Rapetti & Ors and Rapetti - [2011] FamCA 668

FAMILY COURT OF AUSTRALIA

RAPETTI AND ORS & RAPETTI

[2011] FamCA 668

FAMILY LAW - PROPERTY SETTLEMENT – assessment of contributions – adjustment in relation to s 75(2) matters – whether proposed orders are just and equitable - substantial gifts or loans by husband’s parents during the marriage – finding that the husband and wife have no debt to the interveners - Limitation Act 1969 (NSW) considered.

Family Law Act 1975 (Cth): ss 79(4); 75(2)

Drinkwater & Ors. v Caddyrack Pty Ltd & Ors. [1997] NSWSC 589;

Gleeson v Gleeson [2002] NSWSC 418;

Ogilvie v Adams [1981] VR 1041;

Re Brookers (Aus) Limited (in liq) (1986) 42 SASAR 380

APPLICANT:

Mr D Rapetti

RESPONDENT:

Ms M Rapetti

INTERVENERS:

Mr R & Ms P Rapetti

FILE NUMBER:

SYC

2311

2008

DATE DELIVERED:

26 August 2011

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Stevenson J

HEARING DATE:

4-7 July 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT:	Mr Kearney
SOLICITOR FOR THE APPLICANT:	Doolan Wagner & Callaghan

COUNSEL FOR THE RESPONDENT:	Ms Rees SC
SOLICITOR FOR THE RESPONDENT:	Watkins Tapsell Solicitors and Barristers

COUNSEL FOR THE INTERVENERS:	Mr Simpson SC
SOLICITOR FOR THE INTERVENERS:	Diamond Conway Lawyers

Orders

That all applications filed herein by the interveners are dismissed.
That the husband and wife (“the parties”) forthwith do all acts and things and sign all documents necessary so as to list for sale (providing such listing not take place prior to the completion by J of his HSC in 2011) and effect the sale of the property known as … M Street, M, in the State of New South Wales, being the whole of the land described as Folio Identifier … (“the M property”) for the best price reasonably attainable in the following manner:
2.1The husband and wife shall agree upon a licensed real estate agent and auctioneer (“the agent”) to conduct the sale of the M property within 42 days of the date of these Orders.
2.2In default of agreement as to the agent, within 42 days of the date of these Orders, the husband and wife shall do all things and sign all necessary documents to request the President of the Real Estate Institute of New South Wales to nominate a licensed real estate and auctioneer to conduct the sale of the M property and the husband and wife must accept such nomination.
2.3The husband and wife shall, within seven days of appointing the agent, agree upon the method of sale and price for sale, but, in default of agreement, then the husband and wife shall do all things and shall sign all necessary documents to list the M property with the agent for sale by auction.
2.4The reserve price for the auction sale of the M property shall be as agreed between the husband and wife within seven days of the date that the property is auctioned or, in default of such agreement, the husband and wife shall do all things and sign all necessary documents to request the President of the Real Estate Institute of New South Wales to nominate a reserve price for the auction of the M property.
2.5The husband and wife shall do all things and shall sign all necessary documents to cause the agent to auction the M property no later than 28 February 2012.
2.6The husband and wife shall do all things and shall sign all necessary documents to instruct the agent to accept the said reserve price in the event that a bid is made in this sum or a greater sum at the auction.
2.7In the event the M property is not sold on the first occasion that it is auctioned, then the husband and wife shall do all things and shall sign all necessary documents to cause the agent to auction it again every six weeks until it shall be sold upon the same terms and conditions as stated in Orders 2.3, 2.4 and 2.6.
2.8In the event the bidding at the auctions does not reach the reserve price, the husband or wife, or such of them as attends the relevant auctions, may negotiate with the highest bidders or any other interested person and effect a sale of the M property at a price which is not more than 5 per cent below the reserve price, or at such other price as the parties agree in writing.
2.9The husband and wife shall each co-operate in every way with the agent, including:
2.9.1 Making the key available to the agent.
2.9.2Allowing the inspection of the M property at all reasonable times as requested by the agent.
2.9.3By ensuring that the M property, including the grounds, is in a neat and clean condition at the time of inspection by the agent or prospective purchasers.
2.9.4Signing all documents requested by the agent in relation to the listing for sale of the M property, except a contract or agreement of sale which has not been authorised by the solicitor for the husband and wife acting in relation to the conveyance.
2.10The husband and wife shall agree upon and instruct a solicitor to conduct the sale of the M property and, in the absence of agreement reached within 42 days of the date of these Orders, the husband and wife shall do all such things and sign all necessary documents to request the President of the Law Society of New South Wales to appoint a solicitor to act in relation to the sale.
2.11The husband and wife shall do all things and sign all necessary documents and provide all necessary authorities to cause the proceeds of the sale of the M property to be distributed in the following manner and priority:
2.11.1All costs and expenses of sale, including legal costs and disbursements, agent's commission, valuer’s fees and auction expenses (including repayment of any such expense as has been paid by either or both of the parties in relation to the sale).

2.11.2Payment of the debt owning to Ms N and Mr C pursuant to the Orders of 6 July 2011.

2.11.3Payment to Ms K the sum of $7,194.00.

2.11.4The balance remaining to be divided between the parties as to 65% to the wife and 35% to the husband.

That pending the sale of the M property:
3.1Each of the husband and the wife shall be and hereby are restrained from encumbering or dealing in any way with their interest in the said property other than in accordance with these Orders.
3.2The wife shall be solely responsible for payment of all statutory rates and charges and outgoings in respect of the said property and, in the event that any such amount is outstanding at the date of settlement of the sale of the said property, shall reimburse the husband from her share of the sale proceeds in respect of any amount paid by him in respect of such liabilities by operation of these Orders.
That forthwith each of the husband and wife do all things necessary to close the Macquarie Bank controlled monies account in the joint names of the parties and to pay the balance thereof to the wife.
That the wife is declared to be solely entitled to the cartoon cells known as “[Cell 1]”, “[Cell 2]”, “[Cell 3]”, and “[Cell 4]”.
That the husband is declared to be solely entitled to the sports memorabilia (being all of those items identified in the valuation of Mr B prepared on the instructions of the parties for these proceedings) presently held at the M property and the wife shall make all such items available for collection by the husband from the M property in good order and condition within fourteen (14) days of the date of these Orders.
That in accordance with 90MT(1)(b) of the Family Law Act 1975:
7.1The wife is entitled to be paid 25% out of the husband’s interest in the Rapetti Superannuation Fund; and
7.2The husband’s entitlement in the Rapetti Superannuation Fund is correspondingly reduced.
That the Trustee of the Rapetti Superannuation Fund shall forthwith do all such acts and things and sign all documents as may be necessary to pay the entitlement whenever the Trustee makes a splittable payment out of the husband's interest in the Rapetti Superannuation Fund.
That, except as otherwise provided herein, the wife shall retain, to the exclusion of the husband, all of her right, title and interest in the following:
9.1All furniture, jewellery and other chattels currently in her possession, custody or control.
9.2      Any motor vehicle registered in her name.
9.3Any funds standing to her credit in any Bank, Credit Union or Building Society account.
9.4      Any shares in any public or private company.
9.5      Any superannuation fund in which she has an entitlement.
9.6All and any leave or long service, or any other employment benefits or entitlements.
9.7      The horse R.
That, except as otherwise provided herein, the husband shall retain, to the exclusion of the wife, all of his right, title and interest in the following:
10.1His interest in the property at W, New South Wales.
10.2All furniture, jewellery and other chattels, including the golf buggy and golf clubs, currently in his possession, custody or control.
10.3    Any motor vehicle registered in his name.
10.4 Any funds standing to his credit in any Bank, Credit Union or Building Society account.
10.5    Any shares in any public or private company.
10.6    Any superannuation fund in which he has an entitlement.
10.7    All and any leave or long service, or any other employment
benefits or entitlements.
That, except as otherwise provided for in these Orders, each party shall be liable for, and shall indemnify the other, in respect of any liabilities in their name.
That all material produced on subpoena be returned.
That the proceedings be removed from the Active Pending Cases List.

IT IS NOTED that publication of this judgment under the pseudonym Rapetti and Ors & Rapetti is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 2311 of 2008

Mr D Rapetti

Applicant

And

Ms M Rapetti

Respondent

REASONS FOR JUDGMENT

The proceedings

These proceedings concern settlement of property between the applicant husband, Mr D Rapetti, and the respondent wife, Ms M Rapetti. The interveners, Mr R Rapetti and Ms P Rapetti, are the parents of the husband. They sought a declaration that the husband and wife are indebted to them in a sum of $336,664.00, plus interest, and an order that they receive that amount from the proceeds of sale of the former matrimonial home No. … M Street, M (“the M property”).
The husband supported the position of the interveners but left the amount of the alleged debt for the court’s determination. The wife denied the existence of any such debt but sought an indemnity from the husband, in the event that any liability was established by the interveners.
Two cousins of the husband, Ms N, and Mr C, also intervened in the proceedings. They sought orders to the effect that the husband and wife pay to them a sum of $287,448.70, plus interest accrued since the date of their demand for payment. This claim was resolved in favour of Ms N and Mr C, by way of consent orders made on 5 July 2011.
The wife also applied for a child support departure order. This issue was resolved by consent orders made on 6 July 2011. The effect of these orders was that the husband will pay half of the children’s private school fees, “gap” medical expenses and orthodontic costs in addition to child support as assessed from time to time.
It was somewhat difficult to identify the precise orders and outcomes sought by the husband and the wife. This imprecision was largely due to uncertainty as to the existence of any debt payable to the interveners. There was no doubt that the interveners advanced funds to the husband and wife and, in fact, she conceded that they provided a total of approximately $182,000.00. A significant issue in the proceedings was whether the advances made by the interveners should be treated as debts repayable to them or contributions on behalf of the husband.
The husband and wife agreed that they must sell the M property. They were content to postpone the sale until the beginning of 2012, so that their son J can complete the Higher School Certificate this year without being disrupted by a move of houses. The wife and the three children will occupy the property for the remainder of 2011.

