RAINE and THOMAS

[2015] FCWA 6

JURISDICTION : FAMILY COURT OF WESTERN AUSTRALIA

ACT: FAMILY LAW ACT 1975

LOCATION: PERTH

CITATION: RAINE and THOMAS [2015] FCWA 6

CORAM: CRISFORD J

HEARD: 25, 26 AND 27 NOVEMBER 2014

DELIVERED : 21 JANUARY 2015

FILE NO/S: PTW 2265 of 2012

BETWEEN: MS WOLL as Case Guardian for MR RAINE

Applicant

AND

MS THOMAS
Respondent

Catchwords:

PROPERTY SETTLEMENT – Where it is just and equitable to make orders in relation to the parties’ property – Where the parties were married for 15 years – Where the husband’s mental health issues resulted in his case being conducted through a Case Guardian – Where the husband’s mental state has been a main issue in contention – Where the husband has provided little disclosure – Where the Court considers the wife made an overwhelming financial contribution, both initially and after separation, and is entitled to 62.5 per cent of the present property – Where the Court considers the husband should receive an adjustment of 7.5 per cent pursuant to s 75(2)

Legislation:

Family Law Act 1975 (Cth)

Category: Not Reportable

Representation:

Counsel:

Applicant: Mr Nicholls QC

Respondent: Mr Hooper SC

Solicitors:

Applicant: Balmoral Legal

Respondent: O'Sullivan Davies

Case(s) referred to in judgment(s):

Black and Kellner (1992) FLC 92-287

Briese and Briese (1986) FLC 91-713

Kannis and Kannis (2003) FLC 93-135

Oriolo and Oriolo (1985) FLC 91-653

Tate v Tate (2000) FLC 93-047

Weir and Weir (1993) FLC 92-338

WORDS IN SQUARE BRACKETS REPLACE WORDS USED IN THE ORIGINAL
JUDGMENT - PARTIES’ NAMES AND IDENTIFYING DETAILS HAVE BEEN

CHANGED

1[Mr Raine] (“the husband”), a [builder], and [Ms Thomas] (“the wife”), a [professional partner], have asked the Court to determine their respective entitlements to the property they acquired during the course of their relationship which spanned over 15 years. They are unable to make the decision themselves.

2When the parties separated in late 2011, the two children of their relationship [Child A], aged 17 and a half, and [Child B], aged 16, remained with the wife. At trial they were living at [Property A, Suburb M], a property the wife had acquired after separation. The husband is living at [Property B, Suburb M], which is owned by his parents who now reside elsewhere.

3A considerable amount of court time on both an interlocutory and final basis revolved around the former matrimonial home at [Property C, Suburb N (“[Property C]”)]. The interlocutory matters dealt with the disposal of this property. This eventuated on 22 March 2014 and the remaining net proceeds of sale of $2,232,731 are available for division. This represents the bulk of the property of the parties. The manner in which it should be divided is a bone of contention.

4At trial the husband’s case was conducted through his Case Guardian, [Ms Woll]. She is his aunt by marriage. She is a school teacher aged 75 years. The husband did not attend Court or give oral evidence. He had sworn an affidavit on 2 May 2014 and relied upon it at trial.

5The capacity of the husband for future employment as a result of what he maintains is his present mental health is said to be pivotal to my decision. Ms Woll through counsel Mr Nicholls QC, urges the Court to view the husband as someone struggling with an appalling mental illness. Juxtaposed with this is the wife’s position, pressed by her counsel, Mr Hooper SC, that the husband is a consummate actor who is prepared to use any means at his disposal to achieve what he considers to be an appropriate settlement.

Orders sought by each party

6On 8 August 2012, the Court made an order that until further order of the Court, the wife was to pay interim spousal maintenance to the husband of $1,520 a week. There were conditions attached to this payment that:

2.The Applicant provide to the Respondent:

(a)within 6 weeks, a detailed medical report at his cost from his treating general practitioner or specialist detailing the Applicant’s current condition, its cause, when it first manifested itself and its impact on his ability to work in any appropriate gainful employment;

(b)within 4 weeks, copies of all medical reports or documentation relating to the Applicant’s medical condition or treatment as from 1 January 2012 to present, and then ongoing upon receipt by the Applicant; and

(c)at least every 4 weeks, a current medical certificate as to his ability to work.

7At trial the husband was not pursuing this original application for spousal maintenance and he seeks its dismissal. He seeks that from the proceeds of sale of the former matrimonial home $2,200,000 be paid to him and the balance be paid to the wife.

8Apart from this he wants to retain property in his possession which I find has with an overall net value of $175,406. The wife wants to retain items of property in her possession including her superannuation which I find has a total value of $561,924.

