Rushdie and Mohsin
[2017] FamCA 859
•27 October 2017
FAMILY COURT OF AUSTRALIA
| RUSHDIE & MOHSIN | [2017] FamCA 859 |
| FAMILY LAW – JURISDICTION – De facto relationship – Where applicant sought a declaration that a de facto relationship had existed between the parties within the meaning of s 90SB of the Family Law Act 1975 (Cth) – Consideration of the circumstances set out in s 4AA(2) of the Family Law Act 1975 (Cth) – Where it was determined that the parties were living together in a de facto relationship – Where the threshold of two year cohabitation was satisfied – Where a declaration was made pursuant to s90RD of the Family Law Act 1975 (Cth). |
| Evidence Act 1995 (Cth) s 140(1) Family Law Act 1975 (Cth) ss 4(1), 4AA, 90RD, 90SB |
| Jonah & White (2011) 45 Fam LR 460 Ricci v Jones [2011] FamCAFC 222 Sha & Cham [2017] FamCAFC 161 Sinclair & Whittaker (2013) FLC 93-551 |
| APPLICANT: | Ms Rushdie |
| RESPONDENT: | Mr Mohsin |
| FILE NUMBER: | SYC | 5450 | of | 2015 |
| DATE DELIVERED: | 27 October 2017 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Johnston J |
| HEARING DATE: | 28 & 29 March 2017; 18 & 19 September 2017 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Schonell |
| SOLICITOR FOR THE APPLICANT: | Dignan & Hanrahan Solicitors & Attorneys |
| COUNSEL FOR THE RESPONDENT: | Mr Richards |
| SOLICITOR FOR THE RESPONDENT: | Macpherson & Kelley Lawyers |
Orders
It is declared pursuant to s 90RD(1) and (2) of the Family Law Act 1975 (Cth) that a de facto relationship existed between Ms Rushdie and Mr Mohsin during the period commencing not later than August 2009 and concluding in May 2015.
The proceedings are listed for further directions at 9.30 am on 8 November 2017.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Rushdie & Mohsin has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYC 5450 of 2015
| Ms Rushdie |
Applicant
And
| Mr Mohsin |
Respondent
REASONS FOR JUDGMENT
Introduction
The issue in these proceedings is whether this Court has jurisdiction to make property settlement orders in the circumstances of the relationship of the parties.
The applicant is Ms Rushdie and the respondent is Mr Mohsin. The applicant is seeking to have property orders made.
The applicant asserts that the parties had a de facto relationship which would attract application of the relevant financial provisions of the Family Law Act 1975 (Cth) (“the Act”). The respondent contends that the parties’ relationship was that of “boyfriend/girlfriend” which at no time fell within the meaning of “de facto relationship” in the Act.
On 16 May 2016, during the course of making directions for the hearing of these proceedings, the respondent, who was self-represented at the time, had conceded that the parties were in a de facto relationship in excess of two years’ duration but that the actual duration of the relationship remained in issue.
In these circumstances, the property proceedings were listed for hearing for two days commencing on 28 March 2017. The respondent was legally represented at the hearing. Early on the first day, namely 28 March 2017, Mr Richards of counsel indicated that the respondent did not concede the jurisdictional requirement and said that to the extent that he might be taken to have made this concession on the earlier occasion, the Court would note that he was not legally represented at the time.
In light of this change, and bearing in mind that the matter was not prepared in a manner which would enable the property proceedings to be able to be completed within the two days allocated, I informed the parties that I proposed to spend the two days allocated by hearing the applications in respect of jurisdiction. Unfortunately, the hearing about jurisdiction did not conclude on 29 March 2017 and it became necessary to adjourn this for further hearing on 18 and 19 September 2017.
Short summary
Mr Mohsin, the respondent, was born in 1964 and is currently 53 years of age. Ms Rushdie, the applicant, was born in 1968 and is currently 49 years of age.
The applicant has three children from a previous relationship namely Mr B, Ms C and Mr D who are 29, 23 and 18 years of age respectively. The respondent has two children from a previous relationship namely Mr E and Mr F who are 26 and 23 years of age respectively.
Applications
The applicant seeks a declaration pursuant to s 90RD of the Act that a de facto relationship existed between her and the respondent within the meaning of the Act between January 2007 and 11 May 2015.
The respondent seeks a declaration that a de facto relationship within the meaning of the Act never existed between the parties.
Background
In 2005 the respondent finalised a property settlement with his former wife whereby he received the amount of approximately $300 000.
In late December 2006 the parties commenced a relationship. According to the applicant cohabitation commenced shortly thereafter in an arrangement where they would live between their respective residences. According to the respondent, the parties commenced residing at the applicant’s home in August 2009, but only as boyfriend/girlfriend.