Background

The wife was born in 1960 and is 51 years of age. The husband was born in 1966 and is now 45 years old. They commenced a relationship in approximately 1987 and began to live together when they married in 1994. They separated for about six months in 2002 but reconciled until June 2007, when the relationship finally broke down.
There were three children of the marriage:
(a)      J born in September 1993 (17);
(b)      D born in December 1995 (15); and
(c)      Z born in June 1997 (14).
The children have lived with the wife in the M property since the final separation. Their time with the husband has reduced since June 2007, to the point where J and Z now spend only half of school holidays with him and D has not seen his father since May 2009.
After J’s birth in September 1993 the husband spent time with him and the wife on most days. He cared for J while the wife attended to her horse and he provided some financial assistance to her. At this time the wife received a single parent’s benefit.
In 1985 the husband purchased Lot … A Street, W (“the W property”) jointly with Mr S for $175,000.00. The husband’s share of the purchase price was $87,500.00. He claimed that this money came from savings of $23,000.00; a gift of $25,000.00 from his uncle and a loan of $39,500.00 from his parents. The wife did not concede these funding arrangements but offered no evidence to the contrary.
In his affidavit the husband claimed that he repaid this loan from his parents over the next two years. In oral evidence he said that he thought that the loan was discharged in 1994. Mr R Rappetti (“Mr Rapetti Senior”) deposed in his affidavit that the husband borrowed $23,000.00 from his uncle and the balance of about $25,500.00 from the Commonwealth Bank. The husband said that his father was mistaken in this evidence. In any event the wife made no assertion that the W property was subject to any encumbrance as of the date of the marriage.
In January 1989 the husband purchased two shares in a company known as O Pty Limited for $90,000.00, which he borrowed from the Commonwealth Bank. This company was incorporated by the interveners and two others in 1979. The four shareholders purchased a stall at a Sydney market, which they operated under the business name “[Company 1]”.
The husband alleged that he received dividends of $25,000.00 on his shares in O Pty Limited in April 1990 and used this money to reduce the bank loan. Similarly, he claimed that he used dividends of $15,000.00 in March 1992 and $5,000.00 in September 1992 to reduce the bank loan. He maintained that this loan was discharged by funds from dividends and his income by about 1992. The wife did not concede these dealings in relation to the loan but offered no evidence to the contrary.
In 1992 the wife purchased a home unit at B Street, Sydney Suburb 1 for $142,000.00. She borrowed $82,000.00 from the Westpac Bank and the balance of the purchase price came from her savings. This property was sold for $170,000.00 in October 1994, at which time the mortgage payout figure was approximately $71,300.00. The wife thus netted approximately $97,500.00 from the sale of this property.
In June 1994 the RTA reclaimed part of the W property and paid compensation of $130,000.00 to the husband and Mr S. They used this money in part-payment of the purchase price of a property at … A Street, W (“the second W property”). The purchase price for the second W property was $260,000.00. The husband’s share of the balance of the purchase price was $65,000.00, which he funded from income and dividends on his shares in O Pty Limited.
In November 1994 the remainder of Lot … and … A Street, W (the first and second property at W) were amalgamated into one Certificate of Title. Part of this property is leased and the rental money is paid into an account in the joint names of the husband and Mr S. The husband claimed that all expenses relating to this property have always been met from the rental money in this account. The wife did not concede the detail of these transactions but offered no evidence of any different arrangement.
At the date of the marriage in May 1994 the husband owned the following assets:
·An unencumbered 50% interest in the W property with an agreed value of $322,500.00.
·Unencumbered shares in O Pty Limited.
·Motor vehicle and boat.
·Shares in Company 2 and Company 3.
·Jewellery, cartoon cells and golf clubs.
·Superannuation of a value $59,805.00.
·Savings of approximately $20,000.00.
At the date of the marriage the wife owned the following assets:
·… B Street, Sydney Suburb 1 sold for $170,000.00 in October 1994 and subject to a mortgage of approximately $71,000.00.
·Horse, riding equipment and float.
·Motor vehicle provided by the husband.
·Furniture and chattels.
·Superannuation of a value approximately $13,600.00.
In October 1994 the husband and wife purchased jointly number … Y Street, M for $430,000.00 (“the Y Street property”). It was common ground that the interveners paid the deposit of $43,000.00 and that the wife contributed $80,520.00 from the proceeds of sale of her Sydney Suburb 1 property. The balance of the purchase money came from a mortgage of $320,000.00 from the Commonwealth Bank.
In November 1994 the interveners received a sum of $10,375.00 from the proceeds of sale of the wife’s Sydney Suburb 1 property. In her affidavit the wife alleged that they also received the deposit of $17,000.00 but she conceded in oral evidence that this scenario was an impossibility. The Settlement Statement (Exhibit 10 to the wife’s affidavit) indicated that a net sum of approximately $16,700.00 remained from the sale proceeds, from which $10,375.00 was paid to the interveners. The balance was about $6,300.00, exclusive of agent’s commission. Accordingly, it could not be the case that the interveners received the deposit of $17,000.00.
On 10 January 1995 the husband, the wife and the interveners executed two documents prepared by a solicitor, Mr NN. One document, entitled “Loan Agreement”, concerned an amount of $190,000.00. The parties to this agreement were the interveners and the husband. The document was “signed, sealed and delivered” by the husband and recited that he would repay the principal sum on demand, together with interest from that date until payment in full. No party asserted that the husband, in fact, received $190,000.00 from the interveners on or before 10 January 1995.
The second document was entitled “Equitable Mortgage” and was “signed, sealed and delivered” by the husband and the wife. The document recited that they acknowledged receipt of a sum of $110,000.00 from the interveners, which was repayable on demand together with interest from that date until payment in full. By this document the husband and wife agreed to execute a “formal legal mortgage” over the Y Street property if called upon to do so by the interveners. The interveners never made such a call upon the husband and wife.
On 10 January 1995 the husband, the wife and the interveners also executed Wills. The Wills of each of the interveners contained a release to the husband of all monies owing by him at the date of death solely or jointly with the wife.
The wife alleged that she did not recall signing the “Equitable Mortgage” document but she accepted that it bore her signature. She maintained that she was unaware of the existence of this agreement until after the final separation. She denied that she and the husband ever received a sum of $110,000.00 from the interveners. In fact, no party asserted that the husband and wife received $110,000.00 from the interveners on or before 10 January 1995.

