Patterson and Patterson - [2007] FMCAfam 281

FEDERAL MAGISTRATES COURT OF AUSTRALIA

PATTERSON & PATTERSON

[2007] FMCAfam 281

FAMILY LAW – Property – husband disappeared in 2001 – undefended – husband made substantially higher initial contribution – wife made significant indirect contribution following husband’s disappearance – consideration of whether wife should hold husband’s interest in trust.

Family Law Act 1975

Aleksovski & Aleksovski (1996) FLC 92-705
In the Marriage of Clauson (1995) FLC 92-595
In the Marriage of Ferraro (1993) FLC 92-335
In the Marriage of Lee Steere (1985) FLC 91-626
Pierce & Pierce (1999) FLC 92-844
Sippel & Sippel [2004] FamCA 201

Applicant:

LEONIE PATTERSON

Respondent:

WARWICK GEORGE PATTERSON

File number:

PAM 1139 of 2006

Judgment of:

Sexton FM

Hearing date:

30 April 2007

Date of last submission:

30 April 2007

Delivered at:

Sydney

Delivered on:

7 May 2007

REPRESENTATION

Counsel for the Applicant:

Mr J Berry

Solicitors for the Applicant:

Callachor & Helby Solicitors

Solicitors for the Respondent:

No appearance

ORDERS:

The husband forthwith transfer to the wife the whole of his right, title and interest in the Irrigation Water Access Licence No 70 AL 602475.
The husband sign all documents and do all things necessary to transfer the whole of his right, title and interest in the property situate at and known as “The Woolwash” North Forbes-Condobolin Road, Forbes being the whole of the land in Lots 7, 8 and 9 in DP 1/3430 and Lot 1 in DP175597 and Lots 2, 3, 4, 5, 10, 15, 16, 17 and 18, Part 19 and 26, Part 27and 44 in DP 752077 to the husband and the wife as tenants in common as to 70% to the wife and 30% to the husband and the wife to hold the husband’s interest in trust for the husband.
The husband sign all documents and do all things necessary to transfer the whole of his right, title and interest in the property situate at and known as “Caraween” Bedgerebong Road, Forbes being the whole of the land in Lots 161 and 163 in DP 750146 to the wife and the wife to hold the husband’s interest in trust for the husband.
Except as otherwise provided in these orders, the husband and the wife retain all other items of real property and other property of whatsoever nature currently in the possession or control of each of them respectively.
Except as otherwise provided in these orders, the husband and the wife remain liable for any debts, howsoever arising, in their own name at the date of these Orders and in this respect shall indemnify, keep indemnified and hold harmless the other from any liability in relation thereto.
The Registrar of this Court at its Parramatta Registry be appointed pursuant to section 106A of the Act to execute, in the name of the husband all deeds and instruments necessary to give effect to the orders herein, or any of them, and do all acts and things necessary to give validity and operation to the said deeds and instruments.
All exhibits tendered in these proceedings be returned at the expiration of one calendar month unless an appeal is lodged.
All outstanding applications otherwise be dismissed and the matter removed from the list of cases awaiting finalisation.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT ORANGE

PAM 1139 of 2006

LEONIE PATTERSON

Applicant

And

WARWICK GEORGE PATTERSON

Respondent

REASONS FOR JUDGMENT

Introduction

This case concerns property settlement. After almost 10 years of cohabitation, the parties separated on 7 July 2001 when the wife says the husband left the farm at which he and the wife were living without warning and without saying anything to her. She says the husband left her a note telling her he would always love her but needed to get away for a while. He left in his unregistered utility. She has not seen or heard from him since. The wife deposes to reporting the husband’s disappearance to the police and to being informed by the police at around midnight on 25 July 2001 that the husband had been located, admitted to a Brisbane psychiatric hospital but did not wish to have contact with the wife. The wife says she rang the hospital the following morning to be told the husband had walked out during the night. There are no children of the marriage. To the best of the wife’s knowledge, this was the last positive sighting of the husband.
In her original Application for Final Orders filed 27 June 2005 the wife sought 100% of the net assets of the parties. At hearing, the wife seeks approximately 73% of the pool. She asks that the two farming properties in the husband’s name and the husband’s water licence be transferred to her, that she hold one of the two farming properties known as “Caraween” on trust for the husband and that each party otherwise retain the assets currently in their possession. The wife asks the Court to transfer the assets to which the Court determines the husband is entitled, to her or to her solicitor, Mr Helby, to hold on trust for the husband. She says she still hopes he will return.
The wife is 60 and the husband 55. The wife says the parties started living together in 1992 and married on 2 October 1998.

