Reese-Agius and McKenzie

[2007] FamCA 1114

FAMILY COURT OF AUSTRALIA

REESE-AGIUS & MCKENZIE [2007] FamCA 1114

FAMILY LAW – PROPERTY – Settlement in relation to marriage

Family Law Act 1975 (Cth)

APPLICANT: Ms Reese-Agius

RESPONDENT: Mr McKenzie

FILE NUMBER: BRF 16249 of 2005

DATE DELIVERED: 29 June 2007

PLACE DELIVERED: Brisbane

JUDGMENT OF: Barry J

HEARING DATE: 12 and 13 March 2007

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Theobald of Counsel

SOLICITOR FOR THE APPLICANT: Egan Simpson Solicitors

COUNSEL FOR THE RESPONDENT: Mr Priestly of Counsel

SOLICITOR FOR THE RESPONDENT: KL Legal Solicitors

Orders

Draft Orders at conclusion of Reasons for Judgment.

IT IS NOTED that publication of this judgment under the pseudonym Reese-Agius & McKenzie is approved under s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT LISMORE

FILE NUMBER: BRF16249 of 2005

MS REESE-AGIUS

Applicant

And

MR MCKENZIE
Respondent

REASONS FOR JUDGMENT

Orders Sought by Wife

1. I am asked to determine property settlement issues as between the parties.  The Wife’s Amended Application was filed on 17 May 2006.  In that document she seeks Orders as follows:

   “(1)That the Husband transfer to the Wife within 30 days of the date of Order all his right, title and interest in the former matrimonial home [the C property] .

   (2)That the Husband pay to the Wife the sum of $84,078 within 30 days of the date of Order.

   (3)That within 30 days of the date of Order the Husband discharge the parties’ liability to the [B] Building Society and further that he do indemnify the Wife in respect of all monies due and owing (sic) relation thereto.

   (4)In the event that the Husband fails to make the payment due to [B] Building Society or the payment to the Wife in accordance with Paragraph 2 herein then it is noted that the following provisions shall apply in respect of the Husband (sic) DFRDB Super:

   i.This Order shall be binding upon the Trustee namely the Defence Force Retirement and Death Benefits Authority;

   ii.The base amount allowed to [the wife], out of the interest held by [the husband] payable under the Defence Force Retirement and Death Benefits Scheme is 50% of the total pension payable to [the husband] or any reversionary beneficiary.

   iii.That whenever the Trustee of the Defence Force Retirement and Death Benefits Scheme (DFRDB) makes a splittable payment under the Defence Force Retirement and Death Benefits Scheme to [the husband] the Trustee shall pay [the wife] the entitlement calculated in accordance with Part VI of the Family Law Act (Superannuation) Regulations 2001, and make a corresponding reduction in the entitlement [the husband] would have had but for these Orders.

   iv.This Order has effect from the operative time which is 5 working days after the service of the Order upon the Trustee.

   (5)That otherwise the Husband retain all other property presently in his possession to the exclusion of the Wife.

   (6)That the Wife retain all other property presently in her possession to the exclusion of the Husband.

   (7)      Such other Orders as this Honourable Court deems fit.”

2. The parties are agreed on the value of the various assets.  The C property is valued at $400,000.  The mortgage liability is $50,000.  The Wife has a superannuation policy of $50,000 and the Husband has an AMP superannuation policy of $30,000.

3. The Husband is in receipt of a Defence Force Retirement and Death Benefits Scheme (DFRDB) payment.  It can only be received as a periodic payment.  It has been valued by consent at just under $320,000. 

4. The effect of the above Orders sought by the Wife is that she wishes to retain the house with the Husband to be responsible for the mortgage liability.  She would retain her $50,000 superannuation interest and a $5,000 motor vehicle.  The Husband would retain the whole of his DFRDB entitlement together with his $30,000 superannuation and a $10,000 motor vehicle.  The Husband would pay her $84,078.

5. In the course of closing submissions I was informed by Counsel for the Wife that she did not press for payment of the sum of $84,078 nor did she press for the payment of the mortgage.

