Peat and Northup (No 2) - [2020] FamCA 1123

FAMILY COURT OF AUSTRALIA

PEAT & NORTHUP (NO. 2)

[2020] FamCA 1123

FAMILY LAW – CHILDREN – With whom a child lives and spends time – Best interests of the child – Where both parties seek that the children live with the wife – Where the husband seeks a gradual build up in time with the children to five nights per fortnight – Where the wife seeks that the children spend limited time with the husband – Where the relationship between the husband and the children is fractured – Where the children have been and continue to be reluctant to spend time with the husband – Where only one child currently spends time with the husband on a limited basis – Where there are allegations of family violence – Where the wife considers that to force the children to spend time with the husband may result in psychological harm – Where the wife is not invested in promoting the children’s relationship with the husband – Where the Family Consultant considered the relationship between the husband and the children needs to be supported – Where the evidence does not support a finding that the husband presents as a risk to the children – Where there is a benefit to the children maintaining a relationship with the husband – Orders.

FAMILY LAW – CHILDREN – Parental responsibility – Where the husband seeks equal shared parental responsibility and the wife seeks sole parental responsibility – Where there is a lack of communication between the parties – Where the parties are mistrustful of each other – Best interests of the child – Orders.

FAMILY LAW - PROPERTY SETTLEMENT – Just and equitable – Contributions – Add backs - Future needs – Where the parties held minimal assets at the commencement of cohabitation – Where the husband seeks a 65 per cent split of the non-superannuation pool in his favour – Where the wife seeks an equal division of the net asset pool – Where the parties agree to equalise their superannuation entitlements – Where the parties are in dispute about add backs – Where the husband made the greater financial contribution – Where the wife made significant non-financial contributions – Where the wife has retained the primary care of the children following separation – Consideration of an inheritance received by the husband post-separation – Consideration of the treatment of partial property settlement sums – Where both parties are currently employed – Where the husband’s income is substantially higher than that of the wife – Where the wife will retain the primary care of the children - Where it is just and equitable for orders pursuant to s 79 of the Family Law Act 1975 (Cth) to be made – Orders.

FAMILY LAW – PROPERTY SETTLEMENT – Trusts – Where the husband’s late father’s estate is held on trust - Where the wife seeks to include distributions to the husband from the trust in the property pool – Where the wife seeks to include the husband’s interest in the trust in the property pool – Where the purpose of the trust is to hold assets which are to be passed to the husband’s late father’s grandchildren – Where the trustee is a company – Where the husband is not a director of the company but holds shares on a non-beneficial basis – Where the husband receives taxable distributions – Where the husband does not control the trust nor is there evidence that he has exercised any level of control in respect of the trustee or that he would cause the premature distribution of the trust contrary to his father’s testamentary intentions – Where the income available for distribution is coming to an end.

Family Law Act 1975 (Cth) ss 60B(1), 60B(2), 60CA, 60CC(2), 60CC(3), 60CC(2A), 79, 79(4), 75(2)

Ascot Investment Pty Ltd v Harper (1981) 148 CLR 337
Bevan & Bevan (2013) FLC 93-545
C & C [1998] FamCA 143
Champness & Hanson (2009) FLC 93-407
Chorn & Hopkins (2004) FLC 93-204
Cotton & Cotton (1983) FLC 91-330
Godfrey & Sanders [2007] FamCA 102
Harris & Dewell and Anor (2018) FLC 93-839
Jabour & Jabour (2019) FLC 93-898
JEL & DDF (2001) FLC 93-075
Kouper & Kouper (No 3) [2009] FamCA 1080
Kowaliw & Kowaliw (1981) FLC 91-092
La Costa v La Costa (2007) 38 Fam LR 412
M & M (1988) 166 CLR 69
Mallet v Mallet (1984) 156 CLR 605
Mazorski v Albright (2007) 37 Fam LR 518
Norbis v Norbis (1986) 161 CLR 513
Re Richstar Enterprises Pty Ltd and Ors; Australian Securities and Investments Commission v Carey and Ors(No 6) (2006) 233 ALR 475
Sigley v Evor (2011) 44 Fam LR 439
SMB & MFB [2006] FamCA 46
St Clarie & St Claire and Ors [2013] FamCA 108
Stanford & Stanford (2012) 247 CLR 108
Stephens & Stephens and Ors (2007) FLC 93-336
Thurston & Loomis and Ors [2018] FamCA 26

APPLICANT:

Mr Peat

RESPONDENT:

Ms Northup

FILE NUMBER:

ADC

554

2018

DATE DELIVERED:

24 December 2020

PLACE DELIVERED:

Adelaide

PLACE HEARD:

Adelaide

JUDGMENT OF:

Berman J

HEARING DATE:

31 August and 1 - 3 September 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Ms Dickson

SOLICITOR FOR THE APPLICANT:

Culshaw Miller Lawyers

COUNSEL FOR THE RESPONDENT:

Mr Anderson

SOLICITOR FOR THE RESPONDENT:

Purdie Jordan Legal Pty Ltd

Orders

That the parties have shared parental responsibility for X born … 2007 (“X”) and Y born … 2010 (“Y”) (collectively “the children”).
That the wife have sole parental responsibility for matters affecting the health and education of the children PROVIDED that the parties shall use their best endeavours to reach a consensus and agreement as to major issues affecting the children’s health and education but in the absence of agreement the wife shall have the final determination.
That the children live with the wife.
That the children spend time with the husband as follows:-
(a)For a period of three (3) months each Monday (or such other day as the parties may agree) from the conclusion of school (or 4.00 pm if not a school day) until 8.00 pm;
(b)Thereafter, and for a period of six (6) months each alternate week from 10.00 am Saturday until 4.00 pm Sunday;
(c)Thereafter, each alternate week from the conclusion of school Friday (or 4.00 pm if not a school day) until 4.00 pm Sunday;
(d)Such further and other times as may be agreed between the parties;
(e)As and from the October 2021 school holidays, for one half of each short end of term school holiday period at times to be agreed or in default of agreement from the conclusion of school on the last day of term until 5.00 pm on the middle day of the holiday period;
(f)On 25 December 2020 from 9.00 am until 1.00 pm;
(g)In 2021 and each odd year thereafter from midday on Christmas Eve until midday Christmas Day NOTING that the children will spend time with the wife from midday Christmas Day until midday Boxing Day;
(h)In 2022 and each even year thereafter from midday on Christmas Day until midday Boxing Day NOTING that the children will spend time with the wife from midday Christmas Eve until midday Christmas Day;
(i)On a week about basis as follows:-
(i)In December 2021/January 2022 and each alternate year thereafter, for the first week of the holidays commencing at the conclusion of school on the last day of term and concluding at 5.00 pm seven (7) nights thereafter, and each alternate week thereafter;
(ii)In December 2022/January 2023 and each alternate year thereafter, for the second week of the holidays commencing at 10.00 am on the Friday and concluding at 5.00 pm on the following Friday and each alternate week thereafter; and
(iii)That each party be at liberty to spend a two (2) week block with the children during the January school holidays by agreement and in default of agreement the husband to spend the last two (2) weeks of January with the children commencing on the Monday and concluding at 10.00 am on the Monday morning two (2) weeks later.
(j)That upon each of the children reaching the age of fourteen (14) years the time that they spend with the husband will be subject to their wishes;
(k)That if not already in his care the children will spend time with the husband from 10.00 am to 5.00 pm on Father’s Day;
(l)That if not already in her care the children will spend time with the wife from 10.00 am to 5.00 pm on Mother’s Day.
That all handovers that do not occur at the children’s school shall occur by delivering and collecting the children to and from an agreed location in writing and in default of agreement at McDonald’s, Suburb E.
That each party shall be at liberty to take the children for travel both within South Australia and interstate.
That both parties be at liberty to attend at school and sporting activities and other events that parents would normally attend.
That the parties shall facilitate the children’s attendance at their extra-curricular activities which have been agreed by the parties.
That neither party will unilaterally enrol the children to any additional extra-curricular activities without the other party’s consent.
That the parties be restrained and an injunction granted restraining either party from engaging the children or each of them in any therapeutic intervention by a psychologist, psychiatrist or counsellor other than may be agreed between the parties.
In the event of a medical emergency or serious illness relating to the children the informed parent do notify the uninformed parent as soon as possible of all details of the emergency and allow that party to spend time with the children during the child’s recovery.
That in full and final settlement of any claim that either party may have against the other or at any time in the future for settlement of property or alteration of interests in property:-
(a)That the husband and wife do all things necessary to distribute the funds in the NAB joint account representing the net proceeds of sale from the Suburb F property in the following manner:-
(i)To the wife the sum of THREE HUNDRED AND SIXTY FIVE THOUSAND TWO HUNDRED AND TWENTY SEVEN DOLLARS ($365,227);
(ii)To the husband the balance.
(b)That the husband will retain free from any claim by the wife the following:-
(i)Household contents currently in the husband’s possession;
(ii)All funds standing to the husband’s credit in any bank account;
(iii)Any superannuation entitlement of the husband subject to the provisions of these orders;
(iv)The husband’s interest in his Suburb G property;
(v)Such other personalty or realty as may be in the husband’s possession, power and control;
(c)That the wife will retain free from any claim by the husband the following:-
(i)Household contents currently in the wife’s possession;
(ii)All funds standing to the wife’s credit in any bank account;
(iii)Any superannuation entitlement of the wife subject to the provisions of these orders;
(iv)Any other personalty or realty as may be in the wife’s possession, power and control;
(d)That each party shall indemnify each other in respect of any personal or individual taxation liability;
(e)That within twenty one (21) days the parties do all things necessary to effect the closure of any joint bank account;
(f)That each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled to retain pursuant to these orders;
(g)That the husband and the wife do all things necessary and sign all documents as may be required to give effect to the orders made herein and in the event of any failure by either party within fourteen (14) days of a written request to do so a Registrar of the Family Court of Australia is hereby appointed pursuant to s 106A of the Family Law Act 1975 (Cth) to execute any necessary documents.
The following shall apply to the husband’s interest in Super Fund 1 (“the Fund”):-
(a)That pursuant to section 90XT(4) of the Family Law Act 1975 (Cth) as amended, the Court allocates such base amount which will have SEVENTY THREE THOUSAND ONE HUNDRED AND SEVENTY SEVEN DOLLARS ($73,177) paid to the wife out of the husband’s interest in the Fund.
(b)Pursuant to paragraph 90XT(1)(a) of the Family Law Act 1975 (Cth) as amended, whenever a splittable payment becomes payable in respect of the superannuation interest of the husband:-
(i)The wife is entitled to be paid the amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001 (Cth) using such base amount to ensure that the wife receives $73,177; and
(ii)There is a corresponding reduction in the entitlement of the person to whom the splittable payment would have been made but for the Order;
(iii)Paragraphs 13(b)(i) and (ii) of this Order shall have effect from the operative time, which is seven (7) days from the date of service of this Order on the trustee of the Fund;
(iv)Payments from the husband’s superannuation interest made after the trustee of the Fund has rolled over or transferred the transferrable benefits to a Fund of the wife’s choosing are not splittable payments;
(v)Within twenty one (21) days of these Orders being made:-
1. The wife shall serve a certified copy of this Order upon the trustee of the Fund;
2. The wife shall give notice in writing to the trustee of the Fund pursuant to Regulation 72 of the Family Law (Superannuation) Regulations 2001 (Cth);
(vi)That there be liberty to apply in relation to the implementation of this Order by the parties or the Trustee.