At the commencement of cohabitation, the wife was a piano teacher and the husband a farmer. They spent the first few years of cohabitation living at the wife’s property in Parkes before moving to the property known as ‘Stirling’ held in the husband’s name. The parties separated on 7 July 2001 in circumstances already noted. The parties are not divorced. The wife lives in Parkes and works as a music teacher. There is no evidence before the Court as to the husband’s current circumstances.
I accept the wife’s evidence that she is the sole Executor and sole beneficiary of the husband’s estate.

History of proceedings

The wife filed an Application in the Family Court of Australia seeking property adjustment on 27 June 2005. The wife filed an Application in a Case on the same date seeking substituted service on the husband by way of an advertisement in the Courier Mail newspaper.
The matter first came before Registrar Kimmorley on 6 September 2005 where a direction was made for the wife to conduct an Electoral Roll search and the matter was adjourned until 29 November 2005.
An affidavit sworn by Mr David Sloman, Search Clerk, was filed on behalf of the wife on 15 November 2005, sworn 3 November 2005 in which Mr Sloman deposes to having “effected a search in every Electoral Roll for each state of Australia” and to finding no record of the husband on any of the Rolls.
The matter came before Registrar Sanderson on 29 November 2005 and an order was made for substituted service on the husband by way of an advertisement in the Courier Mail newspaper within 28 days and the matter was further adjourned to 7 February 2006.
An affidavit sworn by the wife’s solicitor, Mr Christopher Helby, was filed on behalf of the wife on 17 January 2006 annexing a copy of the Notice of Publication published in the Courier Mail newspaper on

14 December 2005 evidencing compliance with the substituted service order made by Registrar Sanderson on 29 November 2005.
The matter came before Registrar Bartlett on 7 February 2006 when the matter was transferred to the Federal Magistrates Court, Orange circuit. Registrar Bartlett made directions for the matter to proceed on an undefended basis and gave the husband liberty to apply on 48 hours notice.
The matter came before this Court for the first time in the pre-circuit call over on 2 May 2006 and was listed for undefended hearing on