On 12 October 1995 the husband and each of the interveners received a dividend of $25,000.00 on their shares in O Pty Limited. The interveners provided their dividend cheques to the husband and he paid a lump sum of $75,000.00 off the mortgage on the Y Street property.
It was common ground that the interveners provided to the husband and wife rental cheques generated by their investment properties. The husband alleged that they began to receive this money in August 1994, around the time of the purchase of the Y Street property. Both interveners asserted that they began to provide rental cheques to the husband and wife at this point. The wife maintained that she and the husband began to receive this money in about October 1996.
In 1999 the husband and wife commenced litigation against their neighbours for compensation for damage to the Y Street property. It was common ground that, on 25 July 2002, the interveners paid $30,000.00 to a firm of solicitors who acted for the husband and wife in this litigation. They asserted that they provided additional money to assist the husband and wife in this building dispute but they were unable to particularise any further amounts.
The husband and the wife received total net funds of approximately $249,000.00 when this litigation was settled in July 2003. They paid a sum of $40,000.00 to the interveners from this money on 7 August 2003.
The husband and wife discharged the mortgage on the Y Street property in January 2003. They paid some $321,375.00 into the mortgage account between November 1994 and January 2003.
On 4 February 2004 the husband and wife paid $55,000.00 to the interveners. On 19 October 2004 Ms P Rapetti (“Ms Rapetti Senior”) paid a sum of $55,025.18 to the husband and wife. Ms Rapetti Senior deposed that she told the husband that they required funds at the time and asked that he and the wife repay some of the money which had been advanced previously. At the time, the interveners were in the process of constructing a new home.
The interveners borrowed $300,000.00 from the Commonwealth Bank to assist with the construction of their new home in 2001/2002. Ms Rapetti Senior said that the total building costs of approximately $1,000,000.00 came from Mr Rapetti Senior’s superannuation, their savings, a loan of $90,000.00 from her mother and the bank advance. She said that the sum of $55,025.18 paid by the husband and wife was used to discharge the Commonwealth Bank mortgage on 5 February 2004. A copy of a discharge of mortgage document annexed to her affidavit verified this evidence.
In September 2004 Ms Rapetti Senior received a superannuation benefit of approximately $326,000.00. From this money she paid $55,000.00 to the husband and wife on 19 October 2004. The husband maintained that he had asked for liquid funds to pay a deposit on the purchase of a new family home. The wife said the interveners repaid a loan of $55,000.00 made to them by herself and the husband on 4 February 2004.
When Ms Rapetti Senior paid $55,000.00 to the husband and wife, they had available liquid funds of approximately $200,000.00 from the settlement of the building dispute. In cross-examination the husband conceded that they did not need $55,000.00 from the interveners to pay a deposit on a new property.
In August 2005 the husband and wife sold the Y Street property for $950,000.00, from which they received a net amount of $937,158.00. Following the sale they and their children lived rent free in a duplex at M owned by the husband’s cousins. They occupied this property from September 2005 until September 2006.
In March 2006 the husband and wife purchased the former matrimonial home at … M Street, M for $1,260,000.00. The purchase money came from the proceeds of sale of the Y Street property, a loan of $200,000.00 from the husband’s cousins and savings of about $182,000.00.
After settlement of the purchase of the M property, the husband and wife retained savings of approximately $98,950.00. They carried out extensive renovations to this home, using their savings and a further loan of $20,000.00 from the husband’s cousins. In 2006 the interveners paid an amount of $10,000.00 to install air conditioning at the M property.
The Outline of Case document submitted on behalf of the husband noted as an agreed fact that the interveners and the husband’s cousins “issued demands for repayment of loans” on 7 February 2008 and that “interest commences accruing on the balance outstanding”. The Outline of Case submitted on behalf of the interveners made no reference to any such demand but a document entitled “Interveners Points of Claim” referred to “demand for monies advanced”. There was no suggestion in the Outline of Case provided on behalf of the wife or in oral submissions that the interveners failed to demand payment of funds advanced by them.
At the start of the trial there was a live issue as to money alleged to have been advanced by the interveners to meet expenses incurred in respect of race horses. There were disputes as to the beneficial ownership of certain horses and amounts supposedly paid by the interveners or the husband and wife. At the end of the trial I was provided with a document which read:
“Horses
1.The first and second interveners and wife assert payments made in respect of certain horses which, put at their highest are $31,793.00 and $27,985.00 respectively.
2.The parties are not agreed regarding the whole amount claimed or respective liability and acknowledge the cost of definite determination of these issues in the current proceedings would involve disproportionate time and expense.”
This document was submitted by agreement of counsel for the interveners and the wife and with no opposition from counsel for the husband. I will thus give no consideration to racehorse expenses in these reasons.

Approach to these proceedings

According to guidelines established through a series of leading decisions, the Court is required to determine the following matters on the evidence:
·firstly, the assets, liabilities and financial resources of the parties to the marriage are to be determined
·secondly, all relevant contributions of each of the parties, within the meaning of paragraphs (a) to (c) of section 79(4) must be identified and weighed against each other
·thirdly, the matters in paragraphs (d) to (g) of section 79(4), particularly paragraph (e) which takes up by reference the provisions of section 75(2) must be considered and a determination made as to what, if any, alteration should be made to the entitlements of the parties earlier assessed on account of contribution.
·finally, an order under section 79 must not be made unless the Court is satisfied that, in all the circumstances, it is just and equitable to make the order.

The assets, liabilities & financial resources

I was provided with an agreed balance sheet, which I set out in full:

ASSETS

Title

Description

Wife’s value

Husband’s value

1

J

[… M Street, M]

$1,725,000

$1,725,000

2

H

[A Street, W] – 50% interest

850,000

850,000

3

W

IAG Shares (1221)

4,126

4,126

4

H

IAG Shares (1088)

3,667

3,667

5

H

Telstra Shares (600)

1,746

1,746

6

H

Commonwealth Bank Account

492

492

7

H

Commonwealth Bank Account – [W] Farm Account – 50%

1,624

1,624

8

W

CBA Bank Account #452

414

414

9

J

Macquarie Controlled Monies Account as at 31/3/10 – proceeds of sale of Horse [P] & sale of […] Proton motor vehicle

5,019

5,019

10

H

Toyota Motor Vehicle

10,550

10,550

11

J

Cartoon Cells – 4 that wife seeks to retain $nk

- balance $nk

420

420

12

W

Horse (“[R]”)

1,000

1,000

13

J

Household contents

7,515

7,515

14

W

Jewellery

5,535

5,535

15

H

Jewellery

4,910

4,910

16

H

Sports Memorabilia

2,925

2,925

17

H

Golf buggy and golf clubs

2,650

2,650

18

W

Kia [motor vehicle]

Excl

Excl

Total

$2,627,593

$2,627,593

ADD-BACKS

Title

Description

Wife’s value

Husband’s value

19

H

Legal fees and disbursements paid and in trust

170,832

170,832

20

W

Legal fees and disbursements paid and in trust

51,064

51,064

Total

$222,436

$222,436

LIABILITIES

Title

Description

Wife’s value

Husband’s value

21

J

Personal Loan [Mr C] and [Ms N]

$287,488

$287,488

22

J

[Loan from Mr R and Ms P Rapetti]

0

380,994

23

W

Loan from [Ms K] to pay bankruptcy debt for horse vet

7,194

7,194

24

H

Commonwealth Bank Mastercard

Excl

Excl

25

W

Commonwealth Bank Mastercard

Excl

Excl

26

W

CBA personal loan (for car)

Excl

Excl

27

W

Personal loan from [Ms K] ($65,581)

- in respect of legal fees

- balance

50,081

15,500

50,081

0

28

J

Post separation payments by husband’s father re horses

Excl

Excl

29

H

Personal loan from [Ms F] (legal fees)

23,413

23,413

30

H

Personal loan from [Company 4] plus interest of 4% (legal fees)

30,000

30,000

31

H

Personal loan from [Mr M] ($35,662)

- in respect of legal fees

- balance (for school fees)

35,000

0

35,000

662

32

H

Personal loan from [Ms Y] (legal fees)

55,000

55,000

33

H

Personal loan from {Mr F] ($12,198)

- in respect of legal fees

- balance (for school fees)

4,500

0

4,500

7,698

Total

$508,176

882,030

SUPERANNUATION

Title

Name of Fund

Type of Interest

Wife’s value

Husband’s value

34

W

First State Super

$13,985

$13,985

35

W

ING Super

26,443

26,443

36

H

[O Pty Limited] (30.6.11)

Not incl tax

617,509

617,509

Total

$657,937

$657,937

SUMMARY

Description

Wife’s value

Husband’s value

Gross assets

$2,627,593

$2,627,593

Add-backs

222,436

222,436

Gross assets + add-backs

2,850,029

2,850,029

Liabilities

(508,176)

(882,030)

Net assets

2,341,853

1,967,999

Superannuation

657,937

657,937

Net assets and superannuation

$2,999,790

$2,625,936

The wife’s Kia motor vehicle was excluded from the list of assets on the basis that its value was offset by a corresponding debt. Counsel for the husband submitted that the paid legal fees of each of the husband and wife should be excluded from the list of assets on the same basis, as there are corresponding liabilities.
No submission against this approach was put on behalf of the wife. It seems to me that there is merit in this methodology, which has the advantage of simplifying the table of assets and liabilities.
It was agreed that the credit card debts of each of the husband and wife be excluded from the list of liabilities, along with post separation payments by Mr Rapetti Senior for race horse expenses. As noted, consent orders provided for repayment of the debt to Ms N and Mr C.
The remaining liabilities are thus the wife’s debt of $7,194.00 to Ms K and any monies found to be owed to the interveners. The final written submissions on behalf of the husband treated this debt as a joint liability. The orders sought by the husband would see this debt paid from the proceeds of sale of the M property. I will thus treat this debt as a joint liability.

Alleged debts of the husband and wife to the interveners

It is first necessary to identify the amounts advanced to the husband and wife jointly or severally by the interveners. The next issue is whether there was any agreement to repay these monies and, if so, on what terms. Lastly, a question arises as to whether any claim for repayment pursuant to such an agreement is statute barred by operation of the Limitation Act 1969 (NSW).
Counsel for the interveners particularised the components of their claim for $336,664.00 as follows:
“1. Balance deposit on [Y Street] purchase       $32,625.00
2. Rental cheques (not admitted)   $98,492.00
3. Rental cheques (admitted received)   $90,547.00
4. Interveners [O PtyLtd] (October 1995)          $50,000.00
5. October 2004 advance by interveners   $55,000.00
6. Payment re air conditioning (2006)   $10,000.00
Total  $336,664.00”
Counsel for the wife conceded that the interveners made the following advances:
·$32,625.00: balance of deposit on the purchase of the Y Street property
·$90,517.00: rental cheques
·$50,000.00: O Pty Limited dividends
·$10,000.00: air conditioning
The dispute as to the amount advanced by the interveners thus came down to alleged additional rental cheques totalling to $98,492.00 and a sum of $55,000.00 paid in October 2004. Of course, the wife made no concession that the admitted advances by the interveners constituted debts repayable by herself and the husband.

