Priya & Priya

FAMILY COURT OF AUSTRALIA

PRIYA & PRIYA

[2007] FamCA 1152

FAMILY LAW – Property settlement – notional property – “add-backs” – full and frank financial disclosure.

Family Law Act 1975 (Cth)

Hickey & Anor and Attorney-General for the Commonwealth (2003) FLC 93-143
Chorn and Hopkins (2004) FLC 93-204
Marker and Marker (1998) Fam CA 42
Cerini and Cerini (1998) Fam CA 143
Pierce and Pierce (1999) FLC 92-844
Way and Way (1996) FLC 92-702
Elsey and Elsey (1997) FLC 92-727

APPLICANT:

Mrs Priya

RESPONDENT:

Mr Priya

FILE NUMBER:

SYF

3359

2004

DATE DELIVERED:

28 September 2007

PLACE DELIVERED:

Sydney

PLACE HEARD:

JUDGMENT OF:

The Honourable Justice Rose

HEARING DATE:

4 & 5 December 2006

REPRESENTATION

COUNSEL FOR THE APPLICANT:	G Gersbach
SOLICITOR FOR THE APPLICANT:	Gayle Meredith & Associates

COUNSEL FOR THE RESPONDENT:	R Lethbridge SC and R Winfield
SOLICITOR FOR THE RESPONDENT:	Forum Law

Orders

That the husband sign all documents and do all acts and things to transfer to the wife the whole of his right title and interest in the following real property free of all mortgage encumbrances on or before 5.00pm 2 November 2007:
(a)W1 property being all the land contained in Folio Identifier ….
(b)W2 property being all the land contained in Folio Identifier ….
AND the husband shall simultaneously provide to the wife’s solicitors an attornment notice to each tenant, direction for payment of rent to the wife and a copy of all current leases.
That the husband pay or cause to be paid to the wife by payment to her solicitors for payment to her the sum of $134,634.00 on or before 5.00pm 30 November 2007.
That the husband pay all rates, levies and insurance premiums and land tax payable by the parties in respect of each of the properties referred to in Orders 1(a) and 1(b) as at the date of his compliance with those Orders and at the time such compliance cause to be handed to the wife’s solicitors the receipts evidencing such payments.
That upon the husband complying with Orders 1(a), 1(b) and 2 the wife forthwith cause to be delivered to his solicitors in registrable form a completed and signed withdrawal of all caveats lodged by her upon the title to the property at T being the whole of the land contained in Folio Identifier ….
That upon the husband complying with Orders 1(a), 1(b) and 2 the wife forthwith sign all documents and do all acts and things necessary to transfer to the husband the whole of her right title and interest in the property W3 being all of the land contained in Folio Identifier ….
That the husband pay all rates, levies, insurance premiums, land tax and all other outgoings payable at the date of these Orders in respect of the property referred to in Order 5 and indemnify the wife in respect thereof.
That the husband do all things necessary to transfer to the wife the whole of his interest in Mercedes motor vehicle, registration number … free of encumbrances on or before 5.00pm 2 November 2007.
That the wife complete and sign and return to the husband’s solicitor all necessary documents furnished to her solicitor by the husband’s solicitor for the following purposes within 14 days of such documents being received by her solicitors:
(a)Transfer to the husband of her shareholding in A Consulting Pty Ltd and A Superannuation Pty Ltd.
(b)Her resignation as a director of each of those companies.
That the husband forthwith indemnify the wife in respect of all claims and demands that may be made upon her in relation to all and any loan accounts pursuant to which she is indebted to A Consulting Pty Ltd; A Finance Pty Ltd; and F Pty Ltd.
That the husband indemnify the wife in respect of all claims and demands that may be made upon her as a result of her having been an office holder and/or shareholder in A Consulting Pty Ltd, A Finance Pty Ltd, A Superannuation Pty Ltd, and F Pty Ltd.
That by way of a splitting order in respect of the membership of each of the husband and wife in the J Superannuation Fund, the trustee of A Superannuation Pty Ltd is directed to take the following steps on or before 30 November 2007:
(a)To allocate a base amount to the wife out of the interest held by the husband equal to 60% of that interest represented by the sum of $587,694.00.
(b)That this Order have effect from the operative time being 5 October 2007.
(c)The trustee and the husband provide written notice to the wife’s solicitors of having fully complied with this Order on or before 5.00pm 5 October 2007.
That until the husband has complied with Orders 1(a), 1(b) and 2 he shall continue to comply with interim Order 6 made by consent on 13 August 2004.
That subject to the orders made this day declare that each party is the beneficial owner of all other property in his or her possession power or control respectively.

That the application of the wife for maintenance is dismissed.
That all documents produced on subpoena may be returned to the person who produced the same.
That the proceedings be removed from the Active Pending Cases List.

IT IS NOTED IN CONNECTION WITH THESE ORDERS that the judgment of the Honourable Justice Rose delivered this day will for all publication and reporting purposes be referred to as Priya & Priya

FAMILY COURT OF AUSTRALIA AT SYDNEY

File number: SYF3359 of 2004

Mrs Priya

Applicant

And

Mr Priya

Respondent

REASONS FOR JUDGMENT

Introduction

In these proceedings the applicant wife (“the wife”) sought orders for property settlement in accordance with her Application for Final Orders filed 23 June 2004 (“the application”).
The wife’s application was subsequently amended unopposed reflected in the “Minute of Proposed Orders” being Exhibit 31 and otherwise appended to counsel’s written submissions.
In response to an issue raised by me, counsel for the wife informed me at the conclusion of the evidence that an order for spousal maintenance was not sought by the wife.
The orders sought by the respondent husband (“the husband”) are set out in his Amended Response filed 21 November 2005 and otherwise appended to counsel’s written submissions.
The parties cohabitated for a period of approximately 34 years which commenced on their marriage which took place in November 1969.
The parties had brief periods of separation. They finally separated on 24 January 2004 and have lived separate and apart from each other continuously since that time.
In the absence of evidence or information provided by counsel to the contrary, I have inferred that a decree of dissolution of marriage has not been made.
The wife is 57 years of age and engaged in home duties.
The husband is 59 years of age. The husband is a self-employed professional in the finance sector.
The parties have two adult children, namely a married daughter 35 years and a son, aged 27 years. The son now resides with the wife having previously resided with the husband. The son has had unsound health for several years.
The principal factual issues are in the context of whether or not each of the parties has made full and frank financial disclosure.
It is alleged on behalf of the wife that the husband has not fully disclosed all of his property interests, financial resources and retention of her jewellery. The husband for his part, alleges that the wife has not fully disclosed all of her jewellery.

