Pederick & Pederick
[2022] FedCFamC2F 208
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Pederick & Pederick [2022] FedCFamC2F 208
File number(s): ADC 5820 of 2020 Judgment of: JUDGE JENKINS Date of judgment: 31 May 2022 Catchwords: FAMILY LAW – PROPERTY SETTLEMENT – where the parties separated 10 years earlier – where allegations of wastage – where allegations of family violence – where the initial financial contribution exceeded the current asset pool – consideration of the role of a step-parent as it relates to s 75(2)(o) – found just and equitable to alter parties property interests. Legislation: Family Law Act 1975 (Cth) Pt VIII, ss 75(2), 79(1), 79(2), 79(4), 106A
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)
Aleksovski & Aleksovski [1996] FamCA 111
Bevan & Bevan (2013) 279 FLR 1
D & D [2003] FamCA 473
Dickons & Dickons [2012] FamCAFC 154
Hickey & Hickey & Attorney General for the Commonwealth of Australia (2003) FLC 93‑143
In the Marriage of Omacini (2005) 33 Fam LR 134
1 Jabour & Jabour [2019] FamCAFC 78
Kennon & Kennon (1997) FLC 92-757
2 Kowaliw & Kowaliw (1981) FLC 91-092
Lee Steere & Lee Steere (1985) FLC 91-626
Petruski & Balewa (2013) 49 Fam LR 116
Robb & Robb (1995) FLC 92-555
Stanford v Stanford [2012] HCA 52
Division: Division 2 Family Law Number of paragraphs: 105 Date of last submissions 25 February 2022 Date of hearing: 24-25 February 2022 Place: Adelaide Counsel for the Applicant: Mr Praolini Solicitor for the Applicant: CG Family Law Counsel for the Respondent: Ms Bailey Solicitor for the Respondent: Sills & Associates ORDERS
ADC 5820 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS PEDERICK
Applicant
AND: MR PEDERICK
Respondent
ORDER MADE BY:
JUDGE JENKINS
DATE OF ORDER:
31 MAY 2022
THE COURT ORDERS THAT:
1.Within sixty (60) days (“the date”) the wife, Ms Pederick (“the wife”):
(a)Pay to the husband, Mr Pederick (“the husband”) the amount of fifty thousand, one hundred and one dollars and sixty cents ($50,101.60) (“the cash payment”); and
(b)Pay to the Legal Services Commission of South Australia the amount of three thousand, one hundred and eighty five thousand dollars and ninety cents ($3,185.90) on behalf of the husband in full payment of his debt to the Legal Services Commission of South Australia (“the LSC payment”);
2.Contemporaneously with the cash payment and the LSC payment, the husband do transfer to the wife all of his right, title, estate and interest in the property situate at, and known as, B Street, Suburb C in the State of South Australia, (“the Suburb C property”) being the whole of the land comprised and described in Certificate of Title Register Book Volume … Folio … (“the transfer”).
3.The costs of the preparation, stamping and registration of the transfer and any other costs in relation thereto be paid for by the wife.
4.In the event the whole of the cash payment is not made by the date, the parties will do all acts and things and sign all documents necessary to cause the Suburb C property to be placed on the market for sale (“the sale”) upon the following terms and conditions:
(a)The sale agent will be such agent as the parties may agree, and failing agreement as appointed by the Secretary for the time being of the Real Estate Institute of South Australia upon the application of either party and the costs of the Real Estate Institute of South Australia shall be an ordinary cost of sale;
(b)The Suburb C property shall be offered for sale by private treaty for a period of three (3) months and, unless the parties agree to an extension of time in writing, if not sold it shall be sold at private auction within one (1) month thereafter and in the absence of agreement upon the reserve price at auction the reserve price shall be set by the sales agent; and
(c)The proceeds of sale shall be divided in the following order and priority:
(i)In discharge of the ordinary costs of sale, agents fees and usual conveyancing adjustments;
(ii)In discharge of the mortgage to D Bank;
(iii)To repay the statutory charges to the Legal Services Commission of South Australia;
(iv)To pay to the husband so much of the cash payment as is outstanding together with interest pursuant to the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth), to be calculated from the date; and
(v)The balance to be paid to the wife.
5.Hereafter the husband shall retain for his sole use and enjoyment absolutely free from any further claim or demand of the wife:
(a)any insurance policies owned by him;
(b)his separate savings and investments;
(c)any motor vehicle presently in his possession;
(d)the furniture and effects in his possession;
(e)all his estate and interest both at law and in equity which he may now have or hereafter have in any superannuation scheme; and
(f)any other property or financial resource of the husband not otherwise specified.
