pool – dispute over contributions.

Legislation:

Family Law Act 1975 (Cth), ss.75(2), 79(4)

Cases cited:

Bevan & Bevan [2013] FamCA FC 116

Hickey & Hickey & Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143
Stanford & Stanford [2012] HCA 52

Applicant: MR PARKHILL

Respondent: MS RAYNE

File Number: AYC 129 of 2018

Judgment of: Judge McNab

Hearing date: 15 July 2020

Date of Last Submission: 15 July 2020

Delivered at: Melbourne

Delivered on: 16 July 2020

REPRESENTATION

The Applicant: Appeared in person

The Respondent: Appeared in person

ORDERS

1. The wife have the sole right occupancy of the property situated at
   B Street, Town C in the State of Victoria (“the B Street, Town C Property”).

2. The husband discharge the caveat at his expense registered over the B Street, Town C Property within 14 days of the date of these orders.

3. Within 30 days of the date of these orders the wife pay the husband the sum of $35,079.96 (“the payment”)

4. In the event the payment is not met by the wife pursuant to paragraph (3) herein, the parties shall do all things and sign all documents as may be required to list the real property for sale and the following conditions shall apply:

   (a)the parties do all things and sign all documents to appoint a selling agent as agreed between the parties and failing agreement, at the recommendation of the President from time to time of the Real Estate Institute of Victoria; and

   (b)the B Street, Town C Property shall be listed for sale and be sold on terms and conditions to be agreed between the parties but failing agreement shall be upon the recommendations of the nominated selling agent.

5. The net proceeds of the sale of the B Street, Town C Property be applied as follows:

   (a)firstly, to pay all costs, commissions and expenses of the sale;

   (b)secondly, to discharge the mortgage and any other encumbrance affecting the B Street, Town C Property;

   (c)thirdly, so much of the payment as is then outstanding with interest at the rate specified in the Family Law Rules 2004 (Cth) adjusted monthly from the due date to the husband; and

   (d)fourthly, the balance to the wife.

6. The husband receive the money held in Trust by D Lawyers at Town E in the sum of $3,801.00 together and the wife’s engagement ring valued at $3,800.00, and the wife will arrange for the engagement ring to be delivered to the husband.

7. The wife retain her superannuation benefits, all bank accounts in her sole name, all furniture and chattels remaining in the real property, her Motor Vehicle 1 and the dogs, F and G.

8. The husband retain his superannuation benefits, all bank accounts in his sole name, all furniture and chattels taken from the real property and his Motor Vehicle 2.

9. All extant applications otherwise be dismissed.

AND THE COURT NOTES THAT

1. Pursuant to section 81 of the Family Law Act1975 the parties intend that these orders shall as far as practicable finally determine the financial relationship between them and avoid further proceedings between them.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

AYC 129 of 2018

MR PARKHILL

Applicant

and

MR RAYNE

Respondent

REASONS FOR JUDGMENT

(Delivered Ex-Tempore and Revised from transcript)

Background

1. The proceedings in this Court commenced on 15 March 2018 following somewhat tumultuous events that commenced the year before. Orders were sought by the husband in relation to parenting and property.

2. By way of background, the husband is aged 40 and the wife is aged 41. They have one child, X, born in 2017. The parents met in the United Kingdom in about 2005 and commenced cohabiting in 2006. In 2007, the husband relocated to Australia and the wife joined him on a partner visa in 2007 and she became an Australian citizen in 2012.

3. The husband had periods of ill health which resulted in his hospitalisation for treatment of mental health problems in 2014. A property at B Street, Town C (“the home”) was purchased in the wife’s name in 2014. The current value of that property as valued is $400,000. From 2007, the wife has worked in Australia in public service, and from about 2008, has worked as a public servant. She obtained employment as a public servant at the Employer H, Town J in 2015 and continues to work there part-time.

4. The husband has worked throughout the relationship as a professional and is currently engaged on a number of contracts including one with the Employer K. The wife alleges that the husband has had periods of reasonably extensive unemployment, but there is little evidence of this. The husband did not work for a period that he was hospitalised in 2014. The husband paints the picture of an unhappy relationship before the child was born and subsequent to that.

5. In 2017, the wife travelled to the United Kingdom with X and chose not to return.

6. The wife says she left because of the husband’s addictions to alcohol, drugs and his associated mental health issues. Proceedings were issued in the United Kingdom (‘UK’) by the husband and as a result of that, the wife returned to Australia in 2018. In the UK proceedings, the wife expressed dissatisfaction with living at the home, and on her return indicated a desire to sell the home.