26 May 2006. On 18 May 2006 the matter was re-listed on the Court’s own motion as in my view at that time, in preparing for the circuit, the matter was not ready to proceed on an undefended basis. The wife’s solicitor appeared by telephone and the matter was listed for mention only on 26 May 2006.
On 26 May 2006, Mr Berry of Counsel appeared for the wife and there was no appearance by or for the husband. The matter was adjourned for mention to 9 August 2006 to allow the wife the opportunity to comply with the following specific directions:
·The wife to file affidavits in support of her efforts to locate the husband including affidavits from any friends, family or business associates with whom the wife has made enquiries and/ or with whom the husband had regular contact;
·The wife to file further affidavit material from the husband’s family, friends or business associates as to their current knowledge of the husband’s movements or whereabouts;
·The wife cause subpoenas to issue to the NSW Police Service and the Queensland Police Service and to any other authority with whom the husband may have had contact since July 2001 in relation to any knowledge they may have as to the husband’s movements or whereabouts;
·The wife forthwith conduct or cause to be conducted further searches of the electoral roll in each state of Australia and the Commonwealth;
·The wife file further affidavit material to verify the contents of her affidavit in relation to the financial history of the marriage.
On 9 August 2006 there was no appearance by or for the wife or the husband. No material had been filed on behalf of the wife. The matter was adjourned for mention to September 2006 and the Court noted that if there was no appearance on the adjourned date and/ or non compliance with orders previously made by this Court the wife’s application would be struck out.
On 12 September 2006, Mr Berry of Counsel appeared for the wife and there was no appearance by or for the husband. The Court extended the time for compliance with Orders made on 26 May 2006 and further adjourned the proceedings to 28 November 2006.
On 1 November 2006, the wife caused a subpoena to issue to the Commissioner of Police in Queensland and the Commissioner of Police in NSW requesting “All the records relating to the search for enquiry for missing person known as WARWICK GEORGE PATTERSON in respect of whom NSW Missing Persons File No. E13598285 applies.”
On 28 November 2006, Mr Berry of Counsel appeared on behalf of the wife and there was no appearance by or for the husband. The wife was directed to file an updated financial statement and any further affidavit material by 14 April 2007 and the matter adjourned to 30 April 2007.
The wife deposes to contacting the husband’s brother, Gavin Patterson, sometime after the husband disappeared and to the brother telling the wife that he had not heard from the husband. Sometime after the court’s orders of May 2006, the wife deposes to again telephoning the husband’s brother who gave her some information, as a result of which the wife flew to Brisbane to look for the husband. She deposes to the inquiries and efforts she made to find the husband in Queensland and to making no progress in relation to her search for him. She was led to believe the husband may have been living under a tree a few kilometres from Brisbane airport but was unable to verify whether it was in fact her husband who, she was told by a local, used to sit on a bench in Nudgee and had since left the area.
At hearing on 30 April 2007, the wife says in oral evidence that she asked the husband’s brother to swear an affidavit in these proceedings but that he refused to do so.
The wife says in oral evidence that the husband had an interest in horse racing and as a result the wife contacted a jockey, Mr Dale Jeffries, a racing associate of the husband. In an affidavit sworn on 8 November 2006 (filed 10 November 2006), Mr Jeffries deposes to knowing the husband “for many, many years” and to the husband being “a regular at the races.” Mr Jeffries deposes to being made aware of the husband’s disappearance about 5 years ago and further says that he has not seen him or heard anything about him at any time since.
Further, the wife deposes to inquiries made of the husband’s solicitor, Mr Phillip Gilderdale, a Forbes Rural Councillor, Mr Robert Muffet and Mr Kevin Stevens, a stock and station agent from Parkes and says that none of them have heard anything from the husband. The wife says the husband was reclusive and did not socialise or have friends. She says he had a poor relationship with his 3 brothers and his mother. She could think of no-one to ask to swear an affidavit on her behalf as to the husband’s disappearance.
The wife’s counsel submits that the Court cannot criticise the wife for a failure to take proper steps to locate her husband. He submits that although the wife might not have strictly complied with every direction made by the Court, she has taken all reasonable steps to locate the husband.
I am satisfied that the wife has taken sufficient steps to locate the husband in an effort to put him on notice of these proceedings. Given the length of time that has passed since the husband’s disappearance, I decided the matter should proceed on an undefended basis.

Relevant Law

The approach to the determination of an application under s.79 of the Family Law Act 1975 is well established by authority (In the Marriage of Lee Steere (1985) FLC 91-626; In the Marriage of Ferraro (1993) FLC 92-335; In the Marriage of Clauson (1995) FLC 92-595) and involves consideration of these questions:
a)What were the assets, liabilities and financial resources of the parties and their values at the time of hearing?
b)What were the financial and non-financial contributions made directly or indirectly by or on behalf of each party to the acquisition, conservation or improvement of the property of the parties?
c)What was the contribution made by each party to the welfare of the family including contributions made in the capacity of homemaker or parent?
d)What is the effect, if any, of any proposed order upon the earning capacity of each party?
e)What matters referred to in sub-s.75(2) of the Act are relevant and what adjustment, if any, should be made as a result of these factors?
f)After consideration of these matters, is it just and equitable to make the actual orders?

What were the assets, liabilities and financial resources of the parties at the time of hearing and their values?