6.Hereafter the wife shall retain for her sole use and enjoyment absolutely free from any further claim or demand of the husband:
(a)any insurance policies owned by her;
(b)her separate savings and investments;
(c)any motor vehicle presently in her possession;
(d)the furniture and effects in her possession;
(e)all her estate and interest both at law and in equity which she may now have or hereafter have in any superannuation scheme; and
(f)any other property or financial resource of the wife not otherwise specified.
7.The wife do indemnify the husband and keep him forever indemnified with respect to:
(a)All debts and liabilities of the wife; and
(b)The wife’s legal and valuation costs.
8.The husband do indemnify the wife and keep her forever indemnified with respect to:
(a)All debts and liabilities of the husband; and
(b)The husband’s legal and valuation costs.
9.The husband and the wife shall do all acts and things necessary and give all consents and execute all documents and writings to give effect to these orders in the time periods prescribed.
10.In the event that either party refuses or neglects to execute any deed, document or other instrument necessary to give effect to these orders, the Registrar of the Court be appointed pursuant to s 106A of the Family Law Act 1975 (Cth) to execute such deed, document or instrument in the name of the said party and do all acts and things necessary to give validity and operation to the deed, document or instrument upon the Registrar being provided with verification of such refusal by way of affidavit.
11.If any party seeks costs, an appropriate written application may be made within twenty eight (28) days of the date of this order, (supported by any documentary material) to be filed and served within that time period and a copy forwarded to the Chambers of Judge Jenkins. The Court will then determine the application by way of written submissions, unless the parties seek leave to be heard orally. If no such application is made within the time period specified, there will be no order as to costs.
12.Orders 1 and 2 of the Orders of Judge Young made 20 September 2021 remain in full force and effect.
13.The matter is otherwise removed from the active pending cases list.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Pederick & Pederick has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE JENKINS
INTRODUCTION
These proceedings relate to competing property settlement applications.
In determining these proceedings, I have had regard to all of the evidence presented at trial. It is not possible to include every aspect of the parties’ evidence in these reasons for judgment. However, if a particular fact or issue is not mentioned in these reasons, it does not mean that I have failed to consider it.
BACKGROUND
The wife, Ms Pederick (“the wife”) was born in 1964 in the United Kingdom and is currently 57 years of age.
The husband, Mr Pederick (“the husband”) was born in 1976 in the United Kingdom and is currently 46 years of age.
The husband moved to Australia with his family when he was a child.
The parties met in the United Kingdom in early 2000 when the husband was visiting his father, who was terminally ill. They commenced cohabitation in or about 2000 and were married in 2002.
At the commencement of the relationship the wife had three children from a former marriage; W born 1989, X born 1992 and Y born 1994. At the time of cohabitation, the children were ten, seven and six years of age respectively. Unfortunately, the children’s father passed away about a year prior to the parties’ relationship. As such, the wife’s children lived with the parties on a full-time basis.
The parties have one daughter together, Z born 2003 (“Z”). She is currently 19 years of age.
The parties, together with all of the children, migrated to Australia in late 2006.
The parties separated under the same roof in or around 2012, and physically separated when the husband moved out in late 2012/early 2013. They were divorced in 2020.
ORDERS SOUGHT
The wife seeks orders as set out in her Case Outline filed 1 December 2021. In essence, she seeks that the husband transfer his interest in the parties’ property located at B Street, Suburb C, South Australia (“the Suburb C property”) to her, and that the parties otherwise keep everything else in their name or possession, including their savings and their cars.
The husband seeks orders as set out in his Case Outline filed 21 February 2022, namely that the Suburb C property be sold, and the proceeds be divided to affect a 60/40 per cent division in favour of the wife.
MATERIAL RELIED UPON
The wife relies upon the following:
(a)The wife’s Initiating Application filed on 4 December 2020;
(b)The wife’s affidavit filed 11 November 2021; and
(c)The wife’s Financial Statement filed 25 November 2021.
The husband relies upon the following:
(a)The husband’s Response filed 16 September 2021;
(b)The husband’s affidavit filed 10 February 2022; and
(c)The husband’s Financial Statement filed 16 September 2021.
RELEVANT LEGAL PRINCIPLES
The relevant legal principles governing any application for property settlement are set out in Part VIII of the Family Law Act 1975 (Cth) (“the Act”). Section 79(1) authorises the Court to make such orders between the parties as it considers appropriate. Section 79(2) makes it clear that the Court cannot make an order for property settlement unless it is just and equitable to do so.