Orders Sought by Husband (Refer Amended Response Filed 9 June 2006)

1. Orders as follows:

   “(4.1)The Husband and Wife are to immediately list for sale by auction the former matrimonial home known as [the C property] at a reserved price to be agreed between the parties but failing agreement to be at the market value price as appraised by Registered Valuers known as [D] Australia.

   (4.2)The parties shall appoint a real estate agent to auction the property but failing agreement on the nominated agent, the parties appoint the [P] Real Estate Agents at [K] as the auctioneers for the sale of the former matrimonial home.

   (4.3)The auction must take place within 4 months of the date of the making of these Orders.

   (4.4)If the former matrimonial home is not sold at auction, the property must be re-listed for a second auction within 3 months of the date of the first unsuccessful auction and the property will then be auctioned at a “no reserve” price.

   (4.5)From the proceeds of the sale of the former matrimonial home the following shall be paid:

   A.all rates, taxes and charges assessed against the former matrimonial home;

   B.any mortgage encumbering the former matrimonial home;

   C.all commissions, legal expenses and costs associated with the sale of the former matrimonial home;

   D.all commissions, legal expenses and costs associated with the sale of the former matrimonial home;

   E.all jointly owned loans.

   (4.6)The net proceeds be divided by way of property settlement:

   a.62.5% to the Wife;

   b.37.5 to the Husband.

   (4.7)Each party shall be solely entitled to, to the exclusion of the other, to all other money, property (whether real or personal) and chattels of whatever nature in the possession, control or ownership of that party at the date of execution of these Consent Orders and for that purpose, bank accounts are deemed to be in the possession of the person whose name appears on the bank, credit union or building society accounts are deemed to be in the possession of the person whose name appears on those accounts and any superannuation or superannuation/life policies are deemed to be in the possession of the person who is named as the person whose age or working future provides the condition for payment of those entitlements.

   (4.8)Each party indemnifies the other against any debts incurred by him or her after the date of separation.”

2. When allowance is made for superannuation interests, motor vehicles and various liabilities the effect of the Orders sought by the Husband on my calculations is that he would receive approximately one third of Pool A being the house, cars and superannuation funds and retain the whole of Pool B.

3. During the course of the hearing Counsel for the Husband handed up a further document entitled “Orders Sought”.  That document provided:

   1.That upon:

   1.1The Wife refinancing in her own name the mortgage debt to [B] Building Society; and

   1.2Payment by the Wife to the Husband of the sum of $134,393 (hereafter the “ordered sum”).  The Husband transfer to the Wife all his right, title and interest in the property known as [the C property].

   2.That in the event that the ordered sum is not paid on or before 12 June 2007, orders 4.1 and 5.6 set out in the Husband’s Amended Application have effect.”

   Those Orders provide for the sale of the property with the proceeds to be distributed 62.5% to the Wife and 37.5% to the Husband.

4. In the event the Wife was to pay the Husband the sum of $134,393 the Husband would receive approximately 38% of Pool A and retain the whole of Pool B.  The calculations made in arriving at this conclusion are as follows:

   Payment by Wife pursuant to Orders sought  $134,393

   Husband retains motor vehicle  $  10,000

   Husband retains superannuation  $  30,000

   Total  $174,393

   Husband has paid or is continuing to pay whole of

   credit card debt   $   7,500

   Balance  $166,893

   $166,893 as a percentage of $437,500 is $38%.

Property Pool

1. The parties are agreed that the property should be divided into Pool A and Pool B.  The parties are agreed on the values to be attributed to both pools.

   Pool A

   The C property   $400,000

   Husband’s car  $  10,000

   Wife’s car  $    5,000

   Wife’s superannuation  $  50,000

   Husband’s AMP superannuation  $  30,000

   Total  $495,000

   Less credit card liabilities, Virgin  $     7,500

   Less owing on mortgage  $   50,000

   Net assets Pool A  $437,500

   Pool B

   Husband’s superannuation (refer valuation of Mr S)  $334,506

   Less reversionary portion of valuation  $  15,355

   Net value of Husband’s superannuation income stream  $319,151

2. The valuation of Mr S is annexure L to the Wife’s affidavit filed 9 August 2006.

3. I note that the date of Mr S’s valuation is 8 June 2005.  I would have thought an updated figure would reveal the pension is now worth a lesser sum two years after the original valuation.