7. Parenting orders were made in November 2019 after an extensive hearing of the issues. Property matters were the subject of a hearing on 15 July 2020 with both parties self-represented. The hearing was conducted via Microsoft Teams by reason of the COVID-19 pandemic.

The law

1. In considering this matter and the distribution of matrimonial property, I am guided by the principles set out in the Full Court in Hickey & Hickey & Attorney-General for the Commonwealth of Australia (Intervener).[1] In that case, the Full Court identified a preferred four-step process in property matters under the Family Law Act 1975 (“the Act”), those being

   a)to identify the pool of assets and liabilities generally and usually at the time of hearing;

   b)to assess the relative contributions of both the financial and non-financial, direct and indirect nature as specified by section 79(4) of the Act;

   c)to consider the factors as relevant contained in section 75(2) of the Act; and

   d)finally, to determine whether the order the Court proposes to make is just and equitable to both parties.

   [1] (2003) FLC 93-143

2. This approach was approved in Bevan & Bevan[2] where a Full Court of the Family Court of Australia considered the High Court’s decision in Stanford & Stanford.[3] Neither party in this case contends that it is not just and equitable for the Court to make property orders.

   [2] FamCA FC 116

   [3] [2012] HCA 52

3. Before moving to the determination of the asset pool, one issue that the Court was required to determine is which party should retain the home.  In my view, it is appropriate for the wife to retain the home. She has paid the bulk of the mortgage since separation and has maintained the property since her return to Australia.

4. The wife is the primary carer of X, and I presume that the house is convenient to her work. While she previously expressed her dissatisfaction with living at that property. I accept that it was in the context of the proceedings in the United Kingdom where she clearly did not wish to return to Australia or to the home as she was concerned about the husband’s health, the state of the relationship she had with him, and as she was missing the connection with her family in the UK. The wife says that she has developed a friendship and support group in the local area, and I accept that evidence.

5. The husband expressed an interest in retaining the property, referring to the 10 acre property as a “farm”. He talked of running stock on the farm and developing other agricultural projects. These plans were somewhat vague, and I do not believe that the pursuit of them would outweigh the positive benefits which have been identified by the wife in her retaining the property.

The asset pool

1. The property has been valued at $400,000. The husband asserted that an amount of $18,592 should be included in the asset pool, that being an amount which was in a bank account maintained by the wife prior to her travel to the United Kingdom.

2. The wife gives evidence that those monies represented the payments of maternity leave entitlements and were spent for basic living expenses whilst she was in the United Kingdom. I accept that evidence and I do not believe that that amount should be added back into the asset pool as they were funds expended in the ordinary course. The husband has identified an asset being an engagement ring, which is part of his family heirlooms and wishes that to be returned. That has been valued in the sum of $3,800.

3. There is an amount of $3,801 being held in trust in one of the parties’ instructing solicitor’s trust account which is the proceeds of the sale of a motor vehicle which was matrimonial property and that is in the sum of $3,801. There is also the net value of a motor vehicle which the wife now has which was purchased with matrimonial funds, and the value of that vehicle was $4,689, which is the value of the car less the finance costs. Accordingly, I find that the gross value of the asset pool is $412,290. The evidence has been given by the wife that the current value of the mortgage is $278,912, which leaves a net property pool of $133,378.

4. The other assets of the parties were superannuation assets, both of which are in like amounts and in my view, it is appropriate that they be retained by the parties in those amounts and that they be unaffected by these orders. That is a position which has been agreed to by the parties.

Contributions

1. The next step that I must engage in is to assess the relative contributions of both financial and non-financial of the parties. The wife has set out in her evidence the contributions that she says that she made to the purchase of the property.

2. The wife notes that the property was purchased in her own sole name. I do not regard that as particularly significant. It reflects that the husband did have a poor credit history which he acknowledges in his affidavit, but it is not determinative. The wife says that she contributed the deposit of $34,000 and paid for the legal fees associated with the purchase in the sum of $5,000, that she made mortgage repayments for the entire five years and seven months that she has owned the property, save for contributions for seven months in 2017 and five months in 2018 which were made by the husband.

3. The wife says that she has contributed about $20,000 of home improvements and purchased a motor vehicle in the sum of $15,600. She says that she paid all the household bills during the relationship and the husband paid for weekly groceries. In those circumstances, the wife says the bulk of the contributions was made by her. The wife pointed to the husband’s mental health and alleged addiction to a reason for him to make like contributions.

