Rawlings and Rogers
[2014] FamCA 588
•30 July 2014
FAMILY COURT OF AUSTRALIA
| RAWLINGS & ROGERS | [2014] FamCA 588 |
| FAMILY LAW – PROPERTY – Final Orders – where one party resides in Country D – subject property overseas – where husband has been demonstrably uncooperative – where wife’s evidence to be preferred – marriage of 20 years duration - modest asset pool – where wife had primary care of the child following separation – where husband has failed to provide financial support – adjustment in favour of the wife. |
| Family Law Act 1975 (Cth) s 4, 75, 79 Agreement between the Government of Australia and the Government of the United Kingdom of Great Britain and Northern Ireland providing for the Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters, signed 23 August 1990, [1994] ATS 27 (entered into force 1 September 1994) |
| Bevan & Bevan (2013) FLC 93-545 |
| APPLICANT: | Ms Rawlings |
| RESPONDENT: | Mr Rogers |
| FILE NUMBER: | MLC | 8553 | of | 2013 |
| DATE DELIVERED: | 30 July 2014 |
| PLACE DELIVERED: | Melbourne |
| PLACE HEARD: | Melbourne |
| JUDGMENT OF: | Berman J |
| HEARING DATE: | 24 July 2014 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Glass |
| SOLICITOR FOR THE APPLICANT: | Womens Legal Service Victoria |
| COUNSEL FOR THE RESPONDENT: | Not applicable |
| SOLICITOR FOR THE RESPONDENT: | Respondent in person by Cisco Jabber Link from Country D |
Orders
In full and final settlement of any claim that either party may have against the other for settlement of property:-
(a)That within 60 days of the date of this order the respondent do pay to the applicant the sum of SEVENY NINE THOUSAND SIX HUNDRED AND EIGHTY ONE DOLLARS ($79,681);
(b)That contemporaneously with the payment of the said settlement sum in paragraph 1(a) hereof the applicant do all things and sign all documents necessary to transfer to the respondent at his expense all of her right, title and interest in the property situate at B Street, City C, Country D (“the City C property”);
(c)That contemporaneously with the payment of the settlement sum in paragraph 1 (a) or if required to enable the said payment to be made the applicant do all things and sign all documents necessary to transfer to the respondent at his expense all of interest in the three Co-operative endowment policies numbered ..., … and …;
(d)That in default of payment of the settlement sum as provided for in paragraph 1(a) hereof and should such default continue for a period greater than 30 days THEN the City C property shall be forthwith placed on the market for sale in the following manner:-
(a)That the property shall be listed for sale with such agents as the parties may agree and failing agreement the respondent is to select an agent within 7 days from the list of three agents as may be proposed by the applicant;
(b)The parties shall jointly instruct a solicitor who shall have the carriage of the conveyance as agreed between the parties and failing agreement with the respondent to select within 7 days an appropriate solicitor from a list of three solicitors as proposed by the applicant;
(c)In the event that the respondent fails to select an agent or solicitor within the time frame as specified THEN the applicant shall select an agent and/or solicitor from the list as proposed by her;
(d)That the terms and conditions of sale shall be mutually agreed between the parties or in the absence of agreement as may be nominated by the appointed agent for sale;
(e)The parties each cooperate in every way with the agent including (without limiting the generality of the foregoing):-
·Making the keys available to the agent
·Allowing the inspection of the property at all reasonable times requested by the agent
·Doing or saying nothing to hinder or prevent a sale being effected
·Ensuring the property including the grounds are in a neat and clean condition at the time of inspection by the agent and prospective purchases
·Signing all documents requested by the agent in relation to the listing for sale of the property; and
(f)Neither party may confer on any agent without the consent of the other party, any right to any sole or exclusive agency in respect of the property or to any commission.
(e)On settlement of the sale of property the proceeds of sale shall be distributed in the following manner and priority:-
(a)All costs and expenses of sale including agents and solicitors fees;
(b)The amount required to discharge the mortgage;
(c)The amount referred to in paragraph 1 (a) hereof together with default interest calculated at the rate of 8.5 per centum per annum from the date of default until the date of payment to the applicant; and
(d)The balance then remaining to the respondent.