9The wife seeks an equal division of the proceeds of sale of the former matrimonial home and that otherwise the parties retain what they each have.

10The wife seeks a discharge of the spousal maintenance order of 8 August 2012. She seeks to amend it to read:

Until further order of the Court, and subject to the husband complying with the following order, the wife, [Ms Thomas] pay interim spousal maintenance to the husband [Mr Raine]:

(a)from 14 December 2012 in the sum of $1,220 per week;

(b)from 11 April 2014 to 30 November 2014 in the sum of $989 per week.

11The wife says she has over paid the husband. She maintains that when the original order for spousal maintenance was made the husband’s documents did not give a true picture of his needs or if they did they had changed and the ordered rate was no longer applicable from 14 December 2012. To this end she seeks a refund of payments she has already made in an amount of $35,368.

The husband’s evidence

12It is important to note the position in relation to the husband’s evidence and how it should be treated.

13On 18 November 2014 a Senior Member of the State Administrative Tribunal declared that the husband:

(a)is unable to make reasonable judgments in respect of matters relating to his person;

(b)is in need of oversight, care or control in the interests of his own health and safety; and

and the Tribunal orders that:

…

2.[Ms Woll] of [Property D, Suburb O], Western Australia is appointed limited guardian of the represented person with the following function:

(a)To seek legal advice on behalf of the represented person in relation to Family Court proceedings and to bring and defend actions, suits and other legal proceedings in the name of the represented person in relation to the same and related matters and, if applicable, to settle those matters.

…

14The evidence in support of this application was comprised of the medical reports of Dr Darryl Menaglio, Clinical and Forensic Psychologist, and Dr Darryl Barrett, Consultant Psychiatrist.

15On the first day of trial this Court dealt with an application by Mr Nicholls QC that Ms Woll, be appointed case guardian in these proceedings pursuant to r 6.08(1) of the Family Law Rules 2004 (Cth) (“the Rules”). The basis being that the husband is a person with a disability and his case needs to be continued by a case guardian.

16A “person with a disability” is defined in the dictionary of the Rules as being:

person with a disability, in relation to a case, means a person who, because of a physical or mental disability:

(a)does not understand the nature or possible consequences of the case; or

(b)is not capable of adequately conducting, or giving adequate instructions for the conduct of, the case.

17The husband swore his trial affidavit on 2 May 2014. Ms Woll swore a financial statement on the husband’s behalf on 21 November 2014. Objections to this affidavit material were dealt with prior to the conclusion of the hearing.

18It is common ground that the trial affidavit of the husband is admissible in evidence despite the fact he was not available for cross-examination. The veracity of his evidence was not subject to any scrutiny. I find this impacts on the weight to be given to the untested evidence. I intend to treat the evidence of the husband with care especially given the allegations that he is not as ill or as impaired as he claims.

19There were difficulties with the evidence relating to the value of certain property. Ms Woll presented as a very loyal and supportive family member. She accepted that she did not personally check the accuracy of any of the figures inserted in the financial statement. She said she just accepted what the husband had told her. Ms Woll said that she did not consider the husband well enough to give evidence and that he was a broken man. She said she did not like to press him too much. It became apparent in cross-examination that, although very well meaning, she had little understanding of her role in terms of evidence and its value for the Court. It became apparent that she knew little about the husband’s activities and financial position.

20The wife maintains that the husband has consistently failed to make a full and frank disclosure of his financial position. This dates back to the commencement of the proceedings on 24 May 2012. Objectively, the paucity of documents disclosed by the husband in relation to the property is clearly deficient. One example of this is in relation to the unilateral sale by the husband of the parties’ jointly owned boat “[Gemini]” in March 2013.

21It was the wife who produced the contract for sale. Part of the contract for sale was for the purchaser to be able to access the parties’ boat pen, which is situated at [a] Sailing Club, free of charge for six months. There was a further six month option to use the pen but for which there that would be a cost of $5,000. At trial the wife, said that she was aware a different boat was now using the pen. She had regularly seen it moored in the pen. She was able to identify certain payments going into the husband’s bank account but there had been no disclosure of any documents to identify the source of these payments. There were no further documents or explanations about the use of the boat pen or any payments for it.

22The wife was unsure of whether the husband was receiving any rent for the boat pen. Ms Woll had no knowledge of anything to do with the use of the boat pen. She had made no enquiries about this matter.

23The financial statement sworn by Ms Woll identified a Centre Console boat belonging to the husband. In an earlier financial statement the husband had allocated a value to the boat of $22,300. In Ms Woll’s financial statement she said it had a value of $15,000.

