Pelley & Pelley
[2022] FedCFamC2F 933
Federal Circuit and Family Court of Australia
(DIVISION 2)
Pelley & Pelley [2022] FedCFamC2F 933
File number(s): NCC 2928 of 2020 Judgment of: JUDGE CARTY Date of judgment: 14 July 2022 Catchwords: FAMILY LAW – PROPERTY – final property proceedings –damages for workplace injury received by husband post separation – failure to make proper financial disclosure – non-compliance with injunction – consideration of proposed add backs – assessment of contributions-consideration of waste – consideration of whether husband engaged in a course of violent conduct towards the wife during the marriage – consideration of whether husband’s conduct had a discernible impact upon the wife’s contribution as homemaker and parent – consideration of relevant matters in s.75(2) – consideration of what orders are just and equitable Legislation: Family Law Act 1975 (Cth) ss 4AB, 75(2), 79, 114
Federal Circuit and Family Court (Family Law) Rules 2021 (Cth) r 12.06(2)
Cases cited: Aleksovsky & Aleksovsky (1996) FLC 91-705
Clauson (1995) FLC 92-595
Collins (1990) FLC 91-144
Dickons & Dickons (2012) 50 FamLR 244
Friar v Friar (2015) 52 FamFLR 275
In the Marriage of Ferraro (1993) FLC 92-335
In the Marriage of Kowaliw (1981) FLC 91-092
Keating & Keating [2019]FamCAFC 46
Kennon & Kennon (1997) FLC 92-757
Kite & Kite [2011] FamCAFC 13
Norbis v Norbis [1986] HCA 17; (1986) 161 CLR 513
AJO and GRO (2005) FLC 93-218
Parshen.L v Parshen.JF (1996) FLC 92-720
Standford & Stanford (2012) FLC 93-495
Weir & Weir [1992] FamCA 69
Division: Division 2 Family Law Number of paragraphs: 194 Date of last submission/s: 25 February 2022 Date of hearing: 24 & 25 February 2022 Place: Newcastle Counsel for the Applicant: Mr Schonell Solicitor for the Applicant: Countrywide Legal & Business Services Counsel for the Respondent: Mr Bithrey Solicitor for the Respondent: R J O’Halloran & Co Solicitors & Attorneys ORDERS
NCC 2928 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS PELLEY
ApplicantAND: MR PELLEY
Respondent
order made by:
JUDGE CARTY
DATE OF ORDER:
14 july 2022
THE COURT ORDERS ON A FINAL BASIS THAT:
1.Within 14 days from the date of these orders the parties do all things and sign all documents to transfer the funds held in the trust account of Fox & Thomas Solicitors to be paid to the husband.
2.Within 14 days from the date of these orders the parties do all things and sign all documents to transfer the funds held in the trust account of RJ O’Halloran Solicitors to be paid to the husband.
3.Within 14 days from the date of these orders the parties do all things and sign all documents to transfer the funds held in the trust account of Countrywide Legal & Business to be paid in the following manner:
(a)The sum of $70,574.00 to the wife; and
(b)The balance to the husband.
4.Within 28 days of the date of these orders the husband will vacate the property situate and known as B Street, Suburb C in the state of New South Wales being the whole of the land in folio identifier … (“the real property”) and the wife will have the sole use and occupation of the real property from the date being 28 days from the date of these orders, for the purpose or preparing the property for sale in accordance with order 6 hereto.
5.Within 14 days of the date of these order the parties do all things and sign all documents to remove the wife from the Telstra account for the phone and internet at the real property. For avoidance of doubt if there is any outstanding amount on the account or fee that needs to be paid in order to remove the wife, the husband shall meet those costs.
6.Within 14 days from the date of these orders the parties shall do all things and sign all documents and do all things necessary to cause the sale of the real property by public auction at the earliest possible date and unless otherwise agreed in writing the following shall apply:
(a)Everingham Solomons Solicitors will be the solicitors appointed to act on the sale;
(b)The wife shall nominate a real estate agent to act on the sale;
(c)The wife shall consult with the real estate agent to determine a reserve price for the auction. She will have sole authority to instruct the real estate agent as to the reserve price.
7.The parties shall do all acts and things and sign all documents necessary to cause the removal of caveat registered by Perpetual Corporate Trust Limited (dealing number …) registered on the real property prior to or contemporaneously with the settlement of the sale of the real property, at the expense of the wife.
8.The parties shall do all acts and things and sign all documents necessary to cause the removal of dealing … registered on the Torrens Title register in respect to the real property prior to or contemporaneously with the settlement of the sale of the real property, at the expense of the wife.
9.Both parties shall be and are hereby restrained by way of an injunction from encumbering, charging, damaging or otherwise dealing with the real property except as required by these orders.
10.Upon sale of the real property the proceeds of sale shall be disbursed in the following order of priority:
(a)Payments of agent’s commission, advertising expenses and costs of the auction;
(b)Payment of legal expenses of the auction;
(c)Payment of any money due and owing to the mortgagee;
(d)Payment of council rates;
(e)50 % of the net proceeds to the wife, less any amount required to be paid in compliance with Orders 7 and 8 hereto; and
(f)Balance to the husband.
11.Unless otherwise specified in these orders and except for the purposes of enforcing the payment of any money under these or any subsequent orders:
(a)Each party shall be solely entitled to the exclusion of the other to all property, including chose-in-action, in the possession of such party as at the date of these orders;
(b)Any money standing to the credit of the parties in a bank account are to be retained by the party in whose name the account appears;
(c)Each party foregoes any claim they may have to any superannuation benefit or worker’s compensation that is belonging to or owned by the other save as provided for in these orders.
12.Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders.
13.In the event that either party refuses or neglects to comply with any provision of these orders:
(a)A Registrar of the Federal Circuit and Family Court of Australia is hereby appointed pursuant to the Federal Circuit and Family Court of Australia Act 2021 to execute all deeds and documents in the name of the party in default and do all things and acts necessary to give validity and operation to these orders; and
(b)The party in default shall pay all reasonable costs incurred by the other party for the purpose of exercising this order.
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 a pseudonym Pelley & Pelley has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE CARTY
INTRODUCTION
The applicant wife seeks orders to alter the property interests of the parties following the breakdown of their twenty years’ long marriage. She contends for orders which would entitle her to receive property with a value equivalent to 85% of the net assets.
The respondent husband contends for his entitlement to property with a value equivalent to 75% of the net assets.
Background
In this background, statements of fact are to be construed as findings unless otherwise stated.
The parties are both 47 years old. They commenced cohabitation around 1999 and were married in 2001. Their final separation occurred either around Christmas 2019[1] or on 4 January 2020[2]. They are not divorced. They lived together for a period of about 20 years.
[1] Husband’s affidavit paragraph 5
[2] Wife’s affidavit paragraph 9
There are two children of the marriage, Mr D born in 2004, currently 18 years old, and X born in 2005, currently 16 years old. Mr D lives with the wife and X lives with the husband in the former matrimonial home.
At the commencement of cohabitation each party owned a car, an unspecified amount of savings and their own personal effects.[3]
[3] Wife’s affidavit paragraphs 36-37, Husband’s affidavit paragraph 4
The wife worked throughout the marriage in paid employment, full-time up until the birth of X in 2005. From 2005 until 2007 she worked in a permanent casual position two days each week. Between 2008 and 2012 the wife worked in a permanent part-time position about 30 hours each week, and also as a babysitter at least one day a week earning $100 per day. Between 2012 and 2018 the wife worked permanent part-time as a technician at Employer E up to 30 hours each week. From 2018 until 2019 the wife worked as an administrative assistant on a permanent casual basis about 36 hours each week earning up to $42,000.00 per year. In October 2019 the wife recommenced full-time work earning $46,000.00 per year. She has worked full-time since, and currently works as an administrative assistant on a salary of $59,000.00 per year.
The husband worked in paid employment throughout the marriage. In 1999 he worked on a casual basis in a store. In 2000 he worked casually as a labourer. From 2001 until 2011 he worked in seasonal employment as a labourer earning about $78,000.00 per year
The husband suffered a workplace injury in 2008 and was off work for about nine months until late 2008. He had surgery on his back in 2008. He received worker’s compensation during his time off work. I accept the wife’s evidence that she provided support, including personal care, for the husband during this period[4] and that in addition to her permanent part time work she was also predominantly responsible for homemaker and parenting duties. The children were four years old and two years old at the relevant time.
[4] Wife’s affidavit paragraph 56
The husband received lump sum worker’s compensation in the amount of $30,000.00 in 2009 or 2010[5] which was applied to purchase a Motor Vehicle 1. The wife deposes that the vehicle was purchased for the husband’s “sole use”[6] however in cross examination she conceded that the vehicle was used for family purposes, including to transport the children and shopping. I accept that the husband applied the $30,000.00 for the benefit of the family[7].
[5] Wife’s affidavit paragraph 55
[6] Wife’s affidavit paragraph 55
[7] Parshen.L v Parshen. JF (1996) FLC 92-720 at 83, 655
In 2011 the husband commenced employment in primary industry as a transport worker, and from then on his earnings increased to just over $100,000.00 per annum[8] until about 2017, when his income declined following his workplace injury in 2016. The wife says, and I accept, that during the period the husband worked in the primary industry until after his injury, his income was a lot higher than her income.[9]
[8] Husband’s affidavit paragraph 17, Wife’s affidavit paragraph 47
[9] Wife’s affidavit paragraph 51
In about 2002 the parties acquired their first property, a vacant block of land at E Street, Town F. They constructed a kit home. Cross examination of the wife revealed that both parties, and the wife’s father, were involved in construction of the improvements to the E Street, Town F property.
The parties thereafter purchased a five acre vacant block of land at G Street, Town F for $70,000.00[10], although the evidence does not reveal when the property was purchased or precisely how the purchase was funded. With the help of his friend Mr H, and the wife’s father, the husband built a shed in which the family lived while the house was built. The husband obtained an owner builder licence[11] and the house was built with the help of friends and sub-contractors. I accept the evidence of the wife in cross examination that she assisted in erecting the timber framing for the house and with the landscaping.
[10] Husband’s affidavit paragraph 42
[11] Husband’s affidavit paragraph 17, 42
In 2013 or 2014 the husband injured himself in a fall from a ladder at home in Town F. He was off work for a month, during which time the wife attended to his needs while continuing to undertake the primary care for the children and the majority of the household duties, in addition to her permanent part time work.