Rental cheques

The interveners alleged that they provided rental cheques to the husband and wife between October 1994 and December 2000. Mr Rapetti Senior claimed that he last endorsed a rental cheque to them in December 2000, as he and his wife required this money for construction of their new home from that point. The interveners conceded that they did not pay all of their monthly rental cheques to the husband and wife. Mr Rapetti Senior maintained that he endorsed all rental cheques to the husband and wife between December 1994 and October 1996 but retained some of this money between that time and December 2000. Ms Rapetti Senior also said that they retained rental cheques and estimated that they did so “maybe three or four times”.
That wife alleged that she usually wrote deposit slips for the rental cheques, which were always banked into the husband’s account. Mortgage repayments of $1,615.00 were withdrawn from this account each fortnight. The wife claimed that she retained all of the deposit slips and that the interveners provided no rental cheques outside of these dates.
The husband annexed to his affidavit copies of statements in respect of his Commonwealth Streamline account for the period 13 June 1997 to 15 March 1999. He acknowledged that these documents were not a full set of statements for that period. The wife annexed to her affidavit copies of various statements in respect of the joint mortgage loan account. These statements showed that an amount of $1,615.00 was withdrawn from the husband’s account and deposited into the joint mortgage account each fortnight. Unfortunately, bank statements for the disputed period between 1994 and 1996 were unavailable.
The husband said that he was able to identify deposits of rental cheques because they “came early in the month” and were for “amounts ending in funny cent numbers”. Regular deposits fitting that description appeared in the husband’s account.
The husband annexed to his affidavit a schedule of his and the wife’s net income for the years ending 30 June 1995 to 30 June 2003 and of the total mortgage repayments made during those years. There was no objection to the admission into evidence of this schedule.
The basic mortgage repayment was $1,615.00 per fortnight or approximately $41,990.00 per annum. The husband’s schedule showed that a total of $438,818.00 was paid into the mortgage account between the draw down date in October 1994 and the discharge in January 2003.
The net annual incomes for the husband as listed in the schedule were compatible with the tax returns annexed to his affidavit. These tax returns included income by way of the husband’s earnings, dividends on O Pty Limited shares and rental generated by the W property.
This schedule demonstrated that there must have been a shortfall between the income available to the husband and wife and the repayments made in reduction of the mortgage debt. The total net income available to the family for the years ending 30 June 1995 to 30 June 2003 was approximately $454,000.00 and mortgage repayments of about $439,000.00 were made during that period. The amount available for the support of the family was thus about $15,000.00 for eight years. The husband and wife may have won money from horse racing during those years but that pursuit also involved considerable expense.
In cross-examination the wife conceded that the husband and/or the interveners told her that the family had insufficient income to service the mortgage necessary to complete the purchase of the Y Street property. She said words to the effect: “we got money from his parents to meet the shortfall between $1,400.00 per fortnight income and $1,615.00 per fortnight mortgage. The rental cheques did not come in until 1996. I don’t know where the shortfall came from.”
A short time later in cross-examination the wife said words to the effect “I don’t know if rent cheques were deposited prior to October 1996. If they were, I can only expect that they met the shortfall. I don’t know that”. She said that she “was not prepared to concede that they may be right”.
Counsel for the interveners submitted a calculation of $98,492.00 for rental cheques said to have been provided by them in addition to the amount acknowledged by the wife. This calculation was set out as follows:

“Rental receipts net per intervener’s Tax Returns exhibited to [Mr Rapetti Senior’s] Affidavit of 6 September 2010 (exhibit No. RR7 from page 40 to Page 127) Dec 1994 to 30 June 1995 Allow 7/12 of full year of $28,447

$18,851

1/7/95-30/6/96

$32,321

1/7/96-1/10/96

Allow 3/12 of full year of $31,543

$7,377

30/12/99-30/6/00

Allow 7/12 of full year $31,546

$18,403

1/7/00-30/12/00

Allow 6/12 of full year of $43,091

$21,540

$98,492

Total of $98,492 excludes cheques admitted by Wife at paragraph 104 of her Affidavit filed 24 August 2010

$90,517”

With respect, I see considerable difficulty with this submission. The interveners and the husband all acknowledged that they retained some rental cheques for their own use. It was impossible to quantify the rental cheques retained by the interveners as opposed to those provided to the husband and wife. It is true that counsel for the interveners acknowledged that “there may have to be some small discounting of $98,492”.
The evidence fell short of establishing that the husband and wife received any particular part of this sum from the interveners. On their own evidence, the interveners could not assert that they provided a total sum of $98,492.00 from unacknowledged rental cheques to the husband and wife. The interveners could not establish that they advanced any particular sum to the husband and wife by way of rental cheques in addition to those acknowledged by the wife.
On the other hand, the reality of the financial position of the husband and wife would suggest that they did receive an unquantifiable amount by way of additional rental cheques from the interveners. I accept that the interveners provided rental cheques to the husband and wife in an amount which exceeded $90,517.00 but which cannot be quantified on the available evidence.

Payment of $55,000.00 to the husband and wife by Ms Rapetti Senior on 19 October 2004

There is no doubt that Ms Rapetti Senior drew a cheque for $55,000.00 payable to “[the husband and the wife]” on 19 October 2004 (Exhibit 6). The question is whether this sum was a repayment of an earlier advance of $55,000.00 made by the husband and wife to the interveners on 4 February 2004.
As noted, the husband acknowledged in cross-examination that he and the wife had no need of $55,000.00 to pay a deposit on the purchase of a new home in October 2004. He agreed that they had available liquid funds of approximately $200,000.00 from the settlement of the Y Street litigation. Bank statements for the joint account annexed to the wife’s affidavit showed a credit balance of $171,760.00 on 19 October 2004 and $226,785.00 after a deposit of $55,025.18 on the following day.

The wife maintained that the husband told her that his parents needed money to pay out their mortgage to avoid interest. The husband claimed that the interveners were paying interest on their loan from the Commonwealth Bank, pending Ms Rapetti Senior’s receipt of her superannuation entitlements.
Statements for the joint accounts of the husband and wife (Exhibit 33 of the wife’s affidavit) showed a withdrawal of $55,000.00 on 4 February 2004 and a deposit of $55,025.18 on 20 October 2004. A copy of a discharge of mortgage dated 5 February 2004 was annexed to the affidavit of Ms Rapetti Senior sworn on 6 September 2010.
Ms Rapetti Senior received a net amount of $326,046.00 from the Rapetti Super Fund under cover of a letter dated 29 September 2004. On 19 October 2004 she wrote cheques to “[Ms F]” for $90,000.00 and “[the husband and the wife]” for $55,000.00. The most likely scenario thus seems to be to be that Ms Rapetti Senior repaid the loan of $90,000.00 from her mother and the $55,000.00 advanced by the husband and wife on 4 February 2004 when she received her superannuation.
In these circumstances I am persuaded that the payment of $55,000.00 to the husband and wife in October 2004 was a return of money which they had advanced to the interveners in February 2004. Accordingly, I will not include this sum of $55,000.00 in the total of funds advanced to the husband and wife by the interveners.
I thus find that the interveners advanced to the husband and wife the following amounts:
·$90,517.00: rental cheques
·$32,625.00: balance of the deposit on the purchase of the Y Street property
·$50,000.00: dividends on O Pty Limited shares
·$10,000.00: air conditioning in the M property

I am satisfied, further, that the interveners advanced to the husband and wife additional rental cheques in an unquantifiable amount.

The existence of agreement/s between the interveners and the husband and/or the husband and wife