(f)In the event that the applicant does not receive the full payment referred to in paragraph 1 (a) herein together with any default interest as may be calculated, the parties shall do all things and sign all documents as may be necessary to transfer to the applicant such shortfall from the Co-operative endowment policies and thereafter transfer to the respondent at his expense the balance of any said Co-operative endowment policies within 28 days of the settlement of the sale of the property;
(g) The parties do all things and sign all such documents necessary to close the joint ANZ Bank account BSB …, account number … and distribute any balance in that account to the applicant;
(h) That with respect to the respondent’ s superannuation for the purpose of these orders:-
(a)The respondent is the member spouse;
(b)The superannuation fund is J Super (hereinafter referred to as “the fund”;
(c)That these orders are binding upon the estate of both the parties, their heirs and executors and legal personal representatives;
(d)That pursuant to Section 90MT (1) (a) of the Family Law Act 1975 (Cth) whenever a splittable payment becomes payable in respect of the respondent’s interest in the fund, the applicant is entitled to be paid an amount calculated in accordance with Part VI of the Family Law (Superannuation) Regulations 2001 (Cth) using a base amount at the date of these orders in the sum of TWENTY THOUSAND DOLLARS ($20,000) and that there is a corresponding reduction in the entitlement that the respondent would have had in the fund but for these orders;
(e)That the preceding orders shall take effect from the operative time being four (4) days after service of these orders upon the trustees of the fund;
(f)That having been afforded procedural fairness these orders bind the trustee of the fund to observe the requirements of the Family Law Act 1975 (Cth) and the Family Law (Superannuation) Regulations 2001 (Cth);
(i)The respondent, his servants or agents be and are hereby restrained from doing any act or thing which would prevent the applicant from receiving the benefit in the fund to which she is entitled pursuant to these orders;
(j)In default of the parties or either of them doing all acts and things and executing all such documents as are necessary to give effect to these orders, a Registrar of the Family Court of Australia at Melbourne be appointed pursuant to Section 106A to execute all such documents in the name of the party in default and to do all such acts and things necessary to give effect and operation to the said orders;
(k)That unless specified in these orders and save for the purposes of enforcing any monies due under these orders:-
(a)Each party be solely entitled to the exclusion of the other to all superannuation and other property (including choses in action and personal chattels) owned by or in the possession of such party as at the date of these orders;
(b)Any monies standing to the credit of the parties in any bank account to be retained by the party in whose name the account appears;
(c)Insurance policies that remain in the sole property of the named owner;
(d)Each party to be liable for and indemnify the other against any liability including any credit card liability encumbering any item of property of which that party is entitled pursuant to these orders.
That all matters be removed from the Active Pending List of Cases.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Rawlings Rogers has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| FAMILY COURT OF AUSTRALIA AT |
FILE NUMBER: MLC 8553 of 2013
| Ms Rawlings |
Applicant
And
| Mr Rogers |
Respondent
REASONS FOR JUDGMENT
INTRODUCTION
By Initiating Application filed in the Federal Circuit Court of Australia on 3 October 2013, Ms Rawlings (“the applicant”) seeks orders for property settlement following a period of cohabitation with Mr Rogers (“the respondent”) spanning about 20 years.
The short history of the matter is as follows:-
1962 Date of birth of respondent
1965 Date of birth of applicant
October 1992 Date of commencement of cohabitation
9.12.2012 Date of final separation
There is one child of the relationship namely E born in 2004 (“the child”).
The applicant is employed in Melbourne, Victoria. The respondent has historically held the occupation of a tradesman and by his own admission now resides permanently in City C, Country D.
The proceedings also included orders sought by each of the parties in relation to the parenting arrangements in respect of the child.
Before the proceedings were transferred to the Family Court of Australia, consent orders were made by Judge Stewart summarised as follows:-
·That the mother have sole responsibility for the child
·That the child shall live with her
·That the child shall spend time and communicate with the respondent by electronic communication, written communication, by telephone and in terms of physical time as may be agreed between the parties
·That the mother will keep the father informed of significant issues that affect the child from time to time
Accordingly, the proceedings before me were confined to matters of property settlement.
The orders sought by the applicant in the Initiating Application were framed in general terms. They were better particularised in paragraphs 13 to 29 inclusive of a document entitled “Minute of Order Sought by Applicant Mother” being Annexure A to orders made on 23 July 2014.
The applicant seeks orders that the respondent pay her a settlement sum of $90,259 and contemporaneously with the payment of that sum she would transfer to him her interest in a property at B Street, City C, Country D (“the City C property”) together with three Co-Operative endowment policies which are linked to the City C property but perhaps more properly, the current mortgage. The applicant also seeks transfer of a splittable payment from the interest of the respondent in his J Super to her. Thereafter, each party would retain such other items of personalty and investment as shall remain in their possession and control.