In 2014 the husband received an inheritance from his late grandfather’s estate in the sum of approximately $10,000.00 which he applied to purchase an outdoor setting, and fishing and boating equipment for the family.[12]
[12] Wife’s affidavit paragraph 39
On 20 January 2016 the husband suffered an injury at work. He could hardly walk and was admitted to Town F Hospital.[13] On 11 February 2016 he had surgery on his back and spent about 28 days in hospital in Sydney, during which time his parents assisted him, and the wife remained in Town F caring for the children and the home and continuing in her employment. The wife says[14] and the husband admits[15] that following his surgery he could not cope with prolonged sitting or standing. He says he was bedridden and heavily sedated on painkillers for a number of weeks[16]. On 14 December 2016 he underwent a spinal fusion procedure and was in hospital for 5 days in Sydney, following which he had a lot of problems with getting out of bed and with mobility and he admits that he could not do household duties such as cleaning.[17] He “became irritable and felt an ongoing sense of worthlessness, helplessness and hopelessness” after the surgery[18]. He says that he resorted to alcohol and gambling[19] and that the wife would often say to him “You’re cranky and you have become a different person”[20].
[13] Husband’s affidavit paragraph 19; Wife’s affidavit paragraph 57-58
[14] Wife’s affidavit paragraph 59
[15] Husband’s affidavit paragraph 22
[16] Husband’s affidavit paragraph 52
[17] Husband’s affidavit paragraph 26-27
[18] Husband’s affidavit paragraph 54
[19] Husband’s affidavit pargaph 54, 55
[20] Husband’s affidavit paragraph 55
The wife says:
In the last two years of the marriage…[the husband]… was based at home where he would drink alcohol, gamble and sit around watching the racing channel on the TV. When I returned home from work I would….cook and clean and complete all of the home duties whilst [Mr Pelley] would be sitting around….[21]
[21] Wife’s affidavit paragraph 80
In early 2017 the wife moved out of the family home, taking Mr D with her, and the parties lived separately and apart for about six months. In mid-2017 they reconciled and lived together again until their final separation in late December 2019 or early January 2020.
When the wife was absent from the home in 2017 the husband says that he “was heavily reliant upon X to assist with various domestic duties including cleaning.”[22] I infer that the husband was also heavily reliant upon the wife whenever she was in the home with him following his injury in 2016.
[22] Husband’s affidavit paragraph 27
In 2018 the husband received superannuation and “total and permanent disablement insurance through his Employer Super”[23]. He received around $100,000.00 in August 2018[24] and around $60,000.00 in 2019.[25]
[23] Wife’s affidavit paragraph 70
[24] Wife’s affidavit paragraph 70
[25] Wife’s affidavit paragraph 71
The parties sold the home at G Street Town F in 2018 for $609,000.00. The net proceeds of sale amounted to about $300,000.00[26]. It appears that they applied the sale proceeds toward the purchase of the real property at B Street, Suburb C (“the B Street, Suburb C property”) for the sum of $472,000.00. They paid stamp duty of $16,730.00. They borrowed $290,000.00 from CBA, which included a redraw facility of $100,000.00.[27]
[26] Wife’s affidavit paragraph 245
[27] Wife’s affidavit paragraph 246,247
In 2021 the wife severed the joint tenancy and the B Street, Suburb C property is currently held by the parties as tenants in common in equal shares.[28]
[28] Wife’s affidavit paragraph 248
Since final separation the husband has remained in occupation of the B Street, Suburb C property, with X. The wife moved out with Mr D and they live in rental accommodation at Town F.
On 17 August 2020 the wife filed an Initiating Application seeking final and interim financial orders.
In late September 2020 the solicitors who acted for the husband at that time filed a Notice of Address for Service but did not file a Response. The husband did not file a Response until 6 December 2020.
On 7 December 2020 interim orders were made by consent, including that the husband provide disclosure of specific documents to the wife, and concerning the husband’s interim sole use and occupation of the B Street, Suburb C property. Pending its transfer or sale, the parties were restrained from further encumbering or dealing with the B Street, Suburb C property without consent. The husband was directed to maintain the building insurance at his expense, be responsible for maintenance of the B Street, Suburb C property and to indemnify the wife against outgoings including the mortgage payments, rates, insurances and utility expenses.
On 14 April 2021, in anticipation of the husband receiving an award of damages to compensate him for his workplace injury in 2016 (“the damages”), the wife filed an Application in a Case seeking that the damages be held on trust for the parties by Fox & Thomas Solicitors, in an interest bearing deposit account, save for the sum of $50,000.00 and other specified amounts.
On 15 May 2021 the husband filed a Response in which he sought an order to dismiss the wife’s application, and an order that he and X reside in the former matrimonial home pending final order.
On 19 May 2021 the husband received part of the damages in the sum of $430,000.00 which was deposited to his CBA Account #...88 by his solicitors[29]. The wife deposes, and I accept, that she was not informed that the damages had been received by the husband at that time.
[29] Exhibit G
On 9 June 2021 Her Honour Judge Terry ordered that until further order the husband be restrained by injunction from disposing of any more than $20,000.00 of the damages.
On 22 June 2021 Judge Terry ordered that until further order, in summary:
(a)The husband do all reasonable things to direct that any refund from the $70,000.00 paid to Medicare be paid into the Fox and Thomas Solicitors Trust account;
(b)The husband pay the damages, save for the sum of $50,000.00, into the Fox and Thomas Solicitors Trust Account by 5.00pm on 23 June 2021, and authorise the funds to be invested in an interest bearing account in the joint names of the parties; and
(c)The parties be restrained from further encumbering, charging or dealing with the B Street, Suburb C property.
On 12 August 2021 a refund from Medicare in the sum of $68,381.70 was deposited to the Trust account of Fox and Thomas Solicitors.
The damages which were paid to the husband, or on his account, amount to $498,381.70 net, after payment of the legal costs of the claim.
The final hearing before this court proceeded over two days, commencing 24 February 2022. The Applicant wife was represented by Mr Schonell of Counsel and the Respondent husband was represented by Mr Bithrey of Counsel.
Legal principles
Section 79(1) of the Family Law Act 1975 empowers the court to make such orders as it considers appropriate altering the interests of the parties to a marriage in the property of both or either of them.
Section 79(2) provides that the court shall not make an order under the section unless it is satisfied that it would be just and equitable to do so.
In Stanford & Stanford[30] the High Court said that when an application for property settlement is made the court must first identify the legal interests of the parties in the property and then consider whether it is just and equitable to make an order altering those legal interests. The question of whether it is just and equitable to make an order cannot be dealt with simply by considering whether a party has made contributions as set out in s.79(4) of the Family Law Act. The High Court said[31]:
In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s 79(4).
[30] Stanford & Stanford [2012] HCA 52
[31] Ibid paragraph 42
In determining the question of what order, if any, is just and equitable to make altering the interests of the parties in the property, the court is required to determine the following matters on the evidence:
(a)Identify the assets, liabilities and financial resources of the parties to the marriage;
(b)Identify and assess the relevant contributions of each of the parties within the meaning of s.79(4)(a), (b) and (c);
(c)Consider the matters in s.79(4)(d), (e), (f) and (g), including the matters in s.75(2) so far as they are relevant, and determine whether any adjustment ought to be made to the contribution based entitlement of the parties assessed earlier; and
(d)Consider the effect of the above findings and decide whether it is just and equitable to make the order.
The evidence and witnesses
In support of her case the Applicant wife relied on the following documents:
(a)Email from solicitors Countrywide Legal & Business Services providing costs notice in respect of the legal fees of the wife – Exhibit B;
(b)Minute of Final Order sought by the wife – Exhibit C;
(c)Outline of Case Document Final Hearing – Exhibit D;
(d)Her Amended Initiating Application filed 28 January 2022;
(e)Her Affidavit filed 28 January 2022[32];
(f)Her Financial Statement filed 28 January 2022;
(g)Updated Joint Balance Sheet – Exhibit E;
(h)Betstar Account Statement for husband for period 01 January 2021 to 11 February 2022 – Exhibit F;
(i)List of Transactions for Commonwealth Smart Access Account #...88 for period 1 January 2021 – 18 June 2021 – Exhibit G;
(j)Bundle of handwritten notes produced on subpoena by wife’s counsellor – Exhibit H;
(k)Bundle of transaction statements for accounts #...88, #...81 and #...10 – Exhibit I;
(l)Copy Commonwealth Bank cheque in the sum of $100,000.00 dated 23 June 2021 drawn in favour of X– Exhibit J;
(m)Auscript Transcript of Proceedings in the Federal Circuit and Family Court of Australia on Tuesday 12 October 2021 – Exhibit K; and
(n)Copy Trust Account Ledger R.J O’Halloran & Co – Exhibit N.
[32] The husband successfully objected to a number of passages which were struck from the wife’s affidavit
In support of his case the Respondent husband relied on the following documents:
(a)Company J Contract for sale of new Motor Vehicle – Exhibit A;
(b)Outline of Case Document Final Hearing, including Schedule of Effect – Exhibit L;
(c)His Affidavit filed 28 January 2022[33].
(d)His Financial Statement filed 8 February 2022; and
(e)Minute of Order Sought – Exhibit M.
[33] The wife successfully objected to a number of passages which were struck from the husband’s affidavit
The wife and the husband were both required for cross examination and gave oral evidence.
The wife
During the course of cross examination of the wife it became evident that she had tailored parts of her written evidence to suit her case. She deposed that when the husband received $30,000.00 by way of lump sum compensation for his work injury in 2008 he spent it on a Motor Vehicle 1 “for his own use.”[34] When pressed by Learned Counsel for the husband, she conceded that the utility was used for family purposes including transporting the children and shopping. The wife had embellished her evidence in chief by adding words “for his own use”. The wife deposed as to the parenting responsibilities which she undertook during the relationship[35] . She says that the husband assisted with the children’s transport and sporting activities[36]. She conceded in cross examination that from time to time he undertook some of the parenting duties which she deposed were her sole responsibility. The wife deposed that after the husband’s injury in 2016 she “continued to care for the children without any assistance from [the husband].” In cross examination she conceded that she omitted evidence that the husband had attended the children’s sports, training and games from when they were each five years old, until the family left Town F in 2018. The wife also conceded that after she moved out of the home with Mr D in early 2017 she did not provide care for the husband, or attend to the home at all, until cohabitation resumed in mid-2017, whereas she deposed that after the husband’s injury in 2016 she assisted him and continued to do everything around the house and everything for the children[37]. The wife conceded that X lived with the husband when the parties were separated during the first half of 2017.
[34] Wife’s affidavit paragraph 55
[35] Wife’s affidavit paragraph 86
[36] Wife’s affidavit paragraph 87
[37] Wife’s affidavit paragraph 62, 63, 64
Having made the above observations, I consider however that the wife was essentially a truthful witness. I am satisfied that she was the primary homemaker and caregiver for the children throughout the marriage. The husband conceded during cross examination by Learned Counsel for the wife, that the wife is a good mother and that during the entire relationship she was responsible for preparing the children for school, getting their uniforms ready, conveying them to and from school, attending to their extracurricular activities, and to their medical needs including immunisations. He said “Ms Pelley and I had an understanding. She’d clean inside and I’d do the outside”.
I am satisfied that the parties conducted their marriage on the basis of their mutual understanding that the wife was primarily responsible for the homemaker and parenting duties and that the husband was mainly, but not solely, responsible for outdoor maintenance. I am satisfied that during periods when the husband was recuperating from his injuries in 2008 and 2014 and after he suffered his workplace injury in 2016, he was restricted in his ability to undertake any household duties.
