Penner & Conroy (No. 2)

Case [2021] FamCA 411

FAMILY COURT OF AUSTRALIA

Penner & Conroy (No. 2) [2021] FamCA 411   

File number(s): SYC 8355 of 2017
Judgment of: HARPER J
Date of judgment:  21 June 2021
Catchwords: FAMILY LAW – PROPERTY – Where parties married for 6 years – Where parties maintained separate property and bank accounts but purchased joint matrimonial home –
Where evidence did not allow clear findings about all contributions to superannuation or business interests –
Whether global or asset by asset approach is appropriate – Where initial contributions substantially equal – Where wife made greater contributions during the marriage – Where husband used joint funds for living expenses and superannuation after separation.
Legislation:

Family Law Act1975 (Cth) ss 75, 79, 80, 81. 117

Succession Act 2005 (NSW)
Cases cited:

Ashforth & Ashforth [2012] FamCA 621

Barnell & Barnell [2020] FamCAFC 102

Benson & Drury [2020] FamCAFC 303

Bevan & Bevan [2013] FamCAFC 116

C & C (2005) FLC 93-220

cf Van der Linden & Kordell [2010] FamCAFC 157

Dickons v Dickons (2012) 50 Fam LR 244

Elliott & Elliott and Ors [2007] FamCA 1232

Ellison v Sandini Pty Ltd [2018] FCAFC 44

Fielding and Nichol [2014] FCWA 77

G & G [2000] FamCA 1075

Greer & Mackintosh [2013] FamCAFC 16

Hickey & Hickey & Attorney General for the Commonwealth of Australia (2003) FLC 93-143

Horrigan & Horrigan [2020] FamCAFC 25

In the Marriage of Burke (1981) FLC 91-055

In the Marriage of Crapp and Crapp (No 2) (1979) FLC 90-615

Jabour & Jabour [2019] FamCAFC 78

JEL & DDF (2001) FLC 9

Keirn & Moxey [2017] FamCA 487

Kowalski and Kowalski (1993) FLC 92-342

Manolis & Manolis (No 2) [2011] FamCAFC 105

McMahon and McMahon (1995) FLC 92-606

Norbis v Norbis (1986) 161 CLR 513

Norman & Norman [2010] FamCAFC 66;

Stanford & Stanford (2012) 247 CLR 108

Trevi & Trevi (2018) FLC 93-858

Vass v Vass (2015) 53 Fam LR 373

Warbrick & Warbrick [2021] FamCAFC 60

Zagari & Habib [2010] FamCAFC 159

Zyk and Zyk (1995) FLC 92-644
Number of paragraphs: 234
Date of hearing: 30 November – 3 December 2020
Place: Sydney
Counsel for the Applicant: Mr Campton SC
Solicitor for the Applicant: Somerville Legal
Counsel for the Respondent: Mr Lloyd SC
Solicitor for the Respondent: Blanchfield Nicolls

ORDERS

SYC 8355 of 2017
BETWEEN:

MS PENNER

Applicant
AND:

MR CONROY

Respondent

ORDER MADE BY:

HARPER J

DATE OF ORDER:

21 JUNE 2021

AMENDED on 22 June 2021 pursuant to r.17.02 of the Family Law Rules 2004 (Cth)

THE COURT ORDERS THAT:

1.That within seven days of the date of these orders, the parties do all acts and things and sign all documents necessary to cause NN Lawyers (“NNL”) to pay the wife the balance of proceeds of sale of E Street, Suburb F held in a controlled monies account operated by NNL, in the name of the parties, to the Applicant Wife (“the Wife”).