Historical background

The following are further brief relevant historical matters.
At about the end of November 1969 the parties commenced to reside in rented premises in Sydney. The husband was a finance student. The wife was also a student.
In October 1971 the parties returned to reside with the husband’s parents in Suva, Fiji.
In about May 1972 the parties commenced to reside in a house owned by the husband and his father in Suva (“the Suva property”).
In about 1974 the parties moved to reside in other premises in Suva.
In 1981 the husband’s father transferred to the husband his interest in the Suva property.
In 1988 the parties emigrated to Australia and commenced residing in Sydney.
In 1988 the home unit was purchased in L (“the [L] Unit”) for $265,000.00. I accept the husband’s unchallenged evidence that the purchase price was funded by the parties’ savings of $40,000.00 and a mortgage advance of $225,000.00.
In 1992 the husband, together with Mr S purchased shares in the company known as M Pty Ltd. There was subsequently a change of company name to C Pty Ltd and again changed to B Pty Ltd.
In about 1992 the parties jointly purchased the property situate at T (“the former matrimonial home”) for $765,000.00. I accept the husband’s unchallenged evidence that the purchase price was funded by the parties’ savings of $165,000.00 and an ANZ Bank mortgage advance of $600,000.00.
In 1994 C Pty Ltd purchased two commercial premises, namely:
(a) W2 for $224,000.00.
(b) W3 for $76,000.00.
The precise evidence of the funding of W2 and W3 was not given other than a reference to “vendor finance”.
In 1997 the husband received a transfer from Mr S of his share in C Pty Ltd, apparently for nominal consideration. The husband commenced carrying on his business activities in the former matrimonial home.
In 1999, W2 and W3 properties were refinanced by C Pty Ltd with the ANZ.
In 1999 the husband together with a cousin, Mr B purchased the finance business of CA Pty Ltd which the husband alleges cost $500,000.00 fully financed by an advance from the ANZ Bank.
In 2000 C Pty Ltd was placed in liquidation. In circumstances that were not fully explained in the evidence, W2 and W3 properties were transferred to the parties jointly for $400,000.00. For reasons that were not clear on the evidence the transfers were not registered until during 2004. The evidence was obscure in relation to funding of the amount of $400,000.00.
In 2000 the parties’s son commenced tertiary education in the United States of America.
In 2001 the commercial unit, being W1 was purchased in the joint names of the parties. The settlement sheet reveals that the purchase price was $215,000.00 (not $236,500.00 as alleged in the husband’s affidavit evidence). The settlement sheet also gives particulars of $21,500.00 refundable GST and $7,000.00 paid.
In 2001 the parties travelled to the United States of America from time to time to support their son who had become seriously ill.
In 2001 the business relationship between the husband and Mr B was dissolved as the latter allegedly diverted funds from CA Pty Ltd for his own use and was instrumental in unsatisfied tax liabilities of $250,000.00. The ANZ Bank terminated its bank facilities to CA Pty Ltd.
In 2001 M purchased the business undertakings of CA on terms requiring payment of $10,000.00 per month for 48 months and $280,000.00 in October 2006.
In 2001 the Suva property was sold for $160,000.00 (Fiji dollars).
In 2002 the parties granted a mortgage over the title to W1 as security for CA indebtedness of $500,000.00.
On 3 July 2002 F Pty Ltd was incorporated with its registered office at the former matrimonial home. The sole director and shareholder was and continued to be the husband.
F Pty Ltd became the vehicle for the husband’s business undertakings.
In 2003 the L unit was transferred to the parties’ daughter subject to the mortgage.
In 2003 CA Pty Ltd which had a change of company name to B Pty Ltd was placed in liquidation.
In June 2003 the U Unit Trust was established. The husband alleges that there was and continues to be one allotted unit in the U Unit Trust held by him in trust for the parties’ son.
In 2003 the trustee of U Unit Trust purchased Unit W4 for $175,000.00 fully financed. The husband was and continues to be the guarantor. The W4 property has been leased.
On 13 August 2004 interim property settlement orders were made by consent (“the interim property settlement and maintenance orders”) as follows:
“1.THAT by way of interim property settlement the wife transfer all her right, title and interest in the former matrimonial home to the Husband being the whole of the land situate at and known as [T] (“the matrimonial home) and contained in Folio Identifier […] at the same time as the husband complies with order 2 herein;
2.THAT the husband will forthwith do all acts and things necessary to refinance the existing home loan in respect of the matrimonial home with ANZ […] with a loan from NAB Homeside Lending and borrow an additional sum of $500,000.00 in addition to the existing mortgage and thereafter the Husband will pay the following from the additional borrowings:
(a)As to $357,000.00, or as required, to repay a loan with ANZ […] owed by [F Pty Ltd and guaranteed by the Husband and the Wife.
(b)as to the sum of $65,000.00 to the Wife;
(c)as to the balance to the Husband with the husband to account to the wife within 3 working days of the monies received by him and confirmation of the repayment of the [F Pty Ltd] debt to ANZ […]
(d)The parties agree that the amounts referred to in (a), (b) and (c) hereof shall be brought into account at the final hearing
3.THAT thereafter the Wife shall be entitled to lodge a caveat against the title of all the property owned by the parties and set out herein and both the Husband and wife are restrained from encumbering, disposing, alienating or otherwise dealing with their interest in [T property] and any other property owned by the parties solely, jointly or in which they have an interest.
4.THAT the Husband shall thereafter be responsible for the mortgage payments rates taxed and outgoings and levies in respect of the Homeside Loan and in respect of all other properties owned by the parties jointly, solely or in which they have an interest and indemnifies the Wife in respect thereof.
5.THAT the Wife shall be entitled to receive the net rental of the property at W2 property] by way of spouse maintenance payments.
6.THAT the Husband shall do all acts and things necessary and sign all documents necessary to cause the Wife to be paid the sum of $3,000.00 each four weeks from a bank account in the name of [F] Pty Ltd. by way of spouse maintenance payments. NOTE: The parties agree a sum of $10,000 is paid into that account each four weeks.
7.That from the balance of the monies paid into the [F Pty Ltd] account each four weeks the parties agree the husband may retain $3,000 for his personal use with the balance of $4,000 to be paid in reduction of the additional borrowings and existing mortgage in respect of the former matrimonial home.
8.THAT the payments referred to in paragraphs 4, 5, 6 and 7 shall be brought into account at the final hearing.
9.THAT the Husband will continue to pay lease payments in respect of the Mercedes motor vehicle currently being driven by the Wife. The Wife will be responsible for all other outgoings in respect of the vehicle including comprehensive insurance and any parking fines.
10.THAT the Husband will continue to keep the Wife insured with HCF medical insurance
10.THAT the Husband will continue to keep the Wife insured with HCF medical insurance
11.That both parties to do all acts and things necessary to bring these orders into effect orders [sic] and failing either party complying with this order a Registrar of the Court be permitted to sign all documents necessary in the name of the parties and give all consents necessary to bring these orders into effect pursuant to section 106(A) of the Act
12.Notation: The husband agrees the only persons to occupy the former matrimonial home are to be himself and [the parties’ son] unless by agreement between the parties.”
On 4 November 2004 P Pty Ltd entered into a loan agreement with a Fiji Bank with a limited facility of $300,000.00 guaranteed by the husband. The husband holds a 20% interest in P Pty Ltd.
On 23 November 2005 a single expert was appointed for the purpose of valuing jewellery on certain terms.
On 24 November 2005 directions were made in relation to interlocutory issues and a notation made of the parties’ agreement in respect of the current market value of personal property, as well as other matters.

Relevant legal principles

It is now well established that generally speaking the approach to be taken to determination of property settlement proceedings, concluding with an order that is “just and equitable”, represents four steps.
The first of which is that the Court should determine the property and financial resources of the parties at the date of the hearing.
Secondly, determine the nature and extent of the respective contributions made by each of the parties whether financial or non financial, including contribution to the welfare of family in the role of home-maker and parent.
Thirdly, determine and assess the relevant matters pursuant to section 75(2).
Fourthly, consideration of orders, if any, that should be made that are just and equitable.[1]
[1] Hickey & Anor and Attorney-General for the Commonwealth (2003) FLC 93-143
I will now proceed to make findings in relation to the property of the parties, their respective financial and non-financial contributions and relevant matters (if any) pursuant to section 75(2) of the Act. In addition, I will make findings in respect of the issue of “waste” raised by the applicant.

The property of the parties

An agreed schedule of the parties’ “Assets & Liabilities” was received as Exhibit 18 and reproduced as follows:

“ASSETS & LIABILITIES as at 5 DECEMBER 2006

Assets
O’ship
Poss’n
Husband’s Valuation Wife’s Valuation Agreed or Not

1. [T] property H $1,900,000.00 A $1,900,000.00 A A

2. [W2 Property] J $350,000.00 A $350,000.00 A A

3. [W1 Property] J $300,000.00 A $300,000.00 A A

4. [W3 property] J $170,000.00 A $170,000.00 A A

5. [W4 Property] *? $170,000.00 * $170,000.00 * A

6. Mercedes CL180 H $32,500.00 A $32,500.00 A A

7. Mercedes ML320 H $40,000.00 A $40,000.00 A A

8. Loan to [F] P/L H $391,000.00 * $500,000.00 * NA

9. Wife’s jewellery W $5,000.00 A $5,000.00 A A

10. Husband’s jewellery H $5,000.00 A $5,000.00 A A

11. Wife’s missing jewellery *? $81,437.00 * $81,437.00 * A

12. Shares in [A] Consulting H $13,772.00 A $13,772.00 A A

13. Shares in [P Pty Ltd] H NIL A NK A A

14. Shares in Rinker Ltd (192) H $2,555.00 A $2,555.00 A A

15. [F] P/L shares H NIL * NK A

16. Joint ANZ account J $800.00 A $800.00 A A

17. [J] Superannuation Fund *? $378,641.00 * $587,694.00 * NA

18. Wife’s superannuation W $633.00 A $633.00 A A

19. Luxembourg Investments *? NK * $3,700,000.00 E NA

20. H’s share of joint chattels H $23,420.00 A $23,420.00 A A

21. W’s share of joint chattels W $12,550.00 A $12,550.00 A A

22. Wife’s savings W NK * $200.00 E NA

23. Wife’s paid legal fees #W $50,172.00 A $50,172.00 A A

24. Husband’s paid legal fees #H $99,883.00 A $99,883.00 A A

25. Advance from borrowings #W $65,000.00 A $65,000.00 A A

26. Advance from borrowings #H $78,000.00 A $78,000.00 A A

27. [M] debt *#H NIL E NK * NA

28. Advance by husband *#W $5,000.00 E $5,000.00 A A

29. TOTAL ASSETS H $4,175,363.00 $8,193,616.00 NA

Liabilities

30. Mortgage loan H $1,200,000.00 A $1,200,000.00 A A

31. Loan from [F] P/L *H/J $283,785.00 * NIL * NA

32. Loan from [A Consulting] *H $294,720.00 * NIL * NA

33. Loan from [A] Finance *H $11,000.00 * NIL * NA

34. Westpac Lease *H $30,000.00 E NK * NA

35. Husband’s credit cards *H $94,600.00 * NK * NA

36. Parking levy *H/J $12,800.00 * NK * NA

37. Directors liability to ATO *? $82,500.00 E NK * NA

38. ANZ loan to [U Unit Trust] *? $140,000.00 A $140,000.00 A A

39. Other [U Trust] liabilities *? $30,000.00 E NK * NA

40. TOTAL LIABILITIES $2,179,405.00 $1,340,000.00 NA

41. NET ASSET POOL $1,995,958.00 $6,853,616.00 NA

A – Value agreed NA – Value Not Agreed NK – Value not known ? – Identity unknown

* Dispute as to inclusion or value to be the subject of evidence # Proposed add back to pool”

Disputed items of property and liabilities

There are a number of disputed items of property and liabilities as is apparent from Exhibit 18. I will make findings in relation to those disputed items in subsequent paragraphs.
Written submissions have been made on behalf of the parties in relation to the credibility of each of the parties as witnesses which are relevant to my findings in relation to these matters.
Whilst there have been aspects of the evidence of the parties that have not been entirely satisfactory, I do not propose to make a blanket finding as to credit. Rather, I will consider the credit issue in relation to those controversial allegations of fact where the parties’ credibility is relevant.

Disputed assets

Item 5 – W4 Property

The issue is whether that asset should be included as an asset of the husband for the purpose of calculating the net property of the parties.
It is the husband’s case that this property is the asset of the U Unit Trust and that it is the parties’ son rather than him that is beneficially entitled to the only unit in that trust.
The wife’s case is that the husband is the beneficial owner of the property.
It is common ground that A Fidelity Pty Limited is the registered proprietor of the property.
Exhibit 15 is a copy of a trust deed which is undated. It was executed by A Fidelity Pty Limited and by the husband. The top of page 2 seems to indicate that stamp duty was paid on 6 June 2003. The front sheet of Exhibit 15 contains a signed certificate by Anthony Soubris, solicitor dated 12 June 2003 certifying that the document is “a true and complete copy of this trust deed”.
Exhibit 16 is a copy of a unit application dated 4 June 2003 signed by the husband. Exhibit 16 also comprises a copy of a declaration dated 4 June 2003 by the husband that he holds the unit in U Unit Trust in trust for the parties’ son. That declaration of trust is unstamped. The husband has given an undertaking to lodge it for stamping, although as at the completion of the evidence, he had not as yet fulfilled his undertaking.
The evidence of the husband is to the effect that he has controlled U Unit Trust at all material times.
The wife is suspicious as to whether the husband in reality does hold the one allotted unit in U Unit Trust for their son for the reasons set out in the written submissions made on her behalf. Nonetheless, the effect of her oral evidence, as set out in the written submissions on behalf of the husband, is that she has been aware that the property had been purchased upon trust for their son and that he had informed her that so far as he was concerned, she could become the trustee in addition to the husband. The wife’s further evidence was that her son could keep the property.
In his concluding written submission on this particular matter, senior counsel for the husband submitted that an order may be made that each of the parties do all things necessary to ensure that the son has “control of and the beneficial interest in all assets of that trust”. The written submissions in reply on behalf of the wife do not respond to the latter submission.
Having regard to the evidence of the wife and Exhibits 15 and 16, which I accept, I find that:
(d)U Unit Trust has been validly established;
(e)that the one unit that has been allotted in U Unit Trust is held by the husband in trust for the son; and
(f)W4 property is the property of U Unit Trust.
Consequently, W4 Property will not be included in the net property of the parties.
I accept the written submissions on behalf of the husband that as a consequence the liabilities of U Unit Trust as reflected in items 38 and 39 of Exhibit 18 are irrelevant to the calculation of the net property of the parties. The husband of course does have a contingent liability as guarantor.

Item 8 - loan to F Pty Ltd (the husband)

It is contended on behalf of the wife that the husband’s asset represented by the loan is $500,000.00. The husband asserts that the correct amount is $391,000.00.
The amount of $500,500.00 appears in the Affidavit of the single joint expert Mr Y, Chartered Accountant sworn 22 August 2005. The relevant detail is reflected in his report being annexure “D” and annexure “CA”. That document set out the net assets of the company as at 31 December 2004.
It is clear from Exhibit 7 that the loan otherwise referred to in the proceedings as being $500,000.00 had reduced to $390,343.96 as at 30 June 2006.
Mr Y was not cross examined in relation to the subsequent lower figure attributed to the loan account to which I have referred. There is no other evidence before me which would lead me to conclude that I should make a finding that the loan account reflects the historically higher amount compared to the lower amount as at 30 June 2006.
I do not accept the written submission made on behalf of the wife on pages 19 and 20 of that submission. The fact that an agreed value of property was noted as at 24 November 2005 when Interim Consent Orders were made does not have the effect of creating a bar to more up to date evidence reflected in the financial accounts to which I have referred. Certain of the other matters to which those written submissions were directed such as Interim Costs and Spousal Maintenance as well as a distribution of $78,000.00 to the husband will be dealt with separately. Having regard to the matters referred to in paragraphs 69, 70 and 71 and this paragraph, I find that the amount to be attributed to this company loan is $391,000.00.

Item 11 – wife’s missing jewellery

Each of the parties contends that the other is in possession or control of the subject jewellery. The jewellery in question has an agreed value of $81,437.00.
Detailed and helpful written submissions were made on behalf of each of the parties. I am not satisfied on the balance of probabilities that the husband is in possession or control of the jewellery for the following reasons.
I have considered, as submitted on behalf of the wife, that “her actions demonstrated a level of naivety and ineptitude that suggests her version is likely to be genuine”. Nonetheless, for the wife to have substituted an unsafe place for the jewellery compared to its previous safe custody with a bank in the face of her fear and concern in respect of the husband’s actions in possibly gaining control of it against a background where she claims she has been the subject of family violence and abuse, seems extraordinary to me.
In addition, the wife failed to make demand of the husband for the jewellery in the list of items of personalty left behind in the former matrimonial home in correspondence sent on her behalf by her solicitor. That is remarkable, to say the least. That is exemplified by the detailed list of items sought by her and the relative lack of importance of some of those items by comparison to her jewellery in view of the nature and extent of the jewellery which the wife had been collecting for some years and which she had previously been concerned to remain in the control of the bank by a safe deposit box. I do not accept her evidence that she had insufficient time to secure the jewellery prior to attending her sister’s wedding, or for leaving it unattended in different circumstances, especially as she did not trust the husband. The wife’s Financial Statement sworn 31 May 2004 omitted any reference to the jewellery, although her evidence tended to find fault with her solicitor in that regard.
Overall, I accept the submissions made on behalf of the husband which, together with the aspects of the evidence to which I have referred, leads me to find that I am not satisfied on the balance of probabilities that the wife’s missing jewellery is in the possession or control of the husband. It therefore follows that the jewellery will be included as property of the wife.