In default of the payment of the said settlement sum the applicant seeks orders by default.
By reference to an Outline of Case document filed on behalf of the applicant on 17 July 2014, the basis for the orders sought would appear to be an adjustment of 70 per cent in favour of the applicant and the balance to the respondent.
The respondent does not appear to have filed a Response. However, no point has been taken and in the proceedings in the Federal Circuit Court of Australia he was permitted to file various documents including affidavit material and a financial statement.
On 14 July 2014 the respondent forwarded by email a document headed “proposal for property settlement”. This document is not intended to be a part of settlement negotiations but rather, is adopted by the respondent as the orders he seeks in these proceedings.
In summary, the respondent proposes that he pay the applicant $36,200 (£20,000) by way of a settlement sum and contemporaneously with the payment of that sum the applicant will transfer her interest in the City C property and the endowment policies to the respondent. Each party will keep their respective assets and investments currently in their possession and control, but it should be noted that the respondent intends in some way to hold the City C property on trust for the child and his two other children from a different relationship.
Without being precise and notwithstanding the generality of the orders sought by the respondent, the respondent’s position is that the property should be adjusted as to 60 per cent to him and the balance to the applicant.
PROCEDURAL HISTORY
The proceedings commenced by Initiating Application file in the Federal Circuit Court of Australia on 3 October 2013.
The matter was listed before Judge Stewart for final hearing on 23 July 2014. The respondent was given leave to conduct the proceedings from Country D. His attendance in Court was therefore not required. The Court was able to effect a video link with the respondent.
The respondent was unrepresented and before me was content to proceed notwithstanding his lack of representation. An application for an adjournment had been made before Judge Stewart, that application was refused and the respondent did not renew that application.
Following the conclusion of the parenting orders, there was apparently discussion between her Honour, counsel for the applicant and the respondent in relation to the assistance available to enforce any orders made by the Court by reference Australian Treaty Series 1994 No. 27 which came into force on 1 September 1994 in respect of the following, namely:-
Agreement between the Government of Australia and the Government of the United Kingdom of Great Britain and Northern Ireland providing for the reciprocal recognition and enforcement of judgments in civil and commercial matters (the 1994 Treaty).
As the title adequately describes, the purpose of the Treaty is to enable the Courts in Australia and the United Kingdom of Great Britain and Northern Ireland to recognise and enforce judgments and orders made in the reciprocal jurisdiction as if they were made in the subject jurisdiction.
Under the definition of “court of a party” there is reference made to the Family Court of Australia but not the Federal Circuit Court of Australia. Whilst there was no impediment to her Honour hearing the matter and making orders by way of settlement of property, given that it was at least possible that any order made by way of the payment of a settlement sum in favour of the applicant may need to be enforced in circumstances of default as against the City C property the enforcement of such an order may be more easily achieved if made by the Family Court of Australia.
Accordingly, following the making of the parenting orders, her Honour ordered that the proceedings be transferred to the Family Court of Australia for hearing. I was prepared to receive the transfer and listed the matter for final hearing on the following day namely 24 July 2014. The trial commenced and concluded on that day. The applicant was represented by solicitors and Mr Glass of counsel. The respondent appeared by video link as a self- represented litigant.
The trial proceeded with the applicant relying upon the following documents:-
·Initiating Application filed 3 October 2013
·Trial Affidavit filed 16 July 2014
·Financial Statement filed 4 March 2014
·Outline of Case document filed 17 July 2014
The respondent relied upon following documents:-
· The orders sought in paragraphs 13 to 29 in a Minute of Order being Annexure “A” to orders made 23 July 2014
·Affidavit filed 20 March 2014
·Financial Statement dated 6 November 2013 being Exhibit “R1” received by her Honour on 8 May 2014
In terms of the documents relied upon by each of the parties, the applicant’s trial affidavit annexes at “LFR6” a valuation report dated 18 June 2014 in respect of the City C property. The trial affidavit of the respondent is filed under cover of a letter from Thompson McPharlan Solicitor and Notary Public confirming that the affidavit of the respondent was properly sworn in front of Mr McPharlan pursuant to the appropriate rules of court.
The respondent was referred to the list of assets and liabilities as appear at points 4 and 5 of the Outline of Case document but are also mirrored in the applicant’s trial affidavit save for one item being monies being “monies held in trust-WLSV” which is included in the schedules in the outline document. For the purposes of the proceedings the Court, Mr Glass and the parties had reference to those schedules rather than as included in the trial affidavit.