THE COURT NOTES THAT:

A.    C Pty Limited as trustee for C Superannuation Fund (“C…

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Penner & Conroy (No. 2) [2021] FamCA 411
Case
[2021] FamCA 411
Decision Date

CaseChat Overview and Summary

In *Penner & Conroy (No. 2)*, the Federal Circuit and Family Court of Australia considered a property dispute between Ms Penner (the Applicant Wife) and Mr Conroy (the Respondent Husband) following their six-year marriage. The central dispute revolved around the distribution of the proceeds from the sale of the former matrimonial home, held in a controlled monies account, and the division of superannuation interests. The parties had maintained separate property and bank accounts throughout the marriage but had jointly purchased the former matrimonial home.

The court was required to determine the appropriate approach to property adjustment, specifically whether a global or asset-by-asset method was more suitable, and how to assess contributions to various assets, including superannuation and business interests, where clear findings were difficult to make. Further issues included the treatment of post-separation expenditure by the husband and the wife's claim for a significant portion of the proceeds from the sale of the former matrimonial home, as well as a substantial split of the husband's superannuation.

Harper J determined that the wife should receive the entire balance of the proceeds from the sale of the former matrimonial home, amounting to $3,214,692, from the controlled monies account. Additionally, the court ordered a split of the husband's superannuation interest in the C Superannuation Fund, awarding the wife $300,000. The reasoning acknowledged that while initial contributions were substantially equal, the wife made greater contributions during the marriage. The court also addressed the husband's post-separation use of joint funds for living expenses and superannuation, applying principles from cases such as *Vass v Vass* and *Trevi v Trevi* regarding the exceptional nature of "add-backs" for dissipated assets. The final orders declared each party the sole legal and beneficial owner of specified assets in their respective names, with provisions for indemnities regarding liabilities and credit card debts.

Orders

Orders of the court

SYC 8355 of 2017

BETWEEN:

MS PENNER

Applicant

AND:

MR CONROY

Respondent

ORDER MADE BY:

HARPER J

DATE OF ORDER:

21 JUNE 2021

AMENDED on 22 June 2021 pursuant to r.17.02 of the Family Law Rules 2004 (Cth)

THE COURT ORDERS THAT:

1. That within seven days of the date of these orders, the parties do all acts and things and sign all documents necessary to cause NN Lawyers (“NNL”) to pay the wife the balance of proceeds of sale of E Street, Suburb F held in a controlled monies account operated by NNL, in the name of the parties, to the Applicant Wife (“the Wife”).

THE COURT NOTES THAT:

A. C Pty Limited as trustee for C Superannuation Fund (“C Superannuation”) is a self managed superannuation fund listed by the Australian Taxation Office on the Super Fund Lookup website (www.superfundlookup.gov.au) as a complying superannuation fund.

B. The Husband is the only members of C Superannuation.

C. The trustee of C Superannuation is C Pty Limited. The Husband is a Director of that corporation (“the Trustee”).

D. On the basis that the husband is the only director of the Trustee, the procedural fairness requirements of section 90AE(3) (c ) of the Family Law Act 1975 (“the Act””) are satisfied.

E. Having been accorded procedural fairness, these Orders bind the Trustee.

F. In accordance with Section 90XS of the Act, the following Orders are made under Section 79 of the Act in relation to the superannuation interest of the Husband in C Superannuation.

THE COURT FURTHER ORDERS THAT:

2. That in accordance with paragraph 90XT(1)(a) of the Family Law Act 1975:

(a) the Wife is entitled to be paid using a base amount as at the date of these Orders of $300,000 from the husband's interest in C Superannuation calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001; and

(b) the Husband’s superannuation entitlement (and the entitlement of any other person to payments out of the Respondent’s superannuation interest) in C Superannuation is correspondingly reduced.

3. The Trustee shall do all such acts and things and have signed all such documents as may be necessary to:

(a) calculate, in accordance with the requirements of the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001 the entitlement awarded to the Applicant in the clause immediately preceding this clause of this Order; and

(b) pay the entitlement whenever the Trustee makes a splittable payment out of the Respondent’s superannuation interest in the Super Fund.

