ROVERATI & ROVERATI

[2020] FCCA 561

FEDERAL CIRCUIT COURT OF AUSTRALIA

ROVERATI & ROVERATI [2020] FCCA 561

Catchwords:
FAMILY LAW – Property – assessment of contributions – long marriage – add-backs – contributions assessed as 50:50 – no further adjustment made – superannuation splitting order.

Legislation:

Family Law Act 1975 (Cth), ss.75(2), 79, 90MT(1)(a), 90MT(4) and 117(1)

Family Law (Superannuation) Regulations 2001 (Cth), Pt 6

Cases cited:

Hickey & Hickey (2003) FLC 93-143

Stanford & Stanford [2011] FamCAFC 208
AJO & GRO (2005) FLC 93-218
Trevi & Trevi [2018] FamCAFC 173
NHC & RCH [2004] FamCA 633
Petruski & Balewa [2013] FamCAFC 15
Bolger v Headon [2014] FamCAFC 27
Norbis v Norbis (1986) 161 CLR 513

Applicant: MR ROVERATI

Respondent: MS ROVERATI

File Number: ADC 1325 of 2017

Judgment of: Judge Heffernan

Hearing dates: 21 & 22 June 2018

Date of Last Submission: 12 September 2018

Delivered at: Adelaide

Delivered on: 24 March 2020

REPRESENTATION

Counsel for the Applicant: Mr Bowler

Solicitors for the Applicant: Di Rosa Lawyers

Counsel for the Respondent: Mr McQuade

Solicitors for the Respondent: Howe Jenkin

ORDERS

1. There be a 50:50 division of the net assets of the parties including superannuation with the following orders to give effect to the same:

   (a)Within 60 days of the making of these orders, the husband shall do all acts and things and sign all documents necessary to transfer to the wife all of his interest and estate in the property situated at B Street, Suburb C in the State of South Australia (‘the former matrimonial home’) being the whole of the land comprised and described in Certificate of Title Register Book Volume … Folio … at the expense of the wife.

   (b)Within 60 days of the making of these orders the husband shall pay to the wife the sum of $126,085.50 (or such other amount as may be required to achieve a division of assets between the parties in the proportion of 50% to the husband and 50% to the wife).

2. The wife shall retain the following assets free of any claim by the husband:

   (a)The former matrimonial home including the furniture and personal effects therein SAVE AND EXCEPT for the husband’s office furniture, washing machine and clothing and personal effects;

   (b)The settlement sum;

   (c)Her estate and interest in the D Street, Suburb E Trust;

   (d)Her separate savings and investments;

   (e)Her Motor Vehicle 1;

   (f)Her shares; and

   (g)Any other assets in her name or in her possession.

3. The husband shall retain the following assets free of any claim by the wife:

   (a)The Roverati Family Trust and the F Street Trust;

   (b)His separate savings and investments;

   (c)The Motor Vehicle 2; and

   (d)Any other assets in his name or in his possession including but not limited to the husband’s office furniture, washing machine, clothing and personal effects.

4. Paragraph 2 (inclusive) of this order is binding on the Trustee of Super Fund J (‘the Fund’):

   (a)In accordance with s 90MT(4) of the Family Law Act 1975 (‘the Act’) the base amount of $45,965 is to be allocated to the applicant wife of the interest of the respondent husband in the Fund (Member No. …41.

   (b)Pursuant to s 90MT(1)(a) of the Act, whenever a splittable payment becomes payable in respect of the respondent’s interest in the Fund, the applicant shall be entitled to be paid an amount calculated in accordance with Pt 6 of the Family Law (Superannuation) Regulations 2001 (‘the Regulations’) using the base amount and there be a corresponding reduction in the entitlement of the person to whom the spittable payment would have been made but for this order;

   (c)Paragraph 2(a) has effect from the operative time.

   (d)The operative time for the purpose of paragraph 2(a) of this order is four (4) business days after the date of service of this sealed order upon the Trustee of the Fund;

   (e)The applicant’s solicitors serve a copy of the sealed orders upon the Trustee of Super Fund J within 7 days of receipt of the sealed copy of the orders;

5. As and from the making of these orders:

   (a)The parties shall each pay and fully and forever indemnify the other with respect to their separate debts;

   (b)The parties each pay their own costs of and incidental to these proceedings SAVE AND EXCEPT the costs of any transfer necessary to give effect to these orders as otherwise provided for herein;

   (c)The parties are each restrained by injunction from pledging the credit of the other;

   (d)The parties shall each do all such acts and things and sign all such documents as may be necessary to give effect to these orders;

   (e)If either the husband or the wife shall refuse or neglect to execute any document necessary to give effect to the terms of these orders within seven (7) days after the same shall have been tendered to them for that purpose, then and in such case a Registrar or Deputy Registrar of this Honourable Court upon proof by affidavit of such refusal or neglect is hereby appointed to execute any such document on behalf of either party, (together with making any necessary amendments and/or undertaking any such other acts and signing such other documents as may be required to give effect to these orders) AND the party in default shall pay the other party’s costs arising from such default on an indemnity basis.