At the commencement of the hearing the respondent was asked to confirm his acceptance, firstly of the identity of each particular asset as set out by the applicant and then, the value to be attributed thereto. The respondent was not prepared to accept the value of the City C property as £90,000 notwithstanding the valuation report because he considered that there should have been a range namely between £80,000 and £90,000 but he would accept £85,000. There was no acceptance of that proposition or proposal by the applicant. The respondent further considered that whilst he had no disagreement with the identity of the other assets and the values ascribed to them as set out by the applicant, he considered that it was possible that the applicant may have possessed or currently possesses accounts which were not the subject of disclosure by her.
Following upon some initial opening remarks by Mr Glass and a response from the respondent, the proceedings commenced with evidence from the applicant and cross examination by the respondent. At the close of the applicant’s case, the respondent gave evidence and was cross examined by Mr Glass of counsel. The evidence was thereby concluded and there was generous leave given to both Mr Glass but in particular the respondent to make final submissions and a reply.
BACKGROUND
The parties met in December 1990 in City C Country D. It is agreed that they commenced cohabitation in October 1992. At the time of the commencement of cohabitation, the parties were each possessed of minimal assets. The applicant was an administrative assistant with the City C Council. The respondent was employed as a tradesman. They each received income of a similar amount.
In 1996 the parties purchased the City C property. A deposit was paid from the joint savings of the parties and the balance by way of a mortgage. Whilst there was some initial uncertainty as to the manner in which the parties held the property, it is now agreed that they are joint registered proprietors. The parties remained in the City C property until their relocation to Australia in November 2007. The City C property was thereafter rented to third parties. It is acknowledged by the applicant that she was responsible for the management of the property and to that end, an account was set up jointly with her mother Ms F Rawlings with the Halifax (“the Halifax account”). This arrangement enabled the applicant’s mother to manage the property from Country D and to access the account in relation to property related expenses. At paragraph 99 of the applicant’s trial affidavit she sets out the usual expenses that are paid from the Halifax account. It is noted that in addition to the property outgoings, payment is also made to maintain three Co-operative endowment policies which are linked to the City C property. At trial there was some uncertainty as to whether these endowment policies can be dealt with separately or whether they follow the fate of the property. There was further uncertainly as to what will happen to the policies if the City C property was sold. Ultimately, the respondent deferred to the applicant’s better knowledge of the matter and it is her position that if the property is sold the mortgage will be discharged from the net proceeds of sale leaving the three endowment policies with what is effectively their separate surrender value.
Given that it is the common approach of the parties that the applicant is prepared to transfer her interest in the City C property to the respondent subject to the payment of an appropriate settlement sum, it is also conceded that the endowment policies should follow the property.
From time to time there would be surplus funds in the Halifax rental account. The parties would on occasion access the Halifax rental account for personal and other expenses.
Following the relocation of the family to Australia, the applicant obtained employment as a customer service representative. The respondent worked as a tradesman.
The parties purchased a property at G Street, Suburb H by utilising monies from savings and the Halifax account together with a substantial mortgage. The relationship between the parties was acrimonious. Following separation on 9 December 2012 the applicant remained in the Suburb H home with the child. She obtained a family violence intervention order against the respondent and without warning, on 12 December 2012 the respondent returned to Country D. His position is that he does not intend to return to Australia.
The applicant alleges that following the separation the respondent was demonstrably unco-operative. On his departure, the respondent drove his motor vehicle to the airport and simply handed the keys to a stranger with an advice that the stranger could keep the car. Ultimately, the motor vehicle found its way back to the applicant but thereafter the respondent refused to transfer the registration. Ultimately the car was sold in February 2014 for an amount significantly less than its proper value, because by then it was unregistered and in a state of disrepair.
In January 2013 the applicant sought the consent of the respondent to sell the Suburb H property. She was not able to keep up with the mortgage payments and there were difficulties with her ability to negotiate with the bank to put in place hardship provisions. I am satisfied that the respondent was aware of the applicant’s request but for reasons not explained by him either ignored the applicant’s request or was not prepared to be co-operative.
Ultimately, it was only by way of order of this Court made 3 December 2013 that enabled the said property to be sold with the balance of the net proceeds of $18,213.25 being held in the trust account of the solicitors that were involved in the conveyance of the property.
DISCOVERY AND DISCLOSURE
The respondent has been critical of the applicant in that he alleges she has failed to discover and/or provide documents, but in particular bank statements, in relation to various accounts which he says have not been properly disclosed by the applicant. In particular he refers to an account into which monies were paid by way of child endowment for the child.