4. That orders 2 and 3 of these Orders operate from the operative time and the operative time is the beginning of the day upon which these orders are made.

5. That, after service by the trustees of C Superannuation of the payment split notice in relation to each of Orders 10-12 2-4 pursuant to r.7A.03 of the Superannuation Industry (Supervision) Regulations 1994 the wife shall do all such acts and things and sign all such documents as may be necessary, including but not limited to requesting the trustee to transfer or rollover her benefit in C Superannuation to a superannuation fund of the wife's choosing which complies with the Superannuation Industry (Supervision) Act 1993 and its associated regulations;

6. Pending the transfer of the benefits to the wife’s new superannuation fund, the husband is restrained from dealing with or disposing of any of the assets of C Superannuation other than in accordance with the terms of this Order and the husband shall immediately revoke any binding death nomination already made and be and is hereby restrained from:

(a) Making any binding death nomination in favour of a child described in regulation 13 of the Family Law (Superannuation) Regulation 2001;

(b) Making any other nomination where the effect of such nomination would be to render any splittable payment not splittable.

7. Upon compliance with Orders 1 to 6 inclusive, the Wife shall otherwise be declared the sole legal and beneficial owner of all property in her name, possession and/or control to the exclusion of the Respondent Husband (“the Husband”) including but not limited to the following:

(a) Motor Vehicle 1;

(b) Motor Vehicle 2;

(c) Shares in G Group Pty Limited;

(d) Interests in:

(i) The H1 Trust

(ii) The H2 Trust

(iii) The J Trust

(e) Shares in publicly listed companies

(f) Any bank accounts in the Wife’s name;

(g) The superannuation entitlement standing in the Wife’s name in respect of:

(i) The K Super Fund;

(ii) The L Super Fund.

(h) Any other property or chattels of whatsoever kind and whatsoever nature in the wife’s name.

8. Upon compliance with Orders 1 to 6 inclusive, the Husband shall otherwise be declared the sole legal and beneficial owner of all property in his name, possession and/or control to the exclusion of the Wife including but not limited to the following:

(a) Motor Vehicle 3;

(b) Motor Vehicle 4;

(c) Shares in M Pty Limited;

(d) Shares in the following publicly listed companies:

(i) N Company;

(ii) P Company;

(iii) Q Company;

(iv) R Company;

(v) S Company.

(e) Shares in C Pty Ltd (In its own right and as Trustee for C Superannuation Fund).

(f) The Superannuation entitlement standing in the husband’s name in respect of:

(i) C Superannuation Fund;

(ii) Super Fund 1;

(iii) Super Fund 2.

(g) Any other property or chattels of whatsoever kind and whatsoever nature in the husband’s name.

9. The Wife shall indemnify and save harmless the Husband and keep the Husband indemnified and saved harmless from and against all claims, actions, suits or demands arising out of or in connection with any and all liabilities including but not limited to:

(a) Any liability attaching to any property referred to in Order 2;

(b) The Wife’s CBA Mastercard x…90 Credit Card;

(c) The Wife’s CBA Visa x…72 Credit Card;

(d) The Wife’s AMEX x…08 Credit Card;

(e) Any amount owing to the Australian Taxation Office.

10. The Husband shall indemnify and save harmless the Wife and keep the Wife indemnified and saved harmless from and against all claims, actions, suits or demands arising out of or in connection with any and all liabilities including but not limited to:

(a) Any liability attaching to any property referred to in Order 3;

(b) The Husband’s O Bank Credit Card;

(c) The Husband’s Division 293 Deferred debt;

(d) Any amount owing to the Australian Taxation Office.

Costs

11. If any party seeks an order for costs, an application to the Court may be made by Application in a Case within 28 days of the date of these orders, with an affidavit in support, to be filed and served within that time period and a copy forwarded to my Chambers.

The Court further notes:

G. If an application for costs is made in accordance with Order 11, the Court will make procedural orders for any questions costs to be determined.