The husband
As is previously noted, on 22 June 2021 Judge Terry ordered that the husband pay the damages, save for the sum $50,000.00, into the trust account of Fox & Thomas by 4pm on 23 June 2021. The husband did not comply with that order. He caused or permitted a bank cheque in the sum of $100,000.00 to be drawn by the Commonwealth Bank on 23 June 2021 and made payable to the parties’ son X[38]. The husband did not deposit the damages, save and except for the sum of $50,000.00, to the trust account of Fox & Thomas Solicitors.
[38] Exhibit J. X was at that time aged 15 years old.
Counsel for the wife cross examined the husband about the terms of the order made on 9 June 2021 restraining him from “disposing of” more than $20,000.00 of the damages. Counsel asked the husband whether he understands what that order meant. The husband answered “No.” The following exchange occurred:
Counsel: “So you don’t understand that it means you can’t dispose of anything more than $20,000.00? Do you understand what dispose of means?”
Husband: “No I don’t”
Counsel: “So you’ve never disposed of a piece of rubbish?”
Husband: “Disposed. What does disposed mean?”
Counsel: “You don’t know what disposed means. Really?”
Husband: “You tell me”
Counsel: “You get rid of it. You dispose of it. You don’t know dispose?”
Husband: “Now I do, you just told me”…
Counsel: “You weren’t aware on 9 June 2021 that you were you unable to use those funds?”
Husband: “It was all gone out of that account and I gambled it. I am not going to deny I didn’t gamble it. I gambled it and I totally regret what I’ve done but I gambled it”
Counsel: “And you’ve always told the truth in court haven’t you?”
Husband: “Well no I didn’t did I. No I didn’t…”
Counsel asked the husband about the court event on 22 June 2021 and the following exchange followed:
Husband: “I think I said I gambled it”
Counsel: “Was it true?”
Husband: “I think I said I gambled all of it”
Counsel: “That wasn’t true was it?”
Husband: “No.”
The matter came before His Honour Judge Betts on 12 October 2021 and the husband appeared in person by telephone conference and was not legally represented. The Auscript Transcript of the proceedings that day are in evidence.[39] The transcript records that the wife’s solicitor informed Judge Betts that the Medicare refund had been deposited to the Fox and Thomas solicitors’ account, as required by the order made 22 June 2021, but that no other funds from the damages had been deposited. In response to a question from His Honour to the husband about whether the balance of the funds, save for the Medicare refund, had been deposited into the Fox and Thomas Trust Account the following exchange is recorded:
Husband: Yes, Your Honour. That money was disposed of and gambled and spent before the date that I was given to spend it, and I never had any of that money left on that date.
His Honour: [Mr Pelley], her Honour Judge Terry ordered that you were to pay all moneys except for the $50,000.00 received by you out of your compensation.
Husband: Yes. That’s right, your Honour. And I gambled it, and all the money was gone before then, and I told Ms Terry that on the day. [40]
[39] Exhibit K
[40] Exhibit K page 5 lines 30-40
Judge Betts warned the husband that if he had deliberately set out to breach an injunction then that could constitute a contempt of court, and that if the court was being misled and the money had been retained it was a very serious contempt of court. The husband responded“…your Honour, I know all what you’re saying…and guess what, the money has been spent, mate, like I told Judge Terry.”[41]
[41] Exhibit K line 45
During cross examination the husband conceded that when he appeared before Judge Betts he had in his possession the bank cheque drawn on 23 June 2021 in favour of X and that there was a credit balance in his personal bank account #...88 in the sum of $57,303.47.[42]
[42] Exhibit I
It is evident that the husband has neither spent, nor gambled, all of the damages. He told a lie to Judge Terry and Judge Betts when he said that he had spent and gambled all the damages. He reiterated the same lie to this court when he said during cross examination:
It was all gone out of that account and I gambled it. I am not going to deny I didn’t gamble it. I gambled it and I totally regret what I’ve done but I gambled it
I reject the husband’s evidence that he did not understand the meaning of the word “dispose”. On 12 October 2021 he told Judge Betts “…money was disposed of and gambled and spent”. In his Financial Statement he deposes to “Disposal of compensation monies as per affidavit filed 28 January 2022.”[43] I am satisfied that the husband at all relevant times has understood the meaning of the word “dispose” and the words “disposed of ”. The husband is prepared to lie to the court and has attempted to mislead the court.
[43] Filed on 9 February 2022, at Part M.
The husband’s choice to deposit and transfer sums of money using the bank account belonging to the parties’ son X is explained by him in his affidavit:
I have been depositing significant sums of money from my settlement into my son’s account. I initially deposited the money as a further measure to prevent me from gambling. Unfortunately, as a result of my gambling addiction, I have transferred money in and out of my son [X’s] account on multiple occasions[44]
[44] Husband’s affidavit paragraph 56
I reject the husband’s evidence that he deposited the funds to X’s account as a measure to prevent him from gambling. The bank records demonstrate that he carried on his betting activities using X’s account #...81[45]. Commencing on the day after the first transfer of the damages into X’s account there are transfers out of that account to Sportsbet Pty Ltd, Betfair and Company K. X was 15 years old at the time so a more probable explanation for why the husband chose to deposit a large amount of the damages to his son’s account is that he wanted to put the damages out of the reach of the court and of the wife and be able to carry on his activities, including gambling, without restraint or interference. In cross examination he said that he considered the damages were awarded to him for his back and that he did not want to give the damages to anybody else.
[45] Exhibit
Cash withdrawals totalling $40,000 were explained by the husband in his affidavit as follows:
I withdrew $20,000.00 on 7 June 2021 and I withdrew various other cash amounts which I would also estimate total $20,000.00. I kept the $40,000.00 in a safe purchased from Bunnings…the cash amount was stolen. [46]
[46] Husband’s affidavit paragraph 57(f)
The husband deposed that he discovered that the cash, which he says he stored in his safe, was stolen on 22 June 2021. He notified the police and he says that the perpetrator has not been identified. [47] In cross examination he was asked “How much did you put in the safe” and he responded “40-50 thousand”. Later in his oral evidence he said that he took out $50,000.00 and put it in the safe. He was taken to evidence contained in documents produced by NSW Police which record that he reported to police that $30,000.00 was stolen from the safe along with a bank cheque for $100,000.00. The only bank cheque in evidence is the cheque for $100,000.00 drawn in X’s favour on 23 June 2021.[48] He told the court that a bank cheque was stolen on 22 June 2021 and replaced the next day. Nowhere in his affidavit does the husband say that there was a bank cheque in the safe, or that a bank cheque had been stolen. He admitted in cross examination that he reported to the police that his son Mr D has a problem with ice, and that Mr D had sided with the mother in the breakdown and that he had blamed his son for the break-in. There is no evidence in his affidavit to that effect. However the wife annexes to her affidavit a facebook post, which the husband, in cross examination, admitted is his post, which depicts two photos of Mr D and states:
Anyone seen this bloke ring the police I have had my house smashed and broken into and 200 Grand taken out of the safe they smashed. [49]
[47] Husband’s affidavit paragraphs 59, 60
[48] Exhibit J
[49] Wife’s affidavit -11
The evidence the husband gives in his affidavit, and the evidence he gave to the court during cross examination, and the evidence of what he reported to police on 22 June 2021, and his post on face-book, all contain a different account given by the husband as to what he alleges was stolen from his safe on 22 June 2021. His various accounts are plainly inconsistent. The evidence in relation to the alleged theft of monies from the husband’s safe on 22 June 2021 further exemplifies that the husband is prepared to make false representations to the court when he perceives it may assist his case, and it appears that he prioritises his aspiration to retain for his own sole use and benefit the whole of the damages, above the requirement for him to tell the truth. The court rejects the husband’s evidence that money was stolen from his safe on 22 June 2021.
The husband has had the benefit of legal representation throughout most of the course of these property proceedings. He admitted that on 6 October 2021 the wife’s solicitors had requested that he provide to them a copy of statements relating to all his online betting accounts, and also that on 28 January 2022 the wife’s solicitors requested that he supply evidence of the income that he has received from gambling during the past two years. The husband conceded that he has not supplied the documents which were requested by the wife’s solicitors. He also admitted that he has not provided disclosure of his bank account transactions from 15 December 2021 to date. A call was made for the relevant bank statements but the call was not answered. The husband said that he does not know whether the wife knows what he has in his back account currently.
On the second day of the trial the wife’s legal representatives were furnished with a Trust Account Ledger statement for the husband’s solicitors R.J O’Halloran.[50] The ledger records that $17,500.00 was paid by the husband via bank transfer deposit on 4 February 2022 and is held on Trust for him. There is no reference at all to this amount in either the husband’s affidavit or in his financial statement[51] . In cross examination the husband said that he “must have forgot about them.”
[50] Exhibit N
[51] Affirmed on 8 February 2022.
The court finds that the husband has failed to comply with his ongoing duty to make full and frank disclosure of his financial circumstances. He has provided no evidence of the income that he has received from his gambling activities. He has not provided the statements relating to his betting accounts. He has failed to provide or produce up to date bank account statements. He failed to disclose, until the second day of the trial, the transfer of funds to his solicitor’s trust account on 4 February 2022. Due to the husband’s non-disclosure, the wife has been put to the expense of issuing subpoena to obtain the relevant material relating to his betting accounts. The husband maintained in cross examination that he doesn’t understand disclosure. He said “What is disclosure?” I reject his evidence and consider it is more likely than not that the husband is attempting to mislead the court in order to avoid proper scrutiny of his financial circumstances.
Existing Assets, Liabilities and Superannuation Interests
The husband and wife each filed a separate Balance Sheet on 23 February 2022, and the wife tendered an Updated Joint Balance Sheet on 25 February 2022 [52] which was the subject of broad agreement, apart from the issue of addbacks which will be addressed further in these Reasons.
[52] Exhibit E
The following findings are drawn from the Updated Joint Balance Sheet and were conceded to be correct by both parties during submissions.
The existing assets, liabilities and superannuation interests of the parties, subject to the court’s findings with respect to the issues concerning the disputed proposed addbacks, are:
Description Ownership Value Real property at B Street, Suburb C Joint $540,000 Motor Vehicle 2 Wife 17,250 Motor Vehicle 3[53] Husband 41,581 Motor Vehicle 4 Husband 14,700 Furniture, tools, camping and fishing equipment Joint 5,000 Boat Husband 10,000 Monies held in Trust Account of Fox Thomas Solicitors Husband Joint $68,381 Monies held in solicitors Trust account of Countrywide legal business Husband Joint 100,000 Animals Husband $90,000 Monies held in Trust Account of RJ O’Halloran & Co Husband $17,500 Assets $904,412 [53] Exhibit A
The parties have the following liabilities:
Description Ownership Value Mortgage – B Street, Suburb C $272,294 Total liabilities $272,294
The parties have the following superannuation:
Description Ownership Value Super Fund L Wife 94,935 Super Fund M Husband 729.00 Total superannuation 95,644
The parties conceded that the following amounts will be notionally added back to the pool:
Description Ownership Value Redraws on mortgage at separation Husband
Wife20,000
42,500
Disputed notional items of property
The parties are in dispute as to the following proposed addbacks or notional items of property:
(a)The sum of $8,000 from the sale of a Motor Vehicle 1, which the wife contends should be added back and treated as an asset of the husband;
(b)The sum of $20,000 Employer Super received by the husband on 14 January 2020, which the wife contends should be added back and treated as an asset of the husband;
(c)The sum of $9,771 Employer Super received by the husband on 14 April 2020, which the wife contends should be added back and treated as an asset of the husband; and
(d)The sum of $172,500.00 which the wife contends is the amount that is unaccounted for from the damages and should be added back and treated as an asset of the husband.