Counsel for the interveners helpfully provided a document entitled “Interveners’ Points of Claim” which read:
“1.By agreement partly oral, partly written and partly implied made between August 1994 and 10 January 1995 it was agreed between the parties that the Interveners would lend to the Husband and the Wife the sum of Forty Three Thousand Dollars ($43,000) together with future rental monies receivable by the Interveners from properties they owned at [Sydney Suburb 2] and such other advances as they might make.
2.It was a term of the agreement that the monies would be repaid at a date subsequent to any sale by the Husband and the Wife of the property at [Y Street] purchased with the assistance of the sum of Forty Three Thousand Dollars ($43,000) first advanced but that if requested prior to that date the Husband would sell the property owned by him at [W] and apply the proceeds in reduction of such indebtedness as the Husband and the Wife might have to the Interveners.
3.It was a further term that upon the sale of the property at [Y Street] the monies lent would become repayable after a demand was made for that payment.
Particulars
a)The oral parts of the agreement were constituted by statements made by the parties in conversations in about August/September 1994, 28 October 1994, 29 October 1994 and late October or early November 1994.
b)The written parts are constituted by the document dated 10 January 1995 executed by the Husband and the Wife.
c) The implied parts were constituted by the context in which the agreement was come to including the steps taken by the parties to formalise the agreement between them.
4.Pursuant to the agreement the Interveners lent the $43,000 together with rentals and other payments.
Particulars
a) rentals monies advanced - $193,695;
b) payment of [O Pty Ltd] dividend - $50,000.
5.The sum of $10,375 was repaid by the Husband and the Wife in respect of the $43,000.
6.The Husband the Wife sold the property at [Y Street] on or about 30 August 2005.
7.On or about the time of the sale the Interveners at the request of the Husband forbore from making demand pending the purchase by the Husband and the Wife of a new residence.
8.The Interveners made demand for the monies advanced by them but such monies have not been repaid.
9. The Interveners claim the sum of $318,687.
IN THE ALTERNATIVE
10.In the event any part of the monies the subject of the Interveners’ claim as above is said by the Husband and/or the Wife to be repayable from the date of advance and not demand so as to be barred by operation of s.14 of the Limitation Act (NSW) the document dated 10 January 1994, either in its present form or as rectified to reflect the amount advanced to be $43,000 less repayments to its date, is effective as a deed such that the applicable provision of the Limitation Act (NSW) is s.16.
FURTHER CLAIMS
11.By further agreement made September 2006 between the Interveners and the Husband it was agreed the Interveners would pay the cost of the purchase and installation of air conditioning at the residence of the Husband and the Wife in an amount of $10,000 on terms that sum be repaid.
12.In the alternative the monies are monies paid for the benefit of the Husband and the Wife at the request of the Husband.
13.By further agreement made May 2007 between the Interveners and the Husband it was agreed the Interveners would pay costs incurred in respect of horses owned by the Husband and the Wife on terms those monies be repaid.
14.The Interveners have paid an amount of $32,367 in respect of such horses.
15.In the alternative the monies are monies paid for the benefit of the Husband and the Wife at the request of the Husband.
16.Demand has been made for repayment of the monies referred to in the further claims but payment has not been made.”
The interveners and the husband relied in part on conversations alleged to have taken place around the time of purchase of the Y Street property. The husband deposed that there was a conversation involving himself, the wife and the interveners after his successful bid at the auction. He said that part of the conversation was as follows:
“Dad said to [the wife]: How much are you expecting from the sale of the unit?
[The wife] said: $80,000.00
Dad said: You need to add stamp duty costs and paying us back the deposit. You will need to borrow at least $340,000.00 from the bank. Your share of the rental from the farm and salary would be about $685.00 per week. How are you going to pay the mortgage and living expenses?
I said: Sell the farm if necessary.”
The husband deposed that he and the wife attended the home of the interveners on the day after the auction and there was a conversation which included the following:
“Dad said: Your mum and I have discussed things between us and we have decided we are going to lend you the income from our rental properties to help you pay the mortgage. I recall embracing my parents and [the wife] thanking them profusely.
Dad said: I will call my solicitor tomorrow and ask him how we organise this.”
Each of the interveners gave a similar account of these alleged conversations.
The wife conceded in cross-examination that she probably had a conversation with the interveners on the day of the auction. She said that they discussed the amount which she and the husband would need to borrow to complete the purchase of the property and the sale of her home unit. She agreed that she was present during conversations at the interveners’ home on the day at the auction. She denied that she was present during any conversation at their home on the following day. Specifically, she denied being present during any discussion about rental cheques. She said “there might have been a conversation about rental cheques between my husband and his parents but I was not there”. She conceded that she could have thanked the interveners for the rental cheques and then agreed “yes of course I would have thanked them”.
The husband alleged that he and the wife had a conversation about the execution of loan agreements in January 1995. He said that this discussion included the following:
“I said: Now we are married and have started a family we should have proper Wills drawn up. Dad wants us to attend at [Mr NN’s] office to sign the loan agreements so we might as well have them done together.
[The wife] said: yes, we should have done it earlier”.
Mr Rapetti Senior asserted that he telephoned his solicitor, a few days after the auction and said to him:
“[The husband and the wife] have bought a property. [Ms Rapetti Senior] and I want to lend them the money to pay it off. What do I need to do [Mr NN]?”
He deposed that he also said to Mr NN:
“I’m going to give them my monthly rental cheques and I think they are going to need about $300,000.00 by the time they pay off their house.”
He said that this figure of $300,000.00 “was the amount I calculated in my mind that [the husband and the wife] would need to borrow to settle the purchase of the [Y Street] property.”
Mr Rapetti Senior deposed that, a few days after this conversation with Mr NN, he had a discussion with the husband and wife. He claimed that he said to them:
“I have spoken to [Mr NN] who is going to prepare some documents for us to sign for the money we are to lend you.
[The wife] said in response: Of course nonno we will sign whatever you want.”
The wife denied that she ever told the interveners that she would sign whatever documents they requested of her.
The wife denied that she and the husband had any conversation about loan agreements. She agreed that they discussed the execution of Wills. She said that she did not have a good recollection of the circumstances in which she signed the loan agreement.
The husband maintained that he did not know why Mr NN prepared two loan documents. He denied that he gave any instructions to Mr NN to draw the agreements on this basis.
Mr Rapetti Senior denied that he gave instructions to Mr NN to prepare two separate loan agreements. He said that he became aware that there were two documents only after the commencement of these proceedings. He said “it is not true that they received $110,000.00 and [the husband] received $190,000.00”. He said that he “just signed without looking at them”.
In his affidavit Mr NN deposed that Mr Rapetti Senior informed him of a $300,000.00 loan to the husband and wife, to assist them to complete the purchase of the Y Street property. He said that the husband told him that he and the wife would borrow $190,000.00 and that he alone would be indebted to the interveners for the sum of $110,000.00. He said that when he raised the subject of separate loans with Mr Rapetti Senior, he said that: “this is a matter for [the husband]”.
In his oral evidence Mr NN said that he “recalled [the husband] saying there should be two agreements”. He said also “I did have instructions for two agreements and I think they came from [the husband], not [Mr Rapetti Senior]”.
Mr Rapetti Senior asserted that the husband never spoke to Mr NN. He maintained that it was incorrect to suggest that the husband instructed Mr NN to prepare two separate agreements. With respect to Mr Rapetti Senior, he could not say categorically that the husband never spoke to Mr NN. This evidence is inconsistent with that of the husband, who deposed in his affidavit that he telephoned Mr NN and asked him to prepare Wills for himself and the wife. I have difficulty in accepting that an officer of the court would give this evidence as to his instructions unless it were true to the best of his recollection.
There was no indication that Mr NN, the husband or the interveners ever suggested to the wife that she seek independent legal advice. It seems to me to be likely that she had agreed to sign any documents which were requested by the interveners prior to her attendance at Mr NN’s office on 10 January 1995. They had provided $43,000.00 for the deposit on the purchase of the Y Street property some two months previously. She had been a party to discussions with the interveners about the amount which she and the husband would need to borrow to complete the purchase. She had been told that their income would be insufficient to service such a mortgage debt. In these circumstances it seems to me to be likely that the wife was aware that financial assistance would be forthcoming from the interveners, even if she was not privy to the details.
Despite the contents of Mr NN’s affidavit, the agreements were in fact drawn with the husband and wife as borrowers of $110,000.00 and he solely of $190,000.00. No party asserted that the husband received $190,000.00 or that he and the wife received $110,000.00, despite acknowledgements to that effect in the loan documents. This scenario is an impossibility on any version of events. The interveners own evidence was that they had paid the deposit of $43,000.00 and, at most, two months rental from their investment properties by the time the loan documents were executed on 10 January 1995.
The interveners and the husband alleged that they agreed to extend the existing loan to enable him and the wife to purchase the M property. The husband deposed that he and the wife had a conversation with the interveners after they attended an inspection of the property in March 2006. He maintained that the conversation included the following:
“I said: Would you be willing to extend the term of our existing loan so that we can purchase this property?
Mum said: It’s well out of your price range.
Dad said:Yes, we will extend your loan but you will both have to work for me for the rest of your lives to pay back the loan.”
The wife denied that she was a party to any such conversation. She maintained that the husband told her about a conversation to this effect, which he had with the interveners. She denied that there was any “existing loan to his parents”.
The interveners contended that a term of the alleged loan relating to the deposit and rental cheques was that any demand for repayment be made only after the sale of the Y Street property. The evidence of the interveners and the husband was inconsistent on the question of such a condition.
In his Affidavit sworn on 6 September 2010 Mr Rapetti Senior deposed:
“During this conversation [the wife] raised the issue of repayment:
[The wife]: When do we pay the monies back?
[Ms Rapetti Senior]: When you sell the house by which time you will both be better off.
I: Yes and if we need any money you can give us the dividends [O Pty Ltd] distributes to [the husband].
[The husband]: That’s ok, if things get difficult I can always sell the farm to pay you whatever we owe you.”
In her Affidavit sworn on 6 September 2010 Ms Rapetti Senior deposed:
“Shortly after receiving the $10,375.00 from [Mr NN], [the husband], [the wife], my husband and I, had a conversation at our home, as follows:
My husband: I have asked [Mr NN] to prepare some documents for the monies we are lending you.
[The wife]: Of course nonno, we will sign whatever you want. When do you think we will need to pay the money back?
I: We are not in a hurry at the moment but when you sell the house or pay us from your [O Pty Ltd] dividends.”
In his Affidavit sworn on 2 September 2010 the husband said nothing about any discussion of a time for repayment with the interveners. In his oral evidence he said:
“It is not correct that [the wife] wasn’t there when my parents discussed lending us the rental income. [The wife] was happy and thanked them profusely and asked “how are we going to repay it?”
They said: “from the sale of the unit and dividend cheques””.
The two loan agreements made no mention of any condition that a demand for repayment would be made only after the sale of the Y Street property. The affidavit evidence of the interveners was inconsistent on the question of the time for repayment. Mr Rapetti Senior deposed that Ms Rapetti Senior said to the husband and wife that they would be required to make repayment on the sale of the Y Street property. He maintained that, in the same conversation he told them that they could hand over the husband’s O Pty Limited’s dividends if he and his wife needed funds in the meantime. Ms Rapetti Senior deposed that she told the wife that repayment would be made on the sale of the property or from the husband’s O Pty Limited dividends.
On 12 October 1995 the interveners each provided to the husband and wife a dividend cheque for $25,000.00 from shares in O Pty Limited. This sum of $50,000.00 was paid off the mortgage on the Y Street property. The husband gave no evidence as to the circumstances of this advance.
Mr Rapetti Senior deposed to a conversation which he and Ms Rapetti Senior had with the husband and wife in mid 1995. He said that he and his wife told them:
“We have had a good year at the markets. [O Pty Ltd] is going to pay a dividend of $50,000.00 to us and $25,000.00 to [the husband]. If you like we can lend you the $50,000.00 to put towards your mortgage to reduce your interest and [the husband] if you do the same with your $25,000.00 it will be a big help to reduce the mortgage.”
Mr Rapetti Senior maintained that both the husband and wife agreed to this proposition. He gave no evidence of any conversation or statement by the husband and wife which might lead to the conclusion that they acceded to this proposition. Nothing was put to the wife about this alleged conversation or any agreement on her part to such a proposal.
There was no evidence as to the terms of this part of the alleged loan from either of the interveners or the husband. There was no concession from the wife as to any conversation about this aspect of the alleged loan.
The interveners bore the onus of proof, on the civil standard, that there existed an agreement that they would “lend to the husband and wife a sum of $43,000.00 together with future rental monies receivable by the interveners from properties they owned at [Sydney Suburb 2] and such other advances as they might make”. Similarly, it was for the interveners to establish that a term of that agreement was that monies would be repayable subsequent to the sale of the Y Street property but that, if a request was made prior to that date, the husband would sell the W farm and discharge the debt.
I do not accept that there existed a loan agreement in the above terms between the interveners and the husband and wife. There is uncertainty about the total amount advanced by the interveners, yet they claim a sum certain which is not supported by their own evidence as to the rental cheques unacknowledged by the wife. The written documents executed on 10 January 1995 can in no way be construed as representative of any actual financial arrangement between the interveners and the husband and wife. It was not established that the wife was party to any conversations, concerning financial arrangements with the interveners, in addition to those which she conceded. There was inconsistency in the evidence of each of the interveners and the husband as to the alleged term of the agreement governing the time for repayment. I thus find that the husband and wife have no debt to the interveners in the terms set out in paragraphs 1 to 9 inclusive of the document entitled “Interveners Points of Claim”.
I do not accept the submission on behalf of the interveners that the agreement relating to the sum of $110,000.00 should be rectified to reflect the true intention of the parties, being that there existed a debt of the balance of $43,000.00 deposit after repayment of $10,375.00. The evidence simply did not establish any such common intention and it appears that no such instructions were conveyed by anyone to Mr NN.
The interveners alleged that they loaned a sum of $10,000.00 to the husband and wife in September 2006 to meet the cost of air conditioning at the M property. Ms Rapetti Senior deposed that she had a conversation with the husband in which he said:
“[The wife] wants air conditioning for the house. I can’t afford it. Can you lend us $10,000.00?”
There was no suggestion that the wife was a party to this conversation or that there was any subsequent discussion with her about the terms of this advance. Ms Rapetti Senior deposed only:
“I discussed installing air conditioning with [the wife]. A short time later [the wife] gave me an invoice for the cost of the air conditioning unit and installation for which I wrote out a cheque for $10,000.00 which I posted direct to the address on the invoice”.