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 Peat & Northup 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 ADELAIDE

FILE NUMBER: ADC 554 of 2018

Mr Peat

Applicant

And

Ms Northup

Respondent

REASONS FOR JUDGMENT

Introduction

By Further Amended Initiating Application filed 27 July 2020, Mr Peat (“the husband”) seeks orders in respect of the future parenting arrangements for X born … 2007 (“X”) and Y born … 2010 (“Y”) (collectively “the children”) and orders for settlement of property.
The husband seeks property orders summarised as follows:-
(1)That the total net non-superannuation pool be divided 65/35 in favour of the husband.
(2)That the husband retain:-
(a)his interest in the property at H Street, Suburb G, South Australia (“the Suburb G property”);
(b)his Motor Vehicle 1;
(c)any future or present distribution or benefit received from the L Family Trust; and
(d)any other real and/or personal property and/or financial resources of the husband in his name or possession not otherwise specified herein.
(3)That the wife retain for her sole use and benefit:-
(a)her Motor Vehicle 2;
(b)her superannuation entitlements; and
(c)any other real and/or personal property and/or financial resources of the wife in her name or possession not otherwise specified herein.
(4)That the wife pay costs to the husband of $1,650 representing 50 per cent of the disbursement fees of the family consultant Ms C, $1,100 representing 50 per cent of mediation fees, costs in the sum of $8,745 consequent upon the wife’s unsuccessful Application in a Case filed 22 January 2020, $13,350 being costs thrown away and $7,513 with respect to the husband’s Application in a Case filed 28 April 2020.
(5)That there be a superannuation splitting order such that each party receive 50 per cent of the superannuation pool.
With respect to parenting matters, the husband seeks that the parties have equal shared parental responsibility, that the children live with the wife and spend time with him as follows:-
(1)For a period of six months, every alternate week from the conclusion of school Friday (or 4.00 pm if not a school day) until 4.00 pm Sunday.
(2)Thereafter, every alternate week from the conclusion of school Friday (or 4.00 pm if not a school day) until the commencement of school Wednesday (or 4.00 pm if not a school day).
(3)Such further or other times as may be agreed.
(4)For one half of each school holiday period at times to be agreed or in default of agreement from the conclusion of school on the last day of term until 5.00 pm on the middle day of the school holidays.
(5)During the 2020/2021 Christmas school holidays as follows:-
(a)From 5.00 pm Thursday 17 December 2020 until 5.00 pm Monday 21 December 2020;
(b)From midday Friday 25 December 2020 until 5.00 pm Monday 28 December 2020 (noting that the children will be in the care of the mother from 5.00 pm Monday 21 December 2020 until midday 25 December 2020);
(c)From 5.00 pm Friday 1 January 2021 until 5.00 pm Monday 4 January 2021; and
(d)From 5.00 pm Tuesday 12 January 2021 until 5.00 pm Monday 18 January 2021.
(6)For the Christmas school holidays on a week about basis as follows:-
(a)In December 2021 and each alternate year thereafter on the first week of the holidays; and
(b)In December 2022 and each alternate year thereafter commencing on the second week of the holidays;
with each party at liberty to spend a two week block with the children during the January school holidays.
(7)Such further and other times as may be agreed between the parties.
The husband also seeks extensive orders in terms of the arrangements on special occasions including the Christmas period, Easter, Father’s Day and Mother’s Day and the children’s birthdays.
The husband seeks that handovers that do not occur at the children’s school be conducted at McDonald’s, Suburb E.
The husband seeks to be able to attend the children’s school and extra-curricular activities and that both parties be the subject of injunctions to remove the children from the interpersonal conflict between the parties.
Specifically, the husband seeks that the wife be restrained and an injunction granted restraining her from attending at the children’s school at all times that the husband is due to collect the children and for 30 minutes beforehand and from taking the children to attend upon any psychologist, counsellor or therapist without the husband’s written consent having first been obtained or an order of this Honourable Court.
By Further Amended Response filed 29 July 2020 the wife sought parenting orders summarised as follows:-
(1)That she have sole parental responsibility for the children.
(2)That the children live with her.
(3)That the children spend time with the husband each Monday from the conclusion of school (or 4.00 pm) until 8.00 pm, upon the condition that the father’s wife Ms B is not present and any other time as may be agreed between the parties or as requested by the children
(4)That the father spend time with the children on special occasions as agreed in writing between the parties and in default of agreement for not less than two hours on each occasion and upon the condition that Ms B is not present.
(5)That the husband be able to send gifts and cards to the children for Christmas and their birthdays.
Whereas the wife had sought that by way of settlement of property the assets of the parties (excluding the capital assets the husband has received by way of inheritance) be divided as to 90 per cent to the wife and the balance to the husband, she now seeks an equal division of a net asset pool totalling $2,867,153.50 which includes the husband’s inheritance from his mother, distributions from the L Family Trust and a value that the wife places on the husband’s beneficial interest in the latter. The parties are agreed that their separate superannuation entitlements should be adjusted to equality, and in that respect Exhibit 25 in the proceedings is a letter dated 18 September 2020 from the trustees of the husband’s superannuation entitlement with Super Fund 1 confirming that they have no objection to the making of orders providing for a superannuation split in favour of the wife from the splittable benefits available to the husband.

Background

The wife is currently 44 years of age and the husband is 47 years of age. They commenced cohabitation in 2005 and were married on … 2008. The parties separated in December 2016 following 11 years of cohabitation.
The parties agreed that the wife and the children would relocate to Adelaide with the husband to remain in Melbourne to complete his Master’s Degree.
Prior to the birth of X in … 2007, the husband held employment as a professional. The wife was also employed as a professional.
The wife worked fulltime until the birth of X and thereafter she has not returned to fulltime work. The husband remained in effective fulltime employment and commands a substantial income.
In May 2007 the parties purchased a property located at K Street, Suburb F, Victoria (“the Suburb F property”) for $570,000. They were assisted in the purchase by a gift from the wife’s mother of $170,000 and a gift of $100,000 from the husband’s father. The balance of the purchase price was secured by mortgage over the property.
It is a feature of the relationship that on a relatively regular basis the parties received valuable distributions from the husband’s father totalling $88,200. The distributions were generally directed to the wife to take advantage of her more modest income and therefore the lower rate of marginal tax applicable.
From the date of X’s birth until about November 2012 when the wife returned to part-time work, the husband considers that he assumed the financial responsibility for the family and the wife was the primary caregiver for the children and homemaker. The parties are not agreed as to the extent of assistance rendered by the husband to the household and in particular, the extent of his engagement with the children.
The husband says that he was a “hands on”[1] father and was highly motivated to maintain a positive involvement with the children.
[1] Affidavit of the father filed 24 February 2020, paragraph 29.
The wife counters the husband’s assertion and considers that at times the husband was not attuned to the children and their needs and rarely looked after them.
The wife remains highly critical of the husband for his alleged lack of diligence in monitoring the potential for the deleterious onset of a genetic neurological condition (“the genetic neurological condition”) to impact on the children.
The wife’s anxiety about the condition and the possibility that the children may inherit it was evident in her criticism of the paternal grandmother, who she considers was negligent in not informing the parties that she was a carrier of the genetic neurological condition prior to the decision of the parties to commence a family.
The husband does not accept the wife’s criticism and the wife’s attitude towards the paternal grandmother has been a source of argument and upset.
Each of the parties allege that the other has perpetrated family violence.
The wife makes the broad assertion that during the marriage the husband often demonstrated aggressive behaviour in front of the children.
In particular, and coinciding with the separation of the parties, the wife alleges that the husband grabbed her, pushed her head into a kitchen cupboard causing her to fall to the ground. The husband makes the general allegation that during the relationship the wife would often hit him with closed fists, pinch and scratch him and that her behaviour often resulted in bruising.
The husband refers to an incident on 5 December 2016 when he alleges that the wife assaulted him in the kitchen whilst he was preparing school lunch for the children.
Each of the parties contend that the other would belittle them and at times use defensive and deliberately degrading language.
Following separation and the children’s relocation to Adelaide, the husband travelled from Melbourne to Adelaide each fortnight and spent time with the children, at the home of his sister, from 10.00 am until 5.00 pm on Saturday and Sunday.
The parties agreed to commence overnight time in April 2017. The parties are not agreed as to the extent of time that the children spent with the husband but both agree for differing reasons that the time became problematic.
The wife contends that after overnight time commenced Y was upset and withdrawn. The wife says that she did all that could reasonably be expected to promote the children’s time with the husband but their increasing resistance was such that in March 2018 Y did not want to attend.
On 19 June 2018 orders were made that the children live with the wife and spend time with the husband as follows:-
3.…
During term time:
a.From 29 June 2018, from the conclusion of school Friday until the commencement of school Monday (or 5pm in the event of the child/ren’s illness, student-free day or public holiday) every alternate week.
b.At such further or other times as agreed in writing.
The wife comments that the children were angered at the wife’s insistence and encouragement that they spend time with the husband.
The husband does not agree with the wife’s assessment and it is his position that the children’s time with him was happy and enjoyable. The last occasion that he spent time with them was 31 March 2019. He records that there was no reluctance on the part of the children to engage with him and that they had fun.
The husband identifies his wedding day and marriage to Ms B on … 2019 as the catalyst for the wife withholding the children from spending time with him and their reluctance to do so.
The parties arranged for the husband to pick up the children from school on 24 May 2019.
The husband arrived at the conclusion of the school day but the children had left the school grounds and were later found by the husband at a local oval.
The wife received a report from X alleging that Ms B was forcing Y to get into the car. Y sent a text message to the wife that said “Mr Peat is attacking me”.[2] It is a feature of the children’s presentation that they refer to their father as “Mr Peat”.
[2] Affidavit of the wife filed 25 February 2020, paragraph 52.
The wife arrived at the oval, took X into her care and then shortly thereafter made contact with Y.
Thereafter, there is disagreement between the parties as to the extent of the husband’s ongoing involvement with the children. It appears that from May until the husband came into contact with the children on 30 October 2019, under the observation of psychologist Ms D, he did not see them.
There were further observations of the husband’s interaction with the children by Ms D in November and December 2019.

Documents relied upon

The husband relies upon the following documents:-
·Further Amended Initiating Application filed 27 July 2020
·Affidavit of the husband filed 24 February 2020
·Financial Statement of the husband filed 24 February 2020
·Affidavit of the husband filed 27 July 2020
·Affidavit of Ms B filed 24 February 2020
·Affidavit of Mr J filed 3 February 2020
·Affidavit of Mr J filed 27 August 2020
The wife relies upon the following documents:-
·Further Amended Response to Initiating Application filed 29 July 2020
·Affidavit of the wife filed 25 February 2020
·Affidavit of the wife filed 28 July 2020
·Financial Statement of the wife filed 24 February 2020
·Affidavit of Ms M filed 13 February 2020

The legal costs of the parties

The parties’ Schedule of Cost Statements comprise Exhibit “1” in the proceedings. As at 31 August 2020 the husband’s costs were as follows:-
(1)The total amount spent on legal fees to the commencement of trial is $171,595.55.
(2)The total amount spent on counsel fees to the commencement of trial is $35,000.
(3)The current unbilled work in progress is $12,450.
(4)The anticipated costs of the hearing (assuming five days) was a further $55,000 with $53,255 held in trust.
Accordingly, the payment of legal and counsel fees and funds in trust to date total $259,850.55 and have been sourced as follows:-
·$120,000 from partial property settlement orders;
·$50,000 from mortgage drawdowns; and
·The balance from the husband’s income.
A summary of the wife’s legal fees brings to account costs and disbursements incurred with three separate legal firms as follows:-
·N Lawyers from 10 October 2017 to 16 May 2019:-
oFees charged $63,950.69
oFees paid $61,272.96
·P Lawyers from 23 May 2019 to 12 March 2020:-
oFees incurred $126,000
oFees paid $126,000
·Q Lawyers from 18 June 2020 to 31 August 2020
oFees incurred and paid $30,915
Following the sale of the Suburb F property, the husband and wife each received the sum of $120,000. The parties are agreed that those sums were used as part payment of their respective legal fees and as such should be added back into the balance sheet of the parties.
The total of the legal fees of the parties represents a significant sum that will likely have an adverse impact upon their future financial circumstances.