6. Liberty is granted to either party to apply for any consequential orders.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT ADELAIDE

ADC 1325 of 2017

MR ROVERATI

Applicant

And

MS ROVERATI

Respondent

REASONS FOR JUDGMENT

Introduction

1. These are proceedings for matrimonial property orders pursuant to s 79 of the Family Law Act 1975 (Cth) (‘the Act’).

2. The applicant wife seeks orders for the non-superannuation assets of the parties to be divided 55% in her favour and the parties’ superannuation entitlements to be equalised. It is her case that this division is just and equitable based on her financial, homemaking and parenting contributions, which she asserts outweighs those of the husband by 5%. She does not seek an adjustment in relation to the factors set out in s 75(2) of the Act.

3. The husband agrees that the parties’ superannuation entitlements should be equalised, however he seeks that the non-superannuation assets be divided 60% in his favour. He argues that the Court should make an adjustment of 10% in his favour based on the parties’ contributions. Like the wife, he does not seek any adjustment with respect to s 75(2) of the Act.

Background

1. The short history of the parties and their relationship is as follows:

   a)The husband was born in 1957 and was 60 years of age at the time of the trial;

   b)The wife was born in 1959 and was 58 years of age at the time of the trial;

   c)In 1983, the parties purchased the former matrimonial home located at K Street, Suburb L in the State of South Australia;

   d)The parties married in 1983 and commenced cohabitation in the former matrimonial home upon their marriage;

   e)There are two children of the parties’ marriage, namely:

   i)Ms M born in 1987 (‘Ms M’), who was 31 years of age at the time of the trial; and

   ii)Mr N born in 1988, who was 29 years of age (‘Mr N’).

   f)The parties separated on 1 January 2016, but remained living separately and apart in the former matrimonial home until 8 December 2017, when the husband vacated the home;

   g)The parties have not yet divorced; and

   h)The parties’ child Ms M has married and lives independently, while Mr N remains living at the former matrimonial home with the wife.

Legal principles

1. The main provisions relating to the division of matrimonial property are contained in ss 79 and 75(2) of the Act.

2. In Hickey & Hickey[1] (‘Hickey’) the Full Court set out four interrelated steps that I must follow in determining the appropriate orders for the division of the matrimonial property of the parties.  These steps are as follows:

   a)Firstly, identify and value the assets, liabilities, and financial resources of the parties at the date of the hearing;

   b)Secondly, identify and assess the contributions made by the parties pursuant to s 79(4)(a), (b) and (c) of the Act and determine the contributed based entitlements of the parties expressed as a percentage of the net value of the property of the parties;

   c)Thirdly, identify and assess the relevant matters set out in ss 79(4)(d), (e), (f) and (g) as well as the factors contained in s 75(2) of the Act so far as they are relevant and consider whether any adjustments should be made to the contribution based entitlements of the parties; and

   d)Finally, consider whether the orders being made are ‘just and equitable’ in all of the circumstances of this case.[2]

   [1] [2003] FLC 93-143.

   [2]     Hickey at [39].

3. The High Court in Stanford & Stanford[3] (‘Stanford’) further identified that when determining orders for property settlement it is first necessary to consider whether it is just and equitable to make a property settlement order, by “identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property”.[4]

   [3] (2011) FamCAFC 208.

   [4] Ibid.

4. In accordance with Stanford, as an additional preliminary step, I must consider whether it would be just and equitable to make orders adjusting the parties’ interests in property.

The property pool

1. On the last day of the trial, I made orders which set out a timeline for the parties to file their written closing submissions.

2. In August 2018, I made further orders in chambers by consent, extending the dates for the filing of written closing submissions and requiring the parties’ counsel to confer and produce a joint statement of assets and liabilities.

3. A joint statement of assets and liabilities was prepared and produced to the Court and I now set out that statement:

ASSETS
Legal Ownership	Husband’s value		Wife’s value
1.	House and land at K Street, Suburb L (valuation 10/04/2018)	Husband and Wife as joint tenants AGREED	$460,000.00
2.	F Street, Suburb G (valuation 06/04/2018)	F Street, Suburb G Trust AGREED	$400,000.00
3.	Roverati Family Trust Investments (exclusive of $31,610 being held for the benefit of the parties’ son Mr N)	AGREED	$365,825.00
4.	F Street, Suburb G Trust Investments	F Street, Suburb G Trust NOT AGREED	$6,565.00		$7,952.00
5.	Wife’s interest in D Street Trust	Wife AGREED	$68,794.00
6.	N Trust	AGREED	$2,794.00
7.	Wife O Bank account	Wife NOT AGREED	$27,326.00 (as at 14/01/2018)		$1,925.00 (as at 05/06/2018)
8.	O Bank Account	Wife AGREED	$3,418.00
9.	P Bank Account	Husband AGREED	$4,460
10.	P Bank Account	Joint AGREED	$252.00
11.	Company Q Shares	Wife AGREED	$1,817.00
12.	Motor Vehicle 2	Husband AGREED	$1,000.00
Total Non-Super Assets				$1,342,206.00		$1,318,192.00
SUPERANNUATION ASSETS
1.	Super Fund J	Wife AGREED	$83,828.00
2.	Super Fund J	Husband AGREED	$133,838.00
3.	Super Fund R	Husband AGREED	$41,920.00
Total Superannuation				$259,586.00
TOTAL GROSS ASSETS				$1,601,802.00		$1,577,788.00
LIABILITIES
1.	Commonwealth Bank credit card	Husband AGREED	$2,969.00
2.	N Trust Liabilities	NOT AGREED	$3,615.00		Nil
TOTAL LIABILITIES				$6,584.00		$2,969.00
NET ASSETS				$1,595,208.00		$1,574,809.00

1. As identified in the above statement, the items of property which were the subject of dispute between the parties were as follows:

   a)The value of the F Street, Suburb G Trust Investments;

   b)The value of the Wife’s O Bank Account; and

   c)The value of the N Trust Liabilities.