Item 15 – F Pty Ltd shares (husband)

Exhibit 18 demonstrates that the wife was not prepared to accept the “nil” that is attributed by the husband.
However, the written submissions on behalf of the wife in paragraph 2.2 make it clear that there is no longer an issue in relation to this matter.
Consequently, I will attribute no value to the shares in this company.

Item 17 – J Superannuation Fund

The wife contends that the net value to be attributed is $587,694.00. As is apparent from Exhibit 18 the valuation contended for by the husband is $378,641.00.
In his Affidavit sworn 29 September 2006, annexure “C” with its sub-annexure “H”, Mr Y valued the net assets at $587,693.34 as at 6 January 2006. In doing so, he referred to various difficulties in carrying out his valuation due to, amongst other things, the lack of provision of financial statements.
During the course of cross examination, Mr Y stated that the tax liability was included in the valuation. I note that is apparent from his report. He further gave evidence that the valuation may have varied since his report, depending upon the nature of the investments held or performance in the marketplace. Mr Y obviously was not furnished with any such information, as no doubt he would have provided a different amount or at least given an analysis of those matters to which I have referred.
The only other evidence is that given by the husband in his Financial Statement sworn 15 September 2006. The husband contends that the correct valuation is $322,000.00. Neither the financial statement or his oral evidence provides the basis for calculation of that amount.
In the written submissions on behalf of the wife, at pages 23 to 27, it is submitted that the valuation amount should be found to be considerably higher than $587,693.34. Indeed, the amount that is alleged is $873,965.00. I do not accept those submissions for the following reasons.
Exhibit 18 is the jointly agreed schedule of “Assets and Liabilities as at 5 December 2006”. That document was settled by counsel for the parties. I had called for such a document to be handed up at various stages of the trial commencing from the first day. At different times I was assured that various drafts had been prepared, amended and needed checking by one counsel or the other. Ultimately, Exhibit 18 was tendered on the last day of the trial. It would be extraordinary for an amount to be contended on behalf of the wife in Exhibit 18 which is far less than the amount referred to in the written submissions on her behalf. No further relevant evidence was given subsequent to the tender of Exhibit 18. Accordingly, the evidence presumably relied upon by counsel for the wife to support the assertion of $587,694.00 was the same evidence which is now apparently relied upon to support a finding of $873,965.00. It was not contended in the written submissions that there had been an oversight or mistake by counsel. Mr Y was not cross examined to suggest that he needed to revise upwards his net valuation of $587,693.34.00. I can only assume that counsel would have carried out such a cross examination if there was a basis to do so.
I see no reason not to accept the expert evidence of Mr. Y, notwithstanding the difficulties he referred to in carrying out his valuation.
Accordingly, I find that the valuation of J Superannuation Fund is $587,694.00.

Item 19 – Overseas Investments

The wife’s case is that the husband has not disclosed “investments in overseas banks and/or investment accounts, including some or all of the investment accounts with […] Bank” which are referred to in the submissions on her behalf as “the [Overseas] Investments”.
As is apparent from Exhibit 18, it is contended that the value of the Overseas Investments is $ 3,700,000.
The husband denies that he has any such investments, let alone to the value of $3,700,000.00.
During the course of the written submissions on the wife’s behalf, reference is made to Exhibits 10, 11 and 12 and the three emails attached, being Exhibit 29.
Exhibit 10 comprises documents which reveal the husband reporting to Mr H; a client identified in the evidence, security contracts and bank remittances.
Exhibit 11 comprises financial investment statements, requests made to the husband for information by or on behalf of a G family member, instructions given to the husband in relation to financial matters including stock purchases and documents in respect of the husband’s consultancy services that he was providing. The exhibit also includes a copy of a limited power of attorney granted to the husband by R Ltd, banking records and copy of a passport issued to V G.
Exhibit 12 comprises investment records of F Investments Ltd, correspondence passing between Mr B’s family members including the husband’s reports, copies of stock exchange orders, documents emanating from D B and statements of account.
Exhibit 29 included copy email referring to periodic statements (presumably financial statements). Copies of those statements are also included in the exhibit as referred to in the written submissions on behalf of the wife.
It is submitted that the husband made belated disclosure of relevant financial documents.
It is further submitted that the B group accounts as at 31 March 2006 totalled $2.43 million with projected balances as at 31 December 2006 of $3,436,944.00.
On behalf of the wife it is also submitted that an inference should be drawn that the husband “has a 20 per cent beneficial interest” in the relevant B group accounts.
The ultimate submission made on behalf of the wife is that “careful reading of the select documents produced show they are consistent with the husband having a beneficial interest in those two accounts”. The accounts referred to are those which I have identified as having the projected balances as at 31 December 2006.
Unfortunately, the written submissions do not provide an analysis of “the select documents” that demonstrate that the husband has “a beneficial interest” in the relevant accounts. It is one thing to make the assertion. However, it is another matter to refer to particular aspects of the documentation allied with any other relevant evidence, which demonstrates as a matter of law that the husband has “the beneficial interest” the subject of the contention. My independent reading of the relevant documentation does not support the submission that was made, although I may have been assisted had there been a written submission which precisely identified the evidence, from documentation or otherwise, from which a conclusion can be drawn as to the nature and extent of the alleged beneficial interest of the husband. For example, it was not submitted that there was certain shareholding in one or other company in which the husband held a beneficial interest, let alone the class and rights attached to those shares, or the legal basis (eg a trust) upon which a beneficial interest in the relevant accounts is established. It is trite law that shares in a company do not create a legal or beneficial interest in its assets.
The written submission on behalf of the wife also refers to the evidence of the husband “handling substantial sums of cash overseas”. It is further submitted that “the wife does not know the value of the husband’s undisclosed investments but believes and asserts they are of substantial value”. The fact that the husband has been in possession of cash whilst overseas does not lead me to draw a conclusion that he has a beneficial interest in the accounts as contended on behalf of the wife. Suspicion and speculation are no substitute for evidence which could lead me on the balance of probabilities to make a finding of the nature and value of the beneficial interest of the husband in the funds having regard to legal principle or, indeed the shareholding in the B group, to the value as contended or any other value.
There did not appear to be any issue on the evidence that members of the G family, the B group and Mr H have been clients of the husband. I accept the submissions made on behalf of the husband in relation to this matter and the basis for such submissions which, combined with my review of the relevant evidence and the submissions made on behalf of the wife, lead me to conclude that the husband does not have an asset represented by the “[Overseas] Investments” to the value of $3,700,000.00 or indeed any other amount. Consequently, disputed item 19 in Exhibit 18 will not be included in my calculation of the net property of the parties.

Item 22 – savings of $200.00 (wife)

Whilst this item was not admitted on Exhibit 18, I accept the submissions made on behalf of the wife that there is no longer an issue in relation to this. Indeed, no contrary submissions were made on behalf of the husband.
Accordingly, I find that the wife’s savings are $200.00 as noted in Exhibit 18.

Items 23 and 24 – paid legal fees for the parties

The written submissions made on behalf of each of the parties make it clear that it is agreed that the paid legal fees for the wife and the husband in the sums of $50,172.00 and $99,883.00 respectively should be added back in the calculation of the parties’ net property. That is the approach that I will take.

Item 25 – advance from borrowings (wife)

The relevant amount is $65,000.00.
The husband submits that it should be brought to account. I do not propose to do so.
I accept the written submissions made on behalf of the wife which demonstrate the manner in which the $65,000.00 has been spent by the wife, which includes $50,172.00 for costs. That amount has already been allowed for by way of an “add-back” in accordance with item 23.
With regard to the balance of the funds, namely approximately $15,000.00, I accept the submission that the evidence demonstrates that the funds had been used by the wife in supporting herself by way of reasonable expenditure. Indeed, there is no contrary evidence[2].
[2] Chorn and Hopkins (2004) FLC 93-204 at paragraph 24
Accordingly, this item represented by the amount of $65,000.00 will not be added back for the purpose of calculation of the net property of the parties.

