Perna & Perna

Case [2024] FedCFamC1A 183

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1) APPELLATE JURISDICTION

Perna & Perna [2024] FedCFamC1A 183

Appeal from: Perna & Perna (No 2) [2024] FedCFamC2F 424
Appeal number: NAA 101 of 2024
File number: DUC 457 of 2020
Judgment of: MCCLELLAND DCJ
Date of judgment: 15 October 2024
Catchwords: FAMILY LAW – APPEAL – Property – Limited evidence available to the primary judge – Where no retrospective valuation of the farming property was conducted by an appropriately qualified expert –– Consideration of s 79 of the Evidence Act 1995 (Cth) – Where the factual error was material to the outcome of proceedings – Appeal allowed – Orders of the primary judge set aside – Matter remitted for rehearing before a judge other than the primary judge – Costs certificate granted to the appellant.
Legislation:

Evidence Act1995 (Cth) ss 76, 79

Family Law Act 1975 (Cth) ss 75, 79

Federal Proceedings (Costs) Act 1981 (Cth) s 9

Cases cited:

Boensch v Pascoe (2019) 268 CLR 593; [2019] HCA 49

De Winter and De Winter (1979) FLC 90-605

Dickons v Dickons (2012) 50 Fam LR 244; [2012] FamCAFC 154

House v The King (1936) 55 CLR 499; [1936] HCA 40

Jabour v Jabour (2019) 59 Fam LR 475; [2019] FamCAFC 78

McDonald v Queensland Police Service [2018] 2 Qd R 612; [2017] QCA 255

Watton v Mac Taggart [2020] NSWSC 1233

Number of paragraphs: 47
Date of hearing: 29 August 2024
Place: Sydney
Counsel for the Appellant: Dr Barnett SC
Solicitor for the Appellant: King Cain
Counsel for the Respondent: Mr O’Reilly
Solicitor for the Respondent: Campbell Paton Taylor

ORDERS

NAA 101 of 2024
DUC 457 of 2020

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
DIVISION 1 APPELLATE JURISDICTION
BETWEEN:

MR PERNA

Appellant
AND:

MS PERNA

Respondent

ORDER MADE BY:

MCCLELLAND DCJ

DATE OF ORDER:

15 OCTOBER 2024

THE COURT ORDERS THAT:

1.Appeal NAA 101 of 2024 is allowed.

2.Orders of the Federal Circuit and Family Court of Australia (Division 2) made on 5 April 2024 are set aside.

3.The matter is remitted for rehearing to a judge of the Federal Circuit and Family Court of Australia (Division 2), other than the primary judge.

4.The appellant is granted a costs certificate pursuant to s 9 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that, in the opinion of this Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by the appellant in relation to Appeal NAA 101 of 2024.

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…

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Details
AGLC
Perna & Perna [2024] FedCFamC1A 183
Case
[2024] FedCFamC1A 183
Decision Date

CaseChat Overview and Summary

The appeal concerns a property dispute between Mr Perna and Ms Perna, with the primary judge making orders regarding the division of property acquired during their marriage. The appeal was upheld because the primary judge did not have adequate evidence to determine the market value of Property D, a significant asset in the parties' property pool. This was critical to the judge's decision to favour the wife in the property settlement. The appeal involved determining whether the primary judge's decision was flawed due to the lack of expert evidence regarding the market value of Property D, and whether this error was material to the outcome of the case. The court held that the absence of a retrospective valuation of Property D by a qualified expert constituted a material error. This error affected the primary judge's ability to fairly assess the value of the property pool and the respective contributions of the parties. Consequently, the court found that the primary judge's decision was flawed and set aside the orders made on 5 April 2024. The matter was remitted for rehearing before a different judge. The appellant was granted a costs certificate, recognising the appropriateness of the Attorney-General authorising payment of the appellant's costs incurred in the appeal.

Orders

Orders of the court

NAA 101 of 2024

DUC 457 of 2020

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

DIVISION 1 APPELLATE JURISDICTION

BETWEEN:

MR PERNA

Appellant

AND:

MS PERNA

Respondent

ORDER MADE BY:

MCCLELLAND DCJ

DATE OF ORDER:

15 OCTOBER 2024

THE COURT ORDERS THAT:

1. Appeal NAA 101 of 2024 is allowed.

2. Orders of the Federal Circuit and Family Court of Australia (Division 2) made on 5 April 2024 are set aside.

3. The matter is remitted for rehearing to a judge of the Federal Circuit and Family Court of Australia (Division 2), other than the primary judge.

4. The appellant is granted a costs certificate pursuant to s 9 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that, in the opinion of this Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by the appellant in relation to Appeal NAA 101 of 2024.

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).

Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

Background

Background to the litigation

The appeal has been upheld on the basis that, in the absence of admissible evidence from an appropriately qualified expert as to market value, the learned primary judge found that Property D was sold by the wife’s parents to the parties, and other relatives at 20 per cent below market value. This was material to the outcome of the proceedings because the primary judge made a property adjustment order in favour of the wife largely as a result of contributions in the form of the generosity of the wife’s parents to the parties. BACKGROUND For the purpose of this appeal, I provide the following brief outline of facts and contentions insofar as they are relevant to the issues that require determination in the appeal. The appellant, Mr Perna, was born in 1969 and is currently 55 years of age. The respondent, Ms Perna, was born in 1968 and is currently 56 years of age. There are two adult children to the relationship. In circumstances where the parties have each commenced proceedings, the wife at first instance and the husband on appeal, it is convenient to refer to the parties as the husband and wife. The parties married in 1991 and separated on a final basis in 2019. At first instance, the parties agreed that the combined property pool, including superannuation, was $12,263,409. In accordance with the parties’ agreement to do so, the primary judge took a two pool approach (at [22]). The first pool comprised of the assets and liabilities that the parties acquired during their relationship. In regard to this pool, the primary judge found that the wife would receive 54 per cent and the husband would receive 46 per cent based on the finding that, having regard to the matters set out in s 79(4) of the Act, the wife had made a superior contribution in the form of the generosity of her parents to the parties (at [62]). The second pool comprised of the funds the wife was to receive from the estate of the wife’s late father and the equity of the property the wife acquired after the parties’ separation. The primary judge found the husband had made no contributions to this pool and the wife should retain 100 per cent of its contents (at [63]). The overall contributions finding was, however, offset by a 1 per cent adjustment in favour of the husband pursuant to s 75(2) of the Act. This was because the primary judge acknowledged that the husband would face some challenges in building a new farming enterprise in circumstances where orders were made for the wife to retain both farming properties. This was in circumstances where the primary judge accepted that was the husband’s intention post-separation (at [73]–[74]). Acquisition and disposal of property interests during the parties’ relationship The acquisition and disposal of property interests at the commencement and during the parties’ relationship are set out below:(a)In 1988, the husband purchased a rural property at Town E (“Property F”) for $98,000, using savings and a bank loan of $80,000. The husband derived an income from farming work, the proceeds of which were used to repay the bank loan.(b)At the time of marriage, the husband contends he had assets including some equity in Property F as he had repaid $37,500 of the bank loan, over 1,500 farming animals and plant and equipment. (c)At the commencement of the relationship, the wife contends she had $10,000 in savings. (d)Following the marriage in 1991, the parties began working together on the farming enterprise at Property F. Eventually, the parties became engaged in a joint partnership for the purposes of the farming enterprises on various rural properties, which continued throughout their relationship and for some time after the parties separated.(e)In 1994, Property F was sold for $230,000. The net proceeds of sale from Property F were applied together with a loan from the wife’s father in the sum of $100,000 to purchase a property (“Property C”) from the wife’s parents in the sum of $251,200. As a condition of purchasing Property C, the wife’s father required the parties to enter into deeds granting a license for water supply from Property C to his adjoining property and a Right of Pre-Emption.(f)In 2001, the parties purchased a further parcel of land from a property adjoining Property C in the sum of approximately $130,000. The purchase was able to be made entirely from funds from the parties’ farming partnership. (g)In 2004, the parties purchased a farming animal with the assistance of $50,000 of borrowed funds from the wife’s father. (h)In 2009, the wife’s father offered his three children a property located at Town G, NSW (“Property D”) in the amount of $1,462,156. The wife and her two siblings purchased Property D as tenants in common in equal shares, with vendor finance from the wife’s father in the sum of $1,169,725. The parties are in dispute about the exact terms of the purchase and finance from the wife’s father including whether there was a discount from the fair market value.(i)In or about 2011, the husband contends he received an inheritance of $27,000 from the estate of his late mother which he purports to have deposited into the parties joint bank account.(j)In 2012, the parties jointly purchased the wife’s sister’s one third share of Property D in the amount of $507,893. After this acquisition, Property D was held one third jointly between the parties, one third solely by the wife and one third by the wife’s brother.Post-separation events

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

The acquisition and disposal of property interests at the commencement and during the parties’ relationship are set out below:(a)In 1988, the husband purchased a rural property at Town E (“Property F”) for $98,000, using savings and a bank loan of $80,000. The husband derived an income from farming work, the proceeds of which were used to repay the bank loan.(b)At the time of marriage, the husband contends he had assets including some equity in Property F as he had repaid $37,500 of the bank loan, over 1,500 farming animals and plant and equipment. (c)At the commencement of the relationship, the wife contends she had $10,000 in savings. (d)Following the marriage in 1991, the parties began working together on the farming enterprise at Property F. Eventually, the parties became engaged in a joint partnership for the purposes of the farming enterprises on various rural properties, which continued throughout their relationship and for some time after the parties separated.(e)In 1994, Property F was sold for $230,000. The net proceeds of sale from Property F were applied together with a loan from the wife’s father in the sum of $100,000 to purchase a property (“Property C”) from the wife’s parents in the sum of $251,200. As a condition of purchasing Property C, the wife’s father required the parties to enter into deeds granting a license for water supply from Property C to his adjoining property and a Right of Pre-Emption.(f)In 2001, the parties purchased a further parcel of land from a property adjoining Property C in the sum of approximately $130,000. The purchase was able to be made entirely from funds from the parties’ farming partnership. (g)In 2004, the parties purchased a farming animal with the assistance of $50,000 of borrowed funds from the wife’s father. (h)In 2009, the wife’s father offered his three children a property located at Town G, NSW (“Property D”) in the amount of $1,462,156. The wife and her two siblings purchased Property D as tenants in common in equal shares, with vendor finance from the wife’s father in the sum of $1,169,725. The parties are in dispute about the exact terms of the purchase and finance from the wife’s father including whether there was a discount from the fair market value.(i)In or about 2011, the husband contends he received an inheritance of $27,000 from the estate of his late mother which he purports to have deposited into the parties joint bank account.(j)In 2012, the parties jointly purchased the wife’s sister’s one third share of Property D in the amount of $507,893. After this acquisition, Property D was held one third jointly between the parties, one third solely by the wife and one third by the wife’s brother.Post-separation events After the parties’ separation in 2019, the wife vacated the rural properties and rehoused herself in a nearby township. The husband continued to live at one of the rural properties. In the period post-separation, the parties attempted to continue to operate the farming enterprise jointly. The husband mainly tended to the hands-on farming duties and the wife attended to bookwork. The parties dispute the extent of work that the wife performed for the farming enterprise in this post-separation period.