At paragraph 14 of his affidavit filed 21 March 2013 the following is stated:-
[14]On the evening of 9 December 2012 I was looking through paperwork as I had suspicions that [Ms Rawlings] was moving money out of our joint bank account. I asked her where certain paperwork was and she told me that if I did not leave it alone she would call the police. I said I could f****g kill you for what you have done to us.
This was said in anger and frustration. She stood around for 20 minutes calmly with the phone in her hand threatening to phone the police. Eventually I threw the paperwork folder to the ground and she phoned the police…
In the trial affidavit of the wife she responds to the allegations of the respondent in the following manner:-
[108]I deny that I have not provided full and frank disclosure of my financial position My financial position has been set out in the financial statements filed by me and my affidavit.
[109]I deny that [Mr Rogers] was unaware of the ANZ accounts. [Mr Rogers] took all of the documentation regarding the accounts when he left Australia. [Mr Rogers] was also present at the bank when the accounts were opened as we both had to provide the 100 point check list.
[110][Mr Rogers] has continued to claim that he has evidence that I have a Lloyds bank account. [Mr Rogers] produced to my lawyers a statement that was “his evidence” of this account. Now produced and shown to me and marked LFR7 is a copy of the statement. I reiterate that I have never held an account with Lloyds. At a loss to explain the reference to Lloyds on the statement I made further investigations. I discovered that the Halifax became a part-Lloyds bank in 2009. I confirm that this transfer of funds was in respect of the purchase of the former matrimonial home referred to in paragraph 64 above. I am told and verily believe that my lawyers explained the reference to Lloyds bank in a letter to him dated 1 July 2014.
[111]I deny that I currently or have ever had a Bank of [Country D] account.
I had the advantage of seeing the parties give their evidence and in particular the cross examination of the applicant by the respondent on the topic of undisclosed bank accounts.
At the conclusion of the evidence, I was satisfied that the applicant’s explanation was credible and comprehensive. Importantly, the respondent throughout the proceedings was prepared to concede that he had little knowledge of the day to day finances of the parties but rather, the respondent had been in control. The manner in which the various accounts were managed, the appropriate explanation by the applicant and the clarity of her evidence leaves me in little doubt that on this topic her evidence is to be preferred.
Accordingly, I am not persuaded that there has been any non-disclosure by the applicant of bank accounts, nor is there any evidence to support an allegation that she has misappropriated the funds of the parties. I consider that the evidence supports the applicant’s contention namely, that in the difficult circumstances of this relationship the applicant did the best that she could to manage appropriately the parties finances and did so to good effect taking into account the limited financial means available.
LEGAL PRINCIPLES TO BE APPLIED
“Property” is defined in Section 4 of the Act as meaning property to which those parties are, or that party is, as the case may be, entitled, whether in possession or reversion.
Prior to the considerations of Section 79 (2) of the Act by the High Court in Stanford v Stanford (2012) 247 CLR 108, “the preferred approach” is best encapsulated in the approach adopted and endorsed by the Full Court in Hickey & Hickey & Attorney General for the Commonwealth of Australia (2003) FLC 93-143 namely, what has commonly been referred to as “a four step approach”. In summary, after the determination of the pool of assets, the focus of the Court then turns to the contributions of the parties, the factors that may be relevant and referred to in Section 75 (2) and then a consideration of whether the orders are in all the circumstances just and equitable.
In Hickey (supra) there was not a close examination of Section 79 (2) in terms of whether it was just and equitable to make any order. The position in respect of the proceedings before me is different. The parties seek orders that would see a transfer of the applicant’s interest in the City C property to the respondent and in default of the payment of a contemporaneous settlement sum the said property may need to be sold.
Other property, in particular the endowment policies, also require the transfer of the applicant’s interest to the husband.
Ultimately I come to the view that the parties are agreed that Section 79 (2) of the Act is satisfied and that it would be just and equitable to embark upon an exercise that would see an adjustment of property. To consider otherwise would be to make a nonsense of the orders sought by each of the parties in their application and the responding orders sought.
In Stanford the majority held:-
[35]It will be recalled that Section 79 (2) provides that “the Court shall not make an order under this Section unless it is satisfied that, in all of the circumstance it is just and equitable to make the order”. Section 79(4) prescribes matters that must be taken into account in considering what order (if any) should be made under this Section. The requirements of the two sub-sections are not to be conflated. In every case in which a property settlement order under Section 79 is sought, it is necessary to satisfy the Court, that in all the circumstances, it is just and equitable to make the order.