I will consider each of the disputed addbacks in turn. In determining the issue of addbacks I have regard to the decision of the Full Court of the Family Court of Australia in AJO and GRO[54] and in particular the three clear categories of cases where it has been determined that it is appropriate to notionally add back into the pool assets that no longer exist.
[54] (2005) FLC 93-218 at 79,617; 79,618
Proceeds of sale of Motor Vehicle 1
The wife contends that there has been a premature distribution to the husband of a matrimonial asset. The totality of the wife’s evidence about this issue is that the husband purchased the Motor Vehicle 1 in about 2010 using the proceeds of his workers compensation settlement funds of $30,000.00[55]. It appears that that asset no longer exists[56] . There is no evidence from the husband in relation to it, and he was not cross examined about the proceeds of sale of the Motor Vehicle 1.
[55]Wife’s affidavit paragraph 55
[56] Husband’s financial statement
There is insufficient evidence to satisfy the court that it is appropriate to addback any amount on account of the Motor Vehicle 1 and I am not persuaded to addback any amount in respect of it.
Employer Super received 14 January 2020 and 14 April 2020
At the time the husband received the above payments the parties had separated and he was in receipt of worker’s compensation weekly payments in the sum of $494.50.[57] He was yet to receive the damages. He was responsible for the care of X and for paying the mortgage and rates for the B Street, Suburb C property. There is little evidence about the Employer Super funds in the affidavit of the wife, and no evidence at all in the affidavit of the husband. The husband in cross examination said that needed the Employer Super funds to live on.
[57] Husband’s affidavit paragraph 34
I am not satisfied that the husband deliberately embarked on a course of action designed to reduce or minimise the value of the Employer Super, nor that he has acted recklessly, negligently or wantonly with the funds. I am satisfied that it is more likely that the husband applied the funds to meet his legitimate living expenses, noting his modest income at the relevant time, and his responsibility for X. I am not persuaded to addback any amount on account of the Employer Super funds received by the husband in 2020.
The damages
A net amount of $498, 381.70 was received by way of the damages. Doing the best the court can on the evidence it appears that the following amounts, which have their origin in the damages, are presently accounted for:
(a)$68, 381 held in the trust account of Fox & Thomas[58];
(b)$100,000 held in the trust account of Countrywide Legal Services[59];
(c)$17,500 held in the trust account of RJ O’Halloran[60];
(d)$52, 000 used to purchase Motor Vehicle 5[61] (which was subsequently used as a trade in to purchase the Motor Vehicle 3 for $41,581.00 on 17 February 2022[62]);
(e)$90,000 worth of animals[63];
(f)$5,000 repaid to Mr N for monies advanced[64];
(g)$8,000 repaid to husband’s parents in respect of loans[65].
(h)$340,881
[58] Exhibit E, item 7
[59] Exhibit E item 8
[60] Exhibit E item 10
[61] Husband’s affidavit paragraph 57(a)
[62] Exhibit A
[63] Exhibit E item 9, although it is not entirely clear on the evidence whether this is the amount the husband has paid for animals, noting the wife’s evidence that the parties owned 5 animals at date of separation (Wife’s affidavit paragraph 189)
[64] Exhibit G; There is a transfer from the husband’s account to Mr N on 20 May 2021 in the sum of $5,000.00.It is apparent that this transfer repaid funds transferred by Mr N to the husband on 18 February 2021when the balance in the husband’s account was $191.54. I consider that the repayment to Mr N is a legitimate loan repayment.
[65] Exhibit G
I do not accept that the husband was required to repay his parents $16,000 which he says he has paid to them from the damages.[66] He provides no evidence of any amount advanced to him by his parents. There is no evidence from the parents. Evidence obtained from the bank account statements reveals that the husband received four separate transfers, each in the sum of $2,000, posted “Ms O Loan” between 8 January 2021 and 8 April 2021, which transfers total $8,000[67]. The evidence establishes only that $8,000 is a legitimate repayment for the monies advanced to the husband by Ms O in the period leading up to him receiving his damages in May 2021. The balance of the monies which the husband deposes that he has paid to his parents is unexplained.
[66] Husband’s affidavit paragraph 57(c)
[67] Exhibit G
Having regard to the unreliability of the husband’s evidence about how he has used the damages, his preparedness to misrepresent his true financial position to the court, and his failure to make full and frank disclosure or to account for the monies he says he has paid to his parents, I conclude that the sum of $8,000 unaccounted for is properly brought back into the pool on a notional basis and allocated to the husband.
It is not in dispute that the husband withdrew at least $40,000 in cash from the damages. For reasons which have already been explained I do not accept his evidence that an amount of cash was stolen from his safe on 22 June 2021. I consider it more likely than not that the husband has prematurely distributed the cash assets to himself. I consider that the correct way to deal with the husband’s withdrawal of $40,000 in cash is to bring that amount into the pool of assets on a notional basis and allocate it to the husband.
I consider it appropriate to addback the sum of $6,000 which the husband deposes that he paid to his solicitors from the damages in respect of legal fees for his representation in the ADVO proceedings[68].
[68] AJO & GRO ( 2005) FLC 93-218, at 79,617; Husband’s affidavit paragraph 57(d)
Taking into account the $340,881 accounted for, and the addbacks identified so far which account for a further amount of $54,000, there remains a sum of $103,500.70 which is unaccounted for in the amount of the damages.
The wife urges the court to find that the husband has acted recklessly, negligently or wantonly with the damages, the overall effect of which has been to reduce or minimise the value of same, and she relies on such alleged conduct to found her contention that the balance of the damages which are unaccounted for should be added back notionally and distributed to the husband.
There is no dispute that the husband is a gambler, and he admits that he has used the damages to fund his gambling. The wife goes to some length in her affidavit to set out debits from the husband’s account and from X’s account which relate to the husband’s gambling. There have undoubtedly been significant transfers to betting agencies. The husband conceded in cross examination that during the period between 17 June 2021 and 19 June 2021 he lost $ 23,499.70 as a result of gambling. The bank account statements in evidence record credits to the husband’s account, and to X’s account, from betting agencies and from racing, which appear to reflect some winnings. The wife’s evidence is that the husband received $25,560.00 in winnings from racing his own animals since 14 November 2021[69]. The husband was a regular gambler throughout the parties’ relationship. The wife held a trainer’s licence from October 2018. The parties purchased two animals at that time, and by the date of separation they owned five animals, whose value ranged from $800.00 to $4,000.00.[70] The family were active participants in animal racing during the latter years of the marriage, and I am cognisant that the activity provided a source of legitimate entertainment, at least for the husband, and noting the wife’s evidence that she was somewhat of a reluctant participant[71].
[69] Wife’s affidavit paragraph
[70] Wife’s affidavit paragraph 187-189
[71] Wife’s affidavit paragraph 193
There was no attempt by either party to reconcile gambling debits with gambling credits to quantify the amount that the husband has lost overall as a result of gambling using the damages.
The husband’s statutory weekly payments of worker’s compensation ceased when he received the damages.[72] From 19 May 2021 up to the date of trial, a period of about nine months, he has relied on the damages, along with modest fortnightly payments from Centrelink in respect of his care of X, and presumably some winnings, including from races won by his animals, to fund his living expenses including food, fuel, pet food, utility bills and to financially support X including his education expenses[73]. The husband has made mortgage repayments[74] and attended to the payment of council and water rates[75].
[72] Husband’s affidavit paragraph 34
[73] Husbands affidavit paragraph 57(g)
[74] Exhibits G & I; Wife’s affidavit paragraph 261-265; Husband’s affidavit paragraph 57(b)
[75] Exhibit I; Husband’s affidavit paragraph 57(g)
The husband has provided no proper accounting for his expenditure, in circumstances where the court made an injunction on 22 June 2021 restraining him from spending any more than $50,000.00 of the damages. For the reasons already provided, I am satisfied that there has been deliberate non-disclosure of his financial circumstances on the part of the husband.
It is well established, as the Full Court commented in Weir[76] , that:
…once it has been established that there has been a deliberate non-disclosure… then the court should not be unduly cautious about making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature….the Court’s jurisdiction to make an order going beyond the identified property arises once there is sufficient evidence to support a finding that the party has not made a full disclosure of his or her assets.
[76] Weir & Weir [1992] FamCA 69 at 33
In the present case, having regard to the injunction made by the court on 22 June 2021, I consider that the husband’s unaccounted for use of any more than $50,000 of the damages falls within one of the circumstances outlined in AJO & GRO[77], namely the conduct referred to by Baker J in Kowaliw[78]:
…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
[77]Op cit at paragraph 30 (a)
[78](1981) FLC 91-092
The husband has disbursed the damages in disregard for the injunction imposed on 22 June 2021. He has provided no proper accounting for his expenditure. I take into account that he has met his own living expenses, and those of X, for nine months leading up to the trial, as previously outlined. I consider that the amount disbursed by the husband which are unaccounted for are funds which have been disbursed in excess of $50,000 which the court permitted him to use pursuant to the order made on 22 June 2021. Accordingly I will add back to the pool on a notional basis the sum of $53,500 and allocate that sum to the husband.
Assets including addbacks, liabilities and superannuation of the parties
As a consequence of the court’s findings with respect to the issue of addbacks the assets of the parties are:
Non-superannuation assets
(1)B Street, Suburb C Joint $540,000
(2)Motor Vehicle 2 Wife $ 17,250
(3)Motor Vehicle 5 Husband $ 41,581
(4)Motor Vehicle 4 Husband $ 14,700
(5)Boat Husband $ 10,000
(6)Furniture, tools, camping and fishing Joint $ 5,000
(7)Monies held in Trust Account of Fox
Thomas Solicitors (Medicare) Husband/joint $ 68,381
(8)Monies held on Trust in solicitors trust
Account of Countrywide Legal
& Business Husband/joint $100,000
(9)Animals Husband $ 90,000
(10)Monies held on Trust in solicitors trust
Account – RJ O’Halloran & Co Husband $ 17,500
ASSETS: $904,412
Plus addbacks
(11)Redraw on mortgage at separation Husband $ 20,000
(12)Redraw of mortgage at separation Wife $ 42,500
(13)Excess Funds paid to husband’s parents Husband $ 8,000
(14)Husband’s legal fees Husband $ 6,000
(15)Cash Monies withdrawn Husband $ 40,000
(16)Damages unaccounted Husband $ 53,500
ADDBACKS: $170,000
Superannuation assets
(17)Super Fund L Wife $ 94,935
(18)Super Fund M Husband $ 729
SUPERANNUATION: $ 95,664
Total assets including addbacks and superannuation $ 1,170,076
The liabilities
It was agreed that the mortgage of $272,294 secured over the B Street, Suburb C property is the only liability of the parties[79] and I find accordingly.