2. In addition to those items of property set out above, the wife also sought that various sums of money, allegedly spent by the husband during the post-separation period, be ‘added back’ to the property pool.

3. These sums were described in the wife’s final written submissions filed on 1 November 2018 as follows:

Add-back sought by the Wife	Wife’s value
Drawn down by husband post separation to pay business expenses from the parties’ joint P Bank account	$4,456.00
Drawn down by husband post separation to pay various expenses	$4,752.00
Drawn down by husband post separation from the P Bank (The F Street, Suburb G Trust Working Account)	$41,688.00
Drawn down by husband on 7 May 2018 from the P Bank Term Deposit	$23,977.00
Total	$74,873.00

1. I will first deal with the items of currently existing property, the value of which is in dispute.

F Street, Suburb G Trust investments

1. In relation to the F Street, Suburb G Trust investments, neither party clearly articulated or demonstrated how the figure they promoted for the F Street, Suburb G Trusts investments was demonstrated.  Both parties agree that the trust has money invested.  On the wife’s case, the amount is at least that admitted by the husband.  I have adopted the lower figure as at least that amount is not disputed and accordingly, the figure for the purposes of the pool is $6,565.00.

Wife’s O Bank Account

1. There is no dispute between the parties that the balance of the wife’s O Bank Account was:

   a)$27,326 as at 14 January 2018; and

   b)$1,925 as at 5 June 2018.

2. The parties annexed to their Joint Statement of Assets and Liabilities, statements for the wife’s O Bank Account for the periods 8 May 2018 to 5 June 2018 and 15 July 2017 to 14 January 2018, which indicate the above balances on those dates.

3. The issue between the parties is the date at which the wife’s O Bank Account should be valued.

4. It is the wife’s position that the Court should adopt the value of $1,925 as at 5 June 2018, being the closing balance of her O Bank Account in her most recent bank statement at the time of the trial.

5. Conversely, the husband asserts that the Court should adopt the value of $27,236 as at 14 January 2018, being the closing balance of the wife’s O Bank Account in her most recent bank statement after the parties’ separation.

6. The husband refers to a number of transactions in the wife’s O Bank statement for the period 8 May 2018 to 5 June 2018, which he asserts shows the wife’s expenditure on legal fees and costs.  These transactions are as follows:

   a)Court fees of $605 on 10 May 2018;

   b)Mediation fees of $975 on 15 May 2018;

   c)Counsel fees of $3,300 on 15 May 2018;

   d)Solicitor’s fees of $5,000 on 18 May 2018;

   e)Solicitor’s fees of $9,500 on 25 May 2018; and

   f)Solicitor’s fees of $4,300 on 30 May 2018.

7. It is his position that at the very least the wife’s expenditure on legal fees in the total sum of $23,680 should be added back to the pool.

8. The authorities indicate that in proceedings under s 79 of the Act, the property of the parties is ordinarily valued as at the date of the trial.[5]  I can see no good reason to depart from that principle.

   [5]     AJO & GRO (2005) FLC 93-218.

9. I will therefore include the value of $1,925 for the wife’s O Bank Account in the property pool and will consider whether the sum of $23,680 alleged by the husband to have been spent by the wife on legal fees should be included as an add-back.

N Trust Liabilities

1. The husband seeks to bring into account a liability in the sum of $3,615, for expenses he alleges were incurred through the operation of his , N Trust.

2. The wife disputes that the Court should include the sum of $3,615 as a liability owed to N Trust because she says that the husband has not provided any documentary evidence in relation to it.

3. The parties agree that the husband’s business does not have any value, other than the business bank account with a balance of $2,794.

4. The wife’s desire to exclude an amount of liability for a business that has never made money is understandable.  However, the business was commenced during the period of the relationship after a period of study and employment embarked on by the husband with the support and encouragement of the wife.  It was a career path he embarked on for their joint benefit.  Had the business turned a healthy profit, the wife would no doubt seek to have the value of the business brought to account.  I am satisfied the liabilities in question were incurred in the course of running the husband’s business and not a premature distribution of a marital asset and I have included that liability in the amount of $3,615.00 in the pool.

Add-backs

1. The Full Court has made it clear that add-backs are “the exception rather the rule.”  Whether expenditure should be added back to the property pool to be divided between the parties is a matter of discretion.

2. In the recent decision of the Full Court in Trevi & Trevi[6] (‘Trevi’), Murphy J, with whom Alstergen DCJ and Kent J agreed, said as follows:

   [6] [2018] FamCAFC 173.

   “(a)  Dissipation of property and expenditure other than on legal fees

   [27]The Full Court held in AJO & GRO that addbacks fall into “three clear categories”: where the parties have expended money on legal fees; where there has been a premature distribution of matrimonial assets; and “waste” or wanton, negligent, or reckless dissipation of assets.

   [28]However, the Full Court also made it clear that an addback does not necessarily occur whenever “a party has expended money realised from the disposition of assets that existed as at the date of separation”, the Full Court describing such a proposition as “unduly simplistic”. An earlier Full Court made the same point, saying that adding back is “the exception rather than the rule”.