[36]The expression “just and equitable” is a qualitative description of a conclusion reached after examination of a range of potentially competing considerations. It does not admit of exhaustive definitions. It is not possible to chart its metes and bounds.
Importantly, the Court found:-
Whether it is just and equitable to make the order is not to be answered by assuming that the parties rights to all interests in marital property are or should be different from those that then exist.
It is therefore not a matter of assumption that a party to a marriage has a right to an interest in property by reference to matters arising under Section 79 (4). A party cannot pull themselves up by their own boot straps by asserting a contribution under Section 79 (4) and therefore use that position to satisfy the obligation created by 79 (2).
A Court has an obligation to consider the justice and equity of making any order that adjusts the property rights of the parties, I do not consider that Stanford goes so far as to suggest that there can be no regard to the very matters that might fall for consideration under Section 79 (4). It is the very nature of the suite of contributions made by the parties to a marriage which in and of themselves have the ability to create equitable interests in the property of each of them.
In Bevan (2013) FLC 93-545 the majority of the Full Court said (in relation to the previously quoted paragraph in Stanford):-
[70]In our experience the circumstances described in the paragraph above encapsulate the vast majority of cases. Hence the reminder in Stanford of the pivotal role of Section 79 (2) is unlikely to have any impact in most cases, although it will serve as a reminder to trial judges that the precondition to making any order is a finding that it is just and equitable to do so.
Accordingly, and by reference of the decisions of Bevan and Stanford, there are three “fundamental propositions”:-
(1)A Court needs to consider the existing property interests of the parties and to identify those interests (by reference to common law or equity);
(2)The direction must be exercised in accordance with legal principles and not in respect of any assumption that the parties interests should be different from those determined by common law equity; and
(3)Section 79 (2) cannot be conflated by reference only to matters in Section 79 (4).
LEGAL AND EQUITABLE INTERESTS OF THE PARTIES
The period of cohabitation is 20 years. Throughout the course of the relationship both parties were in full time or part-time employment. The financial resources of the parties were pooled in order to assist the provision of some measure of financial security and asset accumulation over the long relationship.
Against the backdrop of a long period of cohabitation in circumstances where the parties have made a mutual commitment to each other, it would be unconscionable to suggest that each of the parties did not uphold a significant and substantial and equitable interest in the property of the other.
I am satisfied that having regard to Section 79 (2) of the Act it is just and equitable to adjust the property interests of the parties. I consider that such an outcome is an inevitable consequence of the proper application of principles arising from Stanford and I come to the decision independently of any consent, tacit or otherwise of the parties that there should be an adjustment of property interests.
SUPERANNUATION
The applicant has an entitlement to superannuation with J Super in the sum of $13,289. The respondent has an entitlement with the same fund in the sum of $23,996.
The applicant seeks an order by way of a superannuation split in the sum of $20,000 from the respondent’s superannuation entitlement. To that end the solicitors for the applicant have helpfully provided a draft order to the trustees of J Super on 6 June 2014. The draft order and the supporting correspondence is Exhibit 2 in the proceedings. There has been no response and accordingly, I am entitled to assume that procedural fairness having been properly afforded to the trustees they are content for the proposed order to be made and do not wish to be heard.
I consider in the circumstances of this case where the superannuation interests of the parties are modest and that each of them propose a superannuation split that it is appropriate to depart from the approach promoted by the Full Court in Hickey & Hickey (2002) FLC 93-143 and Coghlan & Coghlan (2005) FLC 93 -220 both treating the superannuation entitlements of the parties “as if they were assets” and to include the wife’s entitlement in a global approach to the respective interests of the parties in their separate and joint property.
LIST OF ASSETS AND LIABILITIES
Real Estate
At the outset of these reasons I noted the dispute as to the value of the City C property. The respondent alleges that by the applicant adopting the valuation sum of £90,000, that figure represented the high end of the range. The respondent has formed the view that the property has a value of somewhere between £80,000 and £90,000 and he would concede £85,000 as an appropriate value and compromise. He does not put forward any separate or independent evidence and there is no suggestion of real challenge to the valuation of the City C property as appears as Annexure LFR6 to the trial affidavit of the applicant.
There was no request for the cross examination of the valuer and ultimately I am left with the valuation report which sets out apparently appropriate valuation criteria and is ultimately unequivocal in the assessment of the value of the property.
In the absence of agreement, I consider that it is appropriate to bring to account the City C property at £90,000. or $158,005.
In respect of all other property of the parties they are in complete agreement.