[79] Exhibit E
Financial resources
It was agreed that neither of the parties has a financial resource[80] and I find accordingly.
[80] Ibid
NET POOL OF PROPERTY
I find that the net pool of property, including superannuation, available for distribution between the parties amounts to $ 897,782.
SECTION 79(2) FAMILY LAW ACT
I consider that the situation of the parties in the present case falls squarely within the ambit of the circumstances referred to in the passage already quoted from Stanford. Neither party contended otherwise. The court is satisfied that it is just and equitable to make an order altering the interests of the parties in their property in the circumstances of this case.
Assessment of the contributions of the parties
The Full Court said in Dickons & Dickons[81]:
The essential task is to assess the nature form and extent of the contributions of all types made by each of the parties within the context of an analysis of their particular relationship
[81] [2012] FamCAFC 154; (2012) 50 FamLR 244
The five main issues relating to contribution at the trial were:
(1)Whether the court will adopt an asset by asset or global approach to the assessment of the parties’ contributions;
(2)Whether the damages are to be regarded as a contribution solely attributable to the husband;
(3)What weight, if any, the court will give to the wife’s care of the husband when he was recovering from injury, and in the context of her contributions as homemaker and parent and more generally;
(4)The alleged conduct of the husband toward the wife during the marriage and whether the husband’s conduct had a deleterious effect on the wife’s wellbeing including on her mental health which has made her contributions in her role as homemaker and parent more arduous; and
(5)Alleged waste of matrimonial assets due to the husband’s gambling.
Counsel for the husband contended that the court ought to adopt an asset by asset approach when assessing the parties’ contributions to the damages and referred to the decision of the High Court in Norbis v Norbis[82]. In support he submitted that the damages which were received after separation had not been intermingled with other matrimonial assets.
[82] [1986] HCA 17; (1986) 161 CLR 513 (30 April 1986)
In Norbis the Honours Mason and Deane JJ made the following observations:
16. 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. Which of the two approaches is the more convenient will depend on the circumstances of the particular case. However, there is much to be said for the view that in most cases the global approach is the more convenient. It follows that the Full Court is quite entitled to prescribe that approach as a guideline in order to promote uniformity of approach within the Court. In saying this we are not to be understood as denying the legitimacy of the trial judge's ascertainment in the first instance of the financial contributions of the parties by reference to particular assets. It is difficult to conceive how the trial judge in many cases could otherwise take account of such contributions as he is required to by s.79(4)(a) of the Act. In this respect we agree with the comment of Nygh J. in G and G that, although mathematical precision is certainly not required, there is ordinarily a need to know the circumstances in which assets were acquired and the general extent of each party's contribution to them.
17. The assessment of the parties' entitlements before the making of an order is another question, quite distinct from the assessment of their contributions. As a matter of construction of s.79 Nygh J. is right in saying that the section imposes no obligation on the Family Court to pursue in relation to this issue either the global approach or the asset-by-asset approach to the exclusion of the other. We do not understand the Full Court in the present case to suggest otherwise. What the Full Court asserts is that the global approach is the only "realistic", that is, convenient, means of arriving at the entitlements of the parties. Again, it seems to us that it will depend on the circumstances of the particular case, though in the majority of cases the global approach will be the more convenient and for this reason the Full Court is entitled to prescribe its adoption as a guideline in the majority of cases. The Family Court has rightly criticized the practice of giving over-zealous attention to the ascertainment of the parties' contributions, and we take this opportunity of expressing our unqualified agreement with that criticism, noting at the same time that the ascertainment of the parties' financial contributions necessarily entails reference to particular assets in the manner already indicated.
I consider that it is appropriate in this case to adopt a global approach to the assessment of the contributions of the parties. I take into account the duration of the marriage, the birth of the two children, the participation of both parties in paid employment throughout the marriage, the wife’s greater homemaker and parent contributions, and the wife’s support of the husband throughout the majority of the periods when he was recuperating from his various injuries, apart from the 6 month period from early 2017 to mid-2017 when the parties lived separately.
I consider also that the husband has intermingled the damages with other matrimonial assets, for example by buying, racing and training an additional number of animals to those which the parties held at the time of separation. I also note the deliberate non- disclosure by the husband as to the income and outgoings involved in that activity, and in relation to his gambling activities. I take into account that the husband applied the damages to make repayments on the home loan and to pay rates and other outgoings in respect of the B Street, Suburb C property.
In support of his submission that the damages should be regarded as a contribution solely attributable to the husband, Counsel referred to the decision of the Full Court of the Family Court of Australia of Aleksovsky & Aleksovsky[83]. He submitted that the court would weigh the contributions to the damages received by the husband 100% in his favour and 0% to the wife.
[83] (1996) FLC 91-705
I accept the husband’s Counsel’s submission that the husband received, up until separation, statutory weekly payments of workers compensation, along with a total and permanent disability payment in the sum of $100,000.00, and superannuation withdrawals totalling about $60,000.00 during 2018, which together were sufficient for him to continue to contribute to the financial support of the family throughout the course of his injury and up until separation.
The Full Court in Aleksovski v Aleksovski[84] said at 83, 437:
In our opinion, in most cases, a damages verdict arising from a personal injury claim, whenever received, is a contribution by the party who suffered the injury. It should not be considered in isolation, for the reason that each and every contribution, which each of the parties makes to the relationship, must be weighed and considered at the same time
[84] (1996) FLC 92-705
I consider that the assets which have been acquired by the husband through his use of the damages stand in a different position from other property of the parties which was acquired during the marriage by the use of their joint funds, and as a result of their joint efforts. The assets acquired by the husband from his damages have a net value of $424,962 which represents an amount equivalent to 47.3% of the net pool of property currently available for distribution between the parties. I accept that the wife made no direct or indirect financial contribution to the damages. I consider that the damages are a contribution made on behalf of the husband who suffered the injury. I will take that contribution into account when considering and weighing each and every contribution made by each party during the course of the relationship and in the period post separation.
Under cross examination the husband agreed that following his injury in 2008 the wife cooked the food, washed the clothes, cleaned the house and looked after the children. When asked whether the wife did those tasks with little assistance from him he replied “probably right for the first 4 weeks”. I consider that the husband has minimised the wife’s contribution during the 6 months he spent off work recovering from his injury in 2008. I prefer the wife’s evidence that she supported him by assisting him with his personal care, and that she remained primarily responsible for the care of the children and the homemaker duties, while maintaining her permanent part-time employment up to 30 hours each week.
The husband agreed that the wife drove him to Town F hospital following his injury in early 2016, and that he remained there for 28 days and that for that period the wife cared for the children. In cross examination he said, “…yes she done a good job”. He agreed that he was transported by air ambulance to Sydney and that following the first surgery in 2016 he couldn’t sit or stand for more than 20 minutes and was unable to drive for 6 weeks. He asserted during his oral evidence that “the children looked after themselves”. Mr D was then aged between 11-15 years and X was aged between 10-14 years. The Court rejects the husband’s evidence that the children looked after themselves. The husband agreed that the wife did all washing between 2016 and late 2019, except when she left for 6 months in 2017. She prepared the children for school, during the entire relationship, apart for a handful of occasions when the husband took the children to or collected them from school. He agreed that the wife attended to the children’s medical needs. He agreed that since X has lived with him the wife has paid for school shirts and for X’s mobile phone. He volunteered in cross examination that the wife was a loving mother and a good mother. He agreed that she accompanied him to the first appointment with lawyers to assist him with his claim for damages.
I prefer the evidence of the wife that she provided care and assistance for the husband during each of the periods which followed the three separate injuries the husband suffered during the marriage, with the sole exception of the period when parties lived separately and apart in the first half of 2017. The husband has spent a cumulative period of around four years and ten months during the twenty years’ long marriage recovering from injuries he sustained. I find that throughout the husband’s recovery, except for six months in 2017, the husband relied on and was provided with the wife’s personal assistance, and the wife continued to care for the children and undertake the duties of a homemaker, while continuing to work in paid employment throughout the entire periods.
The wife alleges that the husband’s conduct toward her during the marriage was at times violent and that his violent conduct had a significant adverse impact on her sense of wellbeing and in particular her mental health. She says that the impact of the husband’s conduct towards her made her contributions as a homemaker and parent more arduous.
The wife deposes that the husband engaged in controlling behaviour towards her throughout most of the marriage. He accused her of having affairs and regularly questioned the paternity of the older child Mr D, even after a paternity test he demanded established that there was a very high probability that the husband is Mr D’s father. She deposes that the husband regularly took her phone and read her text messages from about 2003 until separation, and that in 2006 he took her keys and ATM card to prevent her from leaving the house. In cross-examination the husband admitted that he read the wife’s text messages between 2003 and separation. He agreed that the wife had put a lock on her phone in 2008. He denied taking her keys and ATM card to prevent her from leaving the house.
The husband admitted during cross examination that on 21 February 2014 in a text message exchange between himself and the wife, while she was out visiting friends across the road and he was at work, he sent a message to her which read “Ring me now”. She responded “Goodnight and stop being possessive”.[85] He texted back “U won’t be talking your way out of this one GPS don’t lie”. Counsel for the wife put to the husband that he was tracking the wife. The husband denied he was tracking her and he answered “I just said it”. The husband volunteered that it was “always in the back of my head” that the wife might have had an affair, because of a pregnancy that he says she terminated. He considered that she may have become pregnant to someone else and said that her alleged decision to terminate a pregnancy made him think “what’s going on here?” He didn’t know if she was pregnant to another man. He said that he’d asked her whether she’d had an affair. His evidence persuades the court that the wife is telling the truth when she deposes that the husband was jealous and controlling, and that he accused her of having an affair and of Mr D not being his son. I consider further that the text message exchange corroborates the wife’s evidence that the husband was controlling and possessive in his attitude toward her during the marriage.