Earlier Full Court authorities have identified a four step process that can assist the Court in reaching a just and equitable decision: see Lee Steere & Lee Steere (1985) FLC 91-626; Hickey & Hickey & Attorney General for the Commonwealth of Australia (2003) FLC 93‑143; and In the Marriage of Omacini (2005) 33 Fam LR 134.
Assuming the Court is satisfied that it is just and equitable to make an order for property settlement, the Court must identify the parties' legal and equitable interests in the assets arising from their relationship, together with their liabilities. The Court should then assess each party's contributions during the relationship in accordance with ss 79(4)(a)-(c).
The third step requires the Court to consider the range of factors set out in ss 79(4)(d)-(g), including the future needs factors identified in s 75(2). The Court should then consider its findings and, if the Court is satisfied that it is just and equitable to do so, make orders adjusting the parties' property interests.
The Full Court in Bevan & Bevan (2013) 279 FLR 1, 18 at [86], in the joint judgment of Bryant CJ and Thackray J, reminded trial judges that the "four step process" is not legislatively mandated. Rather, it provides a structured process towards the ultimate requirement, which is to ensure that a property settlement order is only made when the Court is satisfied that it is just and equitable to do so, and that the terms of the order itself are also just and equitable.
THE ASSET POOL
At the conclusion of the trial, the parties provided to the Court a joint balance sheet. It sets out the current assets of the parties as follows:
Ownership Description Applicants value ($) Respondents value ($) ASSETS 1 Joint B Street, Suburb C $230,000.00 $230,000.00 2 Wife Savings $1,000.00 $1,000.00 3 Wife Motor Vehicle 1 $6,000.00 $6,000.00 4 Wife Motor Vehicle 2 $1,000.00 $1,000.00 5 Hus Savings $154.24 $154.24 6 Hus Motor Vehicle 3 $1,000.00 $1,000.00 7 Wife Furniture & effects Nominal Nominal 8 Hus Furniture & effects Nominal Nominal Total $239,154.24 $239,154.24 LIABILITIES 9 Joint Mortgage $20,850.00 $20,850.00 10 Wife Statutory Charge to LSC $12,232.10 $12,232.10 11 Hus Statutory Charge to LSC $3,185.90 $3,185.90 12 Wife Personal loan $2,000.00 Nil 13 Hus Centrelink debt Nil $7,422.48 Total $38,268.00 $43,690.48 SUPERANNUATION Member Name of Fund Type of Interest Applicants value ($) Respondents value ($) 14 Hus Super Fund 1 Accumulation interest $15,785.20 $15,785.20 15 Hus Super Fund 2 Accumulation interest $7,388.68 $7,388.68 Total $23,173.88 $23,173.88
The parties’ only significant asset is the Suburb C property, which is subject to a mortgage, as well as two statutory charges placed on it by the Legal Services Commission of South Australia (“the LSC”).
Otherwise the parties each have minimal savings and cars of modest value.
The only items that the parties disagree about on the balance sheet are a personal loan of the wife of $2,000.00, and a Centrelink debt of the husband of $7,422.48.
During final submissions, Counsel for the wife urged the court to exclude the Centrelink debt of the husband from the pool on the basis that this was a post-separation debt, resulting from the husband’s conduct. In regard to the personal loan of the wife, Counsel for the wife stated that although the wife seeks inclusion of the loan, it was acknowledged that the personal loan had been incurred post-separation and that there was minimal evidence in regard to it. In such circumstances, both of these debts will be excluded from the asset pool, and remain the sole liability of the applicable party.
Consistent with this, I will also exclude the parties’ savings, which appear to have arisen post-separation and are minimal in any event.
I will also exclude the parties’ respective debts to the LSC, although I note both are secured against the Suburb C property and accordingly, they must be accounted for in a practical sense in any orders I make.
Accordingly I find the asset pool for division between the parties is as follows:
Ownership Description Value ($)
ASSETS
1 Joint B Street, Suburb C $230,000.00 2 Wife Motor Vehicle 1 $6,000.00 3 Wife Motor Vehicle 2 $1,000.00 4 Hus Motor Vehicle 3 $1,000.00 Total Assets $238,000.00
LIABILITIES
5 Joint Mortgage $20,850.00 Total Liabilities $20,850.00 Total Nett-Non-superannuation $217,150.00
SUPERANNUATION
Member Name of Fund Type of Interest Value 6 Hus Super Fund 1 Accumulation interest $15,785.20 7 Hus Super Fund 2 Accumulation interest $7,388.68 Total Superannuation $23,173.88 IS IT JUST AND EQUITABLE THAT AN ORDER BE MADE?