As already noted, the husband has taken no part in these proceedings, nor filed any material. While the limited evidence before me as to the husband’s movements since leaving the wife suggests it is unlikely the husband has acquired assets since the date of separation, I am unable to make that finding.
The wife has provided evidence of the assets and liabilities known to her at the date of hearing, including valuations of the two farming properties and the water licence in the name of the husband[1]. The wife has not adduced independent evidence as to the value of the Parkes property in her name, the household contents or her car and has not provided documents to verify her assertions as to her bank balance, investment account balance, her liability to Central West, which I am satisfied would have been readily available.
[1] Affidavit of Mr Brian Stitt sworn 17 May 2006.
90 Clarinda Street, Parkes property. The wife adduces no evidence as to the value of this property. She deposes to purchasing the property in late 2001 for $167,000, but provides no documentary evidence to verify this figure. The wife estimates the present value of the property at $200,000. She does not explain the basis of her estimate.
Wife’s Ford Fairmont 2002. The wife deposes in her Financial Statement sworn June 2005 to the car having a value of $20,000. At hearing, the wife asserts the car has a present value of $12,000. She is unable to explain the decrease in value except to say that such assets depreciate. It was open to the wife to provide the court with at least a red book value for her car. She did not do so. I find a depreciation of 10% each year is reasonable and that the car therefore has a present value of approximately $16,000.00.
Although I find the wife’s evidence unsatisfactory in relation to values, the wife impressed me as a witness of truth. I therefore otherwise accept the values set out in Exhibit 1 as to the net asset position of the parties at hearing.
I find the parties have at least the following assets and liabilities at the date of hearing available for distribution between them:

Assets at the date of hearing	$
90 Clarinda Street Parkes	200,000.00
“The Woolwash” Forbes	1,028,000.00
“Caraween” Forbes	580,000.00
Water Licence	317,400.00
Commonwealth bank account	1,000.00
Central West Credit Union account	7,000.00
Edvest account	40,000.00
Wife’s 2002 Ford Fairmont motor vehicle LEO 321	16,000.00
Household contents	20,000.00
Additional assets held by the husband at hearing	Not known
Central West Credit Union debt	(2,000.00)
TOTAL NET ASSETS	$2,207,400.00

Contributions

The court must consider all the contributions, both financial and non-financial to the acquisition, conservation and improvement of the parties’ assets as well as to the welfare of the family before and after separation. The Full Court said in Aleksovski & Aleksovski (1996) FLC 92-705 (at 83,437):
It is therefore necessary…[to] weigh and assess the contributions of all kinds and from all sources made by each of the parties throughout the period of their cohabitation and then translate such assessment into a percentage of the overall property of the parties.
The court must consider the contributions in an overall sense both before and after separation: Sippel & Sippel [2004] FamCA 201.

Financial contributions

As already noted, I find the wife frank and honest. In the difficult circumstances she finds herself, I accept she may find it hard to recollect dates, purchase and sale prices and other details in relation to the property transactions undertaken by the husband during their years of cohabitation. However, I find the wife’s affidavit evidence in relation to the financial history of the marriage inadequate. The wife adduces no documentary evidence of transfers or mortgages which would have shown details of purchase price, dates of purchase and sale, mortgage details. The wife adduces no evidence in relation to the husband’s acquisition of water licences, his acquisition of stock, plant and equipment. Many of these details could have been readily obtained. Given the paucity of the affidavit evidence, I invited the wife’s counsel to lead further evidence from the wife and I questioned the wife myself to clarify the parties’ financial history and explain inconsistencies in the affidavits. The wife readily answered questions and I was impressed with her efforts to provide the court with accurate information, even when against interest. I am satisfied that even though the evidence is incomplete, I find it sufficient for a basis of decision.

