Robane & Kalda (No 2)
[2022] FedCFamC2F 711
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Robane & Kalda (No 2) [2022] FedCFamC2F 711
File number(s): ADC 166 of 2021 Judgment of: JUDGE DICKSON Date of judgment: 24 May 2022 Catchwords: FAMILY LAW – Property – 21 year de facto relationship – de facto wife’s application for property settlement – where de facto husband has failed to engage in the proceedings – leave granted to proceed undefended - nature of an undefended hearing – consideration of contributions and future needs – where contributions during the relationship were equal – where de facto wife’s post separation contributions and future needs are greater than those of the de facto husbands – where de facto wife has incurred legal fees due to the de facto husband’s failure to engage in the proceedings - where it is just and equitable for the wife to receive an adjustment in her favour on account of those factors – where Court declines to make the personal protection orders as sought by the de facto wife in a property Trial Legislation: Family Law Act 1975 (Cth) Pt VIIIAB ss 90SF, 90SM
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) Pt 10.6, rr 10.26, 10.27
Cases cited: Jabour & Jabour [2019] FamCAFC 78
Ragusa & Ragusa [2021] FedCFamC2F 470
Stanford & Stanford (2012) 247 CLR 108
Division: Division 2 Family Law Number of paragraphs: 84 Date of last submission/s: 24 May 2022 Date of hearing: 23-24 May 2022 Place: Adelaide Counsel for the Applicant: Ms Miller Solicitor for the Applicant: Tindall Gask Bentley The Respondent: No appearance ORDERS
ADC 166 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS ROBANE
Applicant
AND: MR KALDA
Respondent
ORDER MADE BY:
JUDGE DICKSON
DATE OF ORDER:
24 MAY 2022
THE COURT ORDERS THAT:
1.The net proceeds of sale of the former matrimonial home situate B Street, Suburb C in the amount of $504,743.51 currently held in the trust account of Aaron Conveyancing be applied in the following manner and priority:
(a)As to the Applicant by payment to Tindall Gask Bentley Trust Account for and on behalf of the Applicant, the sum of FOUR HUNDRED AND FORTY NINE THOUSAND THREE HUNDRED AND SEVENTY NINE DOLLARS ($449,379.00);
(b)As to the balance to the Respondent.
KALDA FAMILY TRUST
2.The Applicant do all things and execute all documents necessary to:
(a)Transfer her interest in the Kalda Family Trust (“the Trust”) to the Respondent;
(b)Give effect if deemed necessary by the Respondent in his sole discretion, the Applicant’s removal as a beneficiary and/or member of the class of beneficiaries of the Trust;
(c)Forgive, waive or assign to the Respondent or to such other person as the Respondent may require any monies standing to her credit or debit in any loan account in the Trust and relinquish any other claim or entitlements whatsoever as she may have in relation to any assets of the Trust to the intent and the effect that the assets of the Trust will thereafter not be subject to any claim either legal or equitable by the Applicant.
OTHER PROPERTY TO BE RETAINED BY THE APPLICANT
3.The Applicant shall retain as her sole property absolutely free from any claim by the Respondent:-
(a)The Motor Vehicle 1 currently in her possession;
(b)The furniture and effects currently in her possession;
(c)The clothing, jewellery and personal effects currently in her possession;
(d)All amounts standing to her credit in any bank, building society or credit union account;
(e)The benefit of her entitlements with Super Fund D without adjustment; and
(f)All other property in her possession or control whether registered in her name or not, and not otherwise specified therein.
OTHER PROPERTY TO BE RETAINED BY THE RESPONDENT
4.The Respondent shall retain as his sole property absolutely free from any claim by the Applicant:-
(a)The Town E property;
(b)The land in Country F;
(c)The Digger machines currently in his possession;
(d)The Motor Vehicle 2 (in parts) currently in his possession;
(e)The Motor Vehicle 3 currently in his possession;
(f)The Motor Vehicle 4 currently in his possession;
(g)The Boat currently in his possession;
(h)The Cage Trailer currently in his possession;
(i)The furniture and effects currently in his possession;
(j)The clothing, jewellery and personal effects currently in his possession;
(k)All amounts standing to his credit in any bank, building society or credit union account;
(l)His shares;
(m)His interest in the Business Leases held in Town E and Queensland;
(n)The benefit of his superannuation entitlements without adjustment; and
(o)All other property in his possession or control whether registered in his name or not, and not otherwise specified therein.
LIABILITIES
5.That subject to these orders, each party do release the other party from any liability for any claim that either one may have against the other and the parties do discharge their several debts and liabilities without calling upon the other to contribute (including any income tax liability assessed in their respective names) and the Applicant and Respondent agree that neither of them will hereafter pledge credit of the other.
OPERATION
6.That each party shall do all such acts and things and sign all such necessary documents to give effect to the terms of this order.
7.That it be a condition of these orders that if either party shall refuse or neglect to execute any document necessary to give effect to the terms hereof in the proper form within seven (7) days after the same shall have been tendered to that party by or on behalf of the other party then in such case a Judicial Registrar of the Federal Circuit and Family Court of Australia, upon proof by affidavit of such refusal or neglect, is hereby appointed to execute and if in his or her opinion it shall be necessary to do so, to settle the same and do all such other acts and things and execute other such documents as shall be necessary to give full force and effect hereto.
8.All extant applications do stand dismissed.
9.The applicant de facto wife do serve the respondent de facto husband personally with a sealed copy of the orders made this day together with a copy of the Reasons of Judgment once published and thereafter do file an Affidavit of Service with this Honourable Court.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym Robane & Kalda has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
(Ex tempore reasons settled from Transcript)JUDGE DICKSON:
INTRODUCTION
These proceedings concern applications for property settlement. The trial came before this Honourable Court on 3 February 2022. For reasons that I will come to in a moment, the Trial was adjourned part-heard and recommenced before the Court on 23 May 2022. At the conclusion of the hearing on 23 May 2022, Judgment was reserved and the matter was adjourned until 24 May 2022 for delivery of Judgment.