[85] Wife’s affidavit paragraph 142
The wife describes how the husband’s conduct made her and the children’s daily lives difficult. She gives evidence of him flying into a rage, while accusing her that Mr D is not his son. She says that the husband was generally cranky and displayed a volatile mood with the result that she and the children would walk around him “on eggshells”.[86]
[86] Wife’s affidavit paragraph 96
She deposes that the husband and Mr D argued daily between 2018 and 2019 and that she observed the husband to chase Mr D out of the house, and to throw things at him including a beer bottle. She observed Mr D with a bruise on his face and deposes that Mr D told her “Dad punched me in the face”[87]. She deposes to her observation of derogatory taunting of Mr D by the husband in 2019 including him calling Mr D “druggo”, “a little poofter”, a “cat” and a “cunt”.[88] The wife says that the husband was angry and conducted himself in a threatening and intimidating manner including “…walking around the house with his chest puffed out and voice booming”. She says that she took a week off work and went away with Mr D so he could recover from his appendix operation, as they both needed to get away from the husband. In cross examination the husband agreed that he raised his voice at Mr D, but he did not agree he had called him derogatory names. In light of the husband’s posting to Face-book on 22 June 2021, which publishes photographs of Mr D and infers that he is responsible for the alleged theft of cash from the husband’s safe, I am not persuaded by the husband’s denials in relation to his treatment of Mr D and I prefer the wife’s evidence and find that the husband did engage in derogatory taunting of Mr D, including in the presence of the wife.
[87] Wife’s affidavit paragraph 101
[88] Wife’s affidavit paragraph 102
The wife deposes that during the marriage the husband yelled out inappropriately to the children during football matches and that on one occasion a coach intervened. She deposes to feeling embarrassed and distressed due to the husband’s conduct[89]. She says that his behaviour made her feel down, that it was difficult to keep going, and that she was ashamed that the children were exposed to it[90]. She deposes to feeling like a failure as a parent and upset that she was unable to protect the children from the husband’s intimidation and harassment[91].
[89] Wife’s affidavit paragraph 103-105
[90] Wife’s affidavit paragraph 105
[91] Wife’s affidavit paragraph 114
The wife deposes to an incident in 2008 when she alleges the husband held her up against a brick wall by her throat. She did not formally report this incident to police and did not seek medical attention. She was cross-examined about the incident and confirmed that it did happen. I find the wife’s evidence about this episode of family violence to be persuasive and I am satisfied, on the balance of probabilities, that she is telling the truth and that the husband did hold her by the throat up against the wall on one occasion in 2008.
It was put to the wife in cross-examination that the reason she did not call her psychologist to give evidence at trial was because she had not raised with her psychologist the husband’s conduct in the course of her counselling sessions. The material produced by the wife’s psychologist[92] establishes that in 2017 the wife reported that the husband was obsessive and controlling. A GP Mental Health Plan records the presenting issues for the wife as “Depression due to domestic violence” and a diagnosis of “Chronic Depression”. The wife completed an application for counselling under the Victims Support Scheme, but did not apply for financial assistance or any recognition payment. The psychologist’s report dated 23 January 2017, prepared in support of the wife’s application for counselling, states that the wife left the marital home following the husband’s “rage”, that he’d been drinking and threatened Mr D with a knife. The report notes “feels she’s lost a sense of herself bit by bit as Mr Pelley has worn her down with his abusive control over the years” and that the husband “…was fine for quite some time… [after the marriage]… Then her (sic) gradually became more obsessive after the children came along He even questioned the paternity of the eldest, but despite testing, he’d still claim his doubts. He’d become obsessed with the notion that Ms Pelley had cheated on him with his good mate”. The wife reported that the husband had pulled her hair in anger and that she has pushed him. She reported that after a work injury damaged his back, he did not comply with his medications, drank and was increasingly angry and that his paranoia and obsessions further increased.
[92] Exhibit H
The counselling records in Exhibit H corroborate the wife’s evidence of the obsessive jealous and controlling behaviour of the husband commencing after the birth of the children. I infer from the notes that the husband’s aggressive and belligerent behaviour became more frequent from 2016 onwards, following his workplace injury and his resort to drinking and gambling. The husband was taken in cross examination to an entry in his return to work records in April 2019 wherein it is noted that he reported that he is “angry all the time” and “wife thinks he is going into rages”. He agreed that he had said these things “then in 2019” but he said that the rages where “not at my wife”. I find the husband’s evidence unconvincing and I consider that the husband’s reporting in 2019 lends further credence to the wife’s evidence that he was angry all the time and going into rages.
The wife deposes, and I accept her evidence, that the husband’s harassment of her, and his obsession arising from his suspicions that she’d had an affair, caused her to feel worthless and insecure. She deposes that when she started sleeping in the spare room around 2019 the husband would come into the room during the night whilst she was sleeping and turn on the light, flicking it on and off to wake her. In cross examination the husband admitted that he did go into the room and turn the light on.
The wife deposes that the husband called her “a slut” and “a scumbag” in front of the children, who would also refer to her as a slut. Understandably the wife found this extremely upsetting. She says that in December 2019 she took time off work as she couldn’t focus and needed to get out of the house due to the husband’s harassment of her. There is a text message annexed to the wife’s affidavit, which the husband reluctantly conceded is his message to the wife dated 16 December 2019. The husband attaches a photo of a rental property and writes “fuck off”. In cross examination the husband had previously denied ever telling the wife to “fuck off”, which denial is inconsistent with the text message that he later adopted as his own.[93] He was evasive when answering questions about the text message. He first said the annexure was illegible, and that he couldn’t really read it and couldn’t see his name, and then said he couldn’t recall. He volunteered that it was a difficult part of their marriage when their son started playing up. I accept that the message was sent to the wife by the husband and that the husband told the wife to “fuck off”. The wife says that she developed shingles in 2019 which was brought about by stress, and that she had a relapse in that condition after she separated from the husband in early 2020.
[93] -10
Following the final separation the wife says that the husband told her on 10 January 2020 that he had changed the locks on the house and so she decided to go and stay with her parents at Town P. As a result she could not continue her work at the Employer E at B Street, Suburb C because the drive between B Street, Suburb C and Town P takes two and one half hours. The husband conceded in cross examination that he had locked the wife out of the house after she left the marriage.
A provisional Apprehended Domestic Violence Order (“ADVO”) was made against the husband for the protection of the wife in mid-January 2020. There is currently a final ADVO in place for the wife’s protection against the husband until 30 April 2023. The wife deposes, and I accept, that she had to take a week off work due to stress in April 2021 whilst the ADVO matter was being dealt with.
On 22 June 2021 the husband was charged with breach of the ADVO after he followed the wife and her parents in their car when they drove past the jointly owned former matrimonial home at B Street, Suburb C. On 1 July 2021 a Final ADVO was made against husband for the protection of the wife’s parents.
I have no difficulty in finding that there was family violence as defined in the Act[94] and that there was a course of violent conduct by the husband towards the wife in this case. I find that the wife’s contributions as the primary homemaker and primary parent and her direct financial contributions as a wage earner were each made significantly more arduous as a direct result of the husband’s conduct.
[94] S. 4AB
Alleged waste of funds received by the husband in 2018
The husband was asked about his use of superannuation and total and permanent disability funds he received in 2018. He initially said in cross examination that a fair bit of that money went into the house when the parties moved, to get everything organised and make the house look good. He later corrected his evidence and said that those funds were received before the parties moved to the B Street, Suburb C property and that they had lived on the monies when they moved to B Street, Suburb C. He conceded that in 2018 he was gambling heavily. He said that he would gamble and then he’d win. He conceded that he really did not know how much he had spent gambling in 2018 but denied that a large portion of the super and total and permanent disability payment was spent on gambling, and he said that he looked after the family.
I prefer the more detailed evidence of the wife as to the quantum of the amounts that the husband received from Employer Super in August 2018 and June 2019. I am also satisfied that the husband gambled significant sums of money in 2018 and that he was reckless and that such recklessness has more likely than not resulted in a reduction of the parties’ net worth. I consider that this is a relevant factor to take into account when assessing the husband’s contributions during the marriage, notwithstanding that the waste is not capable of being quantified.
I accept the evidence of the husband that he wasted funds from the damages, and note that any wastage of the damages has been taken into account already in determining the issue of the addbacks. To take further account of the husband’s wastage of the damages in assessing the overall contributions of the parties would amount to an impermissible double counting, which the court will avoid.
The husband and the wife each worked in paid employment throughout the marriage. Both parties made direct financial contributions to the welfare of the family by applying their incomes to meet the day to day expenses of the family. Immediately prior to his work injury the husband’s income for FY 2016 was $120,000.00[95] and the wife’s was salary was about $46,000.00[96]. The parties had a combined income of about $166,000.00 per annum. They were maintaining the repayments on the mortgage, paying the rates and insurances and meeting the living expenses for the family. The husband admits that after the injury in 2016 he resorted to alcohol and gambling[97]. Commencing from about 2017 the husband’s income reduced, initially to about half its previous level, and finally to $494.50 per week[98] received by way of statutory worker’s compensation payments. From mid- 2017 onwards the wife’s income exceeded that of the husband while she continued in her role as primary homemaker and parent and assisted the husband.
[95] Wife’s affidavit paragraph 47
[96] Wife’s affidavit paragraph 42
[97] Husband’s affidavit paragraph 55
[98] Wife’s affidavit paragraph 47
Throughout the duration of the marriage the wife made significant non-financial contributions to the welfare of the family by attending to almost all of the child care and the domestic matters. Her non-financial contributions assisted the husband to concentrate his energies on his income producing activities. The wife’s domestic support was valuable. In evaluating the respective contributions made by the parties in this case the court must compare the different activities, that is the direct financial contributions which were made by the husband along with the direct financial and the non-financial contributions to the welfare of the family which were made by the wife. The Full Court in Ferraro[99] has referred to “the tendency to undervalue the homemaker role” and I am cognisant of the need to give proper weight to the wife’s contribution in the overall assessment.
[99](1993) FLC 92-335
Post separation
The husband has had the benefit of the sole use and occupation, to the exclusion of the wife, of the B Street, Suburb C property since separation. It appears that the wife has paid the home insurance in respect of the B Street, Suburb C property since separation, notwithstanding that the court ordered on 22 June 2022 that the husband was to be responsible for it. I accept the evidence of the wife that she has paid $3,769.00 for the insurance.[100] I also accept that the husband attempted to pay the home insurance in 2020 but, as the wife had already paid it, he received a refund of the amount paid.[101] There appears no dispute that the Telstra account for services connected to the B Street, Suburb C property has remained in the wife’s name since separation, notwithstanding the order that the husband change it into his name. I accept the husband’s evidence in cross examination that he has attempted to transfer the account into his name without success. The wife has continued to pay the monthly charges for the husband’s phone, X’s phone and the internet connection to the B Street, Suburb C property at a cost to her in the sum of $4,600.00[102] . These are matters which weigh in favour of the wife when assessing the overall contributions of the parties.
[100] Wife’s affidavit paragraph 267,268
[101] Wife’s affidavit paragraph 269
[102] Wife’s affidavit paragraph 271,272
The parties are in dispute about whether the husband has made all mortgage repayments as required by the interim orders. He says he has, and the wife says he has not. She asserts that the mortgage would currently have a lower balance if the husband had made all payments required. The court is not able to resolve that dispute on the current state of the evidence. It is clear from the husband’s bank records that he has made payments to the home loan[103] and that he has made payments to the council for rates and water. I consider that the husband’s sole use and occupation of the B Street, Suburb C property during the period post separation weighs as an indirect financial contribution by the wife.