   [29]The fundamental precept that addbacks are exceptional, reflected in the decisions just referred to, also mirrors what has been said in earlier decisions of the Full Court that, for example, “the Family Court must take the property of a party to the marriage as it finds it” at trial. An important parallel proposition is that the parties do not “go into a state of suspended economic animation” after separation. Thus, reasonably incurred expenditure does not usually come within accepted categories of addback.

   [30]Two fundamental premises emerge from AJO & GRO and the authorities preceding it. First, “adding back” is a discretionary exercise. When the discretion is exercised in favour of adding back, it reflects a decision that, exceptionally, in the particular circumstances of a case, justice and equity requires it. The second premise is its corollary: in cases that are not “exceptional” justice and equity can be achieved, not by adding back, but by the exercise of a different discretion — usually by taking up the same as a relevant s 75(2) factor. Indeed, it has been said that the latter is “a course which is, perhaps, technically more correct” than adding back to the list of existing interests in property.”

3. The Full Court then went on to examine the principles relating to paid legal fees as a category of add-backs and said:

   “(b)  Expenditure on Legal Fees

   [31]To the considerations just discussed must be added the propositions emerging from authority that paid legal fees as a category of addback is imbued with considerations specific to that expenditure. The Full Court said in NHC & RCH:

   56.In summary, we consider that the above mentioned decisions of the Full Court establish that, while the treatment of funds used to pay legal costs remains ultimately a matter for the discretion of the trial Judge, in determining how to exercise that discretion, regard should be had to the source of the funds.

   57.If the funds used existed at separation, and are such that both parties can be seen as having an interest in them (on account, for example, of contributions), then such funds should be added back as a notional asset of the party, who has had the benefit of them.

   58.If funds used to pay legal fees have been generated by a party post-separation from his or her own endeavours or received in his or her own right (for example, by way of gift or inheritance), they would generally not be added back as a notional asset; nor would any borrowing undertaken by a party post-separation to pay legal fees be taken into account as a liability in the calculation of the net property of the parties. Funds generated from assets or businesses to which the other party had made a significant contribution or has an actual legal entitlement may need to be looked at differently from other post-separation income or acquisitions.”

1. There are different considerations with respect to paid legal fees as a category of add-backs, as a result of s 117(1) of the Act, which provides a general rule that each party to a proceeding shall bear his or her own costs.

2. The decision to add back funds in which both parties had an interest and were used by one party to pay their legal fees, is a decision about the payment of that party’s legal costs by the other party.

Add-backs sought by the wife

Sum of $4,456 drawn by the husband to pay business expenses

1. The wife asserts that during the post-separation period the husband made payments on a Commonwealth Bank credit card in his sole name in the total sum of $5,433.00.  She says that $4,456 of these payments were not for the husband’s “reasonable living expenses” and should be added back to the pool.

2. At paragraph 73 of her trial affidavit, the wife particularises the following payments made on the husband’s Commonwealth Bank credit card, which she says should not be regarded as reasonable living expenses:

Date	Details	Amount
25/1/2016	Company S	$295.02
25/1/2016	N Trust website	$400.00
11/2/2016	Company T	$1,335.00
22/2/2016	Company S Advertising	$295.02
22/2/2016	N Trust website	$690.00
21/3/2016	Promoting your business workshop	$49.50
21/3/2016	Company S Advertising	$295.02
21/3/2016	business renewal registration	$502.10
21/3/2016	business reading	$300.00
18/4/2016	Company S	$295.02
TOTAL		$4,456.68

1. The husband says that the above expenses were necessary for him to earn an income.  Some of the expenses had a personal and a business element, such as his business renewal registration, while some expenses such as his business website and advertising were only for his business.

2. For the reasons I identified with respect to the N Trust liabilities, I am satisfied it is appropriate to decline to add back the above amounts.

Sum of $4,752 drawn by the husband to pay various expenses

1. The husband and the wife are the appointors, trustees and primary beneficiaries of the Roverati Family Trust.  At separation, the Trust held a P Bank transaction account with a balance of $12,477.

2. The wife asserts that following separation the husband has made withdrawals from the P Bank transaction account in the sum of $4,752, for expenses which were not “reasonable living expenses.”

3. These expenses were set out on page 14 of the wife’s final written submissions as follows:

Date	Details	Amount
23/5/2016	Professional indemnity insurance	$1,193.28
23/5/2016	Company S – Advertising	$295.02
25/5/2016	course	$540.00
7/6/2016	Payment to Howe Jenkin (legal costs)	$600.00
21/6/2016	Adobe software	$81.31
21/6/2016	business school	$1,078.00
11/7/2016	Payment for Business Insurance	$964.92
TOTAL		$4,752.53

1. I am satisfied that it is appropriate to add back the amount of $600 spent by the husband on legal expenses.

Sum of $41,688 drawn by the husband from the F Street, Suburb G Trust working account

1. The husband is the appointor, trustee and primary beneficiary of the F Street, Suburb G Trust.  At separation, the F Street, Suburb G Trust held a working account with P Bank with a balance of approximately $29,000.

2. The wife claims that during the post separation period, the husband made withdrawals from the P Bank working account in the sum of $41,688 which should be added back to the pool.