4. I am unable to estimate what the reduced value would be and proceed on the basis the parties have agreed I am to value Pool B at $319,151.

Agreed Facts

1. Cohabitation commenced in approximately 1990 or 1991.  The Husband says May 1991 and the Wife 1990.  The parties married in May 1993 and separation occurred in April 2005.  The Decree Absolute issued on 12 August 2006.  Notwithstanding the fact the parties are now divorced for the sake of convenience I shall continue to refer to them as the Husband and Wife.  The Wife is the natural parent of the child M born December 1989, a child from her previous marriage.  The parties are the biological parents of a son, J born April 1994.  J remains in the care of the Wife but sees his Father on a regular basis.  The child M was a child of the household at all relevant times prior to separation.

2. The Wife was born in November 1961 and the Husband in September 1963.  The Husband joined the Defence Force in April 1981.  According to the Wife she commenced contribution to the First State superannuation in her name in 1983.  The Husband asserts that these contributions did not commence until 1986.  Annexure I to the Wife’s affidavit filed 9 August 2006 is the Member Benefit Statement for the period 1 July 2004 to 30 June 2005.  That reveals the Scheme Entry Date as 13 January 1993 and the Eligible Service Start Date as 10 September 1986.  It is possible that the Wife’s assertion that she commenced contribution in 1983 was a typographical error for 1993 but if it was such then the error was at no stage corrected. 

3. In late May 1991 the Husband was discharged from one Defence Force sector and on the following day enlisted in another Defence Force sector.  He ceased work with the Defence Force in 2000 and commenced long service leave prior to resignation.

4. In July 2003 the Husband resigned from the Defence Force.

5. The parties present conflicting versions as to the dates various events happen.  One obvious example is the amount of time that the parties separated around 1998. 

6. The Husband’s affidavit reveals he is very precise in the dates that he provides.

7. As to the date of commencement of cohabitation I note the Wife says in paragraph 11 of her affidavit filed 9 August 2006:

   “11.When I first down to [W] to set up house with [the husband] I had initially stayed with my brother for a couple of weeks until I could find a unit for [the husband] and I.”

8. In paragraph 7 of his affidavit the Husband says:

   “7.In about April 1991 [the wife] and [the child M] moved to [W] to live with her older brother, [Mr R], until [the wife] obtained employment at [N] Hospital.  At this time I sent [the wife] some money (approximately $300) to purchase two wardrobes and some other furniture to furnish her new flat.” 

   The Husband’s evidence I find is likely to be more accurate as to the date cohabitation commenced.

9. It is common ground that the reversionary benefits of $15,355 in the calculations of the capital value of the Husband’s pension be deducted.  The Husband has not re-partnered and is insistent that he will not.  In any event it is submitted even if he did re-partner having regard to the principles enunciated by the Full Court the interest in the reversionary benefit would not be his property.

10. It was also common ground that I should disregard any legal consequences of Consent Orders for property settlement entered into by the parties in November 1998 in the Local Court at T.

Period of Cohabitation Relative to Husband’s Period of Service in the Defence Force

1. The Husband commenced service in the Defence Force in April 1981.  His resignation took effect from July 2003 a period of just over 22 years.  According to the Husband the relationship did not commence until May 1991 which means he effectively had served ten years to that point in time. 

2. On balance I am inclined to accept the Husband’s assertion that the parties separated in December 1997.  He is particular as to time and place.  The Wife’s evidence is far more vague.  As to the length of separation I note that Consent Orders for property settlement were filed in November 1998 at the T Local Court.  This would again appear to be corroborative of the Husband’s account of events if as I have assumed his date of the time of separation is correct.