Having identified the parties’ assets and liabilities, and prior to making any order pursuant to s 79(4) of the Act, I must first be satisfied that it is just and equitable that any order be made pursuant to s 79(2) of the Act, as per the High Court decision of Stanford v Stanford [2012] HCA 52 (“Stanford”).
In Stanford, their Honours, in the joint judgment of French CJ, Hayne, Kiefel and Bell JJ, considered the expression “just and equitable” at paragraph 36 and noted that it:
… Is a qualitative description of a conclusion reached after examination of a range of potentially competing considerations? It does not admit of exhaustive definition. It is not possible to chart its metes and bounds.
There is no presumption that the parties’ entitlements in the existing asset pool should be altered, or that one party has the right to have the property of the parties divided between them only on the basis of the considerations in s 79(4) of the Act. The Court must not conflate the determination pursuant to s 79(2) of the Act with its determination pursuant to s 79(4) of the Act. These are separate enquiries.
In these proceedings, although both of the parties urged the Court that it is just and equitable that orders be made to alter their interests in their property, the existence of such an agreement is not sufficient, the Court must be satisfied that such orders are appropriate.
I find that in the circumstances of this case, it is just and equitable to make an order pursuant to s 79 of the Act for a division of property between the parties. Both parties made contributions, financial and otherwise, which may not be appropriately recognised if the Court does not determine to make an order for the adjustment of property.
SECTION 79(4)
In determining what orders are to be made pursuant to s 79(4) of the Act, I must:
weigh and assess the contributions of all kinds and from all sources made by each of the parties throughout the period of their cohabitation and then translate such assessment into a percentage of the overall property of the parties or provide for a transfer of property in specie in accordance with that assessment: see Aleksovski & Aleksovski [1996] FamCA 111 at [50] (Baker and Rowlands JJ) (“Aleksovski”).
In that same judgment, at paragraph 90, of Aleksovski his Honour Kay J said:
The Judge must weigh up various areas of contribution. In a short marriage, significant weight might be given to a large capital contribution. In a long marriage, other factors often assume great significance and ought not be left almost unseen by eyes dazzled by the magnitude of recently acquired capital… What is important is to somehow give a reasonable value to all of the elements that go to making up the entirety of the marriage relationship.
Those observations were quoted with approval by the Full Court in Dickons & Dickons [2012] FamCAFC 154 (“Dickons”). In that case, at paragraph 21, their Honours, Bryant CJ, Faulks and Murphy JJ said that “…the requirements of the section are met by approaching the assessment of contributions holistically…” by analysing the contributions of all types, and by reference to the particular circumstances of that particular relationship.
The assessment of contributions does not require “over-zealous” attention to the ascertainment of contributions, and the process of the Court as required by s 79 of the Act “…is the exercise of a wide discretion, not the performance of a mathematical or accounting exercise” as set out in Dickons at paragraph 25.
In determining any application for property settlement, the Court is not embarking upon an arithmetical exercise but rather an examination of all the relevant factors set out in s 79(4). As noted by the Full Court in D & D [2003] FamCA 473 at [49]:
… the task of the Court in proceedings under s.79 is not akin to an accounting exercise. The task is to examine the facts of each case carefully to decide what is appropriate and just and equitable in the circumstances. There cannot be expected to be a universal answer to that question on any given set of facts. It is of the essence of judicial discretion that different minds may comfortably arrive at different conclusions.
CONTRIBUTIONS IN THIS CASE
Initial contributions
At the commencement of the relationship, the husband did not have any assets or liabilities of significance.
The wife owned a property at E Street, Suburb F in the United Kingdom (“the E Street property”) which was unencumbered. The wife deposes to purchasing the E Street property from her sister for £55,000.00 (which she says was less than the market value of £70,000.00) about six months prior to meeting the husband. The wife also asserts that she had £40,000.00 by way of savings. The husband does not recall the wife having that amount of savings and says he has seen nothing by way of documentation to support her claim.
The wife also deposes to having superannuation at the commencement of the relationship although she does not quantify the amount.
The E Street property
The parties sold the E Street property in 2006, for £157,000.00 with net proceeds being £154,250.00 or $382,000.00 AUD. Whilst the husband deposes to paying for renovations to the property, he conceded under cross-examination that these renovations were paid for from joint funds.
It was common ground that in 2006, a large part of the proceeds from the E Street property were applied to the purchase of a property in Suburb G (“the Suburb G property”), which was purchased for $338,000.00. Despite seemingly having the funds to pay for this purchase outright, the parties obtained a mortgage of approximately $100,000.00.
The Suburb G property was sold in late 2011 for $370,000.00. The parties received net proceeds from that sale of $250,000.00.