H. If no such application is made within the time period specified, no order will be made as to costs.

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).

Background

Background to the litigation

Both parties accept some property adjustment would be just and equitable and should be made. The parties have entirely different approaches to how contributions should be assessed and whether the assessment should be undertaken globally or by reference to the central joint asset, the former matrimonial home. Neither approach is patently wrong, and the determination of this matter presents surprisingly difficult questions of property adjustment. The parties were able to agree a large portion of the balance sheet. Some residual controversies remain and will be dealt with later in these reasons. But, as became clear in final submissions, the central debate focussed on how an amount of $3,214,692, presently held in a Controlled Monies Account, should be distributed. These funds are the remainder of the proceeds of sale of the former matrimonial home, as explained later in these reasons. The parties have sharply divergent views about this. The wife claims she should receive the entire amount, while the husband argues he should receive up to 60 per cent, with the wife to receive the balance. The wife also claims there should be a split of superannuation interests, with her to receive $1,500,000 from the husband’s superannuation. The husband claimed the superannuation interests should be left undisturbed. For the reason which follow I have decided that the wife should receive $3,214,692, from Controlled Monies Account together with $300,000 of the husband’s superannuation.BACKGROUND The husband was born in 1961, and is presently 60 years old. Although he historically had gainful employment for many years, he was made redundant in September 2013 and has been unemployed since. The wife was born in 1966, and is presently 54 years old. She is employed by G Group Pty Ltd (“G Group”), a business in the CBD, which she established in 1993. It is unclear exactly when the parties commenced their relationship. The husband said that they have been financially involved since early-2008 (husband’s trial affidavit filed 3 December 2019, paragraph 89-90). At this time, both parties had young children from previous relationships; the wife had Mr X who was 10 years old, Mr Y who was 9 years old and Mr Z who was 7 years old, while the husband had Mr V who was 12 years old and Ms T who was also 10 years old. It seems clear the parties had formed a relationship by early 2008. On about 26 May 2008, the parties had exchanged contracts for the joint purchase of E Street, Suburb F (“Suburb F”) for $6,510,385 including stamp duty and legal costs. This was the former matrimonial home. The parties were married in 2008. Cohabitation commenced at this time. On 24 July 2008, the parties applied for a flexible loan facility. A NAB Portfolio Facility (“Portfolio Facility”) was established on 20 August 2008 in the parties’ joint names with an overall limit of $5,495,000. The principal purpose was to provide funds for the purchase of Suburb F. The evidence showed that such a portfolio facility can be broken into a number of subaccounts, from which funds can be drawn down in total up to the overall facility limit. When the NAB Facility was first arranged, an offset account #...39 was also established which was intended to hold a credit On 10 March 2014, the parties made the decision to separate.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