3. The Husband says that the parties were separated for a period of approximately 19 months from December 1997 until October 1999.  The Wife says that the period of separation was only some six months.  On balance I prefer the Husband’s version of the period of separation as being more precise and not challenged in any way.

4. In the whole of the circumstances I am inclined to the view that the period of cohabitation represents approximately 50% of the Husband’s period of service in the Armed Forces.

Witnesses

1. The only witnesses in the case were the Wife and the Husband.  Each party was represented by Counsel experienced in family law matters.

2. Each party relied on a series of medical reports.  Those reports were not the subject of any challenge.

DJ & AJ

1. Counsel for the Husband placed great reliance on the recent decision of DJ v AJ a 2006 decision of the Full Court (Bryant CJ, Finn and Coleman JJ). 

2. In that case the Husband and the Wife were both 55 years of age.  Cohabitation had been for a period of some 27 years.  The Husband had retired from his occupation as a teacher through ill health and was in receipt of a pension of $52,000 a year.  That pension had been valued in accordance with the regulations at $864,000.  At the time of trial the Wife worked and was in receipt of $40,000 per year.  The non-superannuation interests had a net value of about $380,000.

3. At trial his Honour assessed the Wife’s contributions to the non-superannuation interests at 59%/41% in favour of the Wife.  The difference was explained by the greater valuer contributed from an inheritance by the Wife.

4. Counsel for the Husband relied on a passage in the Judgment at paragraph 24 (of the Full Court Judgment) quoting the learned Magistrate:

   “24.Then under the heading “Conclusions” his Honour continued:

   79.Having considered the factors set out above, I am still left with the artificial nature of the value of the Husband’s superannuation. In my view, the difficulty for the Court is in the fact that the valuation of his superannuation is essentially a valuation of income stream whereas there is no “valuation” before the Court of the Wife’s income stream.  She is currently employed, earning approximately $40,000 per annum and if she works at that rate of pay until she is sixty five years old, she will gross $600,000.  That is not a valuation of her income stream, but it does illustrate the inherent unfairness of valuing one party’s income stream while not valuing the income stream of the other party.”

Facts of Present Case

1. I note that neither party seeks a splitting order of the Husband’s periodic payments other than the Wife seeking it as a default type order.  I find it is not appropriate to make any form of splitting order.  The Husband says because of his medical condition he needs all of the income he can receive.  The Wife is working four days a week.  She has a medical condition but is not seeking to increase her income with a splitting order.

2. In the circumstances of this case where neither party seeks a splitting order it would not be appropriate to make such an Order.

Submissions by Counsel for Wife

1. Counsel for the Wife submitted Pool A should be divided 75% to the Wife and 25% to the Husband.  This was made up as follows:

   ·Up to the time of separation 55%/45% in favour of the Wife;

   ·Contributions since separation by the Wife included paying the mortgage, rates and medical insurance while on the same income as the Husband.  She has had the cost of supporting the children with no financial support from him.  This would entitle her to a further 10% making a division of 65%/35% in her favour.  It was submitted on account of section 75(2) factors she should receive a further 10% because of her obligations for the future care of the children with no support and her now reduced income as a result of her recent injuries.

2. The calculations based on this methodology are as follows:

   75% of Pool A - $437,500 = $328,125

   Counsel submitted that giving the Wife an additional $130 per week from Pool B net for 43 years (Husband’s life expectancy) discounted on the 5% tables is a capitalised sum of $122,000.  The Wife’s entitlement then adding these two amounts was $450,875.

3. He noted the Wife would settle for $405,000 being the house with the mortgage - $350,000 plus Wife retaining her $50,000 superannuation and $5,000 vehicle.