Parenting issues

X has just turned 13 years of age. Y will turn 11 years of age in … 2021.
Following separation, in December 2016 the wife and the children moved to Adelaide with the husband’s consent.
There is some dispute between the parties as to the extent to which the husband interacted and engaged with the children prior to separation. The husband contends that each of the parties cared for the children, whereas the wife considers that the husband lacked emotional attachment to the children and spent little time with them.
The husband moved to Adelaide in June 2017. Until he moved to Adelaide he saw the children on average, each alternate weekend.
The husband issued proceedings on 15 February 2018 and on an interim basis sought an increase in time from two nights to five nights in each alternate week.
The wife’s Response filed 3 April 2018 proposed that the children spend four nights a fortnight with the husband.
The wife canvassed her observation that the children were becoming resistant to spending time with the husband.
On an interim basis the parties agreed that the children would spend time with the husband from the conclusion of school on Friday to 5.00 pm Sunday each alternate week.
Further orders were made by consent on 17 December 2018 which provided for the time that the children would spend with the husband during the Christmas school holidays. Despite the attempts of the parties to resolve their differences, final orders were not able to be agreed.
The wife considered that the husband was not attuned to the needs of the children, in particular the difficulty that Y was experiencing in transitioning between the two households.
An arrangement was put in place for Y to receive therapeutic assistance to enable him to cope with what the wife perceived to be emotional trauma.
By April 2019 it appears that there were difficulties emerging in X’s relationship with the husband.
Matters came to a head at the time of the husband’s wedding to Ms B in … 2019. The parties could not agree the circumstances in which the children could attend the husband’s wedding.
The husband thereafter did not see the children other than for a dinner on 5 November 2019 and observed interactions under the observation and supervision of Ms D as part of “reunification therapy” intervention.
The husband contends that the wife actively undermines his relationship with the children to the extent that they are now invested with a belief that a simple refusal is all that is required to avoid seeing him.
For reasons that are not easily understood, whilst Y had demonstrated great reluctance to see his father, following orders made on 17 June 2020 which provided for the children to partake in a meal with their father in the absence of Ms B, it is now X who chooses to spend no time with him.
The wife argues that the husband has been insensitive to the emotional needs of the children and will not resile from his view that the children should submit to his will rather than giving weight to the views of the children.
The parties are diametrically opposed in the orders that they seek. The husband continues to seek significant and substantial time with the children, whereas the mother considers that the husband’s proposal is unrealistic and will only cause further damage to the already fractured relationship that the husband has with the children.
The wife’s proposal is not confined to a continuation of the interim orders made on 17 June 2020.
Simply put, the wife considers that a meaningful relationship in this case is not beneficial to the children.
The husband is of the view that in circumstances where there is no obvious reason for the children’s reluctance to fulsomely engage with him, their views must be given little weight.

Property issues

The parties are not agreed as to the construct of the balance sheet setting out the property of the parties.
The parties agree that at the commencement of cohabitation neither party held assets of significance.
Following separation, the parties sold the Suburb F property and agree that the net proceeds of sale are held in a joint account in the sum of $398,071.
The husband’s mother died on … 2016 and he received an inheritance totalling $851,387.
By consent order made 19 June 2018, the husband was ordered to transfer the sum of $66,000 to the wife’s solicitors’ trust account. A further $11,000 was used by the husband to purchase a motor vehicle. The parties are agreed that $774,387 should be brought to account.
The husband seeks to include amounts paid to each of the parties by way of disbursement from the net sale proceeds of the Suburb F property as follows:-
·Partial property settlement received by the wife, being $120,000
·Partial property settlement received by the husband, being $120,000
·Partial property settlement received by the wife, being $30,000
·Partial property settlement received from husband’s income, namely $3,680.
The parties are not agreed as to the treatment of the lump sums received. The husband seeks that the payments be added back into the pool, whereas the wife considers that they should be excluded save and except that any money received and used for the purpose of payment of legal fees should be added back.
At the time of separation the wife retained a sum of $16,000 held in the joint bank account of the parties. The wife argues that the money has been spent on the exigencies of life and should not be added back.
The husband also seeks to add back a tax return received by the wife for the financial year ending 2017.
The parties are not agreed as to the treatment of the current balances of their separate bank accounts.
In particular, the wife seeks to bring to account her credit card and personal loan liabilities.
The more significant issue relates to the extent to which the provisions of the husband’s late father’s will should be considered as either property of the husband or as a factor relevant to his financial circumstances.
The husband and one of his sisters are equal shareholders in L Pty Ltd. This entity is the trustee of the L Family Trust.
The will of the late Mr Peat Snr, amended by codicil, provides that the shares held in L Pty Ltd are to be held on trust for the late Mr Peat Snr’s six grandchildren upon them attaining the age of 25 years.
The husband and his sister have effective control over the L Family Trust which holds a valuable interest in a City O apartment, units in the Location R Trust and other assets of value.
A more ambitious claim is that late Mr Peat Snr’s estate should also reflect the value of a half share in a Sydney apartment which is currently under the control of Ms S who is the husband’s father’s wife.
The wife contends that the assets of the parties should include the following:-
·Distribution from the L Family Trust (Location T proceeds) - $1,071,356
·25 per cent interest in the L Family Trust - $609,664
·Funds received by the husband from the L Family Trust in the 2018 financial year - $27,828
·Funds received by the husband from the L Family Trust in 2019 - $89,170.
The husband does not accept that he has any valuable interest in his late father’s estate, but acknowledges that an income amount in excess of $80,000 will be received by him in 2021 as a distribution, but that thereafter there will be no further capacity for income to be distributed.
The parties are agreed that their separate superannuation entitlements should be divided equally which will necessitate a superannuation split in favour of the wife from the husband’s splittable entitlement with Super Fund 1.

The evidence

The husband

The husband relied upon his extensive trial affidavit material.
The husband continues to spend time with Y and considers that the visits have been progressing well. The same cannot be said for X. He has not attended any visits. The husband is unable to provide an explanation as to X’s refusal to spend time with him. The husband has requested an extension of his time with the children but in particular Y, but such request has either been the subject of refusal or no response.
The husband agreed that after the wife and children moved to Adelaide in 2016 he attended on average each fortnight to see the children. Initially he spent daytime with the children which then transitioned to some overnight time.
The husband was aware of some issues raised by Y to the wife concerning his time with the husband in mid-2017. The husband was not initially involved but recollects that he was told by the wife that Y was exhibiting poor behaviour both at home and at school. Arrangements were made for the parties and Y to attend counselling.
The husband filed a Notice of Risk on 15 February 2018 which did not allege that the wife presented as a risk to the children. In contrast, the wife filed a Notice of Risk on 3 April 2018 which alleged family violence comprising a physical assault on the wife in that the husband pushed and shook her and that from time to time the parties have yelled at each other in front of the children.
The wife further alleged that the children may be at risk because “the husband has a genetic condition and has not provided relevant reports as to the current or potential impact on his cognitive function”.[3]
[3] Notice of Risk filed 3 April 2018, page 3.
The wife highlights a further risk in that she alleges the husband and his family drink alcohol to excess.
It is self-evident from the husband’s Notice of Risk that he considered the wife to be a reasonable parent.
The husband has changed his view of the wife. He considers that she is now angry and attributes the reluctance of the children, but in particular X, to a negative environment created by the wife which has as its catalyst the husband’s marriage to Ms B in April 2019.
The husband was taken by counsel to Exhibit “5” which comprises email communication between the parties on 15 and 16 December 2017. In the email, the wife refers to a period between 10 December 2017 and 8 January 2018 when the husband advised that he would not see the children. The wife considered that the husband’s refusal to spend time with the children during this period was contrary to an earlier agreement.
The wife promotes her position that the husband is not prepared to take up the opportunities offered by her for him to spend time with the children.
The following appears in the penultimate paragraph of the email of 15 December 2017:-
I have advised X that you have declined to come to either event for his birthday as is consistent with the latest correspondence I have – it is two days away. I have also advised the children that you won’t be attending Christmas at our house, something at mediation you said you would do, supported by your lawyers letter dated 30^th November 2017 but subsequently retracted on 11^th December 2017.[4]
[4] Exhibit “5”, page 1.

In a follow up email on 16 December 2017 the wife asserts that the husband has told the children that she is a “bad parent”.[5]
[5] Exhibit “5”, page 2.
The husband agreed that thereafter the parties exchanged email communication which clearly exhibited their increasing frustration with each other.
The husband denied that he was violent and abusive towards the wife. The broad assertion of the wife is that the husband mistreated her and was aggressive in his interaction, more often than not, in the presence of the children.
The husband denied that there had been an occasion in 2016 leading up to the separation of the parties where he grabbed the wife and pushed her head into a cupboard such that she fell to the ground.
The wife alleges that she had been attempting to remove a knife from his hand and that this incident occurred in the presence of X who hugged the wife whilst she was on the floor.
The husband denied that he either pushed the wife or had used a knife to threaten her. He contends that he was sleeping on a sofa and the wife threatened to kick him. He does accept that at some point X observed the aftermath of the parties’ physical interaction.
The husband was prepared to concede that he did denigrate the wife in front of the children and accepts that he should not have made derogatory remarks nor used offensive language directed at her.
The husband does not agree that any reluctance by the children to engage with him was a direct result of any display of adverse behaviour.
The husband accepts that the children were reluctant to spend overnight time with him and acknowledges that Y expressed some disquiet about spending further time with him.
The husband concedes that there is some reluctance by the children to engage with him but does not accept that he has given the children any reason that would explain their reticence.
Attempts were made to reinforce the children’s relationship with the husband under the guidance of Mr U, psychologist. The husband did not consider that further counselling or therapeutic intervention was either needed or warranted, but he did attend upon Mr U with Y on two occasions.
The husband does not agree that the anger displayed by Y was reflective of his conduct but rather, mirrors the anger reflected by the wife following separation and her knowledge of the husband’s new relationship.
The wife was prepared to allow the children to spend time with the husband over the 2018 school holiday periods provided the husband was able to personally supervise them. The husband acknowledged that he had been told of X’s cricket commitments and was given an opportunity to spend one on one time with X in the absence of Y. The husband conceded that he did not take up the time that was offered.
It is apparent from the husband’s evidence that he believed it unreasonable for the wife to dictate the time spending arrangements and in particular that the extent to which the children would spend time with him was subject to their wishes.
The parties have a different view of the impact of the husband’s marriage to Ms B on the children.
On 4 April 2019, two days before the husband’s wedding X ran away from school. X left school and went home. The husband arrived and attempted to speak to him.
It is apparent that X expressed a dislike for Ms B.
The husband was asked to consider whether changes in his life might be a possible explanation for the children’s reluctance to engage with him. The husband denied that either he or Ms B had at any time spoken inappropriately to the children, nor have they ever engaged in denigrating the wife in the presence of the children.
The husband accepted that the wife had kept him advised of the children’s sports schedules and agreed that he had not attended their extra-curricular activities.
The husband was asked to reflect on his conscious decision to not attend the sporting activities of the children. He was frank in his admission that he did not attend because he considered he was being treated as a “second class citizen”.
The husband indicated a high level of irritation that the children had blocked him from their various devices including their mobile phones.
The wife suggested to the husband that he and the children could engage in some further therapy and that a convenient start might be to have a regular dinner with them.
The husband was frank in his admission that he did not have dinner with the children because he considered the wife’s proposal against the background of numerous lawyer’s letters, litigation and other action to be part of a litigation strategy.
The husband considered his position to be a “principled” approach in wanting to be a father and not a spectator.
All efforts by the husband to reinstate a relationship with X have been unsuccessful.
The husband accepted the wife’s suggestion that without objection, the husband can attend the children’s extra-curricular activities.
The husband maintains his employment as a professional with an income of about $130,000 by way of salary and a distribution from the L Family Trust of about $50,000.
The husband’s tax returns for the 2019 financial year include a taxable distribution of $86,131 which has attracted tax of about $35,643.
The husband continues to pay child support as assessed, however, the level of child support is currently the subject of a review.
The husband agreed that the L Family Trust is the primary investment vehicle and that until the shares vest in the grandchildren, the husband and his siblings are recipients of trust distributed income.
The trust also has an interest in a land development at Location R and reflects the ownership of an apartment in City O. The directors of L Pty Ltd are Mr J, Mr V and Ms S, the widow of the late Mr Peat Snr. The husband and one of his sisters are also shareholders, however their shares are held on trust.
I consider that the husband was a reliable witness.