Initial contributions

The wife deposes to owning a property at 49 Dalton Street, Parkes, a Nissan motor vehicle, and approximately $20,000.00 in cash at the commencement of cohabitation[2]. She adduces no evidence as to the value of the Parkes property in 1992. The wife gives inconsistent evidence in her affidavits as to the timing and sale price of the property but tells the court, having seen the husband’s accounts for the 1999 financial year, that the $121,210.31 referred to in the accounts as a capital contribution in the 1999 financial year, was her contribution to the husband’s business from the sale of Dalton Street. I am therefore satisfied that this value is the market value of the Dalton Street, Parkes property in the 1999 financial year.
[2] Paragraph 2 of the wife’s affidavit filed 28 April 2006.
I therefore find on balance, that the wife contributed $20,000 cash + a property with a value of no more than $121,210.31 in addition to her motor vehicle at the commencement of cohabitation.
The wife deposes to the husband owning two rural properties known as ‘Braelmont’ and ‘Langworner’ both near Parkes at the commencement of cohabitation. The wife adduces no evidence as to the value of the properties or as to any encumbrances existing on those properties at that time. I note however that the husband’s business accounts for the year ending June 1998, annexed to the wife’s affidavit sworn 8 November 2006 includes a figure of $573,070 as “proceeds of sale – Braelmont”. I accept that amount as the value of the ‘Braelmont’ property in the 1998 financial year. In oral evidence the wife says the husband was operating a fat lamb production business on those properties at the date cohabitation commenced. She says he owned approximately 2,000 breeding ewes, an old truck, an unregistered utility and plant and equipment to run the business. She gives no evidence as to their approximate value.

While I can make no precise findings as to the value of the husband’s initial contributions, I find them significantly in excess of the initial contributions made by the wife.
The weight to be afforded to initial contributions is comprehensively discussed in Pierce(1999) FLC 92-844 at 85,881 and in particular at [28], where the Full Court said:
‘In our opinion it is not so much a matter of erosion of contribution but a question of what weight is to be attached, in all the circumstances, to the initial contribution. It is necessary to weigh the initial contributions by a party with all other relevant contributions of both the husband and the wife. In considering the weight to be attached to the initial contribution, in this case of the husband, regard must be had to the use made by the parties of that contribution. In the present case that use was a substantial contribution to the purchase of the matrimonial home.’
In the present case, the husband sold his two properties during the period of cohabitation, and purchased the rural properties known as ‘Stirling’, ‘Caraween’ and ‘The Woolwash’. With ‘Caraween’ and ‘The Woolwash’ he purchased water licences. ‘Stirling’ has since been sold by the mortgagee. The water licences which came with ‘The Woolwash’ property have been sold, and part of the proceeds of sale have been used by the wife to purchase her home in Parkes. The parties have accumulated assets with a net value of over $2.2 million. I am satisfied the majority of this pool of assets has been accumulated as a result of the husband’s initial contribution.
I give this factor significant weight in assessing the parties’ respective financial contributions.

Commencement of cohabitation to date of marriage when parties lived in Parkes

The wife says she was self-employed as a music teacher and owned a piano, electrical organ and amplifying equipment as part of her business. The wife deposes to the parties living in her Dalton Street, Parkes property from the commencement of cohabitation in 1992 until the year of their marriage in 1998 during which period she met all of the parties’ household expenses including food, electricity, telephone, rates and insurance from her income as a music teacher. Further, the wife deposes to lending the husband money “from time to time” during the time they lived at Parkes, including a loan of approximately $13,000.00. The wife refers to the figure of $13,632.92 in the accounts under ‘Non-current liabilities’ for the farming business in the year ending 30 June 1999 as the total of the monies she lent the husband during this period.
The wife deposes to the husband purchasing the property known as ‘Carraween’ in or about 1995 or 1996 for the sum of $325,000.00, with funds borrowed from Westpac Bank. He sold ‘Braelmont’ in the 1998 financial year for $573,070.00. He also sold ‘Langworner’ around that time. There is no evidence before me as to the sale price of the ‘Langworner’ property. At around this time, the wife says the husband purchased ‘The Woolwash’ for $420,000.00 and then a property known as ‘Stirling’ for $250,000. The wife says the funds for ‘Stirling’ were borrowed from WP Martin & Co, stock and station agents and the funds for ‘The Woolwash’ from Westpac Bank. The balance sheet for the 1998 and 1999 financial years includes 3 items of freehold land in the husband’s name with a total gross value of $1,205,064.80 and the value at cost of plant and equipment at just over $113,000.00.
There is no evidence before me as to each party’s earnings during this period.