Submissions by Counsel for Husband

1. Counsel for the Husband produced written submissions:

   “2.If the DFRDB (here pool 2) is left where it is, ie with the Husband, that is not a splitting order and it is permissible, at step 3, to award the other party a greater share of the other property (pool 1) on account of super remaining where it is; Hickey at [91]; see also s75(2)(f) and Coghlan at par[53];

   3.The value of the DFRDB interest does not need to be determined in accordance with the regulations if no splitting order is to be made; Hickey at [89];

   4.There is no authority that requires a specific dollar value to be prescribed to the DFRDB interest, and much  authority to suggest that an attempt to give a capitalised value to a periodic payment, which ceases upon death, cannot be assigned, and cannot be capitalised, is artificial.  The difficulty in assigning a meaningful value strengthens the view that it is akin to taking into account the fact of a party’s income when assessing the step 3 adjustment.”

2. In paragraph 5 at page 3 of those submissions Counsel contends:

   “5.…The inappropriateness of the wife’s approach is borne out if the effect of the orders sought is considered.  The wife seeks the house unencumbered, and that the parties retain property otherwise in their possession or name.  This means that the husband, on a pension income totalling about $27K per year, will need to borrow $50K to pay out the wife.  The husband will have no security to achieve this, and the chance of a loan could fairly be said to be nil.  Even if he could get a loan, it would mean his net asset position would be nil, and his only financial resource would be meagre benefits.  At the same time, the wife is to be awarded a mortgage free house of $400,000, and retain her car and super.  The wife thus receives $455,000 out of a net pool of $438,500.”

3. These submissions were clearly prepared before Counsel for the Wife conceded:

   a.his client did not press for the cash payment of $84,000 specified in her Amended Application;

   b.        nor did he seek that the Husband be responsible for the mortgage.

1. In submissions on the decision DJ & AJ [2006] FamCA 961 Counsel for the Husband argued:

   “8.In this case the Full Court approved the approach now being contended for by the Husband in that:

   8.1The non-super assets were valued distinct from the super assets, that is Pool 1.

   8.2The super interests were then considered separately.  A value was stated in line with the regulations value, but that value does not seem to play a real role in the outcome.

   8.3For reasons outlined orally, in this case there was a 23% adjustment to the non-super pool based on super interests.

   9.There would not be an adjustment of that magnitude in the present case for the following reasons:

   9.1The pension in question was large, about $52,000 per annum compared to less than $15,000.

   9.2There the husband’s contribution to super was 60/40 here it is more like 75/25 given the 11/22 position.

   9.3In the earlier case the wife was 50 not 45 and the husband is 43 not 55.  The significance of this is that the husband has a far more perilous future.  He is younger but with limited funds or prospects compared to the wife who is a similar age and has a large current income and better prospects.”

2. The question of future employment was not an issue in the earlier case but it was contended in the present circumstances it was significant as the Wife was in the workforce and the medical evidence indicated the Husband was unlikely to be at least for a number of years.

3. At paragraph 23 (wrongly paragraphed as 15) at page 7 of the written submissions Counsel for the Husband argued that the Husband made sole contributions to the DFRDB for 11 years out of the 22 years of service.  In 2003 upon the husband’s retirement, he received a lump sum of $65,000 after tax which was used to reduce the mortgage and paying off another loan.  A modest amount was rolled over into the AMP super fund in the Husband’s name.  The Husband surrendered a life insurance policy in the amount of $22,000 and this was paid into the mortgage account on the former matrimonial home.  Counsel for the Wife had noted that the particular insurance policy had been redeemed in June 2000 and therefore some of the premiums on such policy had been paid for a period of time from joint income.

4. I do not have a copy of the policy and am unable to make any such concluded finding but can only observe that it appears the policy was in the Husband’s name and he was contributing to it prior to cohabitation.

5. At page 10 of the submissions under the heading “Appropriate Orders” Counsel submits the Husband should be entitled to a payment of $134,000 as previously detailed.

Assessment of Contributions – Section 79

1. The Husband supported the Wife’s child, M throughout the period of the relationship.  The Wife received regular child support for M of a generous amount for the period from November 1990 to November 1995.  Refer Husband’s affidavit paragraph 51.  This evidence was not challenged

2. For the period from November 1995 until separation in April 2005 the Husband assisted with the support of M with no support forthcoming from the child’s natural father.  I infer that immediately after separation the Husband had a good relationship with M as both boys attended on visits to his home.  It is unlikely the Wife will receive financial support from the Husband for their son J for at least the next few years.