Mr J

Mr J relies upon his two affidavits filed 3 February 2020 and 27 August 2020.
Mr J confirmed that he is one of three directors of L Pty Ltd.
Mr J is a professional and holds an MBA from W University. He is currently employed as an Executive.
As discussed, L Pty Ltd is the trustee company for the L Family Trust.
The husband is not a director of L Pty Ltd. He is a beneficiary of the L Family Trust pursuant to the late Mr Peat Snr’s will. He is an executor of the estate and holds a 50 per cent non-beneficial interest in L Pty Ltd.
Mr J has an understanding of the purpose of the L Family Trust which is to hold assets that are to be passed to the late Mr Peat Snr’s grandchildren when they reach the age of 25 years. The estate is comprised of the L Family Trust but also a self-managed super fund controlled by the late Mr Peat Snr’s wife, Ms S.
Mr J confirms that there is a discrepancy with the provisions of the will which did not give the sole discretion over the self-managed superannuation fund now controlled by Ms S.
The will provides that the income from the estate is to be paid to Ms S as to a pre-tax distribution of $200,000 adjusted to CPI per annum, with any residual income to be shared equally amongst the husband and his three siblings.
Mr J acknowledges that there has been some discussion as to how income and capital should be treated within the L Family Trust, but with the broad agreement of all stakeholders it was agreed that 10 per cent of the net profit of the L Family Trust would be retained to increase the corpus of the trust for the eventual benefit of the grandchildren.
The sale of a building in Location T is a case in point. The significant net proceeds of sale were reinvested into income earning assets. There has not been a history of capital distribution to the beneficiaries.
The net proceeds of the Location T building were required to be notionally distributed and this was done in relation to the husband’s three sisters who subsequently signed a deed confirming that the distribution received by them would be notionally returned. There was no tax benefit to any beneficiary and there was a deliberate decision not to distribute to the husband in order that his affairs would not be unnecessarily complicated in terms of the present litigation.
The Location R development has matured and the sale of property comprising the development has provided income to the L Family Trust and has been distributed to the husband and his three siblings. The income stream has been significant, however, Mr J anticipates that the 2021 financial year will likely be the end of the income stream. There will be a capital return to the L Family Trust after the 2021 financial year, but any capital received will be managed along with the other property held by the L Family Trust.
Mr J does not accept that the husband could unilaterally exercise control over the L Family Trust and remove or distribute its assets, contrary to the intention of his late father that the benefit will flow to the six grandchildren.
Mr J indicated his strong opposition to any suggestion that the husband, necessarily in concert with his sister, could or would be allowed to appropriate the property of the L Family Trust as asserted by the wife.
When challenged, Mr J repeated his evidence that the Sydney property sits outside of the trust.
I consider that Mr J is a reliable witness. His evidence does not permit a finding that the L Family Trust is the husband’s alter ego or that there is any clear pathway to the husband controlling the L Family Trust for his own benefit and therefore to the detriment of his siblings and the grandchildren.

Ms B

The husband and Ms B met in or about late 2017/early 2018 and were married on … 2019.
Ms B is completing a Master’s Degree and hopes to graduate in the near future.
Ms B has not been in employment during the course of the marriage and whilst the husband provides some financial support for her and her adult son, she receives no other income or payment from the husband.
Ms B first met the children in about April 2018. She had been in a relationship with the husband for about three months at that time.
She recollects the incident that occurred in May 2019 where the children left school and ran to a local Park. Ms B rejects criticism that she was aggressive in her attempts to get Y to go to the car. Ms B describes the behaviour of Y as being out of control and what she was trying to do was to secure his backpack. She thought that if she could hold his backpack he might be relieved and this may have calmed him down. She acknowledges that this strategy was unsuccessful.
Ms B was candid in her admission that there were discussions in the household concerning the level and extent of child support that the husband was paying. The topic of child support arose because she did not consider that the wife had used the child support being paid to appropriately clothe the children.
She remembers a conversation with Y wherein he asserted that the husband had used the wife’s credit card to buy an Ipad for the children. Ms B admitted that she had told Y his belief was not accurate.
Ms B’s evidence was consistent with her trial affidavit and whilst there appeared to be a ready preparedness on her part to support the husband even if it resulted in her seeking to correct any perceived misapprehension by the children, there was nothing in her evidence which would support a finding that she presented as a risk or that the children had a proper basis to be fearful of her. I accept that Ms B is supportive of the husband and would represent an appropriate adult to come into contact with the children.

The wife

The wife relied upon her trial affidavits filed 25 February 2020 and 28 July 2020.
She confirmed that Y has been spending regular but limited time with the husband each Monday. There have been occasions when the husband has returned Y earlier than the agreed time.
X has not spent time with the husband and considers that he is “done with Mr Peat”.
The wife seeks an equal division of the assets of the parties which would include the inheritance from the husband’s mother who died a few days after separation.
The wife considered that she had a poor relationship with the husband’s mother. She had called her a sociopath. She confirmed that she had sought an intervention order against her on the basis that she was constantly trying to make contact and the wife did not wish to have any further contact either with her or allow the children to do so.
The catalyst for the wife’s enmity towards the grandmother arises from a belief that the paternal grandmother refused to undergo genetic testing and was not forthcoming about her genetic condition which has the potential to adversely impact the children.
The wife considers that the paternal grandmother should have made provision to enable the children to be looked after should their health be adversely affected into the future.
The wife acknowledged that the parties were not able to communicate in person but that communication by email was a possible pathway. The last time that the parties met was on 24 May 2019.
The wife has enrolled X at AA School. She agreed that she had not sought the approval or consent from the husband.
The wife’s evidence supports a finding that there remains an unhealthy and irreconcilable relationship between the parties.
The wife is pessimistic as to the ability of the parties to restore a healthy relationship between the children and the husband. She is concerned that whilst she supports the children having a relationship with the husband, when they were not seeing him their demeanour, behaviour and wellbeing significantly improved. Now Y has regressed and is co-sleeping with her.
The wife denied the husband’s allegation that she kicked him in the thigh and did not accept his further denial that he pushed her head into a cupboard whilst she was trying to disarm him.
She agreed that she had referred to the husband as a “princess” and “pathetic”, but did not consider that he was disgusting.
In particular, the wife denies any attempt to undermine the husband by her notification made to Child Protection Services or SAPOL. She acknowledges that the police were not the least bit interested in the video that X had taken which she considered to portray family violence perpetrated by the husband.
The wife was asked to reflect on the first report of Ms C wherein the children expressed love for their father. The wife believes that she can do more to support the children’s relationship with their father.
The wife does not think that anything is likely to change because it is unlikely they will change their view of Ms B.
The wife acknowledged that in addition to the restraining order taken against the paternal grandmother, she also took out a restraining order against the husband’s sister Ms BB. She is also recorded by Ms C to have concerns about the conduct of Ms CC.
The wife agreed with the general observation that she held most of the Peat family in low regard.
The wife was asked whether Y and X had ever inquired as to why they never met the paternal grandmother. The wife was frank in her admission that it was explained to X, who had inquired, that the paternal grandmother had a disease.
There was no relationship between the children and the paternal grandmother.
The wife’s evidence as to her staunch opposition to the children having a relationship with his grandmother was confronting.
The children were aware that their father wanted them to be ushers at his wedding. The wife confirmed that the children had discussed it with her. The wife maintains that she did not know anything about any other arrangements notwithstanding that the children had stayed with the husband for the weekend prior to the wedding.
I find that the wife adopted an entirely unreasonable attitude in respect of the husband’s proposal that the children participate in his wedding ceremony to Ms B. The husband had consented to the wife’s proposals, however the children’s attendance was not facilitated or supported by her.
The wife was asked to reflect as to the circumstances of X refusing to go with the husband and running home. She conceded that the husband had tried to persuade X to come with him or at the very least to get into the car so that they could have a chat. Her response was to tell X that he did not have to go. Her reason was her considered position that there was no point in trying to persuade X to go with the husband.
The wife also conceded that the children had blocked the husband’s ability to contact them via their devices. The wife did not intervene because she believed that the children were distressed and that they would not be helped by spending any extended period with the husband.
The wife’s evidence on this topic was not persuasive and I find that she provided active encouragement to the children to terminate communication with the husband.
The wife explained the circumstances of X taking a video on his phone of the alleged altercation between the husband, Ms B and the children at the park. The husband alleged that one of the children said that the video was being taken for the wife. She acknowledged that Y was sending her text messages to say that they were being attacked. The wife then told X to take the video of what was happening, however, the video was then taken to the police with a request by the wife that the police charge or at least investigate whether Ms B had assaulted the children.
The wife was asked whether she had advised the Child Support Agency that the children were no longer spending time with the husband and that the percentage of care was now 100 per cent in favour of the wife. I find that she did so to maximise the assessed level of child support.
The children attended upon Ms D to assist them to rebuild a relationship with the husband. Ms D recorded that Y said it was hard not having a relationship with his father and he was aware that he had been mean to the father.
X was able to look at the memory folder the father had made, however Y did not look at the memory folder and is recorded as saying it would be “too ‘painful’ ”[6] to do so.
[6] Exhibit “23”, page 7.
Ms D recorded that X came up with a plan to resume a relationship with the husband. The wife received the report and was asked what steps she took to implement X’s proposal.
The wife considered that the proposed plan fell at the first hurdle because the husband did not wish to initially take up the opportunity of a casual dinner with the children.
Following an appointment on 30 October 2019 Ms D noted that X and the husband had engaged in light conversation and that the children seemed to relax. Whilst Y had initially refused to join the interaction, he was observed to seek out the husband and to remain in close proximity.
Following a further successful interaction on 13 November 2019, the husband took the children for a restaurant meal.
It was put to the wife that she was not supportive of the husband’s request for a fortnightly dinner with the children.
Following on from the first report of Ms C the children were interviewed by Mr U. The report recorded that Y had difficulty in sleeping at each of the parties’ homes and that he hated Adelaide and was upset at having to leave Melbourne. Mr U provided a summary that promoted both parents being involved in the children’s lives. At that time Mr U considered that Y, at age 9, should not have the power to dictate his time with his father.
The wife did not agree with Mr U’s summary and considered that significant weight should be given to any views expressed by Y, in particular in terms of the arrangements for spending time with the husband.

Ms C

Ms C is a psychologist with considerable experience in conducting family assessments, the preparation of family reports and appearing in Court to give evidence.
Ms C was appointed as a single expert upon the joint instructions of the parties as set out in a letter of instruction dated 12 April 2018.
Ms C published a report on 13 June 2018 (“the first report”) directed to the interim parenting arrangements and then in anticipation of a final hearing published a report on 4 March 2020 (“the second report”).