Accordingly, the parties hold the following assets and liabilities.
Applicant
| Proceeds of sale of former matrimonial home (joint) | 18,213 |
| ANZ joint account (applicant) | 747 |
| ANZ account ( applicant) | 45 |
| motor vehicle (applicant) | 5,000 |
| Proceeds of sale of respondent’s car (applicant) | 300 |
| J Super | 13,289 |
| Furniture and effects (applicant) | 5,000 |
| Monies held in trust – WLSV (applicant) | 4,000 |
| Hallifax bank account (applicant) | 3,073 |
| TOTAL | $49,667 |
Respondent
| City C property | 158,005 |
| Joint Co-operative endowment policy … (joint) | 22,027 |
| Cooperative endowment policy … (joint) | 15,110 |
| Cooperative endowment policy … (joint) | 15,110 |
| J Super | 23,996 |
| TOTAL | $234,248 |
Liabilities
| Hallifax rental bond | 877 |
| Hallifax mortgage | 69,682 |
| TOTAL | $70,560 |
| NET TOTAL | $213,355 |
CONTRIBUTIONS
Section 79 (4) (a) – Financial Contributions.
The relevant period of cohabitation is about 20 years. There is one child of the marriage. The parties agree that at the commencement of their cohabitation they came into the relationship with assets of modest value only. Thereafter, each of the parties were employed for varying periods and contributed their income. Both parties undertook substantial effort in order to make adequate financial provision for the family. The parties were generally in continuous employment save and except for those periods when the applicant was not employed but rather, took on the homemaker role in terms of the proper care arrangements of the child.
Section 79 (4) (b)
I am satisfied during the course of the relationship that the parties each contributed non-financially to their property.
Section 79 (4) (c)
I am in no doubt that the respondent undertook the bulk of the care arrangements in respect of the child and whilst it could be said that up to the time of separation the parties had put in place appropriate arrangements by which the household would function, the parties would maintain their employment and the necessary care arrangements would be undertaken for the child, that could not be said following separation.
The respondent left Australia on 12 December 2012 without any effective warning or advice to the applicant. He did so in circumstances which were either intended to cause distress to the applicant, or he was wilfully blind as to the effect of his conduct. The applicant as and from the date of separation was solely responsible for the care and parenting of the child in circumstances where she received no financial assistance or contribution from the respondent. If anything, the somewhat contrary behaviour of the father in terms of his motor vehicle and the difficult position he adopted in respect of the sale of the former matrimonial home did nothing to assist the applicant but rather, had the effect of exacerbating what was already a demonstrably poor financial situation.
No evidence was presented to me as to the direct financial impact of the respondents not making any financial contribution to the applicant for the child, but nonetheless it would have been significant and it is a factor which must be brought to account and given substantial weight.
I consider it appropriate to reflect on whether there is any residual significance attached to the “four step approach” to property settlement. Whilst I do not consider that there remains any validity to a formulaic approach to property settlement, nonetheless in an appropriate case it is permissible to have regard to and determine the weight to be given to factors reflecting the respective contributions of the parties and the relevant Section 75 (2) factors.
In Bevan & Bevan [2014] FLC 93-572, in his written submissions, senior counsel for the husband said:-
[16]The adoption of the above [four step] approach is not intended to pre-suppose a positive answer to the question imposed by Section 79 (2), nor to suggest that it is an appropriate approach in all proceedings. Rather and provided that the fundamental proposition outlined by the High Court in Stanford (2012) 293 ALR 70 are not obscured…, such approach is intended to and does no more than provide a principled, disciplined and structured means by which all of the matters arising for consideration pursuant to Section 79 can be conveniently and properly identified and assessed.
[17]Further, and whilst not said critically, nor in a manner which seeks to cavil with the decision in this Appeal, neither approach to the determination emerges readily from either Stanford nor the decision in this Appeal. It is respectfully submitted that provided the “fundamental propositions” articulated in Stanford are not obscured, and whilst not universally so as has always been recognised, the approach set out above continues to provide a proper, transparent, and certain approach to the presentation and determination of applications pursuant to Section 79.
At paragraph 19 in commenting on the written submissions, the Full Court said:-
We have no issue with what senior counsel have said about the utility of the four step process, which we accept provides a convenient way to structure both submissions and judgment, provided that the caveat mentioned is not overlooked.
Accordingly, and taking into account the various contributions of the parties and relevant contribution factors, I consider that I should give weight to the significant contribution made by the applicant post-separation in respect of the care of the child in the absence of the respondent and the entire lack of any financial support provided by the respondent. I consider there should be an apportionment of 55/45 in favour of the applicant.