The Suburb C property was bought in late 2011 for between $220,000 and $223,000. The purchase was funded using some of the sale proceeds of the Suburb G property and by obtaining a modest mortgage of $30,000.00. The remaining proceeds from the sale of Suburb G were used to repay what the wife labelled as the husband’s “personal debts”.
Day to day contributions
In the United Kingdom
The wife’s evidence is that the husband did not work when he initially came to the United Kingdom and that when he eventually obtained work it was doing odd jobs for which he only earned a few hundred pounds per month. The wife says that she paid for all of the outgoings of the E Street property as well as the general living expenses for the parties, save that the husband would, “occasionally” buy groceries for the family.
The husband’s evidence was that he worked fairly solidly whilst in the United Kingdom including two roles which lasted for two and a half to three years each. These positions included administration roles, which he says earned him between £16,000.00 and £19,000.00 per annum. The husband says the parties combined their incomes to meet the expenses of the family, save that he paid for the parties’ electricity and gas bills directly out of his own bank account.
The wife deposes that when Z was one and a half years old, the husband requested that the wife return to work because they needed more money. The wife says she was subsequently successful in obtaining a job as an educator at the same school that the children attended. However, her evidence is that it was still her responsibility to get the children ready for school, to take Z to her carer, to look after the children in the afternoon, and to prepare dinner. She stated that the husband would “occasionally” help with bathing Z, but otherwise he did not help out with house work or the general care of the children.
In Australia
The husband’s evidence is that the parties moved to Australia because of the declining behaviour of the wife’s boys, W and Y (“the boys”), and a consequent desire to make a “fresh start”.
In Australia the husband worked for a government department on a full time basis. The husband says he earned $52,000.00 per annum, the wife says $29,000.00 per annum.
The husband says that during this time, the boys’ behaviour became progressively worse, to the point where the wife would ring him and request he return home to assist and/or protect her from their abuse. The husband says he took one month off (with pay) from his role to assist the wife with the boys, followed by additional time off without pay.
The husband says that it was a combination of dealing with the boys’ behaviour, general instability in the home and a workplace issue that led to his resignation from his government role. He said under cross-examination that after he resigned, he did contract work for various people, including some night work but “chose to give the job away to try and sort out the family”. In short the husband concedes he was in and out of employment between 2009 and 2014 but says it was primarily to assist with the children.
The wife annexes a medical report to her affidavit which indicates the husband was suffering from ongoing depression attributable to his work and family situation at around that time.
The wife says that after “losing” his government job, the husband would obtain jobs which would not last for long. The husband said he lost many roles because he had to leave work to assist the wife.
The wife’s evidence is that the electrical bills, which she says were the husband’s responsibility, consequently fell into arrears and she had to obtain a moratorium on the mortgage to help out. The husband says he was unable to meet these expenses due to insufficient work, as well as the additional costs of assisting Y, and of redecorating the house.
The wife says that as a result she worked for an agency as a cleaner, and later caring for children. She says she continued in these roles until the parties moved to the Suburb C property in October 2011 when she became a full-time mother.
The husband agrees that the wife was the primary home maker but also says that he assisted her around the home, including cooking the evening meals when she was unwell. Further to this, he says he attended to the garden, mowed the lawns and did home maintenance. He conceded under cross-examination that the wife did most of the cooking but that “everybody” tidied up and had their chores.
In addition, the husband deposes to conducting various renovations to the Suburb G property including replacing a ceiling, as well as painting and decorating the house. The wife says it was she and her daughter X that painted the home and prepared it for sale.
Family Violence
The wife deposes that she was subject to verbal and physical abuse on a regular basis perpetrated by the husband. The wife says the husband would yell at her, put her down, isolate her from family and friends and damage property. She said that at one point the abuse was so bad she voluntarily admitted herself to a psychiatric ward at the H Hospital.
An intervention order, which is still current, was made in favour of the wife against the husband in or about the middle of 2017. The wife deposes that the husband breached this intervention order, including hacking into her emails.
The husband concedes that there was family violence during the marriage but says that it began in the United Kingdom when Y’s behaviour became violent towards his siblings. He says the parties moved to Australia to get “a fresh start” but that the relationship between the wife and the children became progressively worse. This included Y assaulting his mother and W breaking a window. The husband says that as a result, the wife developed Post-Traumatic Stress Disorder (“PTSD”) and anxiety disorders.