These are the Court’s reasons in relation to the de facto wife’s application for property settlement.
RELATIONSHIP BACKGROUND
The applicant de facto wife was born in 1965 and is aged 57 years. The respondent de facto husband was born in 1966 and is aged 56 years.
The parties commenced cohabitation in 1997.
There are four children of the relationship namely, Ms G, born in 1989 and now aged 32 years, Ms H, born in 1993 and now aged 28 years, X born in 2004, now aged 17 years and Y, born in 2007 and now aged 14 years.
The parties have differing separation dates. The de facto wife deposes to separation having occurred on 24 January 2019. The respondent, in documents previously filed on his behalf and on his instructions by Adelaide Family Lawyers, deposed to a final date of separation being on 26 April 2011.
I note however that notwithstanding the alleged date of separation as asserted by the de facto husband, leave to proceed out of time was not sought by the de facto husband in his orders sought in the Response to Application for Final Orders filed on 19 April 2021. In circumstances where I have already given leave for the de facto wife to proceed on an undefended basis and in the absence of any counter-evidence being provided by the de facto husband, I intend to adopt the date of separation as promoted by the de facto wife as being 24 January 2019. Hence, this matter involves a lengthy relationship of approximately 21 years and with four children being born from the relationship. The youngest child Y, now aged 14, resides with the de facto wife and based on her unchallenged evidence, spends no time with the de facto husband.
HISTORY OF PROCEEDINGS
By way of procedural background, I note the following for the purposes of these reasons.
The Initiating Application was originally filed by the de facto wife on 15 January 2021. On the first return date, being 29 March 2021, the matter came before Registrar De Corso (as she was then known) there was no appearance by or on behalf of the de facto husband, and notations were entered into the Court record as follows:
(a) The respondent was served on the 13th of February 2021.
(b) The respondent has not filed responding documents.
(c)If the respondent fails to comply with order 1 herein, then the proceedings may proceed on an undefended basis.[1]
[1] See orders of Registrar De Corso dated 29 March 2021.
Registrar De Corso otherwise ordered inter alia that:
(1)The de facto husband file and serve a response affidavit and Financial Statement;
(2)The de facto wife serve a copy of the order by ordinary post to B Street, Suburb C; and
(3)That the proceedings be adjourned until 3 May 2021.
On 3 May 2021, the de facto husband appeared represented by Adelaide Family Lawyers. On that occasion, Registrar De Corso ordered as follows:
(1)The parties attend a Conciliation Conference on 7 July 2021;
(2)The parties undertake mutual informal discovery within 21 days and inspection within 14 days thereafter;
(3)The de facto wife provide a draft balance sheet within 14 days, and the de facto husband provide a response within 14 days thereafter; and
(4)Valuations of any disputed items to be undertaken by 30 June 2021.
On 30 June 2021, Adelaide Family Lawyers filed a Notice of Withdrawal as Lawyer for the de facto husband.
On 7 July 2021, a Conciliation Conference was convened at the Court. No final agreement was reached after the Conciliation Conference had been convened, although the Court file suggests that there had been some preliminary agreement reached between the parties which was then not the subject of any Minutes of Order.
On 19 July 2021, the de facto wife received a Sales Agency Agreement from Mr J. Mr J is a sales agent employed with K Real Estate. He is also a longstanding friend of the husband. The Annexure to the de facto wife’s Trial affidavit, being Annexure 3, is a copy of a Residential Sales Agency Agreement signed by each of the parties with Mr J for the sale of the former matrimonial home at B Street, Suburb C (‘the former matrimonial home’).
On 9 August 2021, the matter came back before Registrar De Corso. On that occasion, there was no appearance by or on behalf of the de facto husband. The Registrar noted that:
(a)Draft minutes of order had been sent to the de facto husband on 13 July 2021 and there had been no response; and
(b)The terms with regard to the sale of the former matrimonial home were not agreed.
The matter was then adjourned before me to 18 August 2021. On 18 August 2021, the de facto husband again did not appear. The Court noted that the de facto wife sought an opportunity to serve the de facto husband and put him on notice that the matter may proceed in his absence on the next occasion. Accordingly, the Court adjourned the matter to 16 September 2021 and directed that, during the period of the adjournment, the de facto wife cause the de facto husband to be served with a sealed copy of the order, together with written communication confirming that the matter may proceed in his absence on the adjourned date.
On 16 September 2021, the de facto husband appeared self-represented. Orders were made as follows:
(1)That the de facto husband file and serve a Notice of Address for Service within 48 hours;
(2)The matter be listed for Trial for two days on 3 and 4 February 2022;
(3)A number of procedural orders were made, including for the filing of Trial material.
(4)Outline of Case Documents and a Schedule of Assets and Liabilities were directed to be filed no later than seven days prior to the Trial date.
The de facto husband failed to file the Notice of Address for Service as directed by the Court. The de facto husband has failed to file his Trial material as directed by the Court. As set out above, there have been earlier hearings where the de facto husband also failed to attend. The matter came before me by way of a directions hearing on 24 January 2022, when the Trial date was confirmed, and again the de facto husband failed to appear at that hearing also.
On 3 February 2022, given the trajectory of the proceedings and the failure by the husband to appear at the hearings on 9 August 2021, 18 August 2021, 24 January 2022 and then on 3 February 2022, the de facto wife was given leave to proceed with her application for property settlement filed at that stage on 20 December 2021 on an undefended basis.