As noted, the wife conceded that the interveners provided the sum of $10,000.00 to meet the cost of air conditioning. She denied that the money was advanced by way of a loan and maintained that the $10,000.00 was gifted to herself and the husband by the interveners. The evidence fell well short of establishing any agreement by the husband and wife to repay this sum of $10,000.00 to the interveners. There was no evidence of any discussion with the wife concerning repayment of this advance. I find that the interveners failed to establish that the husband and wife are indebted to them in the sum of $10,000.00.

Is any debt to the interveners statute barred?

Having found that the interveners failed to establish that the husband and wife are indebted to them in any amount, it is unnecessary for me to consider the effect of the Limitation Act 1969 (NSW). I will do so, however, to address a situation which may arise if I am wrong in that conclusion.
Section 14 of the Limitation Act 1969 (NSW) provides:
“(1) An action on any of the following causes of action is not maintainable if brought after the expiration of a limitation period of six years running from the date on which the cause of action first accrues to the plaintiff or to a person through whom the plaintiff claims:
(a) a cause of action founded on contract (including quasi contract) not being a cause of action founded on a deed,
(b)a cause of action founded on tort, including a cause of action for damages for breach of statutory duty,
(c) a cause of action to enforce a recognizance,
(d) a cause of action to recover money recoverable by virtue of an enactment, other than a penalty or forfeiture or sum by way of penalty or forfeiture.
(2) This section does not apply to:
(a) a cause of action to which section 19 applies, or
(b) a cause of action for contribution to which section 26 applies.
(3) For the purposes of paragraph (d) of subsection (1), “enactment” includes not only an enactment of New South Wales but also an enactment of the Imperial Parliament, an enactment of another State of the Commonwealth, an enactment of the Commonwealth, an enactment of a Territory of the Commonwealth and an enactment of any other country.”
A question thus arises as to the date upon which any cause of action upon which accrued to the interveners.
I have found that the interveners failed to establish that there was a condition that demand for payment would be made subsequent to the sale of the Y Street property. The consequence is that any loan agreements which may exist provided for repayment on demand. It is well settled case law that such a cause of action commences instanter upon the making of a loan.
In Ogilvie v Adams [1981] VR 1041 Fullagher J said:
“The courts have long since settled it that a mere statement or agreement that the money is repayable on demand (or request or at call) is not sufficient to contract out of that situation where all else that is known of the terms of the contract is that A has paid money to B by way of loan. The lender's cause of action still arises instanter on the receipt of the money by the borrower, so that the lender's cause of action becomes statute barred at the expiry of six years after the receipt of the money.”
In Re Brookers (Aus) Limited (in liq) (1986) 42 SASAR 380 King CJ said:
“It is trite to say that where there is a simple loan of money, the debt is due and payable immediately and from day to day from the time of the making of the loan, and that the cause of action therefore arises immediately upon the loan of the money. This position is unchanged by the fact that there is an express agreement making the loan repayable on demand, on request or on call; the debt is nevertheless due and payable immediately”.
In Gleeson v Gleeson [2002] NSWSC 418 Bryson J cited with approval the decision of Fullagher J in Ogilvie v Adams. Similarly, Young J cited this decision with approval in Drinkwater & Ors. v Caddyrack Pty Ltd & Ors. [1997] NSWSC 589.
The Limitation Act 1969 would therefore operate to prevent recovery of any monies loaned by the interveners pursuant to an agreement entered into between August 1994 and January 1995. Any such claim would become statute barred no later than January 2001.
The debt for $10,000.00, which was allegedly incurred in September 2006, would fall outside the operation of the Limitation Act 1969. In my view, however, the interveners failed to establish any such debt.
The submission on behalf of the interveners that the documents executed on 10 January 1995 were deeds and, therefore, subject to a twelve year statutory limitation period can also be disposed of shortly. Any twelve year limitation period expired on 5 January 2007 and there was no demand for payment until 7 February 2008.
It is now possible to set out the assets, liabilities and financial resources of the husband and wife.
I find that the parties have the following non-superannuation assets with the values listed below:

1.

The M property (J)

$1,725,000.00

2.

50% interest in the W property (H)

$850,000.00

3.

IAG Shares (H)

$3,667.00

4.

IAG Shares (W0

$4,126.00

5.

Telstra Shares (H)

$1,746.00

6.

Commonwealth Bank Account (H)

$492.00

7.

50% W Farm Commonwealth Bank Account (H)

$1,624.00

8.

Commonwealth Bank Account (W)

$414.00

9.

Macquarie Bank Controlled Monies Account (J)

$5,019.00

10.

Toyota Motor Vehicle (H)

$10,550.00

11.

Cartoon Cells (J)

$420.00

12.

Horse (W)

$1,000.00

13.

Household contents(J)

$7,515.00

14.

Jewellery (H)

$4,910.00

15.

Jewellery (W)

$5,535.00

16.

Golf clubs and buggy (H)

$2,650.00

17

Sports memorabilia (H)

$2,925.00

Total

$2,627,593.00

I find that the parties have the following superannuation assets with the values listed below:

1.

Rapetti Superannuation Fund (H)

$617,509.00

2.

First State Super (W)

$13,985.00

3.

ING Super (W)

$26,443.00

Total

$657,937.00

I find that the parties have the following liabilities:

1.

Loan from Ms N and Mr C (J)

$287,488.00

2.

Loan from Ms K (J)

$7,194.00

Total

$294,682.00

There was no suggestion that either party holds a financial resource. I thus find that there are no financial resources.