The husband largely denied that he was abusive to the wife or the children. He conceded he would swear, not at the wife “but around things” but that he did not consider this to be abusive. He agreed he raised his voice at the children, but again said not abusively, and that instead he suggested they go for a walk and cool down. He did, however concede he was concerned about the wife’s mental health both in the United Kingdom and in Australia. He described her as being “upset a lot of the time because … W was being very cruel and Y was quite physical”. He says that at times she would call him to come home from work because she was fearful of the boys and that on occasions, he would have to physically restrain them. I note that in or about 2010/2011, Y accused the husband of assaulting him, and it appears the husband was remanded in custody for 11 days. The husband’s version of events is that Y lied. It would seem the police did not take this matter any further.
The issue of family violence and the boys’ behaviour was the subject of a Family Report in the parties’ parenting proceedings in 2012. The wife was cross-examined about this report which was dated 9 July 2012 (“the Family Report”). In the Family Report the wife appears to confirm that Y was violent towards her and that she developed PTSD symptoms as a result. She also says in that report that the violence between the parties was “mutual” and expressed remorse for having participated in it and the emotional harm that was likely caused to Z. Of significance she says in that report that although there had been instances of physical violence perpetrated by the husband, this had not occurred on a regular basis. The latter is in direct contrast with paragraph 46 of the wife’s trial affidavit in which she says that she was subject to verbal and physical abuse on a regular basis perpetrated by the husband. I note also that the wife subsequently consented to an interim shared care arrangement with respect to Z.
The wife relies on an incident in 2012, when the husband unilaterally took Z to Queensland, as evidence of the husband’s coercive and controlling behaviour. On this issue the husband’s evidence was difficult to follow. He gave various reasons for taking Z away, and was less than convincing as to why he took the wife’s bank card, passport and prescription with him. Whilst I accept that this appears to be an act of coercion and control, it must be seen in the context of a family that was in crisis.
Further to this, although it seems unlikely in my view, that the husband never yelled or swore at the children, this also needs to be seen in the context of a very tense and difficult situation.
The Full Court in Kennon & Kennon (1997) FLC 92-757 (“Kennon”) set out the approach to be taken where a party’s conduct is alleged to have impacted a party’s ability to make contributions. Given the wife’s comments in the Family Report, it would appear that most of the conflict in this family stemmed from her boys and whilst the husband may have at times contributed to the situation, I do not find that the family violence in this case places it in the narrow band of cases to which Kennon applies.
Wastage
The wife deposes to the husband having been a regular smoker of marijuana for many years. Further to this, she says the parties had to draw down on their mortgage and/or the husband would sell their cars to pay for his drug-related debts.
The husband conceded under cross-examination that he smoked marijuana “a little bit”. However I found his evidence on this issue to be somewhat inconsistent. At first he said that in the United Kingdom he was purchasing marijuana every three weeks, however he later said he did not smoke marijuana for a substantial part of the time he was in the United Kingdom because he was working for the government.
Nonetheless, I do not accept that the evidence shows the husband’s use of marijuana would amount to behaviour such as to fall into the categories of cases such as Kowaliw & Kowaliw (1981) FLC 91-092. Nor do I believe there is sufficient evidence to show that the husband’s marijuana use meant he was unable to contribute financially, was otherwise unavailable to assist in the home, or that it made the wife’s contributions as a homemaker and parent more arduous as per Kennon.
The wife also appears to allege wastage due to the husband’s traffic fines and “other debts” and because she says he demanded she stop receiving the widow’s pension once they were married. There was no evidence in this case on which I could be satisfied that any of these matters would amount to wastage.
Contributions to the wife’s children
The husband’s case is that he made significant contributions towards the care of the wife’s children and that he did so under very difficult circumstances.
The husband says he assisted in the wife’s children’s day to day care, including with their school and sporting activities and had a significant role in endeavouring to get the boys help for their behavioural issues. This was particularly necessary as the wife had her own health issues and was often not well enough.
The husband’s case was that the boys took up a lot of the parties’ attention and money, with the parties funding at least one holiday for W to Country J.
The wife denied the husband made significant contributions to her children. She said he was very critical of the children and that because he was young and regularly using drugs, he did not have the ability to understand what they needed. Her evidence was that it was extremely rare for him to help with day-to-day activities and that he never assisted with cooking or cleaning, although she later qualified this to say she recalled he cooked twice in 10 years. The flavour of her evidence was that the husband made very limited contributions, and it appeared in my view that she was endeavouring to relegate his role to a very minor part in the family. For example, it was put to her that when Z was born she must have needed his assistance, however, she would not concede this, instead answering that the older children assisted.