Item 26 – advance from borrowings

This particular item refers to borrowings by the husband of $78,000.00.
I do not accept the submission that there should be an “add back” of this particular amount unless the whole of the F Pty Ltd loan is included.
Firstly, I found that the correct balance of that loan is not $500,000.00 but $391,000.00 for the reasons previously expressed by me.
I accept the evidence of the husband regarding the expenditure by him of the relevant amount of $78,000.00 which I find to have been reasonable expenditure in all of the circumstances. In that regard, I apply the guidance provided in Full Court judgments.[3]
[3] Marker and Marker (1998) Fam CA 42; Cerini and Cerini (1998) Fam CA 143; Chorn and Hopkins, ibid
Accordingly, the amount of $78,000.00 will not be added back as contended on behalf of the wife.

Item 27 – M debt

The substance of the submissions on behalf of the wife is that the wife is unaware as to whether the balance of the loan has been repaid in full or what amount has been paid.
It is further submitted that the wife was not appropriately informed, nor has the husband provided relevant information to the court.
It is recognised in paragraph 4.7.6 of the written submissions on behalf of the wife that if the figures referred to are accepted, then the obvious entry in relation to this non admitted item is “nil”.
Whilst I can appreciate that the wife and her legal advisers may have been left in a quandary as to the payment in full or in part of the balance of the relevant loan, I find it curious that upon the resumption of the hearing on 4 December 2006, which continued during the next day, no order was sought on behalf of the wife to furnish any further information by documentation or otherwise.
In those circumstances, I am left with the evidence as has been provided, particularly by the witness Mr S. Accordingly, I find that there is no amount to be designated for the subject debt. Therefore, item 24 will be recorded as “nil”.

Item 28 – advance by husband of $5,000.00

The written submissions on behalf of the husband concede that “this amount should be disregarded for the purposes of the proceedings”.
Consequently, item 28 will not be included in the calculation of the net property of the parties.

Liabilities

There is no issue in relation to items 30 (mortgage loan), 38 and 39 (ANZ loan to U Unit Trust). So far as Items 38 and 39 are concerned, they will be removed from the necessary calculations given my finding that in relation to item 5 (W4 Property), the parties’ son holds the beneficial interest. That accords with the submissions made on behalf of the husband, not opposed in the submissions in reply.

Items 31, 32 and 33

I accept the expert evidence of Mr Y, there not being other evidence to demonstrate that he was mistaken regarding the liabilities of one or both of the parties, so far as the loans to the companies identified in these items.
During the course of the hearing, I was informed by senior counsel for the husband that the subject companies are the alter ego of the husband.
It has been submitted on behalf of the wife that an issue arises regarding a potential finding as to whether or not all or any of the subject loans will be enforced in those circumstances. There was no submission made on behalf of the husband that the husband will or is likely to take steps to cause all or any of the three relevant companies which are his alter ego to enforce payment by him and/or the wife in the case of F Pty Ltd in satisfaction of the outstanding liabilities.
I will review the matters referred to in the last paragraph and the weight which should be attached to those liabilities when considering orders that should be made which are just and equitable in accordance with s 79(2).

Item 34 – Westpac lease

The husband contends that he has a liability pursuant to this lease for an estimated amount of $30,000.00. That liability arises as a result of his personal guarantee of the lease of office equipment previously used in a historical professional practice.
It is submitted on behalf of the wife that the relevant company underwent change of name with subsequent administration and liquidation.
Whilst the historical change of events undoubtedly occurred, the essential issue remains the same and that is whether or not the husband has continued to be bound by his personal guarantee and if so, the amount of the liability.
Exhibit 24 which includes correspondence from the liquidator corroborates the liability. Whilst the letter dated 21 December 2005, being part of Exhibit 24, quantifies the liability at that time as being $22,870.60 together with any outstanding costs, I have concluded that the estimate of the husband for an amount of approximately $30,000.00 is reasonable in the circumstances. There is no evidence from which I could conclude that such an amount was exaggerated.
Consequently, I find that the husband has a liability of an estimated $30,000.00.

Item 35 – credit cards (husband)

The husband’s alleged liability is $94,600.00. In his Financial Statement sworn 15 September 2006, liability for all credit cards was alleged to be $121,600.00. There is no analysis provided in terms of indicating the actual or estimated liability for each of the credit cards. The amount involved was put forward on a global basis. The contended liability has fluctuated depending on the date on which past financial statements were sworn. That, of itself, is not unusual.
There is no issue that the husband has been actively engaged in a variety of business activities, both in Australia and overseas including overseas travel, part of which has included private as opposed to business travel such as a cruise in North America. The husband’s evidence is that credit cards have been paid for from Australian funds.
I accept the submission made on behalf of the wife that the husband has not produced documentation that one might have expected would have been produced and be readily accessible in relation to some aspects of his business activities. The husband’s lack of production of relevant documentation, such as in respect of membership statements for the superannuation fund, seem extraordinary given his past occupation as a chartered accountant over many years with a leading international firm of accountants and subsequently as a financial consultant.
In addition, it was further submitted on behalf of the wife that the husband has not produced his credit card statements. The submission on behalf of the husband does not join issue in relation to that matter, or the lack of opportunity for those representing the wife to inspect credit card statements so that an analysis could be carried out which differentiates between possible business expenses as opposed to private expenses. The former, of course, would represent a deduction for tax purposes. Without the reasonable opportunity for such inspection and analysis to take place, it has not been possible to come to a conclusion as to whether the asserted credit card liability of $94,600.00 represents expenditure for private purposes only and if so, whether it was reasonable in all the circumstances that then applied.
In those circumstances and notwithstanding that I accept the submission on behalf of the husband that in principle a credit card liability of a party to the marriage may well be properly taken into account, I do not propose to do so in this particular case for the reasons explained in the last preceding paragraph.
Accordingly, I will omit the liability for credit cards asserted to be $94,600.00 from the calculation of the net property of the parties.

Parking levy

It is submitted on behalf of the husband that the prospective parking levy which relates to the W properties should be treated as a liability to be properly taken into account regardless of who may become the sole registered proprietor. It is conceded that the relevant return has yet to be filed with the local authority.
It follows that the parking levy has not yet been assessed.
The husband’s evidence was that he had failed to lodge the relevant returns. This is yet another instance of poor attention to basic documentation.
Order 4 of the interim property settlement orders made the husband liable for the payment inter alia of “levies in respect of the Homeside Loan and in respect of all other properties owned by the parties jointly or solely or in which they have an interest and indemnifies the wife in respect thereof”. By dint of the husband failing to prepare and lodge the relevant documentation, an assessment has not been made. This has had the practical effect of postponing a liability for payment which he would otherwise have had to make in accordance with the orders which he himself consented to.
In those circumstances, I will omit this item of liability from the calculation of the net property of the parties.

Item 37 – directors’ liability to ATO

As is apparent from Exhibit 18 and the submissions made on his behalf, the husband seeks to have taken into account an alleged estimated liability of $82,500.00 for tax.
The husband’s most recent Financial Statement was sworn by him on 15 September 2006. In that document the husband does not specify, either precisely or on an estimated basis, the amount of the tax that he claims to owe pursuant to directors’ liability, but rather merges that liability with “lease payments” to give a global figure of $112,500.00.
That is a strange approach to say the least given the husband’s qualifications and substantial experience in finance.
The husband’s earlier Affidavit sworn 19 August 2005 did not advance the matter any further.
The husband was in the peculiar position of being able to obtain and tender a Notice of Tax Assessment. That did not occur.
The only independent evidence before me by way of documentation or otherwise is provided in Exhibit 24 which includes a letter dated 21 December 2005 from the joint liquidator of B Pty Ltd (formerly C Pty Ltd). That document provides evidence of the husband becoming personally liable “in the amount of approximately $62,540”. I accept that evidence and find that the husband has an anticipated liability for tax in an estimated amount of $62,540.00. That amount will be included as a liability for the purpose of calculation of the net property of the parties.

Items 38 and 39

As previously referred to, these items of liability will be excluded.