24Ms Woll said she had been given the revised value by the husband who had obtained it from “a person he knew”. She made no independent enquiries. As it transpired the husband had an email exchange with the previous owner of the boat in November 2014 in relation to the present value. The email was sent to the previous owner the day before Ms Woll swore the financial statement. It gives a clear and precise description of the present condition of the boat, in particular, setting out its imperfections. The husband sought an urgent response to his request.

25The wife says that she has real doubts that the husband is as incapacitated as he makes out given his selective ability to carry out tasks that directly go to the heart of the proceedings.

26Dr Menaglio has been the husband’s treating psychologist since late 2012. He has a therapeutic role. He said he played a supportive role and reassured the husband. He felt it was premature to challenge his beliefs or commence active therapy or treatment. He said the husband could give instructions to lawyers in an office setting and that he could understand the nature of the proceedings but he would have difficulty paying attention during a trial. His ability to concentrate for long periods was compromised.

27Dr Menaglio gave evidence at trial and was relied upon by the case guardian to show the extent of the husband’s general incapacity both in terms of giving evidence and his ongoing ability to work. In correspondence provided by Dr Mengalio to the husband’s lawyer dated 7 July 2014 he comments:

As you rightly state I have known [Mr Raine] for approximately 18 months. This is both an advantage in that I have been able to observe [Mr Raine] over this time. It is also a disadvantage because I have a therapeutic relationship with [Mr Raine] and therefore a professional duty to support him. It is therefore possible that my view of [Mr Raine] has been coloured by my professional duty to him. I would recommend that should this matter proceed to trial, just prior to trial, or sooner if required, the opinion of a Psychiatrist be obtained as to [Mr Raine’s] capability to stand trial. I have discussed this with [Mr Raine] and he was amenable to attend any Psychiatrist to determine his/her view of his competency.

28Dr Bassett saw the husband on 6 November 2014. It was his only attendance with the husband. Dr Bassett concluded that the husband was not capable of adequately understanding the nature and possible consequences of the legal proceedings. He found that the husband had a marked difficulty with grief and felt there was some indications of depressed mood. He said that it was at least likely the husband had an adjustment disorder.

29I will return to the husband’s mental health issues later in my judgment.

Property of the parties

30The Court must determine proceedings for the alteration of property interests pursuant to s 79 of the Family Law Act 1975 (Cth) (“the Act”).

31In determining whether it is just and equitable to make any order at all altering the parties’ existing interests in the property they acquired during their 15 year relationship, the Court must identify the nature of those interests (as determined by common law and equity).

Balance Sheet

32There are a number of items of property the value and treatment of which are in contention. These matters require explanation.

Boat Pen at a Sailing Club

33There were differing views at trial about the value of this boat pen which was to be retained by the husband. The family had enjoyed boating pursuits throughout their relationship.

34In a financial statement sworn by the husband on 24 April 2014 he had assigned a value of $200,000 to the boat pen. The boat pen is registered in the husband’s sole name.

35On 14 October 2014 the wife filed a Notice to Admit Facts. She sought an admission by the husband that the value of the boat pen was the figure of $200,000 identified by him.

36The husband did not answer the Notice to Admit Facts within the allowed time frame. I accept that the husband changed solicitors during the course of preparation for trial and they had hoped to respond to the Notice, albeit late. This did not eventuate.

37In the financial statement sworn by Ms Woll on 21 November 2014 she estimated the boat pen to then be worth $135,000. She said that the husband had told her that this was the value of the boat pen. He told her he had made enquiries from the Sailing Club. She accepted that she made no independent inquiries herself about the boat pen and simply took it at face value, despite her evidence that the husband was severely affected by mental health issues.

38In all the circumstances I adopt the figure initially identified by the husband of $200,000.

Loan from the husband’s parents

39In Ms Woll’s financial statement she says the husband owes his parents $165,000. There was no admissible evidence in relation to the detail of this advance or its terms and conditions. The Court does not know whether it can be categorised as a loan that requires repayment, whether interest is payable on it or the period of time over which any money was borrowed. Ms Woll had no knowledge of the loan.

40The husband’s parents did not give any evidence in relation to the money. It was an issue they knew about as they had previously lodged a caveat against [Property C]. I do accept that one of the husband’s parents was in hospital at the time of trial but this is a long standing and contentious issue. The husband has deposed that most, if not all, of the money was used to pay his legal costs. The wife’s position is that to the extent the husband’s paid legal costs are not included as property any corresponding liability should also be ignored.

41I will not include any of this amount in the property schedule. There is a paucity of evidence about the advance and the circumstances surrounding it are entirely uncertain.