As at the date of the second assessment X was 12 years of age and Y was 10 years of age.
The recommendations in the first report promoted that the children live with the wife and that over a period of about six months the children would spend time with the husband increasing from three overnights per fortnight to five overnights and half of all school holidays.
Ms C identified that a significant issue for the parties, but having a deep impact on the children, is their inability to communicate.
The wife expressed concern that the husband did not pay enough attention to the children’s safety when they were in his care. She referred to an incident where X had been struck in the back of the head with an ice cube apparently thrown by one of the cousins.
The wife also highlighted that Y remained upset by the separation and that this had escalated to Y displaying aggressive and angry behaviour.
At the date of the first assessment the wife acknowledged that whilst it was impossible to enter into any fruitful negotiation with the husband, because of her own experience following the death of her father, she would never take the children away from the husband.
An important concession recorded by Ms C is her acknowledgement that at the time of the assessment the children loved the husband.
In 2017 Y started to express opposition to spending time with the husband, particularly over the school holidays. The wife’s concerns were summarised in the following paragraph of the first report:-
I asked when Y started talking about not wanting to see his father. She said that [the husband] would visit during Term 1 holidays in 2017. He would come to take the children and stay at his sister’s house. This was in April 2017 and Y’s resistance began to happen at the second visit. I asked how often Y is making these comments. She said it just happened over three or four visits. He was okay when [the husband] got a new house but since then, on most occasions, he has said that he doesn’t want to go.[7]
[7] Family Assessment Report of Ms C dated 13 June 2018, page 4.
X was asked his view of his parents. He described the wife as a great person who is caring and helps him. He was equally complimentary of the husband. He considered that his father was a social person and was engaged with his extra-curricular activities. He enjoyed his time with the husband and whilst he did not want his time extended, nor did he want it to reduce.
X was aware that Y displayed behavioural difficulties and given his belief that Y would not wish to spend more time with the husband, he did not consider that an increase in time would be desirable if it was the source of further upset to Y.
Y was more sanguine about his father.
He was frank in expressing that he did not like visiting the husband and considered that his father did not do much that was fun.
He described his father as a nice man that likes to engage the children in outdoor activities.
Ms C asked Y to explain why he does not want to go to his father. His response is recorded as follows:-
He said he is trying new things out at grandma’s house. When I asked again, he said that he has already told me this. He added that dad does only boring things. I asked if dad had started doing fun things whether he would want to go. He wondered what those fun things would be and could not specify what dad could do that would make him feel more positive about going.[8]
[8] Ibid, page 8.
The children were positive in respect of the husband and whilst there was some opposition from Y arising from a concern that the husband engaged them in boring activities, neither child identified any significant issue.
The children differ in their sensitivity. Y appeared to be more distressed at the marital breakdown and the husband considered that Y may well blame him for the parties’ separation.
Ms C did not consider that the cumulative effect of the issues raised by the children and the wife were sufficient to speak against orders which would preclude the children from having a meaningful relationship with the husband.
Ms C was cognisant of the wife’s allegations that the husband had perpetrated family violence. Whilst a matter for evidence, Ms C did not consider that there were any indications of violent or abusive behaviour by the husband in the children’s presentation.
The presentation of the children to Ms C in the first assessment needs to be contrasted to their presentation as recorded in the second report.
Ms C noted that the relationship between the children and the husband had deteriorated to the point where they were not now seeing him, noting that her evaluation following the first assessment was that there was no reason that should be considered as sufficient basis for the children to spend no time with the husband.
The wife presented with considerable frustration at the dysfunction of the family. She considered that her life was dominated by the litigation and the children not being prepared to see the husband.
She recognised that the introduction of Ms B was likely the tipping point.
The wife was not complimentary of the husband’s lack of emotional support for the children and he did not appear to emphasise with them.
The wife now considers that to force the children to spend time with the husband against their wishes may well result in psychological harm as suggested by Ms D.
Ms C recorded X’s attitude and reason for not wanting to spend time with the father as follows:-
I asked whether that was all that Ms B has done. He said that she uninvited them from the wedding and then got mad when they didn’t come. He said that dad is in denial and thinks there is no problem, even when they didn’t want to go to the wedding, which is psychotic. When I asked what this means, X said he is dumbfounded that dad doesn’t think that anything is wrong. He is in denial about everything and has said that they should just forget what has happened.
I asked X what he thinks should happen. He said that he should have his own free choice about whether he sees his father. His father wants him to go to DD School for school but he doesn’t want to do that. He also wants to stay at mum’s full time.[9]
[9] Family Assessment Report of Ms C dated 4 March 2020, pages 5-6 .
Ms C was not able to persuade X to participate in observed interaction.
Y was similarly determined not to spend time with the husband. He described his father as “not a great guy”.[10]
[10] Ibid, page 7.
Y did not like attending his father’s home because he “just doesn’t like it there.”[11] He also found Ms B bossy and that her son Mr Z was the “worse guy”.[12] He thought he was a monster. Y did not like his father yelling at him and he thought that the wife agreed that they should not have to go see their father.
[11] Ibid.
[12] Ibid.
Ms B did not consider that the complaints of the children had any basis. Far from her son Mr Z being difficult or unpleasant, her observations were that the children sought him out.
She had not observed any aggressive or overt behaviour by the husband and noted that the husband had gone to significant effort in crafting a fun weekend for the children. In summary, she considered their home to be happy and that both she and the husband had made it clear to the boys that they were wanted.
Ms C contrasted her assessment in 2018 with the presentation of the parties and the children for the second assessment. There was a dramatic deterioration in the children’s connection and emotional attachment with the husband.
Ms C considered that the interests of the children would be advanced if there could be a united approach by the parties that told the children they were now united in terms of the extent of the relationship that they considered the children should have with their father. Ms C was not in favour of any further reunification therapy and considered that the following matters were of importance:-
·[The husband’s] relationship with the boys needs to be supported by the Court and its orders. [The wife] told me that she will be applying for sole parental responsibility and my view is that if the court grants such orders, this will most definitely define [the husband] as tangential to the children’s lives. I would not be supporting this.
·I do not think that giving the boys a choice about whether or not they see their father is reasonable at this stage, because in their current mood, they will say they do not wish to see him and I think if steps are not taken soon to re-establish contact between the boys and their father, that relationship is at risk of serious or perhaps even long term fracture. If this were to occur, it most certainly would not be in the best interests of the children. I am also inclined to think that given the on-going previously good connection between the boys and their father, there is enough of a foundation that repair can occur and can be followed by things settling and normalising between [the husband] and the children. In any event, I think vigorous efforts should be made in this direction. I am inclined to see Ms B as a positive and supportive person (to the children) in the background as the children normalise their connection with their father.[13]
[13] Ibid, pages 14 - 15
Ms C did not speak against the husband’s proposal but contemplated that a graduated approach might be more amenable to the children.
In evidence, Ms C confirmed that she had read Ms D’s report that recorded Y recognising that he had been mean to the husband.
She repeated her opinion as expressed in her second report namely, that whilst Y might be considered a quirky child and with a potential to be oppositional, time spending arrangements should not be left to him.
At the time of the hearing Y was now spending time with the husband but X was not. Ms C was surprised that this had occurred.
She considered that in the context of this conflict, the children may well be influenced by atmosphere and environment.
Doing the best that she could, Ms C could provide no explanation to explain any reluctance on the part of the children to spend time with the husband. She considered that X was disrespectful.
Ms C remained concerned that an order for sole parental responsibility would define the husband’s role as tangential.
Neither could she see any reason why Ms B should not be introduced to the children. Her assessment of Ms B was favourable.
Ms C considered that it was important that steps be taken to support the relationship between the husband and the children and whilst they might find it initially uncomfortable, the concern was that the children may have an unreasonable and unjustified negative view of the husband in the long term. It would not be to the children’s advantage if they held the false belief that their father did not care for them.

Parenting considerations

I approach the matter from the perspective that the Court should now focus on the practical reality of each parties proposal, bringing to account the considerations of the primary and additional factors in s 60CC of the Act that are applicable to the circumstances of each case.
Section 60CA of the Act requires that I have the best interests of the child as the paramount consideration. The best interest test is to be considered by application of the objects of s 60B(1) of the Act and the underlying principles of s 60B(2) of the Act.
I am cognisant of the primary considerations and additional considerations in respect of the matters as set out in ss 60CC(2) and (3) of the Act. Whilst I am mindful of the direction contained in s 60CC(2A) of the Act and in particular the focus by the husband of what he considers is the detriment likely to be caused to the children by the wife not supporting the children’s relationship with him, I do not consider that this is a significant factor in the proceedings.
I propose to adopt the following approach:-
(1)Give consideration to the separate proposals put by each of the parties as they were identified to the Court;
(2)Have regard to the objects expressed in s 60B(1) of the Act and the underlying principles in s 60B(2) of the Act;
(3)Have regard to the provisions of s 60CC of the Act in order to determine in each case what is in the children’s best interests;
(4)Have regard to the primary considerations under s 60CC(2) of the Act namely, the benefit to the children of having a meaningful relationship with both of the children’s parents and the need to protect the children from physical or psychological harm if applicable;
(5)Have regard to the additional considerations under s 60CC(3) of the Act;
(6)The evidence adduced by each of the parties in respect of the particular considerations pursuant to s 60CC(2) and s 60CC(3) of the Act are to be considered, and if more weight is to be given to one or more of the matters raised then it must be the subject of delineation or comment.