3. The alleged withdrawals made by the husband from the P Bank working account are set out at paragraph 75b. of the wife’s trial affidavit and include:

Details	Amount
Payment of the husband’s legal fees	$34,942.65
Payments for N Trust software & hardware	$3,391.00
Payment to Business Insurance	$854.00
Payment to husband’s CBA credit card account to fund the replacement of his motor vehicle engine	$2,500.00
TOTAL	$41,687.65

1. The add-back of legal fees is, as noted in Trevi, a discretionary matter.  The disbursement of funds from the working account to pay the legal fees of the husband should properly be regarded as being received in his own right by virtue of being a beneficiary of the Trust.  In such circumstances, funds of that nature expended on legal fees would not ordinarily be added back as a notional asset.[7]  Further, the amounts relating to his business expenses and for a new engine for his car should not be added back.

   [7]     NHC & RCH [2004] FamCA 633 at [58].

The sum of $23,977 drawn by the husband from the F Street, Suburb G Trust Term Deposit account

1. At the date of separation, the F Street, Suburb G Trust also held a P Bank Term Deposit Account with a balance of approximately $42,000.

2. The wife alleges that on 7 May 2018, the husband transferred the sum of $23,977 from the P Bank Term Deposit Account to his personal account.  She says that she does not have any details regarding the transfer and seeks that this sum be added back to the pool.

3. As submitted by counsel for the husband, the wife has not demonstrated that these funds were expended on anything other than living expenses.  It has not, for example, been established that he indulged in the wastage of funds by way of significant discretionary spending.  I decline to add this amount back to the pool.  As the husband himself has observed, he has been either unemployed or running an unprofitable business for many years.[8]

   [8] Exhibit R7 at [80].

4. The wife seeks an amount of $1,350.18 to be repaid to her on account of an amount of post separation income earned by her that was mistakenly paid into the parties’ joint P Bank Account.[9] 

   [9] Exhibit A1 at [72].

5. This was not sought specifically as an add-back to the property pool, rather as I have noted, she sought reimbursement of this amount in full.  The joint P Bank Account was used post separation for “joint living costs” post separation, the husband’s reasonable living expenses post separation, and the husband’s business and professional development expenses.  There is no evidence as to the relative withdrawals from that account in the post separation period.  I am not able to determine the extent (if any) to which the wife had the benefit of those funds once deposited, albeit in error, into the joint account.  I am not satisfied that a sufficient evidentiary foundation has been established for me to order that the amount sought specifically be refunded to her from the joint property pool.

Add-back sought by the husband

Sum of $23,680 used to pay the wife’s legal costs

1. The wife says that she has paid all of her legal fees and disbursements from her O Bank Account.  She says that she opened her Bank Account after separation and her earnings have been paid into this account.  It is her position that her legal fees and disbursements should not be added back to the pool because they have been paid using post-separation income.  I accept her evidence in that regard.

2. In accordance with the principles with respect to expenditure on legal costs set out in Trevi, I am satisfied that the sum of $23,680 should not be added back to the pool.  The funds used to pay for the wife’s legal costs have been generated by her since separation from her own endeavours.

Conclusion about the property pool

1. I have therefore concluded that the pool of assets and liabilities available for division between the parties is as follows:

ASSETS
Legal Ownership	Value
1.	House and land at K Street, Suburb L (valuation 10/04/2018)	Husband and Wife as joint tenants	$460,000.00
2.	F Street, Suburb G, (valuation 06/04/2018)	F Street, Suburb G Trust	$400,000.00
3.	Roverati Family Trust Investments (exclusive of $31,610 being held for the benefit of the parties’ son Mr N)	$365,825.00
4.	F Street, Suburb G Trust Investments	F Street, Suburb G Trust	$6,565.00
5.	Wife’s interest in D Street Trust	Wife	$68,794.00
6.	N Trust	$2,794.00
7.	Wife O Bank account	Wife	$1,925.00 (as at 05/06/2018)
8.	O Bank Account	Wife	$3,418.00
9.	P Bank Account	Husband	$4,460
10.	P Bank Account	Joint	$252.00
11.	Company Q Shares	Wife	$1,817.00
12.	Motor Vehicle 2	Husband	$1,000.00
ADD-BACK
1.	Howe Jenkins Legal Costs	$600.00
TOTAL NON-SUPER ASSETS				$1,317,405.00
SUPERANNUATION ASSETS
4.	Super Fund J	Wife	$83,828.00
5.	Super Fund J	Husband	$133,838.00
6.	Super Fund R	Husband	$41,920.00
TOTAL SUPERANNUATION				$259,586.00
TOTAL GROSS ASSETS				$1,576,991.00
LIABILITIES
3.	Commonwealth Bank credit card	Husband	$2,969.00
4.	N Trust Liabilities	$3,615.00
TOTAL LIABILITIES				$6,584.00
NET ASSETS				$1,570,407.00

1. There was no dispute between the parties as to who should retain which items of property from the pool.

2. The husband seeks to retain:

F Street, Suburb G Trust:

§  Real Estate

§  F Street Investments

$400,000.00

$6,565.00

The Roverati Family Trust

$365,835.00

The N Trust and Advisory Trust

$2,794.00

His P Bank Account

$4,460.00

His Motor Vehicle 2

$1,000.00

Half of the funds in the joint P Bank Account

$126.00

Benefit of the Add-back

$600.00

1. The wife seeks to retain:

House and land, K Street, Suburb L	$460,000.00
Her interest in D Street	$68,749.00
Her O Bank Account	$1,925.00
Company Q Shares	$1,817.00
Half her interest in the Joint P Bank Account	$126.00

It is just and equitable to make a property settlement order?