Super profits of legal practice

42The wife is a senior equity member of [AP] and a partner of [AP (Australia)]. This firm is a global [professional] firm operating from offices over six continents. The wife is the managing partner of the Perth office of [AP].

43It is common ground that all assets of the AP are owned by the partnership absolutely with no members holding individual rights to the property of the partnership. The wife’s partnership interest is not transferrable. It has no value in an exchange by sale. It has no value, save for her capital and current accounts, which is realisable by death or retirement due to the provisions of the partnership agreement.

44The wife has a guaranteed income entitlement until 2016. After this the wife will have a further lockstep entitlement to around 30 April 2020.

45The Australian practice reported a loss after equity partner distributions for the year ended 30 April 2014. The wife’s partnership income entitlement was, by agreement, reduced from $1.35 million to $1.2 million as a result of the underperformance of AP (Australia).

46The husband, based on the evidence of his valuation expert, Mr Wayne Lonergan, says that there is an element of super profits in her guaranteed income entitlement and thereafter her lockstep allocation which is in excess of the notional market salary. He says the wife’s future super profit derived from her partnership interest in AP has a current value of $90,000.

47Mr Lonergan holds a Bachelor of Economics and has over 35 years experience in corporate finance and valuations. Mr Lonergan says that on the basis the wife is:

(a)guaranteed a fixed distribution until 30 April 2016; and

(b)unlikely to receive an annual distribution which is significantly less than this amount until she retires at age 60

she is entitled to an amount of super profits per annum.

48In cross-examination Mr Lonergan maintained that the super profits he calculated were a reasonable estimate of what they were likely to be. He says that the wife had a contractual right to a certain amount of money in an accounting sense although she could agree to accept less. He maintained that this right had a value over and above her interest in the firm. He maintained that some of her present income should be treated as an asset.

49Susan Delbridge, Chartered Accountant, with 20 years of regular experience in the valuation of shares in businesses and other entities was called to give evidence by the wife. She did not consider any super profits to be an identifiable interest in property held by the wife in the firm.

50The wife says that whatever this interest may be it is not capable of being categorised as property. She maintains it is not a resource which is to be taken into account over and above the fact that she will be able to generate a significant income as a practising professional partner and [business] manager in the coming years.

51I am not persuaded that what Mr Lonergan has identified as super profits to be anything other than an indicator of an ongoing reliable income stream for the future. That is a matter to take into account pursuant to s 75(2) of the Act which I will return to that later.

Wife’s tax

52The wife has an uncommon and complicated mechanism for the payment of tax given the intertwining of tax payable in the United Kingdom, where the Head Office of AP is, and tax payable in Australia where she works. The fiscal year in the United Kingdom and Australia do not match each other. There appears to be a complicated offsetting of what is payable in one country against returns or reimbursements in another country. Money that the wife had originally earmarked to pay some of her tax had been used to repay a trust loan of $15,000 and owed to her mother. This was a loan which enabled her to purchase [Property A] for herself and the children after separation.

53The husband opposes the inclusion of the wife’s tax liability in the balance sheet but concedes that it may need to be taken into account in some way. I note that the husband has had the benefit, net of tax, of the spousal maintenance orders since August 2012. The wife has also made payment of all outgoings in relation to the parties’ joint property since separation. I consider it appropriate to include this tax liability in the property schedule.

Interim orders and prepayments

54It is common ground that the husband had the use of the following funds after the separation of the parties:

Item	Value ($)
Money received by husband – Court order 24 May 2012	30,000
Money received by husband – Court order 8 August 2012	72,200
Money received by husband – Sale of Cabin Cruiser boat	187,000
Funds taken by husband from NAB Account	80,000
Funds paid to husband’s solicitors from proceeds of sale of [Property C]	63,388
TOTAL	432,588

55The amount of $30,000 received on 24 May 2012 was pursuant to consent orders, categorised as urgent spousal maintenance.

56The amount of $72,200 received on 8 August 2012 was, until further order, categorised by the court as partial property settlement. I will refer to this when I look at the overall justice and equity of the orders I intend to make. I will not include it in the balance sheet.

57I accept that the money received by the husband from the sale of the Cabin Cruiser boat was used to buy his [Nissan] motor vehicle which is reflected in the balance sheet. It was also used to pay his legal fees.

58To the extent any of the above payments now represent items of property in the balance sheet I will take them into account in that fashion and not double count. The balance of any money received by the husband will be considered later in my judgment. I am unable to ascertain if that money or some of it currently exists. Given this uncertainty I do not propose to run the risk of artificially inflating the balance sheet.