The reasons for the orders being made on 3 February 2022 for the trial to proceed on an undefended basis can be summarised as follows:
(1)The respondent had been on notice of the proceedings since being personally served with the wife’s Initiating Application and supporting documents on 13 February 2021; and
(2)The de facto wife has now filed in support of her position six affidavits deposing to service on the husband of various documents and more recently an affidavit from her solicitor, Mr Niles, which also confirms service by way of email in relation to a further amended position put by the wife upon the sale of the former matrimonial home.
For the sake of completeness, I refer to those Affidavits of Service in relation to the attempts that have been made by the de facto wife to either bring these proceedings to the attention of the de facto husband or to have him engage in the proceedings in some meaningful way. As already identified, an Affidavit of Service was filed on 30 August 2021 which confirms that on 25 August 2021 the de facto husband was served with court orders dated 9 August 2021 and 18 August 2021, various letters and a letter of offer which followed on the de facto husband having been served with the de facto wife’s Initiating Application on 13 February 2021.
A Notice of Withdrawal as Lawyer was filed by Ms L on 30 June 2021 which confirmed that the de facto husband’s address for service was care of the former matrimonial home at B Street, Suburb C in the State of South Australia and with an email address of …@gmail.com also being provided as a point of contact.
On 15 September 2021, the de facto wife’s solicitors filed an affidavit deposing that by way of letter dated 23 August 2021, the de facto husband was served personally with the following:
(a)Letter dated 23 August 2021;
(b)Order dated 9 August 2021;
(c)Order dated 18 August 2021; and
(d)A letter of offer dated 23 August 2021.
On 10 January 2022, an Affidavit of Service was filed on behalf of the de facto wife confirming personal service on the de facto husband of the Initiating Application, Financial Statement and affidavit together with a covering letter upon the de facto husband.
On 30 January 2022, a further Affidavit of Service was filed on behalf of the de facto wife, serving upon the de facto husband a sealed copy of an order made on 24 January 2022 together with a letter. The Affidavit of Service under Part F confirms that the de facto husband declined to sign the Acknowledgement of Service.
On 17 February 2022, an Affidavit of Service was filed on behalf of the de facto wife confirming that the de facto husband was personally served with a Further Amended Initiating Application, a copy of the order dated 3 February 2022, a letter dated 9 February 2022 and an Amended Application in a Proceeding. Under Part F, the Affidavit of Service notes that upon being served, the de facto husband declined to sign the Acknowledgement of Service. On 17 February 2022, an affidavit was also filed by Ms Barry of Tindall Gask Bentley for an on behalf of the de facto wife. That affidavit confirms that documents were forwarded to the de facto husband and confirming service upon him confirming attempts made to engage the husband in these proceedings.
More recently, on 25 May 2022 an affidavit was filed by the de facto wife’s solicitor Mr Niles, enclosing a copy of the amended proposed orders sent to the de facto husband via email at the address set out in the Notice of Ceasing to Act filed by his former solicitor together with a letter dated 20 May 2022 which confirms the orders that were sought by the de facto wife at the hearing before the Court on 23 May 2022 which of course was yesterday. When the matter was called on yesterday, the de facto husband again failed to appear before the Court, nor did he arrange for a solicitor to appear on his behalf.
This afternoon when the Trial commenced at approximately 2:15 pm, I was advised by counsel appearing on behalf of the de facto wife that there had been a recent development. The applicant’s counsel informed the Court that an email had been sent to the de facto husband today 24 May 2022 at 12:02pm enclosing a copy of the Court’s order dated 23 May 2022 and advising him that Judgment would be delivered this afternoon at 2:00pm. At 1:12pm an email was forwarded, purportedly by the de facto husband to Mr Niles, solicitor, advising that there had been alleged issues in relation to mail redirections and seeking a short adjournment in order to get representation due to allegedly suffering mental health issues and not being in an “employable state”. The de facto husband sought an adjournment as his ability to generate wages had allegedly suffered. He requested a response.
By way of email at 1:37pm, Mr Niles wrote back to the de facto husband, advising him that the application for the adjournment was opposed and confirming the arrangements for the dial-in details to the Court if he was unable to appear in person. As I have already recorded, the de facto husband failed to appear at Court this afternoon when the matter was formally called on and he has not appeared in the virtual courtroom at any stage across the course of this afternoon. The correspondence which crossed between the de facto wife’s solicitor and the de facto husband dated 24 May 2022 has been received and marked Exhibit A3.
THE NATURE OF AN UNDEFENDED HEARING
It is trite to observe that proceedings to be determined in the absence of one party is a significant matter. The Court has an obligation to ensure that parties to the proceedings before it have an opportunity to participate in those proceedings. However, there must be limits on such an obligation which cannot be indefinitely prolonged. For the purposes of these reasons, I now refer to and adopt the following comments that were delivered in a decision of his Honour Judge Brown of this Honourable Court in the case of Ragusa & Ragusa.[2] That was a case which similarly involved the failure by one of the parties to engage in final orders for property settlement. It is very similar to the facts of this particular case.
[2] Ragusa & Ragusa [2021] FedCFamC2F 470.
In his reasons for decision, his Honour Judge Brown made the following comments:
Before a person can be adversely affected by a judicial order, they must be afforded an adequate opportunity to be heard.[3]
[3] Ibid [51] quoting Taylor v Taylor (1979) 143 CLR 1, 20 (Murphy J).
For the reasons that I have already outlined above and with particular reference to the volume of Affidavits of Service that have been filed by the de facto wife, I am satisfied that the de facto husband has been given an adequate opportunity to appear in these proceedings and to put his position before the court.