The contributions of the parties

On behalf of the husband it was contended that the assets should be separated into three categories, being:
·Superannuation benefits
·The husband’s interest in the W property
·The remainder of the non-superannuation assets
This approach was said to be warranted because the wife made no contribution of any nature to the husband’s interest in the W property.
On behalf of the wife it was submitted that the second W property was purchased after the birth of J, in circumstances where she was making substantial contributions to his care. It thus follows that his introduction of the W property into the relationship cannot be considered an “unadorned” contribution by the husband.
J was born in September 1993 and the husband purchased his interest in the second W property between June and November 1994. He used savings and dividends from his O Pty Limited shares, totalling $65,000.00, to meet part of the purchase price.
It seems to me that there was an intermingling of contributions by the husband and wife during the period between J’s birth and the husband’s acquisition of the second W property. For approximately nine months before the marriage the wife was almost solely responsible for J’s physical care. As well, she made a significant contribution to his financial support during that period. After the marriage the husband and wife assumed traditional and complementary roles of breadwinner and homemaker.
The husband claimed that all expenses in relation to the W property were covered by its rental income and that he never used “marital funds” for any such purpose. He said that he and the co-owner each draw approximately $4,000.00 to $5,000.00 from the rental account approximately every two years. I assume that these funds were used by the husband for the benefit of the family.
The husband held his interest in the W property throughout the thirteen years of the marriage. During that time he was the major income earner and the wife the primary carer for the three children and homemaker. In these circumstances, the value of the husband’s interest in the property has increased from $322,500.00 to $850,000.00. There were no improvements to the property, nor any debt reduction during the marriage. In these circumstances it seems to me that the wife made an indirect non-financial contribution to the conservation of the W property.
I do not consider her contribution to this asset to be as significant as is the case with the other property of the parties. The fact is that the husband acquired the basis of this asset well before the relationship commenced and it was unencumbered when J was born. Nonetheless, the husband was able to maintain the asset throughout thirteen years of cohabitation, during which period the wife made significant contributions as homemaker and parent. I will thus accede to the submission on behalf of the husband to treat the assets of the parties in three separate categories for the purpose of assessment of their respective contributions.
In the wife’s Outline of Case document it was conceded that the following contributions were made by or on behalf of the husband:
·50% interest in the W property with an agreed value at the date of the marriage of $322,500.00.
·Shares in O Pty Limited brought into the marriage which were not assigned a value at the date of the marriage.
·Superannuation benefit at the date of the marriage with a value of $59,805.00.
·$50,000.00 in dividends provided by Mr and Ms Rapetti Senior and paid off the mortgage debt on 12 October 1995.
·Rental cheques totalling $90,517.00 received from Mr and Ms Rapetti Senior.
·Payment of $10,000.00 by Mr and Ms Rapetti Senior for air conditioning at the M property in 2006.
Total $532,822.00 plus shares in O Pty Limited
The husband purchased his O Pty Limited shares in 1989 for $90,000.00 but there was no evidence as to their value at the date of the marriage.
The husband claimed that he additionally introduced into the marriage savings of $20,000.00, shares, a motor vehicle, a boat and personal effects including jewellery and golf clubs. There was no evidence as to the value of these assets as at the date of the marriage. The boat was sold in the mid 1990’s but there was a dispute as to the sale price and the fate of this money.
The husband’s shares in O Pty Limited generated income by way of dividends throughout the marriage. His unchallenged evidence was that these shares yielded dividends totalling $180,500.00 between 1994 and 2002. The husband also received approximately $46,000.00 on the liquidation of O Pty Limited in 2003/2004. He thus received about $226,500.00 via his shares in O Pty Limited in addition to his salary.
There is no question that the interveners made substantial contributions on behalf of the husband. As noted, the wife conceded most of these contributions. The only alleged contribution by the interveners which she really disputed was the unidentified and unquantified rental cheques. She conceded direct financial contributions from the interveners totalling some $183,000.00. These monies must be considered a direct financial contribution on behalf of the husband.
The wife acknowledged that she and the husband could not have purchased the M property without assistance from his family. She said in cross-examination “I knew we could not afford the [M property] on our own”. The husband’s cousins provided a loan of $220,000.00 for the purchase and renovation of the property. They will, however, receive repayment together with interest when the property is sold in early 2012. The husband’s cousins additionally provided rent free accommodation to the family for about twelve months.
The husband was employed on a full-time basis throughout the marriage. There was no question that he made all of his income, from whatever source, available for the benefit of the family.
Since the separation the husband has paid child support, initially in the sum of $500.00 per week on a voluntary basis, and then as assessed from time-to-time by the Agency. As noted, he agreed in the course of these proceedings to orders that he pay one half of the children’s private school fees, “gap” medical and orthodontic expenses in addition to child support as assessed.
The husband’s superannuation increased substantially between the date of the marriage and the present time. He continued in paid employment throughout the marriage, hence he was able to amass a much larger benefit than was the case with the wife. She spent most of the period of marriage out of the paid workforce and her superannuation benefits effectively stagnated. The husband’s superannuation benefit increased in value from $59,805.00 at the date of the marriage to $617,509.00 at trial. There was an increase of approximately $170,000.00 between the separation and the commencement of the trial. I would not attribute this increase to the husband alone, in circumstances where the wife was substantially responsible for the care of the children and contributing significantly to their financial support during that four year period.
The wife brought into the marriage her equity in the Sydney Suburb 1 property, being about $97,500.00, a superannuation benefit valued at approximately $13,000.00, a motor vehicle which had been provided by the husband and her personal effects.
There was no issue that the wife was primary carer for the children and that she undertook most of the homemaking role throughout the marriage. She has been almost exclusively responsible for the care of the children in the four years since separation as, regrettably, they have become unwilling to spend time with their father.
The wife has the benefit of the occupation of the unencumbered M property for the fours years since separation. She has paid the outgoings in respect of the residence. The husband, on the other hand, has rented accommodation.
In the circumstances to which I have referred, I would assess the contributions to the W property of the husband and wife at 75% and 25% respectively. I would assess that the husband contributed 55% and the wife 45% to the superannuation assets, having regard to the values of their respective benefits at the date of marriage and the circumstances in which the husband’s fund increased in value. I am here particularly mindful of the complementary contributions of the husband and wife between 1995 and 2007 and her substantial responsibility for the care of the children since separation.
The advances made by the interveners seem to me to assume particular significance in the context of contributions to the remaining non-superannuation assets. It is not simply a question of having regard to the amount of their advances to the parties; rather, it is appropriate to consider also the impact on the financial fortunes of the husband and wife.
The provision of rental cheques by the interveners was of considerable assistance to the husband and wife in their acquisition of the Y Street property. As noted, I accept that they provided rental cheques in an amount greater than that conceded by the wife. They also facilitated a $50,000.00 lump sum reduction of the mortgage debt on that property.
I would regard as complementary and equal the contributions of the husband and wife to the non-superannuation assets, excluding the W property, in the absence of advances from the interveners. They fulfilled traditional roles of breadwinner and homemaker, with the wife assuming a significant role in the care of J before the marriage and of all three children following the separation.
Having regard to the contributions of the interveners, I would assess the contributions by or on behalf of the husband to this category of the assets at 62.5%. I would assess the contributions of the wife at 37.5% in relation to this category of assets.
In numerical terms, therefore, the contribution outcome is as follows:

Husband

Wife

Superannuation (55% / 45%)

$361,865

$296,072

W property (75% / 25%)

$637,500

$212,500

Remaining Non-Superannuation Assets (62.5% / 37.5%)

$926,819

$556,092

Total

$1,926,184

$1,064,664

As a checking exercise, these figures equate to about 64.5% to the husband and 35.5% to the wife on a global basis.

Section 75(2) factors

The husband is 45 years old and in full-time employment. He receives a gross salary of $1,500.00 and benefits totalling $215.00 per week from his employment at a Sydney market. He retains his interest in the W property which provides him with net rental income which averages about $5,000.00 per annum, according to his affidavit.
The wife is 51 years old and works full-time in the education field at School 1. She earns a gross income of $47,800.00 per annum or about $920.00 per week. As at the date of her Financial Statement sworn on 4 July 2011, she received $434.00 per week by way of child support.
The wife will continue with responsibility for the primary care of the children, who are now 14, 15 and 17 years old. As noted, two of the boys spend only half of school holidays with the husband and D has not seen his father since January 2009.
It was conceded on behalf of the husband that an adjustment in favour of the wife is warranted on account of section 75(2) factors. An adjustment of 10% of the value of the net non-superannuation assets was proposed but only on the basis of a finding that there exists a debt of some $381,000.00 to the interveners and a determination of contributions equivalent to 70% on a global basis.
I have made neither of these findings. It nevertheless seems to me that an adjustment in favour of the wife is warranted on account of section 75(2) factors. There is clear disparity in respective income-earning capacities of the parties. The wife is likely to leave the paid workforce before the husband does so, as she is five years older. On the other hand, the wife is currently able to support herself on her income and the children are teenagers. The husband will continue to pay child support and additional expenses.
In the ordinary course of events, the husband would have a greater capacity than the wife to borrow funds and service a loan. It thus seems to me that he has more flexibility, in terms of purchasing new accommodation for himself. The wife will be reliant, in that regard, in very large measure on whatever capital she acquires as a result of these proceedings.
In all of these circumstances I am comfortably satisfied that an adjustment in favour of the wife is warranted on account of section 75(2) factors. I would assess an appropriate adjustment at 5% of the net non-superannuation assets, which equates to an additional sum of approximately $149,500.00. As a checking exercise, the result would produce a global distribution of all net assets as to about 59.5% to the husband and 40.5% to the wife. I regard such a result equitable in all of the circumstances.
In numerical terms, the overall outcome is as follows:

Husband

Wife

Superannuation (55% / 45%)

$361,865

$296,072

W property (75% / 25%)

$637,500

$212,500

Remaining Non-Superannuation Assets (57.5% / 42.5%)

$852,674

$630,237

Total

$1,852,039

$1,138,809

Splitting order in relation to the husband’s supernnuation benefit

The husband sought orders which would cause his superannuation benefit to be split between the parties. The wife opposed any such order, largely on the basis that she has an immediate need for liquid funds to re-house herself and the children.