From marriage in 1998 until date of date of separation in July 2001

The parties moved to the property known as ‘Stirling’ near Forbes, at around the time of marriage in 1998. The wife stopped teaching piano and instead worked with the husband in the lamb production business.
The wife sold her home in Parkes and as previously noted, contributed $121,210.31 to the farming business in the 1999 financial year.
The wife says in oral evidence the husband was physically and mentally unwell by the end of 1998 and from that time was only able to perform limited tasks on the farm. She says she worked with him when he was able to work, but otherwise looked after him by performing all domestic tasks and paying accounts. The husband’s business accounts for the 1998 and 1999 financial years show a drop in gross income from $188,856.26 in the 1998 year to $80,267.01 in the 1999 year. The list of expenses in both years support the wife’s contention that the husband was less active in the business in the 1999 financial year.
The wife says from early 1999, the farming business was earning very little income and consequently their debt to Westpac Bank gradually increased. She says by 2001 “we lived in debt” “the banks were chasing us” “we went to rural counselling” but Warwick was unable to make decisions. The husband did, however, as a result of pressure from Westpac Bank, sign sale contracts for the sale of ‘The Woolwash’ water licence and part of the ‘Caraween’ water licence. The wife says by that time “the stock was in a mess” “the sheep were full of lice” “the sheep were not dipped, marked or shorn” “the place was in a terrible state”.

From the time of separation in July 2001 until the present

The wife deposes to the husband owing Westpac bank approximately $450,000 and W.R Martin and Co, Stock and Station Agents of Forbes well over $250,000 by July 2001. She says the properties and the stock were in a state of neglect. After the husband left, the wife took almost immediate action to improve the situation. The water licences sold for $640,000. The wife used those funds to discharge the debt to Westpac Bank. The wife hired 9 men to work on the properties at a cost of $40,000. She shovelled grain each day to hand feed the sheep. After 3-4 months, when the 6,000 sheep were ready for sale, she sold all the stock and the plant and equipment. She arranged the transport and sale of the sheep at public auction. She used the sale proceeds from the sale of the stock, plant and equipment to purchase her present home in Parkes for $167,500, to buy her current motor vehicle and to meet living expenses. She says part of those funds make up the $40,000 she presently holds in an investment account.
In early 2002, the wife entered into an informal 5 year lease agreement with a Mr Matthew Thuaux to farm ‘The Woolwash’ ‘Stirling’ and ‘Caraween’, on the understanding ‘Stirling’ would have to be sold during that period. She says Mr Thuaux only stayed 3 years as he did not pay rent as agreed and she asked him to leave. She says Mr Thuaux paid her less than $10,000 for the whole period.
The wife deposes to the mortgagee selling the Stirling property in 2003 for $400,000 which left a residual debt to WR Martin and Co of $82,421.95. The wife then used the balance of the sale proceeds of the water licences to discharge the residual debt to WR Martin & Co and to meet outstanding farm accounts. She says the amount paid to WR Martin & Co was far more than it should have been. She says “they swindled us but with Warwick gone, I had no way of fighting it.”
In April 2005 the wife says she entered into informal leases with two lessees who are presently farming the two properties which has improved their condition. Mr Paul Behan farms ‘Caraween’ with stock and crops, and Mr Kevin Miller farms ‘The Woolwash’ with sheep and cattle. She says during the 2005/6 year she received rental income for the two properties of a gross $36,000 and is now receiving a gross $48,000 a year. From this income, she meets expenses on the properties of $4,500 a year for rates, $2,000 a year for the Rural Lands Protection Board, $2,500 a year for the water licence in addition to maintenance expenses from time to time. She uses the balance of the net income to supplement her income as a piano teacher to meet modest living expenses. She says if she had the authority to enter into formal leases she would receive higher rental income which could be spent on the properties. I take into account the net rental income received by the wife as a post-separation contribution by the husband.