Legal fees including money in Trust

59At the end of the trial it was agreed that each party would immediately receive $50,000 from the trust money to be used against existing or very recently incurred legal costs.

60The husband has an amount of $62,119 in his present solicitor’s Trust account. He has already paid them $41,832. He has paid other money to his previous lawyers. This amount was not quantified in his Cost Notification handed up at the beginning of trial but I accept, in total, his fees are much the same as the wife’s fees.

61The husband maintains that the source of his funds to pay legal fees has been borrowing from his parents which he says are $165,000.

62The wife has paid $238,421 in legal fees. She presently owes $45,758. She has been in a position to pay her legal fees from her income.

63The Court has a wide discretion in how it treats legal fees. It is important to ensure the delivery of a just outcome, tailored to the circumstances of each case.

64At the conclusion of the trial there was an agreement for $50,000 to be paid to each party. I accept there was an intention that all outstanding legal fees would be paid. I do not intend to include any money associated with legal costs in the balance sheet since for all intents and purpose they have been expended. This includes the transfer of the money in the husband’s solicitors Trust account. The parties are likely to still owe some money at a later stage but I accept at this stage, given the above disbursements, it is likely to be minimal.

65The wife has been able to pay her legal fees from her income and the husband has used borrowings and interim payments including spousal maintenance.

66Given all of the above, the parties’ balance sheet of the property available for division is:

Property Description	Value ($)
Joint Assets
Account no. 1 (Noting $100,000 removed for legal fees)	2,157,256
Account no. 2	75,474
Sub Total of Joint Property (Proceeds of sale of [Property C])	2,232,730
Husband’s Assets
Centre Console Boat	15,000
2013 [Nissan]	49,350
Boat Pen at [a] Sailing Club	200,000
Sub Total Assets	264,350
Husband’s Liabilities
Westpac Business Cheque Plus Account	18,233
Westpac Mastercard Account	8,935
Westpac Choice Flexi Loan	29,177
ANZ Visa Account	16,839
NAB Qantas Plus Visa	15,760
Sub Total Liabilities	88,944
HUSBAND’S NET PROPERTY	175,406
Wife’s Assets
[Property A, Suburb M]	2,580,000
2009 [Audi]	38,000
[AP] Capital Account	1,033,036
[AP] Current Account	249,406
NAB Cheque Account	20,672
[Property E, Suburb P]	11,000
Estimate tax return from ATO 2013 / 2014 financial year	248,838
NAB Classic bank account	125,000
Sub Total Assets	4,305,952
Wife’s Liabilities
NAB Loan ([Property A])	2,324,048
Loan from [E] Pty Ltd ([Property A])	347,830
Loan Barclays Bank ( [AP])	1,033,036
NAB Visa	5,372
Estimated tax payable for 2014 tax year	645,682
Tax liability accrued year to date	280,000
Total Liabilities	4,635,968
WIFE’S NET PROPERTY	-330,016
PARTIES’ TOTAL NET ASSETS	2,078,120
SUPERANNUATION
Wife’s Personal Superannuation and Pension Fund	891,940
TOTAL SUPERANNUATION	891,940
PARTIES’ TOTAL NET ASSETS AND SUPERANNUATION	2,970,060

It is just and equitable to make any orders?

67Both parties are asking the Court to make orders here. They have had a long relationship and an intermingling of finances. It is just and equitable to make orders insofar, at least, as it relates to the proceeds of sale of Property C.

Contributions

68The wife says that contributions from the date of separation to trial should be assessed at 65 per cent in her favour. The basis for her claim is that:

•she had property at the beginning of the relationship and it was the proceeds of sale of her real estate which enabled the parties to purchase Property C, the proceeds of sale of which form the single most valuable asset;

•she made a greater financial and non-financial contribution overall during the relationship;

•she made a significant contribution as homemaker and parent during the relationship;

•she made the overwhelming and only financial contribution to the parties’ assets post separation;

•she has effectively had sole responsibility for the parties’ children since separation; and

•the husband’s conduct since separation has caused loss to both parties.

69Mr Nicholls QC says that Ms Woll’s position is that the wife’s assessment of the overall contributions “may or may not be right, although it probably undervalues the husband’s non-financial contributions as parent, homemaker, home builder and renovator” over a long relationship and “over-value him not making a significant financial contribution…” (emphasis in original).

70Mr Nicholls QC urges the Court to consider this case as being based on a just and equitable outcome rather than a contribution case.

71It was conceded by the case guardian and confirmed in the Papers for the Judge filed on behalf of the husband that the wife made the greater financial contribution. In her judgment of 8 August 2012, at para 16, Magistrate Walter recorded that “the parties agreed that the wife made the overwhelmingly significant financial contribution to the relationship”. I also find the wife’s financial contribution to be overwhelming even in the context of this long marriage.