SECTION 75 (2) FACTORS
The applicant is 48 years of age. The respondent is 51 years of age. the child is solely dependent upon the applicant. The respondent resides in Country D and has no intention of returning to Australia.
The mother is in fulltime employment but receives a modest income. The respondent is not currently employed but says that within some few weeks following the conclusion of these proceedings he anticipates being able to find employment and he expects thereafter to be in a position to contribute towards the financial arrangements of the child.
The issue of the preparedness and likelihood of the father’s ability to make a financial contribution for the child was a matter of some focus. The respondent was asked directly what he proposes to do and what matters he could put to the Court which might satisfy me that he was genuine in his intention to find employment and commence the provision of financial support in circumstances where he has not been able to do so or has chosen not to do so since separation in December 2012.
The father put forward no medical, psychological or psychiatric evidence which would support the contention that he was not able to work. Furthermore, there was nothing to suggest that given his current circumstances in some way his ability to find and retain employment is likely.
The father did not impress me that he had any intention of making a financial provision for the child. His behaviour towards the applicant in respect of the manner in which he dealt with the motor vehicle and the former matrimonial home could not be taken as an indicator of goodwill.
On the balance of probabilities I consider it likely that the respondent will make no financial provision for the child and that his ongoing and future care both physically and financially will fall entirely to the applicant.
Whilst it is difficult to quantify the cost of the child’s future care it is likely to be significant if extrapolated over a 7 year period.
In the circumstances I propose to make a further adjustment of 15 per cent in favour of the applicant.
CONCLUSION
Accordingly the entitlements of the parties in respect of matrimonial property held jointly and severally should be adjusted on the basis of 70 per cent of the total combined pool (including the superannuation entitlements of the parties) to the applicant and 30 per cent to the respondent.
Of a total pool of $213,355, the wife should retain $149,348.
If the applicant retains the following:-
Proceeds of sale 18,213
ANZ account (joint) 747
ANZ personal account 45
Motor vehicle 5,000
Proceeds of sale of car 300
Furniture and effects 5,000
Trust monies in solicitors trust account 4,000
Hallifax Bank 3,073
J Super 13,289
TOTAL $49,667
In addition, the wife is to receive $20,000 by way of a superannuation split. She would receive property and superannuation entitlement to the total sum of $69,667.
The applicant is therefore entitled to a settlement sum payable by the respondent in the sum of $79,681.
It is difficult to determine the ability of the respondent to pay the settlement sum and in particular the time that should be allowed for this to occur. In evidence, the respondent did say that he had the support of his family and if he was able to negotiate the surrender of the endowment policies it is reasonable to conclude that he should be able to effect settlement, particularly if he returns to the work force as he anticipates he is capable of doing.
The disparity between the parties is 40 per cent which equates to a notional sum of $83,542. I consider in all of the circumstances this is a reasonable reflection of the expenses that are likely to be incurred by the applicant in respect of the care of the child in the anticipated absence of any child support or financial support to be paid by the respondent.
In Waters & Jurek (1995) FLC 92-635 Fogarty J at page 82,376 said:-
In the majority of property cases little difficulty is encountered in the contribution step and increasingly in the general run of cases the conclusion is likely to be one of equality or thereabouts. There is no doubt that the centre of gravity in the determination of property cases has, especially in more recent times, moved to the evaluation of the Section 75 (2) factors, and the significance of that has been heightened because of recent Full Court decisions which have emphasised those provisions and indicated that they should be given real rather than token weight.
As was said by Wilson J in Mallet v Mallet (1984) FLC 91-507 at page 127:-
The objective of the section is not to equalise the financial strengths of the parties, it is to empower the Court, following a dissolution of marriage to effect a redistribution of the property of the parties if it be just and equitable to do so.
In the circumstances of this case, I am satisfied that a proper reflection of the weight that needs to be given to the relevant factors pursuant to Section 75 (2) but in particular those factors that related to the ongoing physical and financial care of the child by the applicant properly reflected in the orders that I make.
Orders will be made as set out at the commencement of these reasons.
I certify that the preceding ninety one (91) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Berman delivered on 30 July 2014.
Associate:
Date: 30 July 2014
Key Legal Topics
Areas of Law
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Family Law
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Equity & Trusts
Legal Concepts
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Remedies
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Procedural Fairness
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Injunction
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Costs
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Fiduciary Duty
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Constructive Trust
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