3. The Wife at the commencement of cohabitation contributed $69,000 from a property settlement she received from a previous relationship.

4. The Husband as earlier noted received a gift of $4,000 from his parents, contributed a $65,000 lump sum in July 2003 from his DFRDB and he also contributed $22,000 on the surrender of the life policy.  The Wife has had the use of the former matrimonial home since separation.  The Husband in his material (paragraph 26) says the expenses for the household are $200 per fortnight including mortgage payments, rates and medical insurance. The Wife’s Financial Statement suggests such outgoings are $200 per week.

5. I am unable to resolve this conflict in the evidence.  Suffice it to say if the Wife has been able to have rental of this large home including rates and medical insurance for $200 a week I am confident she has had a significant advantage over the Husband who had to pay for rental accommodation.

6. The Wife sets out her initial contributions at paragraph 24 of her affidavit filed 9 August 2006.

Non-Financial Contributions

1. In paragraph 20 of his affidavit filed 29 June 2006 the Husband deposes as follows:

   “20.Except for the times that I have been away on Defence Force duties, I played an effective part in the raising of [M] and [J] and contributed to the parenting of the children.”

2. In his second affidavit filed 28 August 2006 at paragraph 12 the Husband details various items that were acquired for the household and various improvements and extensions to the family home which were made.  The Husband does not claim to have physically assisted with the construction of any of these improvements other than in subparagraph (l) where he says:

   “I continued to purchase and plant plants for the garden and landscaping around the pool.”

3. Neither party elected to give a great deal of detail on the aspect of non-financial contributions.  The Wife in her trial affidavit says:

   “38.I could not rely upon [the husband] to look after the boys or to undertake a housekeeping role at home.  After [the husband]’s resignation from the [Defence Force] he still took little interest in the running of the household and left the housekeeping duties to me.  I continued responsibility for the running of the household.  [The husband] seemed quite happy to be doing very little.  I encouraged him to obtain the work […] at a local hospital and was able to do so because of my own employment in the hospital. [The husband] then worked casually [at the hospital] but still was reluctant to accept work on a regular basis.  I then made inquiries with a friend who ran a local gym and she offered to employ [the husband] as a fitness instructor.  He accepted this employment but was unwilling to do more than 20 hours a week work.  He only accepted the job after I had insisted that he do so.  When we separated he ceased to work at the gym and hasn’t worked since that time.

   39.I doubt that [the husband] will work in paid employment in the future.  He has expressed to me that he is happy to continue to receive his [Defence Force] pension instead of working and he has now applied for a totally and permanently incapacitated allowance from the [Defence Force].  Both his [Defence Force] pension and his TPI allowance are tax free.  In addition, because of his diagnosis of post traumatic stress disorder he receives a Centrelink disability payment of $141 per week.  He pays no tax on his total income because of the tax free nature of his DFRDB Pension and his Veterans’ Affairs benefits.”

   I was informed, without challenge, the Husband was required to pay tax on his DFRDB pension.

4. At paragraph 55 of her trial affidavit the Wife deposes:

   “55.From the time of [the husband]’s resignation from the [Defence Force], the running of the household fell to me, as well as the financial responsibility.  I would go out to work each day while [the husband] remained at home but still the housekeeping duties also fell to me.  [The husband] provided some supervision for [M] and [J], although he often failed to supervise them appropriately.  He had a good relationship with both boys but took little interest in their care.  He got on well with them but did not participate in their activities and certainly did not provide them with any “hands on” care.”

5. In the absence of better evidence and in the absence of cross examination on this aspect I can only conclude that each party contributed in a reasonable manner in a non-financial sense in the duties of parenting and running the household.

6. On account of section 79 factors I am inclined to find the contributions equal.  The Wife made an initial injection of a capital sum but the Husband had his accrued years with the Defence Force at that point in time.  The Husband made greater contributions during the period of the relationship as detailed above.