I also note that there was an Application in a Case brought by the husband on 24 November 2020 to rely upon an affidavit of Mr B, giving expert opinion evidence as to the liabilities payable in relation the liquidation of a single investment portfolio structure owned by C Pty Ltd (“C Company”) calculated as at June 2020. This structure included a superannuation fund, of which C Company was trustee. The investment structure was designed to provide retirement income for the husband from March 2026. The application was heard on the third day of trial. On 3 December 2020, I delivered an ex tempore judgment concerning the details of C Company, the investment structure, the utility of a tax calculation as at June 2020 and the admissibility of this expert evidence: Penner & Conroy [2020] FamCA 1128 (“ex tempore judgment”). I will refer to this judgment and C Company again and in more detail later in these reasons. The husband’s Application in a Case was dismissed. The wife relies upon the following: (a)Her Trial Affidavit filed 28 November 2019 (including exhibits); (b)Her Updated Affidavit filed 20 November 2020 (including exhibits); and (c)Her Financial Statement filed 20 November 2020. Similarly to the husband, the wife has provided a Case Outline for the assistance of the Court. It is dated 25 November 2020 and has been accepted into evidence. In addition, as described above, there were a number of Single Expert Witnesses appointed for the purpose of valuing certain marital assets. These Single Experts filed the following affidavits, which were also accepted into evidence; (a)The Affidavit of Mr W, relating to the wife’s business interests, filed 15 November 2019, and additional questions and responses put to Mr W pursuant to the Family Law Rules 2004 (Cth); (b)The Affidavit of Mr AA, relating to the rental assessment of the formal matrimonial home, filed on 11 November 2020;(c)The Affidavit of Mr AA, relating to the valuation of the properties at Suburb CC and at Suburb EE, filed on 17 November 2020; and (d)The Affidavit of Mr W, relating to the wife’s trust interests, filed 5 November 2020 and later amended on 24 November 2020, as well as additional questions and responses put to Mr W pursuant to the Family Law Rules 2004 (Cth). In addition to the above, the following documents were also accepted into evidence: As set out in Annexure ‘A’ of the wife’s Case Outline dated 25 November 2020, the wife seeks the following orders; WIFE’S PROPOSED MINUTE OF ORDERAnnexure “A” to Wife’s Case Outline Controlled Monies Account 1.That within seven days of the date of these orders, the parties do all acts and things and sign all documents necessary to cause NN Lawyers (“NNL”) to pay the wife the balance of proceeds of sale of the Suburb F property held in a controlled monies account operated by NNL, in the name of the parties, to the Wife.Husband’s Self Managed Superannuation Fund 2.IT IS NOTED2.1 C Pty Limited as trustee for C Superannuation Fund (“C SUPERANNUATION”) is a self managed superannuation fund listed by the Australian Taxation Office on the Super Fund Lookup website ( as a complying superannuation fund.2.2 The Husband is the only members of C SUPERANNUATION.2.3 The trustee of C SUPERANNUATION is C Pty Limited. The Husband is a Director of that corporation (“the Trustee”).2.4 On the basis that the husband is the only director of the Trustee, the procedural fairness requirements of section 90AE(3) (c ) of the Family Law Act 1975 are satisfied. That having been accorded procedural fairness, these Orders bind the Trustee.2.5 That, in accordance with Section 90XS of the Act, the following Orders are made under Section 79 of the Act in relation to the superannuation interest of the Husband in C SUPERANNUATION.Husband to Split to Wife 3.That in accordance with paragraph 90XT(1)(a) of the Family Law Act 1975:3.1 the Wife is entitled to be paid using a base amount as at the date of these Orders of $1,500,000 from the husband's interest in C SUPERANNUATION calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001; and 3.2 the Husband’s superannuation entitlement (and the entitlement of any other person to payments out of the Respondent’s superannuation interest) in C SUPERANNUATION is correspondingly reduced.4.The Trustee shall do all such acts and things and have signed all such documents as may be necessary to:4.1 calculate, in accordance with the requirements of the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001 the entitlement awarded to the Applicant in the clause immediately preceding this clause of this Order; and 4.2 pay the entitlement whenever the Trustee makes a splittable payment out of the Respondent’s superannuation interest in the Super Fund.5.That orders 3 and 4 of these Orders operate from the operative time and the operative time is the beginning of the day upon which these orders are made.Notice by each of the Parties 6.That, after service by the trustees of C SUPERANNUATION of the payment split notice in relation to each of Orders 10-12 