Returning to his Honour’s reasons:
[the wife] is entitled to have her application for settlement of property matters determined within a reasonable period of time pursuant to the applicable principles of law. This is important, given the delays which have arisen in the conduct of the case, none of which are attributable to any act or omission attributable to [the wife].
As such, she needs neither [the husband’s] formal imprimatur, nor his cooperation to have her application determined. Rather, there is an obligation, on the part of [the husband] if he wishes to be involved in the proceedings for him to attend at Court as required and to pursue any application put by him or on his behalf with due diligence.
The Federal Circuit Court and Family Court is a Court of private law. It determines disputes between parties according to law. In this case, according to the provisions of Part VIII of the Family Law Act 1975 (Cth) (‘the Act’) which relate to the division of property following the breakdown of a de facto relationship.
The Court cannot compel a party to engage with litigation. It is however obliged to give each party the opportunity to put evidence before the Court and, if he or she so wishes to do, contest any evidence relied upon by the opposing party.
However, a party, whether by intransigence, disinterest or manipulation, cannot succeed in denying an applicant a just resolution according to law to his or her application by choosing not to take part in proceedings because they do not proceed in the manner of his or her preference. That would be fundamentally unfair to the opposing party and an affront to the proper administration of justice which requires that a properly instituted application be finalised within a reasonable period of time relative to the complexity and issues raised in such an application.[4]
[4] Ibid [52]-[56].
Part 10.6 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (‘the Rules’) deal with the Court’s authority to enter Judgment against a respondent if that respondent defaults in complying with a Court order or fails to prosecute any proceedings with due diligence.
Pursuant to rule 10.26, a party is in default if, among other things, he or she has failed to:
(1) For the purposes of rule 10.27, an applicant is in default if the applicant fails
(a) comply with an order of the court in the proceeding; or
(b) file and serve a document required under these Rules; or
(c) produce a document as required by Division 6.2.2; or
(d) do any act required to be done by these Rules; or
(e) prosecute the proceeding with due diligence.[5]
[5] Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 10.27.
Returning to the facts of this case, I am satisfied that the de facto husband has not prosecuted these proceedings with due diligence and has failed to comply with numerous order of the court. In these circumstances, pursuant to the provisions of rule 10.27 of the Rules, the de facto wife is entitled to seek the dismissal of the husband’s application.[6]
[6] See r 10.27(1)(a).
In addition and significantly, pursuant to the provisions of rule 10.27(3) of the Rules, the Court may, if it considers it is just, enter judgment and make orders in favour of the de facto wife as against the de facto husband on an undefended basis. For the reasons expressed herein and based on my reading of the file, the de facto husband has been given adequate notice of these proceedings. He has failed to prosecute his application diligently and given the factual matrix and the delay, it is just that the case be finalised at this juncture. However, as was observed by Judge Brown in the decision of Ragusa (supra), the de facto wife is not entitled as of right to the orders that she seeks simply because the de facto husband fails to prosecute his case. The onus still remains on the de facto wife to establish to the Court that the orders which she seeks are just and equitable according to law.
In essence, the de facto wife still must satisfy the Court that she has sufficient evidence to establish her case and to persuade the Court that the result she proposes is just and equitable. The Court’s pre-eminent responsibility is to ensure a just result between the parties, notwithstanding the failure by one party to participate properly in the proceedings. However, in the absence of satisfactory rebutting evidence, the de facto wife’s affidavit material in this case is to be accepted by the Court unless it appears inherently unreliable or unsatisfactory or may, as I observe, result in an unjust decision.
DOCUMENTS RELIED UPON AT TRIAL
As set out on page 10 of the de facto wife’s outline of case document filed on 28 January 2022, the de facto wife relies on the following documents:
(3)Amended Initiating Application filed 20 December 2021;
(4)Trial affidavit filed 20 December 2021;
(5)Financial Statement filed 20 December 2021;
(6)Affidavit of Service filed 30 August 2021;
(7)Affidavit of Ms M dated 15 September 2021;
(8)Affidavit of Service filed 10 January 2022;
(9)Affidavit of Service filed 28 January 2022;
(10)Further Amended Initiating Application filed 9 February 2022;
(11)Affidavit of Wendy Barry filed 17 February 2022;
(12)Affidavit of Service filed 17 February 2022;
(13)Costs Notice of the applicant filed 10 May 2022;
(14)Affidavit of Joel Niles filed 23 May 2022;
(15)Exhibit A1, being Settlement Statement of the former matrimonial home, dated 8 April 2022;
(16)Exhibit A2, being updated assets and liabilities schedule on behalf of the wife; and
(17)Exhibit A3, bundle of email communications between the de facto wife’s solicitor and the de facto husband, dated 24 May 2022.
ISSUES TO BE DETERMINED AT TRIAL
The issues to be approached at Trial are with respect to:
(1)The weight to be attached to the parties’ various financial and non-financial contributions;
(2)Their respective future needs, if any;
(3)A percentage division across the board of the gross asset pool, bringing to account the various factors that I am required to consider under section 90SM of the Family Law Act;
(4)The value of various assets available for distribution at Trial.