Section 72(2) Factors

Medical Evidence

Husband

1. The Husband has been treated by a psychiatrist, Dr H.  He provided two affidavits.  The first sworn 4 September 2006 and the second 10 March 2007.  The Husband first commenced treatment with Dr H on 1 September 2005.  In the first affidavit (paragraph 4) Dr H observes:

   “4.I continued to treat [the husband] with ongoing symptoms of anxiety and depression.  [The husband] has been on Luvox as an anti-depressant for a considerable period of time at maximum dose.  He has had other medications added to Luvox to augment the anti-depression effects with no response or significant side effects.  Those other medications include Epilim Edronax, Buspar and more recently Tolvon – -

   6.I believe that [the husband] is presently unfit to work either full time, part time or casually.  He is unfit for any type of work and it is unlikely that he will return to the workforce within the next twelve months.

   7.There needs to be a significant improvement in [the husband]’s mental health for him to return to work.”

2. In the second affidavit Dr H notes that the Husband is now taking Zoloft as a substitute for the previous medications.  Since the time of the previous report the Husband has been an inpatient at the L Hospital for alcohol detoxification and treatment of anxiety and depression.

3. In paragraphs 7, 8 and 9 of his affidavit he notes:

   “7.I believe that [the husband] is presently unfit to work either full time, part time or casually.  He is unfit for any type of work and it is unlikely that he will return to the workforce within the next few years.

   8.There needs to be a significant improvement in [the husband]’s mental health for him to return to work

   9.[The husband]’s unfitness to work has been affected by traumatic arthritis, his ongoing Attention Deficit Disorder with hyperactivity.  His Post-Traumatic Stress Disorder and a Major Depressive Disorder.  He no longer has intermittent alcohol abuse.”

4. Exhibit 1 consists of a summary of a range of injuries the Husband suffered whilst on service with the Defence Force.  The Veterans’ Affairs file is a very bulky file covering several hundred pages.  I was assured that the summary document tendered was a distillation of the contents of this file.  There did not appear to be any contentious aspect about this.  I note that the Husband has suffered numerous injuries during the course of his military service, initially in one Defence Force sector and subsequently in another Defence Force sector.  His injuries include ankle injuries, knee injuries, shoulder injuries and a wrist injury.

5. In view of the fact there has been no challenge to Dr H’s reports I have not found it necessary to peruse the Veterans’ Affairs file in detail but I have scanned it. 

6. I accept the evidence of Dr H that the Husband would be unable to work in either a part time or full time capacity for a number of years at the earliest. 

Wife

1. The report of Ms G a senior psychologist dated 26 November 2006 is annexed to the wife’s affidavit filed on 2 March 2007.  At page 4 of her report she records:

   “The writer is aware of circumstances pre-existing in [the wife]’s life such as her eldest son’s medical condition and also the fact that she reports that she is going through an acrimonious divorce.  The writer is of the belief that she was coping with these situations as difficult as they are.  The writer believes that the PTSD is a direct result of the incident mentioned above.  [The wife] reports that she has experienced many difficult situations in her years as [a Nurse] and that her work is stressful.  She reports that this incident was terrifying and too much for her to cope with.

   3.My prognosis as to her recovery and her subsequent prospects of returning her to her employment

   Prognosis for recovery is difficult to ascertain.  Treatment of PTSD is difficult.  [The wife] may require medication.  Recovery will relate to treatment, to the amount of support she receives from the hospital system, and the amount of time she is given to heal unhindered.

   All going well her prospects of returning full time to the workforce are good.  The writer does not believe that she should return to nursing and as such she will need to retrained.  Her return to work should be a graduated process.”

Additional Section 75(2) Factors

1. On account of section 75(2) factors the Wife is likely to have the support of the child for a further five years or so.  Because of his financial position it is unlikely that the Husband will be contributing to the support of this child.  In the circumstances I believe a 10% adjustment in favour of the Wife is warranted.  Because of the Husband’s poor health and inability to earn income I would have been inclined to make no adjustment on account of section 75(2) factors however I have balanced against this the fact that the Wife has her own psychological difficulties and will have the sole cost of contributing to J’s upkeep and education without support from the Husband for the foreseeable future.