pursuant to r.7A.03 of the Superannuation Industry (Supervision) Regulations 1994:6.1 The wife shall do all such acts and things and sign all such documents as may be necessary, including but not limited to requesting the trustee to transfer or rollover her benefit in C SUPERANNUATION to a superannuation fund of the wife's choosing which complies with the Superannuation Industry (Supervision) Act 1993 and its associated regulations;7.Pending the transfer of the benefits to the wife’s new superannuation fund, the husband is restrained from dealing with or disposing of any of the assets of C SUPERANNUATION other than in accordance with the terms of this Order and the husband shall immediately revoke any binding death nomination already made and be and is hereby restrained from:7.1 Making any binding death nomination in favour of a child described in regulation 13 of the Family Law (Superannuation) Regulation 2001;7.2 Making any other nomination where the effect of such nomination would be to render any splittable payment not splittable.Personalty [sic] to the Wife 8.That within seven days of the date of these orders, the husband shall do all acts and things to deliver up to the wife, at his own expense, the stone top table purchased in Country RR from GG Company in Country RR on 14 June 2008 as described in paragraph 178 of the Wife’s affidavit dated 29 November 2019 and its accompanying metal base.9.To give effect to order 8, within 48 hours of the date of these orders, the wife shall provide to the husband an address to which the husband can deliver the item set out in order 8.Procedural Orders 10.Both parties be and are hereby ordered to sign all necessary documents [sic] instruments, writings, authorities or things required to give effect to these orders.11.That except as otherwise provided for by these orders to the contrary, each of the husband and the wife releases the other from all debts owing from one to the other.12.In the event that either party refuses fails or neglects to sign any document instrument, writing, authority or thing required to give effect to this property order or any part of it then pursuant to s.106A of the Family Law Act,1975, as amended (Cth), a Registrar or Deputy Registrar of the Family Court of Australia, Sydney Registry, be and is hereby appointed to sign such document instrument writing authority or thing on behalf of the defaulting party upon being satisfied of the relevant default by affidavit evidence.Declarations 13.That the Wife shall otherwise be declared the sole legal and beneficial owner of all property in her name, possession and/or control to the exclusion of the Husband including but not limited to any and all other real estate properties not referred to in the Orders herein including but not limited to the following:13.1 Partial property distribution of sale proceeds of Suburb F pursuant orders dated 19 March 2018;13.2 Funds held in CBA bank accounts in the wife’s sole name or jointly with any other person;13.3 Motor Vehicle 1;13.4 Motor Vehicle 2;13.5 Shares held in wife’s name;13.6 Shareholding in JJ Pty Ltd;13.7 Shareholding in G Group Pty Limited;13.8 Shareholding in SS Pty Ltd;13.9 Registered partnership “KK Partnership (ABN…)”;13.10 Registered partnership “LL Partnership (ABN …)”;13.11 Member interest in K Super fund;13.12 Member interest in The L Super Fund;13.13 any other Superannuation interest in the wife’s name 13.14 MM Street, Suburb NN;13.15 H1 Trust (ABN …);13.16 Y Trust (ABN unknown);13.17 Z Trust (ABN unknown); and 13.18 FF Trust (ABN …)13.19 Her share of BB Street, Suburb CC;13.20 Any jewellery;13.21 Any prospective inheritance from her Mother’s estate;13.22 Household contents;13.23 Any other real estate shares or chattels of whatsoever kind and whatsoever nature in the Wife’s name;13.24 Any other real estate shares or chattels of whatsoever kind and whatsoever nature in the wife’s name.14.That the Husband shall otherwise be declared the sole legal and beneficial owner of all property in his name, possession and/or control to the exclusion of the Wife including but not limited to the following:-14.1 Partial property distribution of sale proceeds of Suburb F pursuant orders dated 19 March 2018;14.2 Motor Vehicle 3;14.3 Motor Vehicle 4;14.4 O Bank Maxi Saver account #...79;14.5 O Bank account #...79;14.6 NAB account #...67;14.7 CBA account #...73;14.8 N Company Shareholding;14.9 P Company Shareholding;14.10 Q Company Shareholding;14.11 R Company Shareholding;14.12 S Company Shareholding;14.13 Life insurance;14.14 Household contents 14.15 O Bank Gold Credit Card 14.16 Shareholding in C Pty Ltd (Trustee for C Superannuation Fund);14.17 C Superannuation Fund;14.18 Super Fund 1;14.19 Super Fund 2;14.20 Shareholding in M Pty Limited.14.21 Any disclosed prospective inheritance from his Father’s estate;14.22 Any other real estate shares or chattels of whatsoever kind and whatsoever nature in the husband’s name;Costs 15.That the husband pay the wife’s costs of and incidental to these proceedings.