ORDERS SOUGHT AT TRIAL
Given the difficult background to this matter, there have been a number of amendments sought by the de facto wife to her final orders. More recently, the final orders proposed by the de facto wife are those set out in the document entitled “Amended Proposed Orders” being Annexure JEN1 to the affidavit of Mr Joel Niles, filed on 23 May 2022. Those orders are as follows:
1. That in full settlement of any claim that either party may have for settlement of property pursuant to Part VIIIAB of the Family Law Act 1975 (as amended) in the past, the present and the future:-
1.1 The Applicant do forthwith serve a copy of these Orders and Reasons on the Respondent by personal service.
…
1.9
IN THE EVENT THAT THE SALE PRICE EXCEEDS $420,000, The net proceeds of sale of the B Street, Suburb C property in the amount of $504,743.51 held in the trust account of Aaron Conveyancing shall be applied in the following order and priority:1.9.1 As to the Applicant by payment to Tindall Gask Bentley Trust Account for and on behalf of the Applicant, the sum of THREE HUNDRED AND EIGHTY THOUSAND DOLLARS ($380,000);
1.9.2 In payment of all costs (other than Council Rates, Water Rates and Emergency Services Levy) of and incidental to the sale of the said property including Land Agent’s fees and conveyancing costs;1.9.3 In reimbursement to the Applicant pursuant to paragraph 1.6 herein;1.9.4 As to the balance remaining:
(a) As to FIFTY PERCENTUM (50%) to the Applicant by payment to Tindall Gask Bentley Trust Account; and
(b) As to the balance to the Respondent
wherefrom the total amount required to discharge in full all amounts outstanding with respect to Council Rates, Water Rates and Emergency Services Levy shall be paid to the said instrumentalities on behalf of the Respondent prior to any further distribution therefrom to the Respondent.1.10 Upon payment to each party of their entitlements pursuant to paragraphs
1.8and 1.9 herein the net proceeds of sale received by them respectively shall be their sole property free of any further claim at law or equity whatsoever by the other.INJUNCTIONS
1.11 That the Respondent be restrained by injunction from:
1.11.1 Communicating with the Applicant;
1.11.2 Coming within 100 metres of the Applicant’s home or place of employment;
1.11.3 Causing any damage to the B Street, Suburb C Property.…
KALDA FAMILY TRUST
1.14 The Applicant do all things and execute all documents necessary to:
1.14.1 Transfer her interest in the Kalda Family Trust (“Trust”) to the Respondent;
1.14.2 Give effect if deemed necessary by the Respondent in his sole discretion, the Applicant’s removal as a beneficiary and/or member of the class of beneficiaries of the Trust;
1.14.3 Forgive, waive or assign to the Respondent or to such other person as the Respondent may require any monies standing to her credit or debit in any loan account in the Trust and relinquish any other claim or entitlements whatsoever as she may have in relation to any assets of the Trust to the intent and the effect that the assets of the Trust will thereafter not be subject to any claim either legal or equitable by the Applicant.
OTHER PROPERTY TO BE RETAINED BY THE APPLICANT
1.15 The Applicant shall retain as her property absolutely free from any claim by the Respondent:-
1.15.1 The Motor Vehicle 1 currently in her possession;
1.15.2 The furniture and effects currently in her possession;
1.15.3 The clothing, jewellery and personal effects currently in her possession;
1.15.4 All amounts standing to her credit in any bank, building society or credit union account;
1.15.5 The benefit of her entitlements with Super Fund D without adjustment; and
1.15.6 All other property in her possession or control whether registered in her name or not, and not otherwise specified therein.
OTHER PROPERTY TO BE RETAINED BY THE RESPONDENT
1.16 The Respondent shall retain as his property absolutely free from any claim by the Applicant:-
1.16.1 The Town E property;
1.16.2 The land in Country F;
1.16.3 The Digger machines currently in his possession;
1.16.4 The Motor Vehicle 2 (in parts) currently in his possession;
1.16.5 The Motor Vehicle 3 currently in his possession;
1.16.6 The Motor Vehicle 4 currently in his possession;
1.16.7 The Boat currently in his possession;
1.16.8 The Cage Trailer currently in his possession;
1.16.9 The furniture and effects currently in his possession;
1.16.10 The clothing, jewellery and personal effects currently in his possession;
1.16.11 All amounts standing to his credit in any bank, building society or credit union account;
1.16.12 His shares;
1.16.13 His interest in the Business Leases held in Town E and Queensland;
1.16.14 The benefit of his superannuation entitlements without adjustment; and
1.16.15 All other property in his possession or control whether registered in his name or not, and not otherwise specified therein.
LIABILITIES
2. That subject to these orders, each party do release the other party from any liability for any claim that either one may have against the other and the parties do discharge their several debts and liabilities without calling upon the other to contribute (including any income tax liability assessed in their respective names) and the Applicant and Respondent agree that neither of them will hereafter pledge credit of the other.
OPERATION
3. That each party shall do all such acts and things and sign all such necessary documents to give effect to the terms of this order.
4. That it be a condition of these orders that if either party shall refuse or neglect to execute any document necessary to give effect to the terms hereof in the proper form within seven (7) days after the same shall have been tendered to that party by or on behalf of the other party then in such case a Registrar of the Federal Circuit Court of Australia, upon proof by affidavit of such refusal or neglect, is hereby appointed to execute and if in his or her opinion it shall be necessary to do so, to settle the same and do all such other acts and things and execute other such documents as shall be necessary to give full force and effect hereto.
5. That the Respondent pay the Applicant’s costs of and incidental to this Application.
6. Such further and other orders as this Honourable Court deems just and equitable.[7]
[7] See affidavit of Joel Edgar Vivian Niles filed 23 May 2022 at pg 6-22.
I am satisfied that the de facto husband has been put on notice of the Amended Proposed Orders as sought by the wife, noting that the de facto husband has communicated with the applicant’s solicitor this day.
The Amended Proposed Orders only differs from the previous Amended Initiating Application filed by the de facto wife by seeking a specific settlement sum from the net proceeds of sale of the former matrimonial home, situated at B Street, Suburb C in the State of South Australia, rather than a percentage of the asset pool. In all other respects, the proposed orders sought by the de facto wife are consistent with the previous orders sought by her which have been served on the de facto husband as set out herein.
ASSETS AND LIABILITIES AVAILABLE FOR DISTRIBUTION AT TRIAL
In paragraph 73 of the wife’s Trial affidavit filed on 20 December 2021 and under the heading ‘Asset pool at current’, the de facto wife sets out the assets and liabilities as she best knows them to be divided at Trial.