I found the husband’s cross-examination with respect to his involvement with the children and the family quite credible. He described having two younger brothers who he looked after, which in his view meant he did not come to this role completely unprepared. In addition, the husband seemed to have insight into and an understanding of the impact on the children of having only lost their father the year before the parties met. He said he assured them he was not there “to replace their dad” but to be their friend. Whilst he conceded the role had its difficulties, he also said, at least at the beginning, they had “a lovely time” and cited an example of an occasion where Y had confided in him about the death of his father but had said “you’re here now, so I’m happy”.
The husband’s evidence was that he was involved with the children until 2015. He says that until that time he had been hoping for reconciliation if he gave the wife some space. Whether or not this was also the wife’s intention, it appears that the husband held a genuine belief in this regard.
I note that pursuant to the case of Robb & Robb (1995) FLC 92-555, a step-parent in providing care for step-children is acting essentially “as a volunteer” in assisting the biological parent in the discharge of their legal obligations. Accordingly, it is a matter which the court can take into account under s 75(2)(o).
On balance, I prefer the evidence of the husband on this issue, and find he made significant contributions towards the care and welfare of the wife’s children.
Contributions by the wife’s mother
It appears to be common ground that the wife’s mother gifted the household two dryers and paid for the parties’ kitchen when Z was born. However, these are not contributions I put significant weight on, particularly given the cost to the wife’s mother was never quantified.
Post-separation contributions
The wife’s case is that after separation she paid for all of the outgoings, including the mortgage on the Suburb C property and that she received no child-support from the husband. The husband says there was an agreement that, because the wife’s mortgage was so low compared with the rent he was required to pay, that he not be required to pay child support. The husband gave evidence that the wife’s mortgage was approximately $235.00 per month plus a $10.00 administration fee compared with his rent of approximately $700.00 a month. These amounts differ from the figures in the parties’ respective financial statements which equate to $429.00 per month for the wife’s mortgage and rates and $975.00 per month for the husband’s rent. In addition, the husband said he would pay for things that Z needed directly. He said he had offered to put funds directly into the wife’s account but she refused because she said it would affect her pensions. Counsel for the wife acknowledged that the husband had paid some school fees for Z but that the fees were reduced as the parties were entitled to a concession.
In taking all of this into account, and the benefit the wife received from residing in the home, I do not believe the wife should receive an adjustment for her post-separation financial contributions to the Suburb C property.
However, it seems to me on the evidence that the wife was almost entirely responsible for Z’s care after the husband moved out of the home. Whilst the husband suggests the parties’ had shared care until early 2015, it seems more likely that his time with Z was sporadic. His evidence was that towards the end of 2014, he kept trying to make arrangements to see Z but was told she did not want to speak to him (or that it was not convenient). This seems to have culminated in an unfortunate exchange between the husband and Z in which Z reportedly said “If you had money, I might love you more” and the husband childishly responded “ring me when you have money” or words to that effect. The husband’s evidence was that when the wife obtained an intervention order in 2015, she essentially removed Z from his life. Whilst the husband seemed to genuinely be grieving, not only his relationship with his daughter but the loss of the entire family, the reality is that he has not seen Z since that time and has no current relationship with her. Accordingly I find the wife made a significant contribution to the care of Z post-separation.
The husband’s industrial payout
It is common ground the husband received a compensation payout of $26,000.00 in about 2018. He says this was applied to general living expenses. Whilst the wife originally sought for this to be an add back to the asset pool this was not pressed in final submissions.
Whilst it is a matter that I could factor in under s 75(2)(o) there is no evidence that the husband applied these funds in any manner other than towards reasonable living expenses.
SECTION 75(2) FACTORS
The wife
The wife has not worked since late 2011. She is on a disability support pension. She asserts, and I accept, that it is unlikely she will ever have meaningful employment in future.
The wife has a myriad of health issues. The wife has been diagnosed with a range of mental health issues. The wife takes a range of medications. The wife is subject to a National Disability Insurance Scheme (“NDIS”) plan which provides her with substantial financial and practical assistance including support workers who assist her four days each week.
It was conceded by Counsel for the wife that there should not be an adjustment in the wife’s favour based on her health because her health needs would be met through the NDIS. The scheme largely pays the cost of the wife’s service providers directly save for an amount which is paid to her in cash to meet the costs of travel to and from support services. The wife’s use of this cash was not challenged.
The wife is currently receiving two pensions being $422.00 per week from her disability support pension and $230.00 a week from her United Kingdom pension, being a total of $652.00 per week as well as a payment of $51.00 per week from the NDIS for travel.
The husband asserts in his affidavit material that the wife has re-partnered, however this was not raised in cross-examination, nor final submissions.