72At the commencement of the relationship she earned a significantly greater income than the husband and had been a partner in a major Perth [business practice] for five years.

73She owned property in which she had considerable equity in [Suburb Q] and an interest in a property in [Suburb R]. She had a superannuation fund, motor vehicle and savings. The sale of the wife’s property in Suburb Q was a spring board which enabled the parties to purchase Property C. In the main her income funded and serviced the debt to purchase and construct a new home on the Property C site.

74After 2009 the husband made little financial contribution and I accept that he suffered some health difficulties. This hampered any ability he had to assist in a meaningful way. After the parties separated his role with the children and maintaining the parties’ assets was at times non-existent.

75During the relationship and up until around mid-2011 the husband did assist around the house and I find he supported the wife in her chosen field of employment. She spent time away from the family and the husband was at home. It is common ground that the parties had significant support through paid and unpaid assistance from nannies and grandparents.

76The husband utilised his knowledge as a builder and his contacts in the building field to assist in the construction of Property C. He did some renovations and maintenance on the wife’s Suburb Q home and also Property C. During her cross-examination the wife made some concessions about the husband’s indirect contributions to their property and the family up to about 2009. Despite this I consider that the wife’s role in organising and maintaining the household and the properties was greater than that of the husband.

77After the parties separated the wife was almost solely responsible for all of the important aspects of the household, the children and the parties’ financial matters. She has had to arrange counselling and other assistance for the children when their relationship with their father has been made considerably more difficult by his behaviour which he says is brought about by mental health issues. The wife has also needed to access counselling to ensure her own mental health was not compromised. During this period she continued to maintain the whole family financially.

78Although not the subject of any cross-examination at the trial, given the husband did not attend, I accept that his behaviour in relation to the sale of Property C created great stress and difficulties for the wife. It created a financial impost. There were also times when I accept he tried to intimidate the wife in order to achieve what he wanted in a financial sense. He failed to apply appropriate boundaries in his communication with his daughters and shared with them his mental health difficulties including his desire to commit suicide.

79The husband was in receipt of spousal maintenance from 8 August 2012 at a rate of $1,520 each week. The cross-examination of Ms Woll was successful in challenging the present reasonable needs of the husband as set out in his financial statement. A number of items claimed did not reflect the current position of the husband. The order made in August 2012 was a much greater amount than the husband’s present reasonable requirements. The total amount of spousal maintenance paid is $156,660. The husband also had the benefit of interim payments and prepayments previously itemised. The total of these amounts is $432,588. In addition he says he has received $165,000 from his parents.

80The husband has failed to properly account for the use to which he has put all the money he has received post-separation. There is no evidence it was used to preserve assets or assist the family.

81When the Court considers the myriad of different contributions, of all kinds, made over this long marriage, especially the wife’s overwhelming financial contribution particularly initially and after separation, I consider that she is entitled to 62.5 per cent of the present property.

Primarily prospective factors of s 75(2) of the Act

82The wife will be 55 years old this year, the husband will be 58 years old. These proceedings have taken a toll on them both. The husband currently suffers mental health issues for which he has been hospitalised. His problems include a depressed mood. He seeks psychological assistance on a regular basis and has done so since late 2012.

83The wife earned considerably more than the husband during their relationship. I consider that in the years remaining of her working life she is likely to continue to earn a significantly greater income than the husband.

84One need only look to the joint statement of experts which was filed pursuant to r 15.69(3)(e) of the Rules on 21 November 2014 at para 17 to understand the secure position the wife presently finds herself in:

17.In most professional practices, equity partners are remunerated on a performance basis which is linked to the profitability of the practice. The circumstances surrounding [Ms Thomas’] partnership interest are unusual as her income entitlements protects her from the poor profit performance of the Australian practice of which she is the Managing Partner. Currently the Australian practice does not generate sufficient profits to cover anywhere near the Australian equity partners’ agreed profit share. In this instance, [AP] as corporate partner of [AP (Australia)] (the Australian partnership) bears the loss, whilst [Ms Thomas]:

(a)received a significant payment of some $1.2 million (albeit apparently agreed by her to be reduced from the guaranteed amount of $1.350 million) despite the Australian partnership reporting a modest profit before partner salaries and a significant loss after partner shares

(b)has suffered no erosion to her capital account.

85It is common ground that since about 2009 the husband has not worked full time. He has not worked at all for some years.