In paragraph 74 of the said Trial affidavit, the de facto wife deposes that the values which she had detailed in the column labelled “Mr Kalda’s value” is based upon the information contained in the de facto husband’s Financial Statement filed with this Honourable Court on 19 April 2021. In addition to the schedule set out in the body of the Trial affidavit, the de facto wife also tendered through her counsel on 23 May 2022, what was described as an updated balance sheet which included the net proceeds of sale of the former matrimonial home. That document has been marked Exhibit A2.
I propose for the purposes of these reasons to refer to the figures set out in paragraph 73 of the de facto wife’s trial affidavit together with the inclusion of the net proceeds of sale of the former matrimonial home which are evident from the Settlement Statement set out in Exhibit A1, being the amount of $504,743.51.
By way of final order, the de facto wife proposes what is commonly known in the family law jurisdiction as a “one pool” approach. The wife proposes a one pool approach, given
(a)the ages of the parties;
(b)the relatively modest size of the parties’ respective superannuation entitlements, which will not significantly alter the division of assets on a global basis; and
(c)the difficulty in having the husband engage in a super splitting order, noting that the husband has failed to participate or engage in these proceedings in any meaningful way or at all since 16 September 2021 when the matter was listed for trial.
Based on the figures set out in paragraph 73 of the de facto wife’s Trial affidavit and referring specifically to the amounts set out in paragraph 73.1 to 73.24 inclusive, the gross asset pool including superannuation is $901,661.51. The de facto wife is retaining the assets set out in the following line items:
73.4, a Motor Vehicle 1;
73.15, her ANZ Bank pensioner advantage account;
73.16, her ANZ Bank progress saver account;
73.17, her ANZ Bank online saver; and
73.24, her modest superannuation with Super Fund D.
Those items total $16,218.00.
For the purposes of these reasons I record that the de facto husband will be retaining the following line items:
73.2, three digger machines;
73.3, Motor Vehicle 2 (in parts);
73.5, Motor Vehicle 3;
73.6, Motor Vehicle 4;
73.7, Motor vehicles 5 and 6;
73.8, a boat;
73.9, a cage trailer or proceeds thereof;
73.10, shares;
73.11, interest in the Kalda Family Trust comprising of a property at Town E;
73.12, ANZ Bank savings account;
73.13, ANZ Bank B Street, Suburb C;
73.14, ANZ Bank account with unknown or nil balance;
73.18, business lease at Town E with unknown or nil value;
73.19, business lease in Queensland of unknown or nil value;
73.20, household contents;
73.21, gemstones;
73.22, Super Fund N; and
73.23, Super Fund D.
On the de facto wife’s figures, as set out in paragraph 73 of her Trial affidavit, the de facto husband would be retaining assets worth approximately $380,700.00. However, notwithstanding the fact that this matter is proceeding on an undefended basis, I must be vigilant to afford justice as between the parties. An undefended hearing does not mean that the Court simply has to accept the proposed values attributed or ascribed by the de facto wife without question. In the absence of any independent corroborative evidence, I propose to adopt the values for his assets as deposed to by the de facto husband in his Financial Statement filed 19 April 2021.
I propose to rely on the figures set out in the de facto husband’s Financial Statement where his figures differ from those promoted by the de facto wife in paragraph 73 of her Trial affidavit. Therefore, using the same line items as set out in paragraph 40 of these Reasons, the de facto husband will be retaining assets worth approximately $255,035.00. Therefore, combining the assets to be retained by each of the parties as deposed to above, together with the net proceeds of sale of the former matrimonial home, the pool available for division is:
(1)De facto wife’s retained assets being $16,218;
(2)De facto husband’s retained assets being $255,035; and
(3)Sale proceeds of former matrimonial home, $504,743.51.
The total gross asset pool is therefore $775,996.51.
APPLICABLE LEGAL PRINCIPLES
In this case, the de facto wife proposed an adjustment of the parties’ existing interests in their property available for division at trial. The relevant sections of the Family Law Act 1975 (Cth) (‘the Act’) as they relate to de facto property are contained in sections 90SM and 90SF respectively.
Section 90SM(1) of the Act provides that in property settlement proceedings after the breakdown of a de facto relationship the Court may make such order as it considers appropriate. In considering what orders should be made under section 90SM, the Court must take into account the following factors.
(a) the financial contribution made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:
(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
(ii) otherwise in relation to any of that last-mentioned property;
whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them; and
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:
(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
(ii) otherwise in relation to any of that last-mentioned property;
whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them; and
(c) the contribution made by a party to the de facto relationship to the welfare of the family constituted by the parties to the de facto relationship and any children of the de facto relationship, including any contribution made in the capacity of homemaker or parent; and
(d) the effect of any proposed order upon the earning capacity of either party to the de facto relationship; and
(e) the matters referred to in subsection 90SF(3) so far as they are relevant; and
(f) any other order made under this Act affecting a party to the de facto relationship or a child of the de facto relationship; and
(g) any child support under the Child Support (Assessment) Act 1989 that a party to the de facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the de facto relationship.[8]
[8] Family Law Act 1975 (Cth) s 90SM.