Revised property of the parties

In accordance with the findings made by me in respect of disputed items in Exhibit 18, I find that the revised property of the parties, including the J Superannuation Fund is as follows:

Assets Ownership/
Possession Value

1. [T] property H $1,900,000.00

2. [W2 property] J $350,000.00

3. [W1 Property] J $300,000.00

4. [W3 property] J $170,000.00

6. Mercedes CL180 H $32,500.00

7. Mercedes ML320 H $40,000.00

8. Loan to [F] P/L H $391,000.00

9. Wife’s jewellery W $5,000.00

10. Husband’s jewellery H $5,000.00

11. Wife’s missing jewellery W $81,437.00

12. Shares in [A] Consulting H $13,772.00

13. Shares in [P Pty Ltd] H NIL

14. Shares in Rinker Ltd (192) H $2,555.00

15. [F] P/L shares H NIL

16. Joint ANZ account J $800.00

17. [J] Superannuation Fund H $587,694.00

18. Wife’s superannuation W $633.00

20. H’s share of joint chattels H $23,420.00

21. W’s share of joint chattels W $12,550.00

22. Wife’s savings W $200.00

23. Wife’s paid legal fees W $50,172.00

24. Husband’s paid legal fees H $99,883.00

27. [M] debt H NIL

29. TOTAL ASSETS H $4,066,616.00

Liabilities

30. Mortgage loan H $1,200,000.00

31. Loan from [F] P/L H/J $283,785.00

32. Loan from [A Consulting] H $294,720.00

33. Loan from [A] Finance H $11,000.00

34. Westpac Lease H $30,000.00

37. Directors liability to ATO H $62,540.00

40. TOTAL LIABILITIES $1,882,045.00

41. NET ASSET POOL $2,184,571.00

Submissions were made on behalf of the wife in relation to the obligations of the parties to make full and frank financial disclosure, whether by way of documents and/or affidavit evidence. Those submissions as to principle are not disputed and are accepted by me.
In these proceedings, it is submitted on behalf of the wife that the husband has failed in various respects to make the full and frank financial disclosure that is required. As a consequence, it is submitted that during the hearing before me, the wife and her legal representatives were handicapped in exploring various financial issues. Reference is made to interlocutory orders and directions as well as subpoenas to produce documents.
However, pursuant to modern case management and pre-trial procedures in existence for some years in this Court, the parties have been required to certify that the proceedings are ready to proceed to trial. In the event that they are not ready to proceed, there are well known pre-trial procedures that can be utilised.
I pointed this out to counsel for the wife when this issue was raised during the course of the hearing on 15 October 2006. For example, in my experience it is not uncommon for an expert witness to be requested to furnish a list of documents that the witness requires to complete the relevant investigation and report. Those documents can then be subpoenaed if necessary. Should documents not be in existence which are required under the Corporations Law, the Superannuation legislation and/or Accountancy Standards, then an order can be sought directing the responsible party to have the documents prepared, completed and furnished to the other party by a particular date prior to the trial. If that is not done, then a possible sanction is that the trial proceeds undefended.
For reasons best known to the wife’s legal representatives, that more sophisticated approach to the preparation for the trial apparently did not take place.
Consequently, the trial proceeds on the available evidence, short of a successful adjournment application being made. No such application was made in these proceedings.
In the event that the husband in this case has failed to make full and frank financial disclosure, then to the extent that it is relevant to a particular issue, that matter has been considered by me.

Contributions of the parties

I make the following findings in relation to the financial and non-financial contributions of the parties including the contribution to the welfare of the family and the role as homemaker and parent.
There was little challenge in cross-examination to the affidavit evidence of each of the parties so far as this issue is concerned.

The wife

It is not submitted on behalf of the wife that her initial contributions implicitly were of substance beyond her personal effects and clothing.
During the period of cohabitation of the parties, the wife fulfilled the role of homemaker and parent.
The wife carried out extensive work in the performance of domestic duties including members of the husband’s extended family during the period of about eight years that the parties lived in the homes of the paternal grandparents.
In addition, the wife attended to the daily care and upbringing of the two children of the marriage. Her contribution in that regard was accentuated for a significant period due to the special needs and care that had to be provided to the parties’ son.
The wife joined in with the husband in the purchase of real estate and the legal responsibility created as a result of the financing that the parties required from time to time.

The husband

As with the wife, it is clear that the husband’s initial contributions were negligible.
Throughout the period of cohabitation, the husband was engaged full-time in his occupation and subsequently on a self employed basis in various business activities, principally financial.
There is no dispute that the income earned by the husband together with savings accumulated were utilised to meet the living expenses of the parties and their children as well as the acquisition of real and personal property.
The husband developed his practice in finance which included both Australian and overseas clients.
Having regard to the written submissions on behalf of each of the parties and my own independent review of the evidence, there is no dispute that the husband made additional financial contributions reflecting:
(a)Approximately $50,000.00 which was passed to him from his father as a result of the sale of family business interests in Fiji.
(b)Net proceeds of sale of real estate in Fiji of $150,000.00 approximately which passed to the husband following a direction from his father and ultimately applied to discharge the bridging finance in respect of W1 property.
(c)The benefit to the parties of the provision of accommodation by the husband’s parents, apparently without cost to the parties during the years that they resided with the husband’s parents in Fiji.
I make findings in accordance with the evidence and submissions that I have summarised in the last preceding paragraph.
The husband gave unchallenged evidence that he also made a contribution in the role of homemaker and parent from time to time particularly in the taking of children to and from school.
The husband has continued to make financial contributions subsequent to the separation of the parties by meeting a variety of financial obligations.

Assessment of contributions

It is submitted on behalf of the wife that the contributions to the property of the parties should be assessed as being equal.
For his part, counsel for the husband submitted that due to the weight that should be given to the husband’s financial contributions referred to in paragraph 170, the contributions made by the parties should be assessed in the proportions of 60% to the husband and 40% to the wife.
The written submissions on behalf of the parties did not seek to distinguish between contributions to the value of the superannuation fund as opposed to the remainder of the property of the parties. I consider that is an appropriate approach given that superannuation entitlements have developed during the period of cohabitation of the parties and possibly since (precise evidence was not given). Accordingly, that is the approach that I will take.
The contributions of the parties must be seen against the background of the period and length of cohabitation of some 34 years with two children.
There is little doubt that each of the parties applied him or herself fully in their respective spheres. As had been emphasised in numerous authorities, the contribution in the role of homemaker and parent should not be regarded as a token one which cannot have the same value as monetary contributions by a party. No submission to the contrary was made.
However, there is no doubt that the financial contributions made by the husband as a result of the funds received from one or both of his parents, to which I have referred, should and will attract significant weight having regards to the quantum involved and the use of those funds for the benefit of the family[4].
[4] Pierce and Pierce (1999) FLC 92-844
It is also well established that a mathematical approach in cases of lengthy marriages should not be applied. Indeed, for the purpose of weight to be attached to financial contributions, I have to take into account the length of the period of cohabitation and the contributions that each of the parties have otherwise made[5].
[5] Way and Way (1996) FLC 92-702 and the cases reviewed in the judgment.
Accordingly, approaching the assessment of contributions on a global basis (there being an absence of a contrary submission) I have assessed the contributions of the parties as being in the proportions of 55% in favour of the husband and 45% in favour of the wife.

Relevant section 75(2) matters

I make the following findings in relation to the relevant matters pursuant to the provisions of s 75(2).
The wife and the husband are 57 and 59 years of age respectively.
The wife has given affidavit evidence of her health issues. Expert evidence was given on her behalf by her practitioner Dr O in her Affidavit sworn 29 November 2006 being annexure “C”.
Dr O’s evidence is that the wife has been a patient of hers for the past nine years. During this time the wife has been treated for a variety of health issues ranging from angina and heart disease to stress and anxiety attacks, more particularly described in her affidavit.
Dr O referred the wife from time to time to various specialists.
Dr O concluded that the wife did not suffer from any mental health disorder based upon an assessment provided by a clinical psychologist.
Dr O expressed the opinion that the wife will need to attend medical specialists as well as herself on a regular basis due to her chronic health issues.
Dr O was not required for cross-examination on the basis that part of the medical report during the hearing was admitted only on the basis of a history given by the wife rather than the truth of its contents. That was agreed by counsel. I proceeded on that basis.
I accept the evidence of Dr O which was detailed and persuasive. I make findings accordingly.
The husband did not give evidence of any particular health issue affecting him. Accordingly, I find that the husband is in good health.
The income of the wife is as set forth in her Financial Statement sworn 15 September 2006. An average gross weekly income of $1,122.00 which included interim maintenance of $750.00 and rental income of $372.00 per week.
The wife has the property described in paragraph 151. The wife does not have other financial resources.
I accept the unchallenged evidence of Dr O in annexure “C” to her affidavit sworn 29 November 2006 that “due to the nature of her chronic medical conditions and need to attend medical specialists and myself on a regular basis, opinion, it would be extremely difficult for [the wife] to pursue any form of employment, be it full time or part time”.