Conclusion Re: Pool A

1. Pool A then will be divided on the basis of 60% to the Wife and 40% to the Husband.

Division of Pool B

1. In relation to Pool B I propose to make a notional capital adjustment.

2. I appreciate that the West v Green formula approach is no longer in vogue but because no splitting order is sought it is appropriate to make an adjustment to the Wife.  The period of the relationship was approximately one half of the period of the Husband’s service in the Defence Force.  To give the Wife one half of that 50% would be to award her 25% of the value – 25% of $320,000 is $80,000.  The fact such conclusion is in accord with the West v Green formula is entirely serendipitous.

Calculations

1. Wife receives 60% of Pool A at $437,500  $262,500

   25% of Pool B  $  80,000

   Wife’s entitlement   $342,500

   Wife receives house   $400,000

   Superannuation and car  $  55,000

   Total $455,000

   Less mortgage  $  50,000

   Less one half of credit card debt  $    3,750

   Net amount$401,250

   Wife retains property  $401,250

   Wife’s entitlement  $342,500

   Wife to pay Husband  $  58,750

2. I am satisfied the Wife would have the ability to make payment of this sum.  She has a valuable property with a modest mortgage.  She will have the security of the home for the child and herself.  The Husband does not have any real property but retains the benefit of his modest payment from his DFRDB policy and the Veterans’ Affairs pension.

3. I have only deducted the sum of $3,750 on account of credit card debt being the Wife’s one half share of the agreed credit card liability of $7,500.  I have had regard to the Husband’s affidavit evidence at paragraph 13 where he states:

   “13.On separation the total owing on our credit card was approximately $7,500.  I am still repaying that credit card and have done so solely since separation.”

   It appears that credit card debt largely related to an overseas holiday the parties had with the children at about the time of separation.

4. In paragraph 43 of his affidavit the Husband deposes:

   “43.I agree that I now have a sole Virgin Credit Card.  However, I have continued to make repayments on the credit card covering debts jointly incurred during our relationship.”

5. Whilst the Wife will have sole responsibility for the mortgage debt – and this aspect was not challenged – it is appropriate to only debit her entitlement with one half of the credit card debt.  The Husband will remain responsible for such debt as he has in the past.

6. I have reviewed the evidence in this matter in light of the findings I have made.   I have considered the overall impact of the Orders and I am satisfied that these Orders represent a just and equitable distribution of property as between the parties having regard to the matters that I am required to take into account pursuant to section 79 and section 75(2).

Draft Orders

(1)Upon the Wife refinancing in her own name the mortgage debt to B Building Society and paying to the Husband the sum of $58,750 the Husband transfer to the Wife all his right, title and interest in the C property.

(2)In the event that the Wife fails to pay the sum of $58,750 within a period of sixty (60) days the C property is to be sold and after payment of expenses of sale and payment of any mortgage debt the Wife is to pay the Husband the sum of $58,750 together with interest.  Interest is to be calculated from a date two months after the sealed orders issue.

(3)Each party shall be solely entitled to the exclusion of the other, to all other money, property (whether real or personal) and chattels of whatever nature in the possession, control or ownership of that party at the date of execution of these Orders and for that purpose, bank accounts are deemed to be in the possession of the person whose name appears on the bank, credit union or building society accounts are deemed to be in the possession of the person whose name appears on those accounts and any superannuation or superannuation/life policies are deemed to be in the possession of the person who is named as the person whose age or working future provides the condition for payment of those entitlements.

(4)A Registrar of the Family Court of Australia is appointed to execute any document in either party’s name and do all acts and things necessary to give validity to any documents required to execute the orders made herein in the event a party refuses to sign when so requested.

I certify that the preceding seventy-five (75) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Barry

Associate

Date:  29 June 2007