Ratio Decidendi

Legal Principle Established

The wife seeks a superannuation split. The husband does not. I have taken the view that superannuation should not be treated as a separate pool of assets. I will return to this later in these reasons.Expenditure after Separation and Addbacks As already noted, the wife initially argued that two items should be included on the balance sheet as addbacks. These were the husband’s loan to M Company, and his post separation utilisation of the Portfolio Facility, specifically to draw down on sub-account #...43, increasing the debit balance from $220,998 to $727,416 at the point in time when the Portfolio Facility was discharged upon the settlement of the sale of the Suburb F property. That is an increase of $506,418. There was no claim by either party to addbacks for paid legal fees. The approach to add backs in connection with the determination of the parties’ existing interests in property was stated in Vass v Vass (2015) 53 Fam LR 373; [2015] FamCAFC 51; as follows:138. There is no error committed per se in adjusting the parties’ actual property interests by a calculation involving notionally adding back into the pool sums which have been dissipated by the parties. We reject any suggestion that the decision of Bevan & Bevan (2013) FLC 93-545 – or, more particularly, the decision of the High Court in Stanford & Stanford (2012) 247 CLR 108 – is authority for any necessary contrary solution. Some statements made by the High Court may lead to the conclusion that references to “notional property” as have been referred to in decisions of this court and at first instance may need to be reconsidered.139. The decisions referred to seek to remind the Court that, however the exercise of discretion might seek to deal with property that is said to be the subject of “add back”, proper consideration must be given to existing interests in property, and the question posed by s 79(2) as a separate inquiry from any adjustment to property interests by reference to s 79(4) if a consideration of s 79(2) reveals that it is just and equitable to alter existing interests in property. Vass was recently applied by the Full Court in Warbrick & Warbrick [2021] FamCAFC 60 at [30]. In Trevi & Trevi (2018) FLC 93-858; [2018] FamCAFC 173 (“Trevi”) at [27]-[42] the Full Court set forth the guidelines relating to addbacks as follows:Guidelines for adding back to the property available at trial(a) Dissipation of property and expenditure other than on legal fees[27] The Full Court held in Omacini and Omacini that addbacks fall into "three clear categories": where the parties have expended money on legal fees; where there has been a premature distribution of matrimonial assets; and "waste" or wanton, negligent, or reckless dissipation of assets.[28] However, the Full Court also made it clear that an addback does not necessarily occur whenever "a party has expended money realised from the disposition of assets that existed as at the date of separation", the Full Court describing such a proposition as "unduly simplistic". An earlier Full Court made the same point, saying that adding back is "the exception rather than the rule".[29] The fundamental precept that addbacks are exceptional, reflected in the decisions just referred to, also mirrors what has been said in earlier decisions of the Full Court that, for example, "the Family Court must take the property of a party to the marriage as it finds it" at trial. An important parallel proposition is that the parties do not "go into a state of suspended economic animation" after separation. Thus, reasonably incurred expenditure does not usually come within accepted categories of addback.[30] Two fundamental premises emerge from Omacini and the authorities preceding it. First, "adding back" is a discretionary exercise. When the discretion is exercised in favour of adding back, it reflects a decision that, exceptionally, in the particular circumstances of a case, justice and equity requires it. The second premise is its corollary: in cases that are not "exceptional" justice and equity can be achieved, not by adding back, but by the exercise of a different discretion - usually by taking up the same as a relevant s 75(2) factor. Indeed, it has been said that the latter is "a course which is, perhaps, technically more correct" than adding back to the list of existing interests in property.Citations omitted.