[103] Exhibits G and I
As noted previously I take into account as a direct financial contribution made by the husband to the acquisition of the property the sum of $424,962 referable to the damages. I consider that this direct financial contribution weighs in favour of the husband in the overall assessment of contributions in this matter.
I also have regard to the $30,000.00 which was received by way of lump sum damages in 2009 or 2010 and which was applied to purchase the Motor Vehicle 1, which I consider to be a direct financial contribution by both parties to the welfare of the family. I also have regards to the inheritance received by the husband in the sum of $10,000 which was applied to purchase furniture and other equipment for use by the family, which I take into account as a direct financial contribution to the welfare of the family.
I consider that the Employer Super funds received in 2018, to the extent that they were applied by the husband other than for the purposes of gambling, are a direct financial contribution made for the welfare of the family. I consider that both parties contributed to those funds being received due to the nature of the contributions which resulted in the payments, namely superannuation payments made from the husband’s income during the marriage to which I consider both parties contributed, albeit in different ways. As already stated, I also consider it likely that the husband wasted at least some of those funds on gambling thereby reducing the value of the assets to which the wife had made a contribution and I consider that weighs against the husband in the overall assessment of contributions.
I assess that the contribution made by the wife to the welfare of the family, including her contributions made in the capacity of homemaker and parent significantly outweigh those of the husband and that this is a factor which weighs in favour of the wife in the overall assessment of contributions.
As noted already I have found that the husband engaged in a course of conduct that constitutes family violence within the meaning of s.4AB of the Act. I find that the husband’s conduct impacted directly on the wife’s wellbeing, including her mental health, and made the wife’s contributions in her capacity of homemaker and parent more arduous and I consider that this is a factor which weighs in favour of wife and against the husband.
In respect of the matters to be taken into consideration in s.79(4)(a)–(c) of the Act the wife contended for her contribution based entitlement to be assessed at 55% and the husband’s at 45%. The husband contended for his contribution based entitlement to be assessed at 70% and the wife’s at 30%.
For the reasons already provided I assess that the contribution based entitlement of the wife is 40% and the contribution based entitlement of the husband is 60%.
Section 79(4) (d) (e) (f) and (g)
The court is required to consider the matters in s. 79(4)(d), (e), (f) and (g) of the Family Law Act.
I consider that the orders proposed by the wife would significantly impact on the husband’s earning capacity. Her proposal, if accepted, would result in him retaining only the assets in his current possession and none of the monies which are held in trust. I consider it more likely than not that the husband currently makes a very modest income from his activities as a trainer and racer, and I consider that he may have retained sums which will be added back into the pool and attributed to him. On the current state of the evidence, due to the husband’s non- disclosure as to his true financial position, I am unable to come to a concluded view as to the quantum of the income that he has been able to generate as a result of racing or gambling. However I consider that the orders which the wife proposes would deprive the husband of an opportunity to invest the remaining damages and produce some income for him into the future.
The orders proposed by each of the parties do not directly affect the earning capacity of the wife, although she may choose to invest any cash monies she may receive and thereby increase her level of income.
SECTION 75(2) matters
The general approach to a consideration of s.75 (2) factors was set out in Collins[104] and endorsed in Clauson.[105] The weight to be attached in a particular case to the diverse range of matters that the Court is obliged to take into account, when they are relevant to the facts of the case in s.79 proceedings, is very much a matter in the discretion of the court.
[104] (1990) FLC 91-144 at pp 78,043
[105] (1995) FLC 92-595 at pp 81,911
In respect of the matters to be taken account of under s.75 (2), the wife contended for an adjustment in her favour of 30%, and the husband contended for an adjustment in his favour of 5%.
I have carefully considered all of the factors set out in s.75 (2) and will refer only to those subsections which appear to me to be relevant in this particular case.
s.75 (2) (a) the age and state of health of each of the parties;
Both parties are 47 years old.
The wife is in good physical health and attends upon her psychologist fortnightly to help with her mental health.[106]
[106] Wife’s affidavit paragraph 290
The husband contends that he remains in constant pain and takes prescription medication daily[107] although he provides no medical evidence in support of his contention, nor does he provide any medical evidence as to current state of his health.
s. 75(2) (b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment
[107] Husband’s affidavit paragraph 25
The wife discloses earnings of $57,900.00 per annum. She is employed full time as an administrative officer. She lives in rental accommodation at Town F which she shares with her housemate Ms Q aged 59. Mr D lives with the wife and at the date of trial was almost 18 years old.
The wife currently owns a Motor Vehicle 2 which has an agreed value of $17,250.00, an equal share as tenant in common with the husband in the B Street, Suburb C property and an accumulation interest in Super Fund L which has an agreed value of $95,664.00. She has had the benefit of the redraw of $42,500.00 from the home loan around the time of separation, which the parties have agreed to add back into the pool and distribute to the wife.
The husband is currently unemployed. He lives with X, aged 16 years, in the former matrimonial home.
The husband currently owns two motor vehicles with a combined agreed value of $56,281.00, a boat with an agreed value of $10,000.00, furniture tools and fishing equipment worth $5,000.00 and animals with an agreed value of $90,000.00. He owns an equal share as tenant in common with the wife in the B Street, Suburb C property. He has minimal superannuation in the sum of $729. He has had the benefit of the redraw of $20,000.00 from the home loan around the time of separation, which the parties have agreed to add back into the pool and distribute to the husband, and the benefit of other amounts which total $107,500.00 which the court has determined will be added back and distributed to the husband. There remains a cash sum of $185,881.00 which is held in Trust from the damages.
The damages vested with the husband receiving the full amount of the compensation to which he is entitled. There is no further need to consider the circumstances of the award in the context of s.75 (2) except in relation to any residual disability which the husband may have impacting on his earning capacity.
The wife contends that the husband is not exercising his capacity to work. The husband says that he continues to have problems with lifting, bending, carrying, sitting and standing for periods of time, although he is does not provide any specific as to how long he can sit and stand for.[108] He contends that he is unable to work and needs the balance remaining from the damages to live on in the future.
[108] Husband’s affidavit paragraph 22
Neither party presented any expert evidence at the trial concerning the husband’s current capacity or incapacity for work. In cross examination the husband said that he last worked over twelve months ago, for 20 hours per week with a disability “mob”. The wife deposes that he last worked as a support worker from September 2020 until December 2020 earning $36.14 per hour for up to 20 hours each week. The husband said that the work involved him looking after a client, driving him around and taking him to a park. The husband said he can drive for up three and one half hours. His evidence is that he regularly drives such a distance to participate in racing.
There is no dispute that the husband suffered injury in 2016. He continued to receive statutory weekly workers compensation payments up until he resolved his damages claim in May 2021[109]. He was diagnosed with a disc herniation at the L5/S1 level, and had surgery in February 2016. He was did not return to employment in primary industry. In December 2016 he underwent a spinal fusion. He says that he continues to take prescription pain medication daily. He was employed 15 to 20 hours each week as a transport worker from February 2019 and held down that job for about 3 months. When he was asked about a report in which it is recorded that he had stated that he is tolerating the duties of a transport worker he answered “no chance”.
[109] Husband’s affidavit paragraph 34
The husband holds a trainers licence, and he trains and races animals, he says as a hobby rather than a career[110]. He has purchased a number of animals using the damages. The parties agree that currently the husband has animals with a combined value of $90,000.00. The husband says that he currently owns seven fully grown animals[111]. He has made a very significant investment in his hobby. He has failed to disclose his earnings notwithstanding the wife requests that he do so.
[110] Ibid paragraph 37
[111] Ibid paragraph 57(e)
On balance the court considers that the husband is capable of generating an income from training and racing animals or alternatively by deploying the skills he has developed as a result of training and raising animals.
S. 75(2) (c) whether either party has the care or control of a child of the marriage who has not attained the age of 18 years;
The husband has the care and control of X who is currently 16 years old.
S. 75(2) (d) commitments of each of the parties that are necessary to enable the party to support:
himself or herself; and
a child or another person that the party has a duty to maintain;
The wife deposes that she earns a weekly income of $1,115.00 and that her fixed weekly expenditure totals $616.00. She lives in rental accommodation in Town F with Mr D and a housemate who helps her share the rent. Her evidence is that Mr D was working during the produce season but was not working at the date of the trial and that he was reliant on her financially. She estimates that she spends $100.00 per week for Mr D.[112]
[112] Wife’s Financial Statement and Wife’s affidavit paragraph 116
The husband deposes that he earns a weekly income of $87.50 and that his fixed weekly expenditure is $588.00. He lives in the B Street, Suburb C property with X.
S. 75(2) (e) the responsibilities of either party to support any other person;
Neither party has re-partnered or discloses a responsibility to support any other person, other than X in the case of the husband.
S. 75(2) (f) subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
any law of the Commonwealth, of a State or Territory or of another country; or
any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party;
It is not in dispute that due to the damages the husband is precluded from receiving income support from Centrelink between 17 May 2021 and 17 October 2021 (“the preclusion period”)[113] . The letter from Centrelink indicates that the preclusion period was calculated on the basis of advice to the effect that the husband was entitled to receive a lump sum compensation payment of $700,000.00. The amount the husband received after legal costs and the refund to Medicare is $498,381.70. The Centrelink letter provides the husband with information about the calculations and what to do if he thinks the decision is wrong, however he has omitted to annexe a copy of the whole letter, instead annexing only the first page of it, so the court is unable to come to a concluded view as to whether there is any scope for the husband to dispute the decision made under Social Security Act 1991.
S. 75(2) (k) the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;
[113] Husband’s affidavit Annexure B
Following the birth of the second child in 2005 and continuing until October 2019 the wife elected to work on a part time or casual basis, as opposed to full time. I infer from the evidence that a combination of the parenting and homemaker duties, and the necessity to provide assistance and support for the husband following his injuries, impacted on the wife’s capacity to engage in anything other than part time or casual work. I find that the duration of the marriage has likely affected the earning capacity of the wife. She has had more limited opportunities for career progression due to part time and casual work, than she would likely have had if she had been engaged in full time employment.
I consider that the duration of the marriage has had no impact on the earning capacity of the husband.
S. 75(2) (l) the need to protect a party who wishes to continue that party's role as a parent;
The husband continues to live in the former matrimonial home with X currently 16 years old. X attends R School and is in year 11. The wife deposes that X may start an apprenticeship this year, and the husband’s evidence in cross examination confirmed that X may take up an apprenticeship shortly. The wife attaches an email from X’s year advisor which indicates that he was not engaged with school in 2021.[114] The evidence suggests that it is likely that X will leave school and commence employment in the near future.
S. 75(2) (na) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage;
[114] Wife’s affidavit paragraph 118; Annexure -5
There is no evidence that the husband is assessed to pay or did pay to the wife any child support for Mr D in the period between separations in early January 2020 and when Mr D turned 18 years old in 2022.