Non-financial contributions

I accept the wife’s evidence as to her non-financial contributions during the course of cohabitation and after separation.
During the period the parties lived in Parkes, the wife helped the husband on his properties on weekends and on some weekdays as he rarely employed anyone. She also ran her business as a music teacher. The parties worked together assisting each other in different ways. The wife says she performed the day to day domestic tasks including washing, ironing, cleaning, shopping and cooking while her husband worked a 6 day week on the properties. On the properties the wife was roustabout during shearing time; marked lambs, helped drench sheep and helped with fencing as well as a multitude of tasks associated with managing a sheep farm. She did all the book work and paid the bills.
From 1998 when they lived on the ‘Stirling’ farm, the wife worked alongside the husband in the business, but was responsible for the book work and payment of bills and all day to day domestic tasks. From the end of 1998, she looked after her husband who she says suffered symptoms of chronic fatigue syndrome and was unable to work more than half days, if at all. The wife says she did not have the physical strength or skills to work the farm without the husband’s involvement, but “I was always helping when he was able to work.” She continued to do the book work and pay the bills.
After separation, the wife took over the management of the properties and accepted sole responsibility for sorting out the parties’ financial difficulties. She ensured the value of the stock and the value of the plant and machinery did not deteriorate further. She arranged for debts to be paid so there were no further mortgagee sales. I agree with Mr Berry’s submission, that without the substantial effort contributed by the wife, the value of the parties’ assets would now be significantly less than they are.
I am satisfied the wife’s non-financial contributions were greater than those of the husband during the period of cohabitation and significantly greater than the husband’s after separation. I give this finding substantial weight.

What is the effect, if any, of any proposed order upon the earning capacity of each party?

The husband has earned his income from farming all his life. He has depended on his farming business for income. If the properties in his name are sold, I find the husband’s earning capacity will be diminished. The wife’s earning capacity will not be affected.
Mr Berry submits that on the basis of the unchallenged evidence of the wife, I should find the parties’ overall contributions to be between 70 and 75% in favour of the wife. I do not accept this submission. The parties cohabited for less than 10 years. There are no children of the marriage. As already noted, I give significant weight to the husband’s much greater initial contributions which made possible the growth in the parties’ assets. Weighing all the factors relating to contributions both financial and non-financial, I assess the wife’s contribution entitlement at 55%.

What matters referred to in sub-section 75(2) of the Act are relevant?

The wife is 60 and the husband 55. The wife is self employed as a music teacher earning approximately $150 a week. In addition, she receives rental income from the informal lease arrangements on the two properties and interest of $38 a week on her investment savings. She is unable to enter into formal leases which would give her a higher rental return because she does not own the properties and has no authority to enter into formal leases which would give the lessees security of tenure. I find the wife has a taxable annual income of approximately $40,000. I can make no findings as to the husband’s income.
The wife makes no health complaints. There is no evidence before me as to the husband’s current state of health other than the wife’s evidence that the husband suffered from a physical and mental illness from the end of 1998 and was previously treated for psychiatric problems. Given the husband has not returned to claim his substantial interest in the farming properties it seems likely that he continues to suffer some level of disability. He may be deceased. On balance, I am satisfied the wife earns a higher income than the husband.
I agree with Mr Berry that it is difficult for the Court to assess the s.75(2) factors given the circumstances. The court can make no findings as to the future needs of the husband. Counsel submits that although the wife is working, given her age she has a limited working life which may justify an adjustment in her favour. However, on a weighing of the known factors, counsel submits that there should be no further adjustment.
Section 75(2)(o) gives the court power to make an adjustment for:
“any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account”.
The wife urges the court to make orders which would preserve the two farming properties and the water licence in case her husband returns. She says the husband knows no other life but farming. She wants to formally lease the farms for income and to meet the expenses on the properties. She asks the court to appoint her as trustee of the husband’s interests. Under such an arrangement, the wife would not take her entitlement from the property settlement in cash. She would take her entitlement by way of a share in one or both of the properties and/or by way of having the water licence transferred to her. She would not realise the value of the water licence. She would be entitled to a pro- rata percentage share of rental income in accordance with her percentage interest. If her interest were taken in cash and invested, the wife would be substantially better off. As I accept the wife’s evidence as to her intentions in regard to the properties and water licence I find this warrants a further adjustment of 5% in the wife’s favour.
This will give the wife 60% of the total net asset pool overall and the husband 40%.