86Dr Menaglio considered the likely genesis of the husband’s problems came from his reaction to the relationship breakdown in early 2012. He said the husband was not now in a psychological state to cope with paid employment. His mental state was severe. It had a tendency to fluctuate within a severe range. The husband would not be considered anything other than severely psychologically disabled. Dr Menaglio said he also suffered a chronic sense of injustice. He said the husband needed finality in relation to the proceedings.

87The husband commenced taking a mild dose of antidepressants in early 2014 and he continues taking these. Dr Menaglio says the husband has the capacity to direct his lawyers and give instructions but that he has very limited capacity for sustained concentration. This inability to sustain concentration means that he would struggle with any court appearance.

88As his treating therapist, Dr Mengalio was fully supportive of the husband. He said he had considered whether the husband was simply just a competent actor. He said that it was possible. However, he was firm in his view that the husband was unable to work at the present time and also for some time in the future. His ability to follow through with his endeavours and continue to work may well be impacted by the continuation of these proceedings.

89When I carefully consider the husband’s actions and the medical evidence I accept he presently has considerable mental health difficulties. I accept this originally hard-working and caring family man has suffered as a result of the breakdown of the relationship to an extent that he often makes irrational and poor choices. The evidence of his treating therapist does not support a calculated attempt to achieve a better outcome by overplaying his difficulties.

90I consider that once these proceedings are concluded and the husband assesses his position he may be able to find some work.

91Even if the husband is in a position to support himself in a modest way in the future through his own endeavours as a builder it is clear the quantum of any income he may earn will not match that of the wife. The wife has a guaranteed high income until she is 60 years of age. She deposes she anticipates working until she is 65 years old. Her history suggests she will always work hard and be a success. The wife will continue to be responsible for the children in both a financial and emotional sense. However, they are no longer young children. Both are anticipated to attend and complete higher education. The children have been greatly disrupted as a result of the breakdown of the relationship and the husband’s mental health difficulties.

92The husband’s mental state has been the main issue in contention. I have addressed whether, and to what extent, it impacts on the husband’s ability to support himself by paid employment. A further issue is whether his mental state explains some of his behaviour displayed during the course of the proceedings, including a failure to disclose relevant documents in a timely fashion.

93Considerable uncertainty revolves around the failure by the husband to provide full details of his financial position. He disclosed very few bank and financial details. He provided nothing over the six months prior to trial.

94In late 2012 the husband did some work as a builder at the very least in a manner described by the case guardian as rehabilitation. I do not know the end result of his endeavours in that regard. Correspondence written by him under the guise of [XY Builders], giving details about renovation plans for a unit in [Melbourne] suggests the husband can operate quite successfully when he chooses. I consider that he was able to make enquiries in an informed and direct way when he needed to get financial details for the case guardian that he thought would assist him progress his claim. Whilst it is common ground he needed a case guardian for court appearances I find he appreciated the need to provide financial information. He was selective in doing so.

95There is a clear obligation under the Rules to make a full, frank and complete disclosure of all relevant financial circumstances in a timely fashion. This need for parties to make such disclosure in financial matters is not in doubt. (See Oriolo and Oriolo (1985) FLC 91-653; Black and Kellner (1992) FLC 92-287; Weir and Weir (1993) FLC 92-338; Tate v Tate (2000) FLC 93-047 and Kannis and Kannis (2003) FLC 93-135. Smithers J in a seminal passage in Briese and Briese (1986) FLC 91-713 at 75,180 said:

I believe that a person in the position of the husband in this case has a positive obligation to set out at an early stage his financial position in a clear and comprehensive manner. The Regulations, and now the Rules, are not intended as a vehicle to mask the true position, or as an aid to confusion, complexity or uncertainty. They are not intended as the outer limits of the obligation of financial disclosure, but as providing avenues towards disclosure. The need for each party to understand the financial position of the other party is at the very heart of cases concerning property and maintenance. Unless each party adopts a positive approach in this regard delays will ensue with the consequent escalation of legal, accounting and other expenses, always assuming that a party has the strength to continue the struggle for information and understanding.

…

In my view it is fundamental to the whole operation of the Family Law Act in financial cases that there is an obligation of the nature to which I have referred. Livesey v Jenkins makes it clear that mere compliance with rules of court or practice directions does not alter the basic principle of the need for full and frank disclosure by the parties.

96In relation to non-disclosure of assets, the Full Court in Weir (supra) stated at 79,593 as follows:

… once it has been established that there has been a deliberate non‑disclosure … then the Court should not be unduly cautious about making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature.

97Some of the husband’s conduct in this regard, even taking into account his difficulties, does not reflect well on him.

98Considering all relevant matters I will make an adjustment in the husband’s favour of 7.5 per cent.