There is no evidence that the wife is assessed to pay or has paid to the husband any child support for X in the period between separation and trial, noting that X is currently 16 years of age. The wife gave evidence that she has tried, and is willing to provide X with financial support and I infer that if the husband made an application for administrative assessment of child support and the wife was assessed as liable to pay child support for X, then the wife would comply with any assessment.
S. 75(2) (n) the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties
Both parties will need somewhere to live in the future whether an order is made for the husband to have sole use of the B Street, Suburb C property until X finishes school, as he proposes, or whether the B Street, Suburb C property is sold forthwith as the wife proposes. Both parties will require access to some cash to rehouse themselves, and the husband will likely require cash reserves to augment his current level of income, the precise quantum of which is unknown due to his non-disclosure.
The property orders which the court proposes to make will see the wife retain the property currently in her possession, which includes her car and her superannuation entitlements, as well as the benefit she has obtained from the redraw of the mortgage at separation. The wife will also receive her share of the equity in the B Street, Suburb C property and a modest amount of cash from the funds currently held in trust.
The proposed orders will see the husband retain his two motor vehicles, his boat and his furniture, tools camping and fishing equipment. He will retain his animals and the benefit that he has obtained from the redraw of the mortgage at separation, and other cash amounts he has retained from the damages. The husband will also receive his share of the equity in the B Street, Suburb C property and an amount of cash from the funds currently held in trust. He will retain his minimal superannuation.
S. 75(2) (o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account;
Dealing number … is currently registered on title to the B Street, Suburb C property. In cross examination by Counsel for the husband the wife said that the dealing was registered by her former solicitors Fox & Thomas, with her consent, in respect of monies owed by her to that firm for legal fees in the sum of $29,755.[115] That dealing will have to be withdrawn prior to, or contemporaneously with, settlement of the sale of the B Street, Suburb C property.
[115] Wife’s affidavit paragraph 285
I find that the monies payable by the wife to Fox and Thomas Solicitors are a post separation liability of the wife’s for which she is solely liable. An order will be made for the monies necessary to be paid to cause the dealing to be discharged will be paid from the wife’s share of the proceeds of sale of the B Street, Suburb C property. The wife’s share of the proceeds of sale will be thereby be reduced by the sum of $ 29,755.
The wife deposes that she has a debt to Plenti Legal Finance (“Plenti”) in the sum of $29,640.00 in respect of monies she borrowed to pay her solicitors Fox & Thomas and that Perpetual Corporate Trust Limited has registered caveat dealing number … over the wife’s interest in the real property, with her consent.[116] The caveat will have to be withdrawn prior to or contemporaneously with settlement of the sale of the B Street, Suburb C property.
[116] Wife’s affidavit paragraph 285 and her oral evidence
I find that the monies owing by the wife in respect of her litigation funding is a post separation liability of the wife’s and that she is solely liable for it. An order will be made for the monies due and payable so as to cause the caveat to be lifted will be paid from the wife’s share of the proceeds of sale of the real property. The wife’s share of the proceeds of sale will be thereby be reduced by the sum of $ 29,640.
I also take into account that in addition to the above costs for which the wife is liable and which will need to be paid in order for the discharges of caveats to be obtained, she is also liable for unpaid billed legal fees in the sum of $59,396.00 along with unbilled legal fees of $26,000.00 plus GST and anticipated further fees of up to $22,000.00 plus GST.[117]
[117] Exhibit B
The court is not able to take into account the husband’s outstanding legal costs and disbursements. A call was made by the wife’s Counsel for the husband’s cost notice pursuant to Rule 12.06(2) of the Federal Circuit and Family Court (Family Law) Rules 2021 that was not answered, and there is no evidence before the court in relation to this aspect of the matter.
Conclusion As to Section 75(2) factors
The factors which principally favour the wife is that she has a relatively modest earning capacity, with little opportunity to increase her capacity, and that the duration of the marriage has impacted on her earning capacity. She has a modest superannuation fund. The wife is liable for outstanding legal costs and disbursements, including the sum of $56,395.00 which will have to be paid in order for the caveats to be withdrawn and discharged to enable registration of the transfer relating to the proposed sale of the B Street, Suburb C property.
The factors which principally favour the husband are that due to the damages he may not be eligible to receive income support from Centrelink until October 2027 and he may be reliant on what remains from the damages to supplement his income until the preclusion period has ended, and that for the time being at least he is responsible for the financial support of X, although I have found that it is more likely than not that X will commence an apprenticeship this year and that thereafter he will earn his own income, which will reduce his current reliance on the husband for financial support.
The husband has failed in his obligation to provide full and frank disclosure about the income he has earned from training and racing, and has provided no medical evidence in support of his contention that he is unable to work. As a result, I am unable to come to a concluded view as to the husband’s current income or his capacity to earn an income in the future.
When these considerations are weighed and balanced against each other I am satisfied that there should be no adjustment to either party on account of the relevant matters in s. 75(2).
S 79 (4) (f)
There are no other orders under the Act affecting a party to the marriage or a child of the marriage.
s. 79(4) (g)
I have dealt with this matter when considering the matter in s 75 (2)(na) of the Act.
Result
I have found that the gross pool of property and superannuation is valued at $1,170,076. After deduction of the mortgage of $272,294 the net value of the pool amounts to $897,782.
In order to achieve an outcome whereby the wife would receive property with a value equivalent to 85% of the net pool of assets she sought orders that within 14 days the parties do all things required to remove registered the dealings from title to the B Street, Suburb C property and sell that property and that the net proceeds of sale be paid to the wife, and an order that the whole of the balance of the funds held in trust accounts of each of Fox & Thomas Solicitors, Countrywide Legal & Business and RJ O’Halloran be paid to the wife, which would result in the wife receiving property with a combined net value of $608,272, equivalent to 67.8% of the net pool.
On the wife’s scenario the husband would hold or have had the benefit of the following property and superannuation: his motor vehicles with a consolidated value of $56,281, his boat worth $10,000, his furniture, tools and camping and fishing equipment worth $5,000, his animals worth $90,000, property added back and distributed to him totalling $127,500, and his superannuation of $729.00 resulting in a distribution to the husband of $289,510 equivalent to 32.2% of the net pool.
The outcome for which the wife contends would produce a differential between the parties of $318,762 in her favour which I consider is not a result that can possibly be categorised as just and equitable, having regard to the overall contributions of the parties.
In order to achieve an outcome whereby he would receive property with a value equivalent to 75% of the net pool of assets the husband sought orders that, on or before the completion of X’s secondary education, the parties’ transfer the B Street, Suburb C property to the husband and discharge the mortgage, and that contemporaneously with such transfer he pay the wife 50% of the equity in the property, and in the event that he is unable to refinance the mortgage and pay the wife 50% of the equity, then the B Street, Suburb C property be listed for sale when X completes his secondary education, and the net proceeds be divided equally between the parties. He sought orders that until completion of the sale or the transfer he will be responsible for the applicant’s share of the payments as and when they fall due and keep the B Street, Suburb C property in good order. He sought an order for him to retain the whole of the funds held in trust which are referrable to the damages.
The final orders sought by the husband are imprecise. There is no certainty as to the date by which X will complete his secondary education, and the husband seeks to remain in occupation of the B Street, Suburb C property with X until that uncertain date. There is no reason advanced by the husband for why he ought to retain the B Street, Suburb C property until X finishes secondary education nor as to why he cannot accommodate himself and X elsewhere if the B Street, Suburb C property is sold forthwith.
The orders proposed by the husband do not require him to pay his share of outgoings for the home during his occupation of it, although that may be an oversight. The husband does not propose any order which would restrain him from further encumbering the property. The husband does not specify how, on what basis, or at what stage, the value of the equity in the property will be calculated in order to pay the wife 50% of such equity.
The husband has failed to comply with previous orders of the court and there is no certainty or security for the wife in the husband’s proposal. If the husband refuses or neglects to pay the mortgage, rates and other outgoings in respect of the property, fails to maintain the property and fails to “keep the property tidy, clean and in repair (having regard to its present condition)” then the wife will be significantly disadvantaged. There is no evidence as to the present condition of the property.
The court is concerned that the husband, having already spent a considerable portion of the damages received on 19 May 2021 in contravention of court orders, and where he has been on notice of the Centrelink preclusion period, and in circumstances where he has failed to make proper disclosure, I consider that there is no evidence which can satisfy the court that the husband will be in a financial position by the time X completes his secondary education, whenever that will be, to refinance the mortgage and pay the wife her share in the B Street, Suburb C property.
I consider that it is not a just and equitable outcome for the wife to have to wait until an uncertain future date to liquidate her share of the equity in the former matrimonial home or have to rely on the husband to make loan repayments and meet the outgoings and maintain the B Street, Suburb C property pending transfer or sale at an uncertain future date.
The court can have no confidence that the husband will comply with any orders that does not suit him and it is unjust to expect the wife to wait any longer to receive her share of matrimonial assets.
The court considers it is just and equitable for there to be an order that the husband vacate the B Street, Suburb C property forthwith and for the wife to have the sole use and occupation of it in order to prepare it for sale at the first opportunity. The court considers that the best option is a sale of the B Street, Suburb C property.
In order to achieve the result whereby the wife will receive her entitlement to assets with a value equivalent to 40% of the net pool she will need to receive property with a total value of $359,112. This can be achieved by the wife holding or having had the benefit of the following property:
(1)Motor Vehicle 2 $ 17,250
(2)Her redraw $ 42,500
(3)Her superannuation $ 94,935
(4)Half share of equity in B Street, Suburb C property $ 133,853
Total $288,538
The wife would thus require $70,574 from the funds held in trust by Countrywide Legal and Business to bring her up to her entitlement.
In order to achieve the result whereby the husband will receive his entitlement to assets with a value equivalent to 60% of the net pool he will need to receive property with a total value of $538,669. This can be achieved by the husband holding or having had the benefit of the following property:
(1)Motor Vehicle 5 $ 41,581
(2)Motor Vehicle 4 $ 14,700
(3)Boat $ 10,000
(4)Furniture, tools and equipment $ 5,000
(5)Monies held in trust account Fox Thomas Solicitors $ 68,381
(6)Monies held in trust R.J O’Halloran Solicitors $ 17,500
(7)Balance of funds in Countrywide Legal & Business $ 29,426
(8)Animals $ 90,000
(9)His superannuation $ 729
(10)Half share of equity in B Street, Suburb C property $133,853
(11)Redraw $ 20,000
(12)Excess funds paid to parents $ 8,000
(13)Paid legal fees $ 6,000
(14)Cash monies $ 40,000
(15)Damages unaccounted $ 53,500
Total: $ 538,670
The husband conceded in cross examination that the wife’s name ought to be removed from the Telstra account, and an order will be made accordingly.
The court considers that the orders set out at the forefront of these reasons are the orders which are just and equitable in the circumstances of this case.
I certify that the preceding one hundred and ninety-four (194) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Carty. Dated: 14 July 2022
0
3
0