4. The husband disputes that his contributions were not as minimal as that purported by the wife and he refers at paragraphs [184]-[204] of his trial affidavit sworn 10 November 2019 in relation to the contributions that he made.

5. I accept that the husband did make contributions to the purchase of the property and throughout the relationship, and those contributions are not as minimal as that made out by the wife. However, the wife’s contributions are significantly greater than the husband’s, particularly to the purchase and the maintenance of the property, and she has certainly made greater contributions to the payment of the mortgage, both prior to and post separation. I accept the wife’s evidence that the husband was a poor financial manager and saver, whereas she was an effective saver of funds.

6. The husband identified, in his oral evidence, his habitual Friday activity was to withdraw $1,000 or so from a bank and purchase ‘a few beers’ and then gamble on pokies and horses. He adopted the language of the profit-making gambling companies when he said he ‘was having a bit of fun’, which, of course, generally involves the punter losing money. Although he gave evidence that he occasionally won, it could not have been advantageous for him to engage in this activity if he was seeking to save money.

7. I find that the wife’s contribution was greater by a factor of at least 10 percent in relation to the contribution to property.

Section 75(2) factors

1. In relation to the factors under section 75(2), each of the parties are of similar age, both being in their early forties. The husband is currently earning more than the wife. He said, in his evidence, that he is earning about $76,000 per annum and that he has a reasonable expectation that the contracts that he is engaged in will continue. The husband’s expenses include a lease on a vehicle, payment for rental accommodation, and that he pays child support as assessed. The husband has had periods of ill health but he says that he is currently well and his drinking is under control.

2. The wife is employed part-time as a public servant and her current income is approximately $38,000 per annum. She has a continuing obligation to pay the mortgage on the property and to maintain X, with the assistance of child support payments from the husband. She will have ongoing commitments to support X as a primary caregiver and accordingly, I find that her future needs would be greater than the husband’s, having regard to those responsibilities and the likelihood that she will be earning a lesser income.

Dispute over pets

1. Neither party contends that it is not just and equitable for the Court to make orders in this case. Before I make final orders, there is one other issue which has occupied a lot of the emotional energy of the parties and that involves the two dogs, who are clearly much loved by both parties. The dogs have been living with the wife at the home. The wife says that they provide company for her. She walks them three times a day. They are companion animals to her and her son. They have plenty of space to enjoy at the home.

2. The husband wishes to have one of the dogs, whereas the wife wishes to retain both of the dogs. This is not a legal issue and I am disappointed that I am having to make this decision for these parties. In my view, it is appropriate for the dogs to remain together. They are a pair of breed of dog. They are bought from the same breeder and are related to one another. Although that is not particularly significant, but they are together and they keep one another company and they are both getting older. They are walked regularly and the child is growing up with both the dogs. The best course for the husband to adopt, if he is able to and wishes to maintain a dog, is to go out and buy a puppy and enjoy that, whilst the two dogs remain with the wife at the home. The purchase of a puppy may provide a focus for the husband and child to enjoy when they spend time together.

3. In terms of the final split of assets, the wife contended that a split of 70/30 was appropriate given the greater contribution that she made.  The husband contended that a split of 60/40 in favour of the wife was appropriate. I did raise the fact that the parties who are mature, educated people were arguing about what is, on any measure, a reasonably small amount of money. That is, the 10 per cent of the net asset pool of $133,000. So a court case has been conducted, effectively, over $131,000. If the husband was correct in including the $18,000, it is slightly more, but it is not a significant amount of money for the purposes of maintaining the tension and stress of litigation which is not good for either parent or the child.

4. That said, it is obviously important to these people, whether it has a financial sum or a means of promulgating their dispute with one another.  In my view, it is appropriate that the assets to be divided 32 percent in favour of the husband and 68 percent in favour of the wife. That would mean that of the net asset pool, a sum of $42,680.96 would be payable.  The monies that are held in trust by the solicitor should be provided to the husband and the engagement ring, which is valued at $3,800, should be provided to the husband, and that would result in a net payment of $35,079.96. That division is just and equitable as it takes into account the greater contributions of the wife and the future needs of both parties.

I certify that the preceding twenty-nine (29) paragraphs are a true copy of the reasons for judgment of Judge McNab

Associate: 

Date: 22 July 2020