In relation to section 90SM(4)(e), which are colloquially known as ‘the future needs factors’, the Court is also to take into account the following matters contained in section 90SF(3) of the Act:
(a) the age and state of health of each of the parties to the de facto relationship (the subject de facto relationship ); and
(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c) whether either party has the care or control of a child of the de facto relationship who has not attained the age of 18 years; and
(d) commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
(e) the responsibilities of either party to support any other person; and
(f) subject to subsection (4), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g) a standard of living that in all the circumstances is reasonable; and
(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(i) the effect of any proposed order on the ability of a creditor of a party to recover the creditor's debt, so far as that effect is relevant; and
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k) the duration of the de facto relationship and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l) the need to protect a party who wishes to continue that party's role as a parent; and
(m) if either party is cohabiting with another person--the financial circumstances relating to the cohabitation; and
(n) the terms of any order made or proposed to be made under section 90SM in relation to:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party; and
(o) the terms of any order or declaration made, or proposed to be made, under this Part in relation to:
(i) a party to the subject de facto relationship (in relation to another de facto relationship); or
(ii) a person who is a party to another de facto relationship with a party to the subject de facto relationship; or
(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(p) the terms of any order or declaration made, or proposed to be made, under Part VIII in relation to:
(i) a party to the subject de facto relationship; or
(ii) a person who is a party to a marriage with a party to the subject de facto relationship; or
(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(q) any child support under the Child Support (Assessment) Act 1989 that a party to the subject de facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the subject de facto relationship; and
(r) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(s) the terms of any Part VIIIAB financial agreement that is binding on either or both of the parties to the subject de facto relationship; and
(t) the terms of any financial agreement that is binding on a party to the subject de facto relationship.[9]
[9] Ibid s 90SF.
I am satisfied, given the length of the parties’ relationship, the fact that there were four children arising from the relationship and because the de facto wife seeks a division of property in order to be able to finalise her property application, that it is appropriate, applying the principles set out in the decision of Stanfordv Stanford,[10] for there be an adjustment of the parties’ existing interests in the property which I find is available for division at Trial.
[10] Stanford & Stanford (2012) 247 CLR 108.
PROPERTY ADJUSTMENT PURSUANT TO SECTION 90SM
As stated in section 90SM of the Act, the Court may make such order as it considers appropriate following the breakdown of a de facto relationship, altering the interests of the parties to the de facto relationship in the property available for division at the time of Trial.
In this particular case, it is a very long relationship. On the de facto wife’s case the relationship lasted for approximately 21 years. It is conceded by the de facto wife that each of the parties have made both financial and non-financial contributions to the relationship which would justify an adjustment of existing property interests and for the reasons already set out herein, I am satisfied that it is just and equitable to make an order for property settlement.
The de facto wife contends in relation to the matters that are to be brought to account pursuant to section 90SM(4)(a)-(c) that the Court should find that the parties’ respective contributions were made on an equal basis.
The de facto wife contends that the parties’ initial financial contributions were of approximate value. I accept the de facto wife’s evidence in this regard. During the relationship I accept the evidence of the de facto wife that each of the parties made financial and nonfinancial contributions during their relationship to the benefit of their family and which then allowed them to acquire and conserve a number of assets.
The de facto wife concedes that the de facto husband’s financial contributions exceeded those of her own. However, the de facto wife contends, and I accept her evidence in this regard, that her contributions by way of nonfinancial contributions were overwhelming and significant. I accept her evidence that for all intents and purposes during the relationship she was the primary homemaker and caregiver to the parties’ four children and, in addition, remains the primary care giver for the parties’ youngest child Y, who is 14 years of age.
In paragraph 16 of the Outline of Case Document the de facto wife argues that there are grounds that she should receive a loading on account of her post-relationship contributions.
Post separation the contends, and again I accept her evidence in this regard, that she has made significantly greater contributions than the respondent, noting that the de facto husband has had the benefit of accommodation provided without any rent or mortgage repayments for a period of about three years other than the payments of rates, insurances and utilities.
By contrast, and this is a significant matter on the facts of this case, the de facto wife has been required to provide housing for herself and Y in the private rental market, which has resulted, according to her Financial Statement filed 20 December 2021, in her paying rent payments of $200.00 per week to a landlord described as Mr O. This is in circumstances where demonstrably the de facto wife receives a very modest income comprising of a gross salary of approximately $398.00 per week, funds by way of Family Tax Benefits and JobSeeker payments and modest Child Support for the support of Y. The payment of $200.00 per week by way of rental accommodation in circumstances where the de facto wife’s gross income was $443.00 per week is a significant burden to bear.
In addition to the payment made by the de facto wife towards her own housing and accommodation, the de facto wife contends that by virtue of the fact that the de facto husband has not spent any time with Y other than a brief visit at Christmas period post separation, that her contributions to the care of a child of the relationship be acknowledged. I accept her evidence in this regard.
CONSIDERATION OF FUTURE NEEDS
Section 90SM(4)(d) to (g) inclusive and section 90SF(3)
I have had regard to the matters set out in the wife’s Trial affidavit, which are summarised succinctly by her counsel on page 9 of the Outline of Case Document under the heading ‘Contention As To Future Needs’. The de facto wife contends that her future needs are considerable and accordingly she seeks a loading on account of those future needs. The seeks a proposed distribution of assets in her favour 61 per cent with the remainder in favour of the de facto husband.
For her part the applicant is employed as a hospitality manager. Her annual income from her employment is approximately $25,000.00. The Court is informed and accepts her evidence that her contract is not permanent and is to be reviewed on a yearly basis.
The de facto wife is 57 years of age. Whilst not, strictly speaking, close to the statutory age of retirement, I think I would have to acknowledge that the de facto wife does not have an enormous amount of working years available to her, particularly given that she is engaged in employment largely of a physical nature.
In addition, the de facto wife continues to have the fulltime care of Y, who is 14 years. The de facto wife receives $123.08 per month from the de facto husband for the support of Y. Whilst it is acknowledged that the de facto husband is discharging his duties as assessed by the Child Support Agency, given the age of Y, I consider it appropriate to take judicial notice of the fact that $123.08 per month for a child of Y’s age is unlikely to cover many of the expenses that are needed to be paid by the de facto wife on his behalf.