Meaningful relationship

Section 60B(1) of the Act provides that the aims and objects of the Act are to ensure that the best interests of children are met by:-
(a)ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with the best interests of the child; and
(b)protecting children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence; and
(c)ensuring that children receive adequate and proper parenting to help them achieve their full potential; and
(d)ensuring that parents fulfil their duties and meet their responsibilities concerning the care, welfare and development of their children.
In Mazorski v Albright (2007) 37 Fam LR 518 at [26], Brown J considered the definition of “meaningful” to be synonymous with “significant”, “important” or “of consequence”.
A meaningful relationship does not connote an optimal relationship.
In Godfrey & Sanders [2007] FamCA 102 at [36] Kay J considered the requirements of the legislation in relation to the promotion of a meaningful relationship in the following terms:-
Even if the move results in a diminution of quality of the relationship, what the legislation aspires to promote is a meaningful relationship, not an optimal relationship.
The present position is that X chooses to spend no time with the husband, whereas Y is prepared to spend limited time usually involving an evening meal and in the absence of Ms B.
The wife seeks orders that she concedes would at best provide a minimal level of relationship between the husband and the children. Even then, the orders sought are conditional upon Ms B not being present. As considered, X does not attend with Y and the husband. It is not suggested by the wife that she has any confidence in being able to promote X’s attendance upon the husband.
The wife does not accept that an order could be crafted which would likely be the subject of ready compliance.
The wife’s counsel relies upon the decision of Cotton & Cotton (1983) FLC 91-330 where Nygh J considered the importance for a child to maintain a meaningful relationship with both parents by requiring that there must be the possibility of a meaningful relationship.
In Sigley v Evor (2011) 44 Fam LR 439 at [136] the Full Court considered the various authorities that defined “meaningful relationship” and quoted with approval the decision of Champness & Hanson (2009) FLC 93-407:-
103.The submissions of counsel for the father also appeared at times to be based on an assumption that it was obligatory for the trial judge to make the orders most likely to ensure the children had a “meaningful relationship” with both parents. This is an incorrect assumption. The court’s obligation is to make the orders most likely to promote the child’s best interests. In seeking to achieve that objective, s 60CC(2)(a) directs the court to consider “the benefit to the child” of having a meaningful relationship with both parents. Even if such a benefit is established, it must still be weighed along with all other relevant factors. (See Bennett J’s analysis in G & C [2006] FamCA 994.) [Emphasis in original.]
The Full Court also observed at [191]: “The first and very important observation we would make about this complaint is that the expression ‘meaningful relationship’ is a legal construct, not a psychological one. It is for the court, not an expert, to determine what constitutes a ‘meaningful relationship’”.
In St Clarie & St Claire and Ors [2013] FamCA 108, Cronin J was faced with a child that was five years old at the date of separation but eight years old when judgment was delivered. The father had not had any contact with the child since separation. His Honour determined that the appropriate course was to make final orders which provided for the child to live with the mother but to spend time with the father in accordance with a strict therapeutic regime conducted over a period of approximately 12 months. His Honour said at [209]:-
It is a primary consideration in s 60CC that the children have the benefit of having a meaningful relationship with both parents. In Pishke & Rupp; Bannon & Rupp [2010] FamCA 632 Murphy J noted with approval the comments of Nygh J in Cotton & Cotton (1983) FLC 91-330 at 78,252, where the question was asked whether there was a chance of a meaningful relationship which was beneficial to the children but also whether both parents had ‘something to offer’ the children.
(Original emphasis)
In M & M (1988) 166 CLR 69 at 75 - 78 the remarks of the High Court said :-
In proceedings under Pt VII of the Act in relation to a child, the court is enjoined “to regard the welfare of the child the paramount consideration”: s 60D. The paramountcy of this consideration in proceedings for custody or access is preserved by s 64(1). The consequence is that the ultimate and paramount issue to be decided in proceedings for custody of, or access to, a child is whether the making of the order sought is in the interests of the welfare of the child. The fact that the proceedings involve an allegation that the child has been sexually abused by the parent who seeks custody or access does not alter the paramount and ultimate issue which the court has to determine, though the court’s findings on the disputed allegation of sexual abuse will naturally have an important, perhaps a decisive, impact on the resolution of that issue.
But it is a mistake to think that the Family Court is under the same duty to resolve in a definitive way the disputed allegation of sexual abuse as a court exercising criminal jurisdiction would be if it were trying the party for a criminal offence. Proceedings for custody or access are not disputes inter partes in the ordinary sense of that expression: … The court is concerned to make such an order for custody or access which will in the opinion of the court best promote and protect the interests of the child. In deciding what order it should make the court will give very great weight to the importance of maintaining parental ties, not so much because parents have a right to custody or access, but because it is prima facie in a child’s interests to maintain the filial relationship with both parents: …
…
In resolving the wider issue the court must determine whether on the evidence there is a risk of sexual abuse occurring if custody or access be granted and assess the magnitude of that risk. After all, in deciding what is in the best interests of a child, the Family Court is frequently called upon to assess and evaluate the likelihood or possibility of events or occurrences which, if they come about, will have a detrimental impact on the child’s welfare. The existence and magnitude of the risk of sexual abuse, as with other risks of harm to the welfare of a child, is a fundamental matter to be taken into account in deciding issues of custody and access. In access cases, the magnitude of the risk may be less if the order in contemplation is supervised access. Even in such a case, however, there may be a risk of disturbance to a child who is compulsorily brought into contact with a parent who has sexually abused her or whom the child believes to have sexually abused her. But that is not the issue in this case.
Efforts to define with greater precision the magnitude of the risk which will justify a court in denying a parent access to a child have resulted in a variety of formulations. The degree of risk has been described as a “risk of serious harm” … “an element of risk” or “an appreciable risk”… “a real possibility” … a “real risk” … and an “unacceptable risk” … This imposing array indicates that the courts are striving for a greater degree of definition than the subject is capable of yielding. In devising these tests the courts have endeavoured, in their efforts to protect the child’s paramount interests, to achieve a balance between the risk of detriment to the child from sexual abuse and the possibility of benefit to the child from parental access. To achieve a proper balance, the test is best expressed by saying that a court will not grant custody or access to a parent if that custody or access would expose the child to an unacceptable risk of sexual abuse.
(Citations and footnotes omitted)

The parties were not able to agree the following:-
(1)Partial property settlement received by the wife (from the husband’s inheritance). The husband says $66,000, the wife says $49,000.
(2)Partial property settlement received by the wife (from the net proceeds of sale of the Suburb F property) - $30,000. Parties are agreed as to the amount but not as to treatment.
(3)Partial property settlement (received from the husband’s income) - $3,680. Parties are agreed as to the amount but not as to treatment.
(4)The sum of $16,000 retained by the wife at the time of separation from the joint account of the parties is to be added back. The parties are agreed as to amount but not as to treatment.
(5)Wife’s tax return for the financial year ending 2017 is agreed as to the sum of $8,875, but not as to treatment.
(6)Council rates paid by the husband are agreed as to the sum of $1,003 but not as to treatment.
(7)Mortgage repayments made by the husband are agreed as to the sum of $7,506 but not as to treatment.
The following are assets sought to be included by wife but opposed by the husband:-
(1)Distribution from the L Family Trust (Location T proceeds) - $1,071,356.
(2)25 per cent beneficial interest in the L Family Trust - $609,664.
(3)Funds received by the husband from the L Family Trust in 2018 - $27,828 (after tax).
(4)Funds received by the husband from the L Family Trust in 2019 - $89,170.
The parties are able to agree the following liabilities:-
(1)CBA mortgage over the husband’s home at Suburb G - $400,771.
(2)Husband’s NAB Visa - $3,445 but not that it is a joint liability.
The parties are not able to agree the following liabilities:-
(1)Wife’s Mastercard - $1,500.
(2)Wife’s NAB Mastercard - $10,042.
(3)Wife’s NAB Personal Loan - $17,575.

Partial property settlement received by wife

On … 2016 the husband’s mother died leaving an estate which totalled $3,547,484.15. The estate was distributed in four equal shares to the husband and his three sisters Ms CC, Ms BB and Ms EE. The husband received $851,387.
By consent order made 19 June 2018 the husband paid the wife $66,000 by way of partial settlement of property. The wife’s evidence is that $49,000 was used in part payment of her outstanding legal fees and $17,000 was applied to her outstanding credit card debt and expenses, including those of the children.
The husband seeks to add back the entire sum of $66,000, whereas the wife is prepared to concede the sum of $49,000.
In C & C [1998] FamCA 143 the pool of property as between the parties was approximately $3 million and the trial Judge had made a number of add backs. The Full Court considered on appeal whether $13,000 spent by the husband post-separation on an overseas trip should have been added back. The Full Court said at [46]:-
Whilst not seeking to place a fetter upon the exercise of discretion of a trial judge in individual cases, it seems to us that the concept of adding monies reasonably disposed of back into the pool ought to be the exception rather than the rule. The parties are entitled to reasonably conduct their affairs post-separation in a manner that is consistent with properly getting on with their lives. Providing modest support for their adult children or taking not inappropriate holidays for themselves seems to fit comfortably within that description.
In Kouper & Kouper (No 3) [2009] FamCA 1080 Murphy J was required to consider the treatment of the loss by the husband of $4.5 million in money invested in failed business ventures. The wife argued that the monies invested and ultimately lost amounted to waste in the sense as referred to in Kowaliw & Kowaliw (1981) FLC 91-092 ("Kowaliw"). His Honour identified at [108] that the issues could be approached by reference to five questions:-
(a)Is it contended that property (including money), that would otherwise be available for distribution between the parties if a s 79 order is made, has been dissipated with a consequential loss to the property otherwise potentially divisible between the parties at the date of trial?;
(b)If so, is it alleged that dissipation of property was in respect of things other than what, in the particular circumstances of this particular marriage, can be classified as “reasonable living expenses”?;
(c)If it is asserted that any loss to the divisible property results from dissipation of property other than in respect of such expenses, why is it asserted that the result should be a sharing of that loss by the parties other than equally?
(d)If it is contended that this be the result, why should there be an add back (which brings to account, dollar for dollar, such past expenditure in current dollars) as distinct, for example, from there being an adjustment made pursuant to s 75(2)(o)?; and
(e)How should either any “add back”, or adjustment pursuant to s 75(2)(o) be quantified?
In Kowaliw Baker J said at 76,644:-
As a statement of general principle. I am firmly of the view that financial losses incurred by parties or either of them in the course of a marriage whether such losses result from a joint or several liability, should be shared by them (although not necessarily equally) except in the following circumstances:
(a)where one of the parties has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets; or
(b)where one of the parties has acted recklessly, negligently or wantonly with matrimonial assets, the overall effect of which has reduced or minimised their value.
Conduct of the kind referred to in para. (a) and (b) above having economic consequences is clearly in my view relevant under sec. 75(2)(o) to applications for settlement of property instituted under the provisions of sec. 79.
In Thurston & Loomis and Ors [2018] FamCA 26, Forrest J considered that an assessment needed to be conducted of the reasonableness of the expenditure, noting that the Court generally takes the property of the parties as it finds it at the date of the trial.
In Chorn & Hopkins (2004) FLC 93-204 the Full Court considered two earlier Full Court decisions at 79,314 [24]:-
We will refer again later in these reasons to the decision in Townsend, but we would in the present context draw attention to the following observations by later Full Courts:
“2.11 There seems to be no appropriate basis for notionally adding back moneys that existed at separation but which have been subsequently spent on meeting reasonably incurred necessary living expenses. Neither the Family Law Act nor the case law require that parties go into a state of suspended economic animation once their marriage breaks down pending the resolution of their financial arrangements. Parties are entitled to continue to provide for their own support. Whether any expenditure so incurred is reasonable or extravagant is a matter that can be determined by the trial Judge.
…
46. Whilst not seeking to place a fetter upon the exercise of discretion of a trial judge in individual cases, it seems to us that the concept of adding monies reasonably disposed of back into the pool ought to be the exception rather than the rule. The parties are entitled to reasonably conduct their affairs post-separation in a manner that is consistent with properly getting on with their lives.”
(Citations omitted)
In SMB & MFB [2006] FamCA 46 (“SMB & MFB”) the wife had received a total sum of $102,500 from various Court orders. The consideration by the Full Court is apposite to the competing arguments of the parties in the present case:-
18. The wife filed an application in September 2001 seeking, inter alia, interim orders for spousal maintenance. By consent, the husband agreed to pay the wife a total of $25,500 in two instalments. A series of further orders, all made by consent, required the husband to make lump sum payments to the wife. In all, between September 2001 and June 2002, a total of $102,500 was paid by the husband to the wife. Each order reserved discretion to the judicial officer dealing with the final issues of property settlement and spousal maintenance as to how, and in what proportions to classify the payments (be it spousal maintenance, interim costs or interim property settlement).
The trial judge found that there should be some allowance in respect of spousal maintenance, but ultimately decided that the sum of $102,500 received by the wife should be categorised as property.
The Full Court considered that the treatment by the trial Judge was erroneous and said:-
68. Even if his Honour had been correct in not categorising the sum of $102,500 as spousal maintenance on the basis that it was essentially paid from capital of the husband rather than income, it is not axiomatic that a sum, even if characterised as property, will be added back to the pool. Here, his Honour did not consider whether the money was available to the wife and how it had been spent. Having characterised it as property he simply added it back notionally to the pool. True it was that the wife was “on notice” of a need to account for the funds that she had received, but subject to the comments that we have made, she did so and that evidence was not the subject of any significant challenge. Nor was there any evidence that she had misapplied the funds in some way.
The wife’s evidence was not the subject of significant challenge and I accept that it could not be argued the sum of $17,000 was “wasted”.
By order dated 25 October 2019 the wife received the sum of $30,000 from the sale of the Suburb F property for her living expenses.
The husband argues that the wife did not require the sum to supplement her living expenses, in circumstances where she was receiving an income of $3,060 per fortnight made up of a casual income of $1,500 per fortnight, child support of $936 per fortnight, an additional sum by way of child support following an application to the Child Support Agency of $399 per fortnight and a Centrelink benefit or allowance of $225 per fortnight. The husband contends that his solicitors made repeated requests for information as to how the sum of $30,000 had been utilised. No response was received.
The wife maintains her position that the sum received was expended on credit card debt and a short holiday with the children.
I do not consider that money received by a party, whether by way of an order or a subsequent categorisation by the trial judge means that the said sum should automatically be treated as an add back. In La Costa v La Costa (2007) 38 Fam LR 412 (“La Costa”) the Full Court considered the treatment by the trial judge in including a lump sum received by the parties pursuant to an order as part of the property pool. The Full Court determined that the trial judge had erred in characterising the order as an order pursuant to s 79 of the Act for interim distribution of property.
In La Costa at [43], the Full Court cited with approval the following remarks of the Full Court in SMB & MFB :-
[67] In approaching the matter in this way his Honour failed to have regard to the evidence about the wife’s needs for the support of herself and the children including their school fees, and how she had spent the funds received, all of which was largely unchallenged.
[68] Even if his Honour had been correct in not categorising the sum of $102,500 as spousal maintenance on the basis that it was essentially paid from capital of the husband rather than income, it is not axiomatic that a sum, even if characterised as property, will be added back to the pool. Here, his Honour did not consider whether the money was available to the wife and how it had been spent. Having characterised it as property he simply added it back notionally to the pool. True it was that the wife was “on notice” of a need to account for the funds that she had received, but subject to the comments that we have made, she did so and that evidence was not the subject of any significant challenge. Nor was there any evidence that she had misapplied the funds in some way.
…
For similar reasons, I do not propose to add back the sum of $30,000 received by the wife from the sale of the Suburb F property, the sum of $3,680 received from the husband, the sum of $16,000 retained by the wife at the time of settlement or the wife’s tax refund for the 2017 financial year of $8,875.