Just and equitable

99It is now important to stand back and consider the practical outcome of my findings. Overall the husband will retain 45 per cent of the value of the available assets. This would mean he retains $1,336,527. He presently retains property in his possession worth $175,406. He will receive a further $1,161,121 from the proceeds of sale of Property C. In turn the wife will retain $1,633,533. Including her superannuation, she retains net property which has a total value of $561,924. Of the proceeds of sale of Property C she will retain $1,071,609.

100Given what I have previously discussed in relation to the husband’s failure to disclose I am left unsure of what his present asset position is. I am not confident the Court knows all about the boat pen at the Sailing Club and any rental he receives from it. I do not know whether the husband retains some of the money given to him during the course of the proceedings. In an exercise of my discretion I have not included the amounts originally designated as partial property settlement in the balance sheet, or indeed other money he has received.

101Although I accept that the amount of spousal maintenance paid by the wife is likely to have been generous I will not order any repayment of that amount to her. I do not have a clear picture of when the husband’s circumstances changed and to what extent. I consider an order for reimbursement unjust. I do not intend to reimburse the wife for the costs of $2,000 she paid on the husband’s behalf on 15 November 2013 for mediation.

102The wife has substantial debt to service. Her present net property is part of her superannuation and that is not available until she retires. Her net debt position, without taking into account her superannuation, is over $300,000.

103The disparity created by a 7.5 adjustment is 15 per cent or $445,509. Despite this disparity, which is of some magnitude, I consider the overall outcome to be just and equitable given the wife’s secure financial future and the husband’s less positive prospects after a long marriage.

Orders

104Subject to any submissions by counsel as to form, the orders I propose to make are:

1.The Respondent, [MS THOMAS], do all such acts and things and sign all documents necessary to close the National Australia Bank Accounts numbered [1] and [2] and do disburse the amount of $1,161,121 to the Applicant, [MR RAINE].

2.The Applicant transfer to the Respondent his right to receive payment of any monies to which he is presently entitled from The [CD] Family Trust and do sign such documents as the wife may reasonably request to evidence such transfer of entitlements and his exclusion as a beneficiary of the Trust.

3.Unless otherwise set out in these orders, the interest of the Respondent (if any) in the following vest in the Applicant:

(a)the furniture, chattels and household effects in the power, possession or control of the Applicant;

(b)jewellery and personal items in the power, possession or control of the Applicant;

(c)the [Nissan]registered in the name of the Applicant;

(d)[XY Builders] business;

(e)Boat Pen at [a] Sailing Club registered in the sole name of the Applicant;

(f)any account in the name or the sole name of the Applicant at any bank or financial institution;

(g)any interest of the Applicant arising from his membership of a superannuation fund; and

(h)any other property of any description in the name of or in the possession of the Applicant at the date of these orders and not specifically dealt with in these orders.

4.Unless otherwise set out in these orders, the interest of the Applicant (if any) in the following vest in the Respondent:

(a)the property situate at [Property A, Suburb M] in the State of Western Australia and registered in the sole name of the Respondent;

(b)the 2009 [Audi] registered in the name of the Respondent;

(c)the [Audi] motor vehicle in the possession of the Respondent’s mother;

(d)the furniture, chattels and household effects in the power, possession or control of the Respondent;

(e)jewellery and personal items in the power, possession or control of the Respondent;

(f)the interest of the Respondent in [AP ];

(g)any entitlement of the Applicant to any assets of, or monies owed to him by, the Trust, and the Respondent indemnify the Applicant with respect to any liability of the Applicant to the Trust;

(h)any account in the name of the Respondent at any bank or financial institution;

(i)any interest of the Respondent arising from her membership of a superannuation fund; and

(j)any other property of any description in the name of or in the possession of the Respondent and not specifically dealt with in these orders.

5.Unless otherwise specified in these orders and except for the purposes of enforcing these orders:

(a)each party be solely liable for, and indemnify the other against, any liability encumbering any item of property to which that party is entitled to these orders and each party indemnify and keep indemnified the other party in relation to liabilities in his or her sole name; and

(b)each party sign any release necessary to forgo any claim they may have to any superannuation benefits arising from the other party being a member of a superannuation fund other than as provided by these orders.

6.Each party:

(a)do all such things as are necessary and sign all such documents as are necessary to give effect to the orders made herein; and

(b)have liberty to apply in relation to the implementation of these orders.

7.The application of the Applicant for spousal maintenance be and is hereby dismissed.

8.The applications and responses otherwise be and are hereby dismissed.

I certify that the preceding [104] paragraphs are a true copy of the reasons for
judgment delivered by this Honourable Court

Associate