1. The parties’ marriage has irretrievably broken down. Both parties seek final property orders to put an end to the financial relationship between them. I am satisfied that it is just and equitable for the Court to make orders pursuant to s 79 of the Act.

Contributions - Sections 79(4)(a), (b) & (c)

1. It is the wife’s position that the parties’ contributions should be assessed 55:45 in her favour, while the husband asserts that they should be assessed 60:40 in his favour.  There is therefore a 15% difference between the parties’ positions with respect to contributions.

2. The parties cohabited for thirty three years, with cohabitation commencing on the date of their marriage in 1983.

3. Shortly prior to their marriage, the parties purchased the former matrimonial home, located at K Street, Suburb L for the purchase price of $60,000.  They paid a deposit in the sum of $28,000 and borrowed the remaining $32,000.  The parties discharged the mortgage in 1987 and have owned the property freehold since that time.

4. When the parties purchased the former matrimonial home, the wife had approximately $40,000 in savings and the husband had $4,000 in savings, a Motor Vehicle 3, which was subject to finance, and the sum of $10,000 which was gifted from his parents.

5. Over the course of their marriage and post separation, the husband’s employment and income was as follows:

   a)From the start of cohabitation until 1988, the husband was employed as a tradesman;

   b)In 1988, the husband suffered a work place injury.  As a result of his injury, the husband was declared unfit for work and started receiving workers’ compensation payments.  He returned to work on modified duties in about 1989, but continued to receive worker’s compensation payments until mid-1993;

   c)For the first twelve months after his injury, the husband received his full-time equivalent income in worker’s compensation payments.  Thereafter and until mid-1993, the husband received 80% of his usual income;

   d)In mid-1993, the husband’s worker’s compensation payments were terminated and he was made redundant from his previous employment.  The husband received a redundancy payment in the sum of $3,466 and a compulsory superannuation payment in the amount of $5,514, which he paid into his Super Fund R interest;

   e)Following his redundancy, the husband was unable to gain employment and commenced studies at the V School, where he completed the equivalent to Year 10, 11 and 12 high school studies.  The wife states that she supported the husband during this period financially through her part-time employment at a business in Suburb E.  On the wife’s case, her earnings were a vital supplement to the husband’s only source of income during this time which was Austudy payments.  He did not have any form of employment during his period of tertiary study.[10]  The husband deposes that he applied unsuccessfully for a number of graduate positions before starting his qualifications.  He then commenced University studies in 1996 and graduated with a degree in 2000 and a degree in 2002.  The husband deposes, and the wife conceded in cross-examination, that prior to commencing these studies, he unsuccessfully applied for hundreds of clerical positions;[11]

   f)Between 1994 and 1999, the husband received a number of payments as a result of his work place injury.  These payments were set out at paragraph 22 of the husband’s trial affidavit as follows and were not disputed by the wife:

   [10] Ibid at [36].

   [11] Exhibit R7 at [30].

   i)1994  $7,554.00

   ii)1995  $15,323.00

   iii)1998  $15,147.00

   iv)1998  $15,150.00

   v)1998  $15,642.00

   vi)1999  $34,335.00

   Total   $103,333.00

   g)The husband cannot now remember how all of these sums were applied.  That is hardly surprising.  It has not been suggested that they were the subject of wastage by him.  The final payment was placed into a term deposit and used to establish the Family Trust;

   h)After completing his degree in 2000, the husband started full-time employment as a graduate professional. From 2003 to 2017, he held a number of positions as a professional[12] but was unable to maintain employment with one employer for a significant period of time.  The wife is critical of the husband in this regard, alleging that he did not maximize opportunities for paid employment during this period.  Between positions, the husband was unemployed for a total of approximately 5 years.  Over a period of approximately 10 years ending in 2012, he completed his qualifications to become a professional.  The wife emphasises that her income during this period was a significant contributing factor in funding his participation in the employment programme;

   i)In 2013, the husband established the business ‘N Trust’, which he operated as a sole practitioner from the former matrimonial home.  The business was not successful and the husband has not derived a taxable income from the business to date;[13] and

   j)At the time of the trial, the husband was unemployed and had not been employed since 2017.  He says that he was assiduous in trying to get his business off the ground, advertising and starting a website, to no avail.  Since 2015 he has applied for over 60 positions with very limited success.[14]

   [12] Exhibit R7 at [41].

   [13] Ibid at [42].

   [14]   Exhibit R7 at [42]-[49].