Money paid by husband for council rates and mortgage repayments

The husband paid council rates and mortgage repayments in respect of the Suburb F property of $1,003 and $7,506 respectively.
There is considerable contention concerning the circumstances of the sale and disposal of the Suburb F property. Each of the parties contend that the other caused loss in terms of the eventual sale of the property and the net proceeds received by their recalcitrant conduct.
I do not propose to bring to account the wife’s assertion that the husband left the property in a state of disrepair which she considers had the effect of reducing the sale price, nor do I bring to account the husband’s assertion that the wife caused unnecessary expense in her refusal to sign a contract with a purchaser of interest thereby causing the further marketing of the property and incurring unnecessary expense.
Whilst I accept that the husband paid council rates and mortgage repayments as he asserts, I do not consider that the appropriate treatment is that they should be added back to the pool but rather, they will form part of the general consideration of the separate contributions of the parties.

Husband’s interest in the L Family Trust

The husband’s father Mr Peat Snr died on … 2014. A Grant of Probate was made on 28 April 2016 which confirmed that the husband and his sister Ms CC are the executors and trustees of their father’s will.
The estate is held on trust by L Pty Ltd for the L Family Trust.
The husband is not a director of L Pty Ltd but holds 50 per cent of the shares on a non-beneficial basis.
The late Mr Peat Snr directed the L Family Trust to provide his wife Ms S with a yearly indexed distribution of $200,000 and a right during her lifetime to occupy various residential properties.
The husband acknowledges that he receives a taxable distribution from the L Family Trust which is broadly determined by dividing the income of the L Family Trust after the distribution to Ms S has been made.
There was an anomaly to the anticipated exercise of the trustees’ discretion as to distribution of profit in the 2017 year. The L Family Trust held an interest in a building in the Location T. In the 2017 financial year the property was sold with a profit of $4,285,425. A distribution was made to Ms CC, Ms EE and Ms BB but not to the husband. The decision not to distribute to the husband was deliberate and in part was in an attempt to simplify the litigation, in particular in respect of the assessment of child support.
The overarching intention of the late Mr Peat Snr was that the entirety of the L Family Trust is to pass to his six grandchildren upon each of them attaining the age of 25 years.
The three beneficiaries of the trust distribution in the 2017 financial year each signed a Deed of Covenant which directed the notional distributions to be re-invested as capital by the L Family Trust.
The wife accepts that the shareholding by the husband and Ms CC in L Pty Ltd are held non-beneficially.
It is not controversial that the will of the late Mr Peat Snr provides for the shareholding to be divided equally among the grandchildren when they each attain 25 years of age.
Whilst the wife acknowledges that the husband does not control the trust, she focuses on the fact that he holds 50 per cent of the shares in L Pty Ltd and argues that with the consent of his sister the current directors could be removed and the husband appointed as a director. If that occurred, the husband could then control the trust.
The gravamen of the wife’s assertion is a belief that the husband would be able to persuade his sister to do his bidding.
It is not challenged that the current directors of L Pty Ltd are at arms-length to the husband.
The evidence of Mr J as to his independence was unchallenged.
A secondary argument promoted by the wife is that the husband is a beneficiary of the L Family Trust given that he falls within the class of “Trust Fund Beneficiaries”.[14]
[14] Affidavit of the wife filed 25 February 2020, paragraph 141.
It is asserted that the directors of L Pty Ltd could be persuaded to distribute capital to any of the beneficiaries prior to the grandchildren attaining the age of 25 years.
The wife contends that given the familial relationship between the husband, Ms CC, Ms S and Mr J, if they decided to act in concert they could thwart the testamentary intention of the late Mr Peat Snr.
The wife’s argument can be distilled down to the proposition that the husband’s sister as a joint shareholder of L Pty Ltd and the three directors of the trust are the husband’s puppets.
It is not asserted by the wife that the trust is a sham.
The wife does not contend that the trust is the alter-ego of the husband. To do so would be to ignore that the entirety of the property held by the trust and therefore subject to the testamentary intention of the husband’s father was entirely generated by him with no contribution from the husband.
The wife accepts that the intention of the late Mr Peat Snr was to devolve significant benefit on his grandchildren whilst providing for the financial security of Ms S and to allow for the residue income to be distributed to his four children.
Accordingly, it is the potential pathway that the wife asserts would ultimately enable some or all of the capital of the trust to be distributed to the husband.
In Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337 commencing at 354, Gibbs J considered the power that the Court has to make an order which may directly or indirectly affect the position of a third party:-
It is one thing to order a party to a marriage to do whatever is within his power to comply with an order of the court, even if what he does may have some effect on the position of third parties, but it is quite another to order third parties to do what they are not legally bound to do. If the sections had been intended to prejudice the interests of third parties in this way, it would have been necessary to consider their constitutional validity.
The position is, I think, different if the alleged rights, powers or privileges of the third party are only a sham and have been brought into being, in appearance rather than reality, as a device to assist one party to evade his or her obligations under the Act. Sham transactions may always be disregarded. Similarly, if a company is completely controlled by one party to a marriage, so that in reality an order against the company is an order against the party, the fact that in form the order appears to affect the rights of the company may not necessarily invalidate it.
Except in the case of shams, and companies that are mere puppets of a party to the marriage, the Family Court must take the property of a party to the marriage as it finds it. The Family Court cannot ignore the interests of third parties in the property, nor the existence of conditions or covenants that limit the rights of the party who owns it. …
In Re Richstar Enterprises Pty Ltd and Ors; Australian Securities and Investments Commission v Carey and Ors(No 6) (2006) 233 ALR 475 at 480 French J considered the remarks of Gummow J in Federal Commissioner of Taxation v Vegners (1989) 90 ALR 547 in describing the power of a trustee of a discretionary trust as a special or hybrid power and noted that at 552 his Honour said:-
a power exercisable in favour of any person including the donee of the power would be a general power and thus would be tantamount to ownership of the property concerned …

Further, at 481 of the judgment of French J, the following appears:-
At least by analogy it may be observed that a beneficiary who effectively controls the trustee of a discretionary trust may have what approaches a general power and thus a proprietary interest in the income and corpus of the trust.
The proposition however is modified if there is an absence of beneficial entitlement notwithstanding that a party controls a trust. Finn J in Stephens & Stephens and Ors (2007) FLC 93-336 (“Stephens”) at 81,767 [137] said:-
In my opinion, control of the Trust was not sufficient. As was submitted by senior counsel for the husband in all of the earlier authorities on which his Honour relied (being principally, Ashton (supra) and Davidson (supra)), the spouse who had control of the trust also had some capacity to benefit (if only through a corporate entity) from the assets of the Trust. In the present case, if the 1983 Deed remained in place, which was the basis on which Strickland J expressly proceeded, the husband had no beneficial right or interest. He only had control, and I accept that no earlier authority in this court has gone so far as to hold that control alone without some lawful right to benefit from the assets of the trust, is sufficient to permit the assets of the trust to be treated as property of the party who has that control.
In Harris & Dewell and Anor (2018) FLC 93-839 (“Harris & Dewell”) the Full Court considered whether a unit trust was the “puppet” or “creature” of the husband in circumstances where his father had the lawful control of the trust, but there existed a history of the husband making all relevant decisions affecting the trust and its property.
Following a consideration of the relevant authorities the Full Court in Harris & Dewell considered Finn J’s remarks in Stephens and concluded the following:-
67.It should be accepted that the principles emerging from the High Court and from the decisions of this Court to which reference has been made permit of a finding that property ostensibly that of a trust can be treated as property of a party for s 79 purposes where evidence establishes that the person or entity in whom the trust deed vests effective control is the “puppet” or “creature” of that party. The metaphor is used to connote a situation where the person or entity with control (the “puppet”) does nothing without the party (the “puppet master”) controlling or directing that person or entity.
68.Control is not sufficient of itself. What is required is control over a person or entity who, by reason of the powers contained in the trust deed can obtain, or effect the obtaining of, a beneficial interest in the property of the trust. In our respective view, it is in that sense, that Finn J speaks of “some lawful right to benefit from the assets of the trust”.
There is no evidence that following the Grant of Probate in respect of the husband’s father’s estate in 2016 that either the husband in concert with his sister Ms CC or otherwise has exercised any level of control in respect of L Pty Ltd for his or their separate benefit.
It is a conundrum for the wife that were she to be successful in seeking a value to be attributed to the husband’s beneficial interest in the trust, the interests of the subject children may well be adversely affected.
I do not consider that there is any evidence to support the contention that the husband, in concert with Ms CC, could or would set upon a course of action to cause the premature distribution of the trust property contrary to the testamentary wishes of the husband’s father.
It must be remembered that the class of beneficiaries are extensive and the potential for third party interests to be affected go beyond the husband and his siblings.
I am left in no doubt that it is the intention of the husband, his siblings and the non-family directors of L Pty Ltd to manage the trust, with an intention that the grandchildren will receive valuable benefit upon each of them attaining 25 years of age.
The wife also seeks to bring to account the funds received by the husband in the 2018 and 2019 financial years. The distributions received by the husband are properly to be considered as income in his hands. The distributions are the subject of declaration by the husband as part of his taxable income. It may well be that the potential for future distribution of income will be treated as a valuable financial resource in the hands of the husband, however, the evidence of Mr J is that income available for distribution is as a result of the Location R Development maturing consequent upon the sale of allotments.
I accept the evidence of Mr J that the income stream will come to an end within the next few years.