Accordingly, I find that due to the wife’s unsound state of health and the lack of relevant qualifications and experience the wife does not have the capacity to be engaged in full-time or part-time employment.
I find that the husband has the income as set forth in his Financial Statement sworn 15 September 2006 which amounts to an average gross weekly income of $3,195.00 estimated $1,600.00 of which is the component salary.
I find that the husband has the property described in paragraph 151. The husband does not have other financial resources subject to the companies which are his alter ego as conceded by his counsel.
It is not disputed that the husband has the physical and mental capacity for continued self employment over many years against substantial experience in practice in the field of accountancy albeit, that he has not practised in that occupation for a considerable period of time.
Each of the parties has commitments for her or his support as set forth in their respective financial statements.
Each of the parties has assumed responsibility during different periods for the support of their son who has been in ill health. On the evidence of the wife, the husband has not been making any contribution to the son’s ongoing living expenses. It is a matter for the wife to seek legal advice regarding the possibility of an application for adult child maintenance. No such application was before me.
The husband is eligible for superannuation benefits pursuant to the J Superannuation Fund described in Exhibit 18 and the subject of my earlier findings. He has conceded that the trustee of the fund is his alter ego. The fund was established by him and he has been solely in control of it since establishment.
Annual financial statements of the superannuation funds were not tendered, let alone member statements. According to the husband, those documents have not been prepared, it seems for several years. That is extraordinary to say the least, especially given the husband’s occupation, qualifications and experience in the financial sector. I am baffled as to why an interlocutory order was not sought to compel the husband to have such documentation prepared, copied to the legal representatives and then ultimately available to be tendered during the hearing. The husband gave vague evidence that he and the two children have been members of the fund. The husband purported to have only a scant recollection of possibility that the wife had continued to be a member. As I have stated, no relevant documents were tendered, let alone available to be tendered on his behalf.
In the absence of basic documentation, in relation to the superannuation fund, the oral evidence of the husband, which I do not accept, as it was vague, imprecise and not supported by documentation for which he was solely responsible given that the trustee is his alter ego, I find that the husband is entitled to all of the superannuation benefits represented by the J Superannuation Fund.
It is clear that the parties have had the benefit of a good standard of living reflected in ownership of their own home, private school education for the two children with overseas travel from time to time, albeit associated with the husband’s business activities.
It is submitted on behalf of the wife that the husband is in arrears of $9,000.00 in the payment of interim spousal maintenance. No contrary submission was made. I accept the submission on behalf of the wife.
In another extraordinary aspect of the husband’s attention to his financial responsibilities, he established a company loan account in the name of the wife, whereby she became indebted for the payment to her of spousal maintenance payments pursuant to the interim order. That was done without any recourse to, or knowledge, or consent of the wife. The husband is clearly an intelligent, well-educated and astute financial consultant and former practising accountant. I find it to be an amazing course of conduct by him to create a loan account so that the wife becomes indebted for payments that she was entitled to receive, being the sole personal responsibility and liability of the husband. That devious scheming by the husband does not do him any credit.

Assessment of relevant section 75(2) matters

I have determined that there will be an adjustment of 15% of the net property of the parties excluding the J Superannuation Fund. As a consequence the net property is $1,596,877.00 ($2,184,571.00 - $587,694.00).
My reasons for doing so are as follows.
The wife is in chronic ill-health, the subject of my earlier findings.
As a consequence, the wife, realistically, does not have the capacity to earn income on a full-time or part-time basis in the foreseeable future. The wife’s lack of qualifications and relevant experience in outside employment accentuate her lack of capacity in that regard.
In contrast, the husband is in good health and experienced professional. He was a successful accountant over a considerable period of time notwithstanding the knowledge, skills and experience that he has gained have been undoubtedly an advantage to him over the years that he has carried on his business activities as a financial consultant. The financial advice that the husband has provided and carried out for clients have involved substantial monetary interests.
The husband has structured his income whereby he has received an average weekly amount of $1,600.00 gross. That amount reflects income paid by F Pty Ltd of $692.00 per week. F Pty Ltd is the alter ego of the husband.
However, that is not the only indicator of the husband’s overall financial capacity. The picture in that regard is more complete when one takes into account that the mortgagee was obviously satisfied as to the husband’s capacity to pay the mortgage loan of $1,200,000.00 apart from leasing finance of $75,406.00 and credit card indebtedness of $121,600.00.
The indebtedness to which I have referred is substantial when one considers the husband’s disclosed average weekly income is $3,195.00 gross as against personal expenditure of $3,865.00 per week. The amounts I have referred to are extracted from the husband’s Financial Statement sworn 15 September 2006. It includes income received from tenanted commercial units in W.
As is apparent from the husband’s Financial Statement sworn 15 September 2006, the total of personal expenditure given by him of $3,865.00 per week does not include the liability that he then had to make interim spousal maintenance payments of $3,000.00 every four weeks, or $10,000.00 to be paid for that period as noted in consent Order 6 made 13 August 2004.
Page 7 of the husband’s Financial Statement sworn 15 September 2006 refers to F Pty Ltd being the source of payment for consent Order 6 made 13 August 2004 of monthly payments of $4,000.00 by way of interest to Homeside Lending. Given that F Pty Ltd is the alter ego of the husband the financial capacity of F Pty Ltd to make the payments to which I have referred is part of the financial picture of the husband not otherwise readily apparent by a concentration upon the salary paid to him by F Pty Ltd as referred in his financial statement.
The husband has the capacity to continue to practice as a financial consultant to maintain and potentially develop his financial resources through commercial entities and otherwise with his control.
The husband potentially is able to continue to secure his future by increased superannuation entitlements and his earnings and/or commercial interests under his control. The wife does not have that capacity.

Conclusion

As a result of my determination of the contribution based entitlements of the parties and the adjustment in favour of the wife having regard to my findings in respect of relevant matters pursuant to s 75(2), the result is that orders for property settlement will be made in favour of the wife reflecting 60% proportion of the parties’ net property of $1,596,877.00 in her favour with the remaining 40% in favour of the husband.
The net property of $1,596,877.00 is arrived at by deduction of the J Superannuation Fund of $587,694.00 from the total net property which includes that fund amounting to $2,184,571.00 as set forth in paragraph 151.
So far as the J Superannuation Fund is concerned, each of the parties has sought superannuation splitting orders. As acknowledged by counsel on behalf of the husband, the requirements for particular notice to and response from the trustee does not have to be strictly applied in these proceedings given that the trustee is the alter ego of the husband.
I have found that the contributions of the parties to the superannuation fund is the same as the contribution entitlements in respect of the balance of the net property, namely 55% in favour of the husband and 45% in favour of the wife. I have also found that there will be an adjustment in favour of the wife of 15% compared to my findings in relation to s 75(2) matters and the weight which I have attributed to those matters referred to in previous paragraphs.
As a consequence, the superannuation splitting orders will reflect a base amount of $587,694.00 and splitting of the entitlements ultimately in proportion of 60% in favour of the wife and 40% in favour of the husband.
I have determined that the property settlement orders are just and equitable with regard to not only the outcome of the contribution based entitlements and adjustments in relation to s 75(2) matters but also the practical effect of the proposed orders.[6]
[6] Elsey and Elsey (1997) FLC 92-727 at 83,799
In analysing the implications of the proposed orders in terms of them being just and equitable, I find that the effect of those orders illustrated below whereby the wife receives 60% of the balance of the net property (excluding superannuation of $1,596,877.00 being $958,126.00) is as follows:

Wife to retain/receive:

Mercedes CL180 $32,500.00

Jewellery 5,000.00

Missing jewellery 81,437.00

Superannuation 633.00

Share of chattels 12,550.00

Savings 200.00

Paid legal fees 50,172.00

W1 Property 300,000.00

W2 Property 350,000.00

Lump sum payable by husband 125,634.00

$958,126.00

I have made a finding that the husband has been in arrears of $9,000.00 having regard to his liabilities in relation to maintenance to the wife reflected in consent Order 6 made 14 August 2004. That amount will be added to the lump sum otherwise payable by the husband to the wife. The result is a total payable by him of $134,634.00 ($125,634.00 + $9,000.00).
So far as the effect of the proposed orders on the husband is concerned, I have taken into account that he will retain the T property (the former matrimonial home) which has been utilised by him as his home as well as for the purpose of meeting clients. The husband will retain W3 property as well as his Mercedes ML320, his commercial company interests, and other items of personalty described in paragraph 151.
Given that F Pty Ltd, A Consulting Pty Ltd and A Finance Pty Ltd are the alter ego of the husband, it is unlikely that all or any of those companies will enforce his liabilities to them or any of them as described in paragraph 151. No submission to the contrary was made.
The commercial entities which are the alter ego of the husband represent valuable financial resources for him.
I also take those matters into account for the purpose of assessing whether the orders are just and equitable.
I will make orders that the husband continue to be responsible for indemnifying the wife in relation to all outgoings for properties W1 and W2 until such time as the transfers to her of his interest in both of those properties take place. Until that occurs the husband will also have the benefit of the rental income from those properties.
There is no issue that the wife should transfer her share in certain of the companies to the husband and resign as a director. The husband has been solely in control of those companies which have included the establishment of company loan accounts and possibility for meeting company statutory liabilities and other outgoings. In those circumstances, it is just and equitable that appropriate orders be made to ensure that the husband indemnifies the wife in respect of any claims and demands that may be made upon her in relation to those liabilities and outgoings.
I will provide a suitable period for payment by the husband to the wife of the lump sum of $134,634.00 to afford him a reasonable time to reorganise his finances for that purpose.

I certify that the preceding two hundred and thirty-three (233) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rose

Associate:

Dated: 28 September 2007

[2007] FamCA 1152

28 September 2007

Key Legal Topics

Areas of Law

Family Law

Equity & Trusts

Legal Concepts

Remedies

Costs

Fiduciary Duty

Constructive Trust

“ASSETS & LIABILITIES as at 5 DECEMBER 2006
Assets		O’ship Poss’n	Husband’s Valuation			Wife’s Valuation		Agreed or Not
1.	[T] property		H	$1,900,000.00			A	$1,900,000.00		A	A
2.	[W2 Property]		J	$350,000.00			A	$350,000.00		A	A
3.	[W1 Property]		J	$300,000.00			A	$300,000.00		A	A
4.	[W3 property]		J	$170,000.00			A	$170,000.00		A	A
5.	[W4 Property]		*?	$170,000.00			*	$170,000.00		*	A
6.	Mercedes CL180		H	$32,500.00			A	$32,500.00		A	A
7.	Mercedes ML320		H	$40,000.00			A	$40,000.00		A	A
8.	Loan to [F] P/L		H	$391,000.00			*	$500,000.00		*	NA
9.	Wife’s jewellery		W	$5,000.00			A	$5,000.00		A	A
10.	Husband’s jewellery		H	$5,000.00			A	$5,000.00		A	A
11.	Wife’s missing jewellery		*?	$81,437.00			*	$81,437.00		*	A
12.	Shares in [A] Consulting		H	$13,772.00			A	$13,772.00		A	A
13.	Shares in [P Pty Ltd]		H	NIL			A	NK		A	A
14.	Shares in Rinker Ltd (192)		H	$2,555.00			A	$2,555.00		A	A
15.	[F] P/L shares		H	NIL			*	NK		A
16.	Joint ANZ account		J	$800.00			A	$800.00		A	A
17.	[J] Superannuation Fund		*?	$378,641.00			*	$587,694.00		*	NA
18.	Wife’s superannuation		W	$633.00			A	$633.00		A	A
19.	Luxembourg Investments		*?	NK			*	$3,700,000.00		E	NA
20.	H’s share of joint chattels		H	$23,420.00			A	$23,420.00		A	A
21.	W’s share of joint chattels		W	$12,550.00			A	$12,550.00		A	A
22.	Wife’s savings		W	NK			*	$200.00		E	NA
23.	Wife’s paid legal fees		#W	$50,172.00			A	$50,172.00		A	A
24.	Husband’s paid legal fees		#H	$99,883.00			A	$99,883.00		A	A
25.	Advance from borrowings		#W	$65,000.00			A	$65,000.00		A	A
26.	Advance from borrowings		#H	$78,000.00			A	$78,000.00		A	A
27.	[M] debt		*#H	NIL			E	NK		*	NA
28.	Advance by husband		*#W	$5,000.00			E	$5,000.00		A	A
29.	TOTAL ASSETS		H	$4,175,363.00			$8,193,616.00		NA
Liabilities
30.	Mortgage loan		H	$1,200,000.00			A	$1,200,000.00		A	A
31.	Loan from [F] P/L		*H/J	$283,785.00			*	NIL		*	NA
32.	Loan from [A Consulting]		*H	$294,720.00			*	NIL		*	NA
33.	Loan from [A] Finance		*H	$11,000.00			*	NIL		*	NA
34.	Westpac Lease		*H	$30,000.00			E	NK		*	NA
35.	Husband’s credit cards		*H	$94,600.00			*	NK		*	NA
36.	Parking levy		*H/J	$12,800.00			*	NK		*	NA
37.	Directors liability to ATO		*?	$82,500.00			E	NK		*	NA
38.	ANZ loan to [U Unit Trust]		*?	$140,000.00			A	$140,000.00		A	A
39.	Other [U Trust] liabilities		*?	$30,000.00			E	NK		*	NA
40.	TOTAL LIABILITIES		$2,179,405.00			$1,340,000.00		NA
41.	NET ASSET POOL		$1,995,958.00			$6,853,616.00		NA
A – Value agreed		NA – Value Not Agreed			NK – Value not known				? – Identity unknown
* Dispute as to inclusion or value to be the subject of evidence						# Proposed add back to pool”

Assets	Ownership/ Possession	Value
1.	[T] property	H	$1,900,000.00
2.	[W2 property]	J	$350,000.00
3.	[W1 Property]	J	$300,000.00
4.	[W3 property]	J	$170,000.00
6.	Mercedes CL180	H	$32,500.00
7.	Mercedes ML320	H	$40,000.00
8.	Loan to [F] P/L	H	$391,000.00
9.	Wife’s jewellery	W	$5,000.00
10.	Husband’s jewellery	H	$5,000.00
11.	Wife’s missing jewellery	W	$81,437.00
12.	Shares in [A] Consulting	H	$13,772.00
13.	Shares in [P Pty Ltd]	H	NIL
14.	Shares in Rinker Ltd (192)	H	$2,555.00
15.	[F] P/L shares	H	NIL
16.	Joint ANZ account	J	$800.00
17.	[J] Superannuation Fund	H	$587,694.00
18.	Wife’s superannuation	W	$633.00
20.	H’s share of joint chattels	H	$23,420.00
21.	W’s share of joint chattels	W	$12,550.00
22.	Wife’s savings	W	$200.00
23.	Wife’s paid legal fees	W	$50,172.00
24.	Husband’s paid legal fees	H	$99,883.00
27.	[M] debt	H	NIL
29.	TOTAL ASSETS	H	$4,066,616.00
Liabilities
30.	Mortgage loan	H	$1,200,000.00
31.	Loan from [F] P/L	H/J	$283,785.00
32.	Loan from [A Consulting]	H	$294,720.00
33.	Loan from [A] Finance	H	$11,000.00
34.	Westpac Lease	H	$30,000.00
37.	Directors liability to ATO	H	$62,540.00
40.	TOTAL LIABILITIES	$1,882,045.00
41.	NET ASSET POOL	$2,184,571.00

Wife to retain/receive:
Mercedes CL180	$32,500.00
Jewellery	5,000.00
Missing jewellery	81,437.00
Superannuation	633.00
Share of chattels	12,550.00
Savings	200.00
Paid legal fees	50,172.00
W1 Property	300,000.00
W2 Property	350,000.00
Lump sum payable by husband	125,634.00
$958,126.00