6. The wife’s employment and income throughout the parties’ marriage was as follows:

   a)When the parties’ started living together, the wife was employed on a full-time basis as an office worker;

   b)She ceased employment as an office worker in 1986, prior to the birth of the parties’ children, Ms M, who was born in 1987 and Mr N, who was born in 1988.  She deposes, and I accept, that on her resignation, she contributed all of her long service leave and annual leave entitlements to the reduction of the mortgage on the former matrimonial home.[15]  As will be seen from this summary, the wife was in paid employment throughout the 32 years of the marriage with the exception of five years when the children were young;

   c)Following the birth of the children, the wife was primarily engaged in parenting homemaking duties.  She returned to the workplace in 1991 and was employed until 2001 on a part-time, casual basis in various positions;

   d)In 2001, having obtained a Certificate, the wife obtained employment as a Clerk at Employer X on a casual basis.  She continued in this employment until 2003, when she was made redundant and commenced working part-time as a clerk at Employer Y; and

   e)In 2016, the wife’s employment was made full-time at the Employer Y and she has remained in this employment at the time of the trial.  She states that funds from her salary sacrifice were consistently applied to household expenses, in particular, groceries.

   [15] Exhibit A1 at [11].

7. Throughout their marriage, the parties each received a significant inheritance from their parents’ estates, which was placed in various trust entities.

The D Street Trust

1. Following the death of the wife’s father in 2003, the wife inherited a one-quarter interest in the property located at D Street, Suburb E, with her three brothers.  The property was valued at $189,000 and was rented, with a rental bank account balance of $12,547.

2. In 2006, a discretionary trust called the ‘D Street Trust’ was established with the wife and her three brothers being the trustees and their children being the beneficiaries of the Trust.  The property and the rental bank account balance were transferred into the Trust.

3. Upon the establishment of the D Street Trust, the wife and her three brothers generally agreed that any rental income received by the Trust would be distributed to their children.  The wife has never received any distribution from the D Street Trust and this is expected to continue.

The F Street, Suburb G Trust

1. The husband’s father died in 2006.  Following his death, the husband inherited one half of his estate, which included the property located at F Street, Suburb G, cash and investments.

2. The total value of the inheritance alleged to have been received by the husband is set out at paragraph 62 of his trial affidavit as follows:

   a)F Street, Suburb G:  $255,000;

   b)Conveyancing fees to transfer F Street, Suburb G into

   his sole name:  $11,281;

   c)Sale proceeds from the vacant block of land

   at Suburb Z:  $90,010;

   d)126 Company AA shares:   $6,247;

   e)898 Company BB shares:  $9,429;

   f)195 Company CC shares:   $719;

   g)Cash:   $72,782

   Total: $445,486

3. The wife asserts that the husband has overstated this value and that the value of the husband’s inheritance was $404,619.64.  In the context of a marriage of over 30 years’ duration, the effect of an overstatement in this amount is minimal to the contributions taken as a whole.

4. In 2007, the husband established the ‘F Street, Suburb G Trust’, of which he is the appointor, trustee and primary beneficiary.  He transferred the property at F Street, Suburb G, and the sum of $11,650 he inherited from his father’s estate into the name of the Trust.

5. The property at F Street, Suburb G has been retained by the Trust as a rental.

6. During the trial, the husband’s counsel tendered the Financial Statements for the F Street, Suburb G Trust for the years, which indicated that the Trust made distributions totalling $79,108.51 to the parties including distributions towards the Roverati Family Trust.  The wife conceded that these distributions were either re-invested or applied by the parties’ towards household expenses.

The Roverati Family Trust

1. In 2006, the parties established the Roverati Family Trust, with the husband and the wife being the appointors, trustees and primary beneficiaries of the Trust.

2. The initial assets of the Trust were a term deposit in the sum of $35,433, which contained some of the proceeds of the husband’s worker’s compensation payments and the sum of $8,682 received by the wife as a gift from her late grandmother.

3. The parties agree that the husband subsequently transferred the following assets from his inheritance into the Roverati Family Trust:

Date	Asset	Value
09/3/2007	126 Company AA shares	$3,487.00
03/4/2007	898 Company BB shares	$6,089.00
195 Company CC Shares	$324.00
08/9/2007	Cash	$23,350.00
01/6/2008	50% share of sale proceeds of Suburb Z block	$90,010.00
28/6/2014	Further cash distribution	$28,843.00
50% share of cash discovered buried in the Husband’s father’s backyard	$9,000.00
TOTAL	$161,103.00

1. The parties agree that the present value of the trust is $365,825.00.

2. The parties agree that the sum of $31,610 is being held on trust for their son Mr N to pay for his wedding at some point in the future.  That figure has been excluded from the agreed value of the Trust.

3. Since its establishment, the Trust has made distributions to the parties of $127,718.36.  The wife maintains and I accept that distributions were largely made on paper only with profits being reinvested.

4. There appears to be no dispute that significant household expenses were paid out of family trust.

Homemaker and parent

1. The wife asserts that she was the primary homemaker and attended to all of the housekeeping duties such as cooking, cleaning, washing, ironing and grocery shopping.  The husband mowed the lawn and pruned the plants and washed the car, but his non-financial contribution as a homemaker and parent did not significantly increase even when he was unemployed or studying.[16]

   [16] Exhibit A1 at [10], [22] & [32].

2. On the wife’s evidence, an important part of her contribution was in her prudent management of the household and in particular the household budget.  She did everything within her abilities to ensure that the family lived frugally.  Money was always a bone of contention between her and the husband, but her efforts should be seen as a significant contributing factor to the parties’ ability to have paid off the mortgage on the former matrimonial home by early 1987.[17]  I accept her evidence in that regard.

   [17]   Exhibit A1 at [11]-[17].