Liabilities of the parties

The parties are agreed that the mortgage encumbering the husband’s Suburb G home in the sum of $400,771 should be brought to account.
The wife seeks to bring to account the further liabilities as follows:-
·Mastercard     $1,500
·NAB Visa  $10,042
·NAB Personal Loan            $17,575
The husband considers that they are liabilities incurred by the wife post-separation.
The wife does not contest the husband’s assertion that the liabilities are incurred post-separation but presents no evidence as to the manner in which the liabilities were incurred.
The wife retains employment as a professional receiving approximately $63,000 per annum. Her income is supplemented by a government benefit of $186.36 a fortnight and she acknowledges that the husband pays child support in the sum of about $2,479 per month.
On 16 April 2018 the wife obtained a personal loan from the NAB of $25,000, the bulk of which was directed to the payment of her legal fees.
It is assumed that the current balance of the wife’s NAB personal loan of $17,575 is as a result of the cumulative activity of the personal loan that commenced on 16 April 2018.
In the absence of evidence as to the detail of the wife’s expenditure in respect of her credit cards and the residual balance of the NAB personal loan, I do not consider that I am able to exercise my discretion and include the wife’s liabilities in such a way that would cause them to be treated as a notional joint liability.

Adjusted property pool

Assets

Ownership

Amount

Proceeds of the sale of the Suburb F property

Joint

$398,071

Balance of the husband’s inheritance

Husband

$774,387

Partial property settlement received by the wife

Wife

$120,000

Partial property settlement received by the husband

Husband

$120,000

Partial property settlement received by the wife (part of the sum of $66,000 from the husband’s inheritance)

Wife

$49,000

CBA Offset account

Husband

$ 7,748

NAB Classic account

Husband

$ 1,945

NAB Classic account

Husband

$ 1,520

Total

$1,472,671

Liabilities

Ownership

Amount

NAB low rate Visa

$ 3,445

CBA mortgage

$400,771

Total

$404,216

The Court is required to make orders in adjusting the interests of the parties in property that are just and equitable.
I am required to consider the direct and indirect financial contributions made by the parties to the acquisition, conservation or improvement of property (s 79(4)(a) of the Act), the contribution other than a financial contribution made directly or indirectly by the parties to the acquisition, conservation or improvement of property (s79(4)(b) of the Act) and the contribution made by the parties to the welfare of the family in their capacity as parent or homemaker (s79(4)(c) of the Act).
The parties commenced cohabitation in 2005. The parties held property of minimal value.
Each of the parties were employed.
Following the husband becoming unemployed the parties determined to relocate to Melbourne where they both secured employment. The husband was employed as a professional and the wife obtained employment up until the time of X’s birth.
The husband was generally in employment throughout the course of the relationship and a consideration of his taxable income demonstrates that over the period from 2010 to 2018 his income has gradually increased.
Following the birth of X the wife did not return to work until she gained part-time employment in November 2012.
The parties each used their best endeavours to provide for the family and promote the care, welfare and development of the children.
The husband records that the parties received graduated payments from his father in the total sum of $88,200. Those funds were applied to the mortgage and other living expenses.
At the time, the wife was an employee of L Pty Ltd and received the funds as income given that she was on a lower marginal rate.
The wife acknowledges that monies were received by her but does not recollect the extent of the sum received.
Of significance to the husband is the weight that he considers should be given to the inheritance from his mother’s estate received after separation in the sum of $851,387. Given that the total net assets of the parties are in the sum of $1,068,455, the introduction of $851,387 is overwhelming.
In considering the evaluation of the contributions of the parties, I am careful not to assume a starting point that presupposes equality of contributions.
In Mallet v Mallet (1984) 156 CLR 605 at 636 Wilson J said:-
However, equality will be the measure, other things being equal, only if the quality of the respective contributions of the husband and wife, each judged by reference to their own sphere, are equal. The quality of the contribution made by a wife as a homemaker or parent may vary enormously, from the inadequate to the adequate to the exceptionally good. She may be an admirable housewife in every way or she may fulfil little more than the minimum requirements. Similarly, the contribution of the breadwinner may vary enormously and deserves to be evaluated in comparison with that of the other party. It follows that it cannot be said of every case where the parties reside together that equal value must be attributed to the contribution of each. That will be appropriate only to the extent to the respective contributions of the parties are each made to an equivalent degree. …
In Norbis v Norbis (1986) 161 CLR 513 at 523 Mason & Deane JJ said :-
Although it is natural to assess financial contributions under s. 79(4)(a) by reference to individual assets, it is also natural to assess the contribution of a spouse as homemaker and parent either by reference to the whole of the parties’ property or to some part of that property. For ease of comparison and calculation it will be convenient in assessing the overall contributions of the parties at some stage to place the two types of contribution on the same basis, i.e. on a global or, alternatively, on an “asset-by-asset” basis. …
I am obliged to consider the contributions of the parties not at the date of separation but rather at the date of trial. Circumstances may arise where pre-separation contributions will be treated differently to those made either prior to separation or after separation. It is not an arithmetical exercise.
The parties have not argued that I should quarantine the husband’s inheritance. The assessment of the husband’s inheritance as a contribution must be considered with the myriad of contributions made by each of the parties.
There is no suggestion by either party that during the course of cohabitation their focus was other than on securing a financial future for the family. As discussed, the husband was in continuous employment whereas the wife sacrificed her employment opportunities to undertake the significant role as homemaker. She returned to part-time work in 2012 and whilst now in fulltime employment, she is not able to command a salary commensurate with that of the husband.
Following separation the wife retained the primary care of the children, although the extent to which the husband would have wanted the children to spend more time with him is not the subject of agreement.
In the decision of Jabour & Jabour (2019) FLC 93-898 the Full Court did not favour an approach which attempted to quarantine property contributions but rather, considered that the contributions of each of the parties especially in circumstances where there was a long period of cohabitation, should be a single exercise and not the subject of separate and individual assessment of each contribution.
In JEL & DDF (2001) FLC 93-075 at 88,334 the Full Court summarised the approach which should be taken when considering and evaluating the contribution made by the parties:-
152.It seems to us that the following general principles can be said to arise from the cases referred to in these reasons, namely:-
(a)There is no presumption of equality of contribution or “partnership”.
(b)There is a requirement to undertake an evaluation of the respective contributions of the husband and the wife.
(c)Although in many cases the direct financial contribution of one party will equal the indirect contribution of the other as homemaker and parent, that is not necessarily so in every case.
(d)In qualitatively evaluating the roles performed by marriage partners, there may arise special factors attaching to the performance of the particular role of one of them.
(e)The Court will recognise any such special factors as taking the contribution outside the “normal range” in the sense that the phrase was understood by the Full Court in McLay (supra).
(f)The determination of an issue of whether or not a “special” or “extra” contribution is made by a party to a marriage is not necessarily dependent upon the size of the asset pool or the “financial product”. When considering such an issue, care must be taken to recognise and distinguish a “windfall” gain.
(g)Whilst decisions in previous cases where special factors were found to exist may provide some guidance to judges at first instance, they are not prescriptive, except to the extent that they purport to lay down general principles.
(h)It is ultimately the exercise of the trial Judge’s own discretion on the particular facts of the case or regulate the outcome.
(i)In the exercise of that discretion, the trial Judge must be satisfied that the actual orders are just and equitable, and not just the underlying percentage division.
The wife’s evidence as to her relationship with the husband’s mother left no room for misunderstanding. The wife held a strong and demonstrated dislike for her which extended to her deliberate conduct in ensuring that the children would not have a relationship with their grandmother. The wife’s enmity towards the husband’s mother extended to an intervention order being taken out.
It could not be said that the wife in any way contributed to helping the husband’s mother in her later years and as such it is not seriously argued on behalf of the wife that the inheritance should be treated as an intended benefit to both of the parties.
I propose to consider the husband’s inheritance as part of the contributions that he has made in the same way that the wife’s contributions to the primary care of the children post-separation form part of her contributions.
I consider that the contributions of the parties should be reflected by an apportionment as to 70/30 per cent in favour of the husband.
In determining the percentage apportionment I have regard to the net pool in the sum of $1,068,455. Accordingly, the differential between the parties is 40 per cent or $427,382. I consider that the proposed adjustment brings to account the separate contributions of the parties but recognises the extent to which the pool currently includes the husband’s inheritance received post-separation.

Section 75(2) factors

The Court is obliged to consider the factors as set out in s 75(2) of the Act. It is to be remembered that the exercise is not one of social engineering. The purpose is not to equalise the circumstances of the parties going forward but rather, to determine an appropriate adjustment taking into account the s 75(2) factors in order to reach an outcome that is just and equitable.
The parties are currently in employment. It is conceded by the husband that his income is substantially higher than that of the wife. His income is in excess of $180,000 per annum and he acknowledges that there will be a substantial distribution received by him consequent upon him being a beneficiary of the L Family Trust and in particular, income that is derived by the trust and then distributed to the husband and his three siblings from the Location R Development.
The wife’s income is approximately $63,000 per annum.
Even upon full compliance with the parenting orders, the wife will retain the primary care of the children. The husband pays child support as assessed. Whilst he is not entitled to be given credit for the fact that he pays child support, the payment of child support at approximately $30,000 is nonetheless a significant sum when considered against the costs of the children as assessed by reference to the Child Support Guide setting out the costs of the children between $34,964 and $42,324.
It could not be said that the wife bears an unreasonable proportion of the children’s costs.
I do not ignore that the husband has been diagnosed with a neurological condition. It is a genetic disease passed on to the husband. At present he is asymptomatic and he concedes that his condition does not impact upon his employment
At present the wife does not work a full 37 hour week. The husband considers that she has the capacity to work fulltime and given her proximity to the children’s school there would be no impediment to this occurring.
In the circumstances of the presentation of the children, it is reasonable for the wife to consider that at present she needs to be available to supervise the children at least for the next few years.
I propose an adjustment of 20 per cent in favour of the wife. I do so by noting that it equates to a differential of $213,691.

Conclusion

The net pool is $1,608,455. At 50 per cent the wife is to retain property in addition to her superannuation totalling $534,227.
The wife retains the following:-

Partial settlement of property

$ 49,000

Partial settlement of property

$120,000

Total

$169,000

Balance

$365,227

The wife is therefore entitled to a settlement sum of $365,227 which will be paid from the funds held in the NAB joint account representing the net proceeds of sale of the Suburb F property. The balance of those funds will be paid to the husband.

Superannuation

The parties have agreed to equalise their superannuation entitlements. The total superannuation of the parties is $266,319. To equalise their entitlements each party should receive the sum of $133,159, however, bringing to account that the wife’s superannuation entitlement totals $59,982 the orders will provide for a lump sum to be the subject of a superannuation split from the husband’s splittable benefit from Super Fund 1 in the sum of $73,177.
I make orders as appear at the commencement of these reasons.

I certify that the preceding four hundred and thirty seven (437) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Berman delivered on 24 December 2020.

Associate:

Date: 24 December 2020

Assets	Ownership	Amount
Proceeds of the sale of the Suburb F property	Joint	$398,071
Balance of the husband’s inheritance	Husband	$774,387
Partial property settlement received by the wife	Wife	$120,000
Partial property settlement received by the husband	Husband	$120,000
Partial property settlement received by the wife (part of the sum of $66,000 from the husband’s inheritance)	Wife	$49,000
CBA Offset account	Husband	$ 7,748
NAB Classic account	Husband	$ 1,945
NAB Classic account	Husband	$ 1,520
Total	$1,472,671

Liabilities	Ownership	Amount
NAB low rate Visa	$ 3,445
CBA mortgage	$400,771
Total	$404,216

Partial settlement of property	$ 49,000
Partial settlement of property	$120,000
Total	$169,000
Balance	$365,227