In my view it would not be just and equitable for the husband to retain the whole of a superannuation benefit which he cannot access for many years. On the other hand, I appreciate the wife’s need for liquid funds to re-establish a home for herself and the children. There is an inevitable element of arbitrariness in the selection of a percentage of the husband’s superannuation benefit which should be taken by the wife. I have fixed the proportion at 25% which is an attempt to balance the two competing considerations.
Otherwise, it seems appropriate that the assets and superannuation remain as presently situated. The wife will receive the funds in the controlled monies account so as to increase her access to presently available cash. After a separation of four years, the wife should retain the contents of the M property. The wife will also take the four specified cartoon cells, by the consent of the husband. I will make no orders in respect of the children’s bank accounts, as they are not yet of the age of legal capacity.

Conclusion

The assets and superannuation to be distributed to the husband are as follows:
Husband

1.

The W property

$850,000.00

2.

IAG Shares

$3,667.00

3.

Telstra Shares

$1,746.00

4.

Commonwealth Bank Account

$492.00

5.

50% W Farm Account

$1,624.00

6.

Toyota Motor Vehicle

$10,550.00

7.

Jewellery

$4,910.00

8.

Sports Memorabilia

$2,925.00

9.

Golf Equipment

$2,650.00

10.

75% Rapetti Superannuation Fund

463,132.00

Total

$1,341,696.00

The husband thus requires approximately $510,343.00 from the proceeds of sale of the M property to complete his entitlement. The figure constitutes approximately 35% of the net value of the M property.

The assets and superannuation to be distributed to the wife are thus as follows:
Wife

1.

IAG shares

$4,126.00

2.

Commonwealth Bank Account

$414.00

3.

Horse

$1,000

4.

Jewellery

$5,535.00

5.

Cartoon Cells

$420.00

6.

Wife’s superannuation

$40,428.00

7.

25% Rapetti Superannuation Fund

$154,377.00

Total

$206,745.00

The wife thus requires approximately $932,509.00 from the proceeds of sale of the M property, which equates to approximately 65% of its net value.

It should be remembered that the husband could sell his interest in the W property if he requires liquid funds. He is far less dependent than is the wife upon the sale proceeds of the M property for the purpose of rehousing.
In all of the circumstances, I regard this outcome as just and equitable. My orders will deal with the husband’s superannuation and the proceeds of sale of the M property in percentage terms.

I certify that the preceding one hundred and fifty one (151) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Stevenson delivered on 26 August 2011.

Associate:

Date: 25 August 2011

ASSETS
Title		Description	Wife’s value	Husband’s value
1	J	[… M Street, M]	$1,725,000	$1,725,000
2	H	[A Street, W] – 50% interest	850,000	850,000
3	W	IAG Shares (1221)	4,126	4,126
4	H	IAG Shares (1088)	3,667	3,667
5	H	Telstra Shares (600)	1,746	1,746
6	H	Commonwealth Bank Account	492	492
7	H	Commonwealth Bank Account – [W] Farm Account – 50%	1,624	1,624
8	W	CBA Bank Account #452	414	414
9	J	Macquarie Controlled Monies Account as at 31/3/10 – proceeds of sale of Horse [P] & sale of […] Proton motor vehicle	5,019	5,019
10	H	Toyota Motor Vehicle	10,550	10,550
11	J	Cartoon Cells – 4 that wife seeks to retain $nk - balance $nk	420	420
12	W	Horse (“[R]”)	1,000	1,000
13	J	Household contents	7,515	7,515
14	W	Jewellery	5,535	5,535
15	H	Jewellery	4,910	4,910
16	H	Sports Memorabilia	2,925	2,925
17	H	Golf buggy and golf clubs	2,650	2,650
18	W	Kia [motor vehicle]	Excl	Excl
Total		$2,627,593	$2,627,593

ADD-BACKS
Title		Description	Wife’s value	Husband’s value
19	H	Legal fees and disbursements paid and in trust	170,832	170,832
20	W	Legal fees and disbursements paid and in trust	51,064	51,064
Total		$222,436	$222,436

LIABILITIES
Title		Description	Wife’s value	Husband’s value
21	J	Personal Loan [Mr C] and [Ms N]	$287,488	$287,488
22	J	[Loan from Mr R and Ms P Rapetti]	0	380,994
23	W	Loan from [Ms K] to pay bankruptcy debt for horse vet	7,194	7,194
24	H	Commonwealth Bank Mastercard	Excl	Excl
25	W	Commonwealth Bank Mastercard	Excl	Excl
26	W	CBA personal loan (for car)	Excl	Excl
27	W	Personal loan from [Ms K] ($65,581) - in respect of legal fees - balance	50,081 15,500	50,081 0
28	J	Post separation payments by husband’s father re horses	Excl	Excl
29	H	Personal loan from [Ms F] (legal fees)	23,413	23,413
30	H	Personal loan from [Company 4] plus interest of 4% (legal fees)	30,000	30,000
31	H	Personal loan from [Mr M] ($35,662) - in respect of legal fees - balance (for school fees)	35,000 0	35,000 662
32	H	Personal loan from [Ms Y] (legal fees)	55,000	55,000
33	H	Personal loan from {Mr F] ($12,198) - in respect of legal fees - balance (for school fees)	4,500 0	4,500 7,698
Total		$508,176	882,030

SUPERANNUATION
Title		Name of Fund	Type of Interest	Wife’s value	Husband’s value
34	W	First State Super	$13,985	$13,985
35	W	ING Super	26,443	26,443
36	H	[O Pty Limited] (30.6.11)	Not incl tax	617,509	617,509
Total		$657,937	$657,937

SUMMARY
Description	Wife’s value	Husband’s value
Gross assets	$2,627,593	$2,627,593
Add-backs	222,436	222,436
Gross assets + add-backs	2,850,029	2,850,029
Liabilities	(508,176)	(882,030)
Net assets	2,341,853	1,967,999
Superannuation	657,937	657,937
Net assets and superannuation	$2,999,790	$2,625,936

“Rental receipts net per intervener’s Tax Returns exhibited to [Mr Rapetti Senior’s] Affidavit of 6 September 2010 (exhibit No. RR7 from page 40 to Page 127) Dec 1994 to 30 June 1995 Allow 7/12 of full year of $28,447	$18,851
1/7/95-30/6/96	$32,321
1/7/96-1/10/96 Allow 3/12 of full year of $31,543	$7,377
30/12/99-30/6/00 Allow 7/12 of full year $31,546	$18,403
1/7/00-30/12/00 Allow 6/12 of full year of $43,091	$21,540
$98,492
Total of $98,492 excludes cheques admitted by Wife at paragraph 104 of her Affidavit filed 24 August 2010	$90,517”

1.	The M property (J)	$1,725,000.00
2.	50% interest in the W property (H)	$850,000.00
3.	IAG Shares (H)	$3,667.00
4.	IAG Shares (W0	$4,126.00
5.	Telstra Shares (H)	$1,746.00
6.	Commonwealth Bank Account (H)	$492.00
7.	50% W Farm Commonwealth Bank Account (H)	$1,624.00
8.	Commonwealth Bank Account (W)	$414.00
9.	Macquarie Bank Controlled Monies Account (J)	$5,019.00
10.	Toyota Motor Vehicle (H)	$10,550.00
11.	Cartoon Cells (J)	$420.00
12.	Horse (W)	$1,000.00
13.	Household contents(J)	$7,515.00
14.	Jewellery (H)	$4,910.00
15.	Jewellery (W)	$5,535.00
16.	Golf clubs and buggy (H)	$2,650.00
17	Sports memorabilia (H)	$2,925.00
Total	$2,627,593.00

1.	Rapetti Superannuation Fund (H)	$617,509.00
2.	First State Super (W)	$13,985.00
3.	ING Super (W)	$26,443.00
Total	$657,937.00

1.	Loan from Ms N and Mr C (J)	$287,488.00
2.	Loan from Ms K (J)	$7,194.00
Total	$294,682.00

Husband	Wife
Superannuation (55% / 45%)	$361,865	$296,072
W property (75% / 25%)	$637,500	$212,500
Remaining Non-Superannuation Assets (62.5% / 37.5%)	$926,819	$556,092
Total	$1,926,184	$1,064,664

1.	The W property	$850,000.00
2.	IAG Shares	$3,667.00
3.	Telstra Shares	$1,746.00
4.	Commonwealth Bank Account	$492.00
5.	50% W Farm Account	$1,624.00
6.	Toyota Motor Vehicle	$10,550.00
7.	Jewellery	$4,910.00
8.	Sports Memorabilia	$2,925.00
9.	Golf Equipment	$2,650.00
10.	75% Rapetti Superannuation Fund	463,132.00
Total	$1,341,696.00