The husband
The husband is not currently working. However, until recently, he was earning approximately $55,000.00 per year. The husband’s evidence is he ceased his employment due to the pressures of these proceedings. Presumably the husband will be able to return to work once the stress of this litigation has concluded. However, I note the husband has struggled historically to maintain constant employment, in part because of his own mental health issues. In any event, his income earning capacity is modest and after tax, is not dissimilar to the wife’s income from pensions.
DISCUSSION
This is one of those cases where unfortunately, the parties have very little to show for their 12 year relationship apart from one adult child. The asset pool is very small and neither party is likely to earn significant income.
It seems, given the parties’ modest income throughout the relationship, and what is now available for division between them, that the parties lived beyond their means.
This is also a difficult case because it is common ground that the wife’s initial financial contribution exceeded the total of the current asset pool. The wife’s Counsel submitted that, but for the fact that the Suburb C property was in joint names, this would be a case where the Court ought to be considering whether any orders should be made pursuant to Stanford. It was argued that the only reason the parties have the current property to divide is because of the wife’s initial contribution, and that everything flowed from that, likening this case to Jabour & Jabour [2019] FamCAFC 78.
It is evident that the wife made an overwhelming contribution to the marriage by virtue of the E Street property. This contribution was not only the “springboard” to the current pool but enabled the parties to live with only a modest mortgage, freeing up income for other purposes.
Nonetheless, the husband’s Counsel submitted, and I accept, with reference to the case of Petruski & Balewa (2013) 49 Fam LR 116, that the correct approach is to evaluate the extent of the contributions of all types made by the parties in the context of their relationship.
If the wife’s evidence is accepted, the husband made very few financial and/or non-financial contributions to the relationship. Her evidence was he was in and out of employment, spent any money he earned on drugs, was violent towards her and the children, did little around the home, and accumulated debts.
The husband’s evidence was that the marriage was a joint venture, the parties pooled their limited incomes for the benefit of the family and paid for expenses as they arose. Although the wife was the primary carer and primary homemaker, he assisted, in particular when she was unwell. From his perspective the relationship deteriorated as a result of the children’s behavioural issues and that although he did his best to keep the family together, their behaviour ultimately led to the parties’ separation.
In terms of the parties’ evidence I found the husband’s evidence to be the most compelling. The wife’s evidence was very black-and-white and it seemed she found it almost impossible to give the husband credit for any contributions to the relationship. The wife is no doubt aggrieved by the fact that even if she receives the entirety of the pool, she will be financially worse off than when the relationship commenced. This may have coloured her evidence and led her to play down, wherever possible, any contribution made by the husband.
Doing the best I can, weighing all of the parties’ contributions over the years, I am satisfied that those contributions are appropriately assessed as 75 per cent in favour of the wife and 25 per cent to the husband.
It seems to me that in relation to the s 75(2) considerations, the parties are in roughly equivalent circumstances. The wife’s health needs are met by NDIS and the parties otherwise have not dissimilar nett incomes. I am satisfied there is no basis for any further adjustment.
JUST AND EQUITABLE ORDERS
The Court has a very broad discretion as to how property orders should be structured to achieve an appropriate division of the parties’ property overall.
Given the modest superannuation in the husband’s name and that the wife will continue to receive ongoing pension payments beyond what would have been her retirement age, I do not believe it is just and equitable to make a superannuation split in this matter.
In terms of the non-superannuation property of $217,150.00, 25 per cent of that pool is $54,287.50. The husband has a car valued at $1,000.00 which would make a nett payment to the husband of $53,287.50. However the husband’s LSC debt is currently secured against the Suburb C property. In the event the wife is able to retain the property, the husband’s LSC debt would need to be repaid so the LSC charge can be removed. To ensure this occurs, I have reduced the payment to the husband by the amount of his LSC debt, being $3,185.90 and will order the wife to payout the LSC debt directly. Accordingly the husband is to receive $50,101.60.
I questioned the wife’s Counsel as to her ability to refinance the home but it remained unclear whether she could even refinance the current mortgage over the Suburb C property. As such, in order to give effect to these orders, it may be that the home has to be sold. Nonetheless, I will give the wife an opportunity to refinance the home at first instance.
Finally, I note that there is an existing costs order made by Judge Young on 20 September 2021 with respect to the husband and which, at trial, was still yet to be paid. This order provides for costs to be paid as agreed or as taxed. As there is no evidence before me as to either an agreement or as to taxation I am not able to account for those costs in the orders I make this day, save to order that the costs order remains in full force and effect.
For all of the foregoing reasons, I make the orders as are set out at the commencement of these reasons for judgment.
I certify that the preceding one hundred and five (105) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Jenkins. Associate:
Dated: 31 May 2022
0
4
0