For his part the de facto husband has not provided any updating evidence in relation to his personal circumstances or income. The only information provided to the Court in his Financial Statement is that filed on 19 April 2021. At that time the de facto husband described his occupation as tradesman. He deposed to having an average weekly gross income of $833.00 per week with total personal expenditure of $479.00 per week. The de facto husband has, to his credit, worked throughout the entirety of the relationship and for a period of time worked as a self-employed tradesman. The de facto husband was the primary bread winner during the relationship and he supplemented his business income through various activities associated within primary industry in which it is asserted, and I accept, that the husband had relevant business licenses.
The de facto husband, based on the information provided to the Court and the only information available as filed by him, given his failure to engage in these proceedings, has a superior income earning capacity to meet his expenses and, of course, does not have the added burden of caring for a child of the relationship.
Neither party have provided any medical information to the Court, which would suggest that they are compromised in terms of their health or any health issue which impacts on their capacity to work moving forward. Aside from the de facto wife’s care of the child Y, neither party have any commitments to support any other person. I accept that at the conclusion of this Trial the orders that I propose making will maintain a standard of living based on the facts of this case, which, in all of the circumstances, is reasonable.
In addition to the section 90SM and section 90SF(3) factors, the de facto wife refers the Court to an additional matter regarding the consideration by the Court of justice and equity. The de facto wife contends that, as a consequence of the de facto husband’s failure to engage in these proceedings, that she has incurred legal fees in excess of what should have or could have been incurred had the de facto husband engaged properly in the proceedings to date and had participated in proper negotiations to resolve the matter.
The de facto wife has filed on 18 May 2022 a Costs Notice pursuant to rule 12.06 of the Rules. That document is very recent. It describes current work in progress at approximately $35,813.00 and with estimated future costs for resolution, including GST, to be in the vicinity of $15,400.00 to $17,600.00. As a consequence of this matter having to proceed to a final hearing, the wife argues that justice and equity result in an apportionment of a loading in her favour as a consequence of the de facto husband’s failure to act.
I accept the contention filed by the de facto wife that she will be indebted to her solicitor for approximately $55,500.00 or thereabouts and that she will need to meet those legal fees from her settlement sum. The de facto husband, of course, by virtue of his failure to engage, will have limited, if any, legal fees to meet at the conclusion of the proceedings.
In addition, and again this flows into the reasons as to the basis for which the de facto wife was permitted to proceed on an undefended basis, I accept that the de facto wife has been put to unnecessary legal expense on account of the de facto husband’s failure to comply with orders and engage in the resolution of these proceedings in any meaningful way.
In my view, this is a relatively straightforward and simple matter and the de facto wife and the de facto husband should have been able to resolve this matter at a much earlier juncture, had the de facto husband actually made an effort to participate in the proceedings properly. Indeed, I note that on 9 August 2021 when the matter was before Registrar De Corso (as she then was known), following a Conciliation Conference, it was noted that draft minutes of order had been forwarded to the de facto husband and there had been some settlement discussion, which, whilst in their tentative and preliminary stages, suggested that there had been some preliminary agreement reached at the Conciliation Conference on 7 July 2021. Demonstrably, those minutes came to nothing and the de facto wife has been put to significant cost in prosecuting her application to final hearing.
In addition to the cost matters that I bring to account as a factor under justice and equity, I also record again, for the purposes of these reasons, the fact that the husband resided, on the wife’s case, from 2019 until the property was sold in 2022 in the former matrimonial home without incurring any mortgage or rental expenses. I acknowledged that he was responsible for outgoings, council rates and the like. The de facto wife, as I say, has paid significant sums of money for housing post separation and that is also a factor to bring to account in making my orders.
In pronouncing the orders that I will make in a moment I have had regard to, as I have mentioned previously, the decision of Stanford. I confirm that the Court finds that it is just and equitable to make orders adjusting the parties’ legal and equitable interests in property. I have also had regard to the decision of Jabour,[11] which directs the Court to consider the myriad of contributions to be made by parties in a marriage or relationship such as this, particularly one of significant length and involving a number of children.
[11] Jabour & Jabour [2019] FamCAFC 78.
THE OVERALL EFFECT OF THESE ORDERS
Based on my assessment of the parties’ contributions, the section 90SF(3) factors and considerations as to justice and equity, I have come to the conclusion that the parties’ gross assets should be divided as to 60 per cent to the applicant and 40 per cent to the respondent. Based on the calculation set out above, the gross asset pool is approximately $775,996.51. The applicant’s entitlement is $465,597. The applicant will be retaining assets totalling $16,218. This would see the applicant receiving the sum of $449,379 to receive her proper entitlement.
I am satisfied for the reasons given, noting the length of the relationship, the parties’ respective financial and nonfinancial contributions and my findings thereon and the section 90SF factors, that the orders proposed herein are just and equitable in the circumstances.
In addition to the orders for property settlement, the de facto wife has sought what might be described as personal protection orders as contained in paragraph 1.11 of the amended orders sought. I decline to make the orders for personal protection in favour of the de facto wife in a property Trial. There is no recent material put before the Court in relation to the husband’s alleged conduct. An order of this Court is unlikely to provide the wife with the sort of immediate relief that she might otherwise seek if there is a breach of any order in relation to personal protection. It is a matter for the wife to take advice in relation to what other avenues are available to her for personal protection orders. But on the facts of this case I decline to make the orders as sought by the wife.
For all of the above reasons, I make the orders as set out at the commencement of this Judgment.
I certify that the preceding eighty-four (84) numbered paragraphs are a true copy of the Ex Tempore Reasons for Judgment of Judge Dickson. Associate:
Dated: 7 June 2022
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