3. The wife deposes, and I accept, that after the 1995 diagnosis of her mother-in-law with cancer, she attended to all of her medical appointments and care as well as assisting her mother-in-law with home duties and shopping.[18]  This was of course in addition to working part-time and maintaining her level of home duties for the immediate family.  On the death of her mother-in-law, the wife states that she assisted her father-in-law with his home duties and shopping every week without assistance from the husband.[19] 

   [18] Ibid at [35].

   [19] Ibid at [37].

4. On the husband’s case, the wife was less involved with the care of his mother than she has claimed.[20]  He also states that when his father moved into residential care, he successfully applied to the Guardianship Board to be appointed as his father’s guardian and power of attorney.  On his father’s death, he was executor of the estate, obtained probate and distributed the assets.

   [20] Exhibit R7 at [51].

5. The husband describes the parties’ relationship as very traditionally Country DD.  The wife was primary care giver to the children and ran the household.  He maintained the property and gardens.  Nonetheless, he states that he contributed to the care of the children in many ways, being responsible for discipline, doing school pick-ups and drop-offs when his wife was unable to do so, and managing the children’s extra-curricular activities on weekends if his wife was working.[21]  He also maintains that he assisted with domestic tasks within the capacity afforded him by his back injury.  His outdoor work included maintaining a sizeable vegetable patch.  He would also assist his wife’s family with the annual tomato sauce making, olive picking and sausage making.[22]  He mowed the lawn and looked after the fruit trees.  Despite his back injury, he says that he performed significant maintenance and improvements on the former matrimonial home.[23]  He denies that he was financially controlling during the marriage but says that he encouraged them to live frugally and his efforts in that regard enabled them to send the children to private school.  I accept that the husband made a contribution to the family as a homemaker and parent.

Conclusion as to contributions

[21] Ibid at [91]-[97].

[22] Ibid at [102]-[103].

[23] Ibid at [110]-[111].

1. It is well established that when assessing contributions in the context of a long marriage, no precise formula can be brought to the task.  That observation was emphasised by the Full Court in Petruski and Balewa[24] (‘Petruski’) where the Court had this to say:

   “The task of assessing contributions under s 79 of the Act is an holistic one; what is required is to evaluate the extent of the contributions of all types made by each of the parties in the context of their particular relationship …”

   [24] [2013] FamCAFC 15 at [49].

2. The same observation was made by the Full Court in Bolger v Headon[25] (‘Bolger’) where the Court emphasised the breadth of the discretion as to the assessment of contributions and reminded itself of the stricture of the High Court in Norbis v Norbis[26] (‘Norbis’) that the assessment of contributions should be made without “giving over-zealous attention to the ascertainment of the parties’ contributions …”

   [25] [2014] FamCAFC 27 at [28].

   [26] (1986) 161 CLR 513, 524.

3. The parties supported each other, financially and non-financially, in different ways over many years.  At times their individual levels of contribution, both financial and non-financial fluctuated.  I have concluded that contributions between them should be apportioned on a 50:50 basis.  I am further satisfied that it is appropriate to make orders providing for an equalisation of superannuation interests as sought by both parties.

Sections 79(4)(d), (e), (f) & (g)

1. The husband remains in control of his business which he claims makes no money and has few clients, and he continues to look for work.  The wife is employed in a stable position she has held for some time.

2. The wife is employed as a clerk with the Employer Y and earns approximately $60,000 per annum, which is made up of a salary of $43,000 and a tax free exemption amount of about $17,000.

3. I am satisfied that the orders I propose to make will not have an effect on the capacity of either of them to earn an income.

4. While the husband alleges that the wife has a superior earning capacity, he, like the wife, does not seek any adjustment to their contribution based entitlements with respect to the factors in s 75(2) of the Act. In all of the circumstances, I consider that this is appropriate.

5. The husband and wife are both in good health and, at their respective ages, have many years of potential for gainful employment ahead of them.  They are both in good health.  Neither party has the care or control of a child of the marriage under the age of 18 years.  Each party has assumed responsibility for supporting themselves and neither has a duty to maintain another person.  Each of them has an entitlement to enjoy a reasonable standard of living.  That will be possible with an equal division of the assets.  This has been a lengthy marriage but I have concluded that the income earning capacity of neither of them has been affected by that circumstance.

6. There are no other orders under the Act currently affecting either of the parties or a child of the marriage.

7. Child support is not a relevant consideration in these proceedings.

8. I am satisfied that no further adjustment is warranted.

Justice and equity

1. The net non-superannuation property pool being $1,317,405, a 50% distribution to each party would amount to them having non-superannuation assets of $658,702.50.  With the husband retaining the property I have referred to earlier in these reasons, he would have assets and cash in the amount of $781,380.00.  With the wife retaining the property I have referred to, she would have assets and cash in the amount of $532,617.00. 

2. An equalisation of the non-superannuation assets on a 50:50 basis would require the husband to pay the wife $126,085.50.

3. An equalisation of the superannuation entitlements would see both parties with $129,793.00 in superannuation as a financial resource.  Each party would then have combined non-superannuation assets and superannuation in the amount of $788,495.50.

4. Standing back, and as a final check, I am satisfied that it is just and equitable to make orders which give effect to a division of assets on the basis indicated above.

5. Accordingly, I make those orders to be found at the beginning of these reasons.

I certify that the preceding one hundred and two (102) paragraphs are a true copy of the reasons for judgment of Judge Heffernan

Associate: 

Date: 24 March 2020