Is the result just and equitable?

Section 79(2) provides that:
The Court shall not make an Order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the Order.
Counsel for the wife submits, and I agree, that the Court has wide powers with respect to property settlement including the power to appoint the wife or the wife’s solicitor or the Public Trustee as trustee for the husband’s share of the property. These options would ensure the preservation of the properties. Counsel urges the court, in the very unusual and special circumstances of this case, to make orders appointing the wife as trustee of the husband’s interest. Mr Berry submits that the wife would be required to comply with all her responsibilities and obligations as a trustee under the Trustee Act and the general law. The wife would be obliged to account to the husband for all income and profits to which the husband is entitled in relation to his share of property. Mr Berry submits that the wife has acted at all times with honesty and integrity and there is no evidence to suggest she will not continue to do so.
The question is whether it is just and equitable to make the orders in the form sought by the wife, or whether assets should be sold to provide for the wife’s entitlements. I have given careful consideration to this issue. On the one hand, I find the wife has demonstrated a commitment to the interests of her missing husband. She has taken steps since his disappearance to preserve his properties and to earn income from the properties. She has ensured liabilities have been paid and continues to pay necessary expenses on the properties. She has sold plant and equipment. She employed men to prepare the stock for sale, to prevent the losses which would inevitably flow from a further deterioration in their condition. There is no evidence of malevolence on the part of the wife. I am satisfied the wife is genuine in her wish to retain the properties as long as she possibly can. In addition, I am satisfied the wife is the sole executor and sole beneficiary of the husband’s estate and will be entitled to the whole of the property in the event of the husband’s death or upon a declaration of his death. On the other hand, section 81 of the Act requires the court, as far as practicable, to finalise the financial relationship between parties when making orders for property settlement. An arrangement which provides for the wife to act as trustee for the husband, receiving income and profits on his behalf, would breach this principle of finality. There is also a potential conflict of interest if the wife is required to receive, manage and account for profits and income to which the husband is entitled. On a weighing of these factors, including the protections provided in the general law and the Trustee Act, and taking into account the very unusual circumstances of this case, I have decided to appoint the wife trustee of the husband’s interests to enable her to continue to manage the assets as she has done since his disappearance in 2001.
The wife presently has assets and liabilities with a value of $282,000.00. I have found the net asset pool of the parties is $2,207,400.00. For the wife to receive 60% of the overall net asset pool she will need an additional $1,042,440.00. The water licence is likely to increase in value and I find it appropriate for the wife to be in a position to realise this benefit if she ever needs to. This means she will need in addition a 70.53% share of ‘The Woolwash’ property. To simplify the implementation of this order, I will adjust the wife’s entitlement to a 70% interest in this property as a tenant in common with the husband. As a consequence the husband will receive 40.2% rather than 40% of the net asset pool overall.
The wife and husband will therefore receive assets as set out in the following tables:

Assets to be retained by wife	$
90 Clarinda Street Parkes	200,000.00
70% share of property known as “The Woolwash” Forbes	719,600.00
Water Licence	317,400.00
Commonwealth bank account	1,000.00
Central West Credit Union account	7,000.00
Edvest account	40,000.00
Wife’s 2002 Ford Fairmont motor vehicle LEO 321	16,000.00
Household contents	20,000.00
Central West Credit Union debt	(2,000.00)
TOTAL NET ASSETS	$1,319,000.00
Assets to be retained by husband	$
30% interest in “The Woolwash” Forbes	308,400.00
“Caraween” Forbes	580,000.00
TOTAL NET ASSETS	888,400.00

I am satisfied that in all the circumstances of this case, the Orders I have made are just and equitable.

I certify that the preceding sixty-nine (69) paragraphs are a true copy of the reasons for judgment of Sexton FM.

Associate: Collette McFawn

Date: 7 May 2007