In mid-2007 the applicant’s property at G Street, Suburb H (“the Suburb H property”) was destroyed by a fire. The applicant’s insurance company funded the family’s accommodation at a motel for six weeks and then in a rental property for several months. According to the applicant, the parties lived at the respondent’s property at J Street, Suburb K (“the Suburb K property”) until the completion of the rebuilt home. According to the respondent, the applicant lived with her mother and he continued to reside in his home at Suburb K.
The applicant entered into a contract with a building company to rebuild the home. The respondent provided a guarantee with respect to the contract of the building work and later provided the finance.
In December 2008 the respondent purchased a franchise in Company P for $45 000. An initial payment of $30 000 was made followed by the payment of $15 000 in instalments. The respondent commenced working full time in the business. The applicant commenced working in the business after its purchase although the extent of this was in issue between the parties.
In 2009 the parties commenced living in the newly constructed home at the Suburb H property. The applicant said they commenced living in the new home in February 2009 and the respondent said August 2009. The respondent contends that this is when the parties commenced cohabitation. I shall refer to this again below.
In June 2009 the applicant transferred the Suburb H property into the name of her son, Mr B. The mortgage was then increased to approximately $225 000. The respondent said that he did not have knowledge of this transfer or the increase in the mortgage. I shall refer to this again below.
According to the respondent, the parties separated in May 2011 but continued to live under the same roof.
In May 2011 the title to the Suburb H property and the associated mortgage were transferred into the respondent’s sole name. I shall also refer to this again below.
In 2012 or 2013 the parties formed Company L. This was for the purpose of a joint venture for a development of land at M Street, Suburb N with Mr O, who was to provide finance (“the M Street development”).
In January 2013 the applicant’s son, Mr B, moved out of the parties’ residence.
In January 2013 the applicant’s sister was employed as a personal assistant by Company L.
In September 2013 the applicant’s sister resigned from her role at Company L and thereafter the applicant worked solely at Company L and only worked at the Company P business when required.
On 14 January 2014 the respondent prepared a handwritten document headed “If Money Was No Object What Would I do? How Would I Live?” Included were the following:
“Party and have fun with [Ms Rushdie]” and
“Spend time with [Mr E] and [Mr F], [Mr B], [Ms C], [Mr D]”.
In 2014 Company L was incorporated. The respondent and the applicant were shareholders. The land at the M Street Development was purchased and subdivided into 29 lots. Those lots were later sold. Funds received from that sale were applied in payment of Mr O and the remaining amount deposited into a trust account held by Marsdens Solicitors, who were acting in respect of the M Street development. There remains further land at the M Street development which has not been developed (“the residual land”).
From February 2014 until separation, the parties retained a domestic cleaner.
During 2014 the respondent’s son Mr F lived with the parties for a period of approximately two months and Mr E for a period of a few weeks.
On 6 March 2014 the applicant lodged a caveat on the Suburb H property after she became aware of an attempt by the respondent to sell it.
On 1 May 2014 the applicant gave to the respondent the sum of $5000 which she had won on a poker machine.
In early 2015 the applicant’s son, Mr B returned to live with the parties.
In April 2015 the applicant received a salary advance from Company L in the amount of $20 000.
The applicant asserted that the parties separated on 10 May 2015. The applicant alleged that on this day, the respondent assaulted her. She provided a statement to the Police in relation to that incident on 11 May 2015. An interim Apprehended Violence Order (“AVO”) was issued against the respondent for the protection of the applicant.
On 7 August 2015 a final AVO was issued against the respondent for the protection of the applicant.
On 10 August 2015 the applicant was served with a Notice to Caveator of Proposed Lapsing of Caveat. That document advised the applicant that unless an order was obtained to extend the caveat, it would lapse in 21 days.
On 19 August 2015 the applicant commenced these proceedings.
On 31 August 2015 orders were made by consent. Among other things, those orders restrained the respondent from dealing with the Suburb H property; permitted the applicant to have exclusive occupation of the property and provided that the parties each pay one half of the costs of the repayments towards the mortgage and the line of credit.
In January 2016 the respondent sold the Company P business.
Credit
The Applicant
The applicant appeared to have considerable difficulty with the process of cross-examination. Time and again, instead of limiting her response to the subject of the question she said things which appeared to be perceived by her to favour her case.
Having said this, the applicant appeared to demonstrate a reasonable recollection for relevant events and dates.
It has to be noted, however, that she did not inform the Department of Social Security about the status of her relationship with the respondent presumably because this would have been a matter which she understood would be likely to adversely affect her eligibility to continue to receive the sole parent pension.
I have some reservations about the likely reliability of her evidence.
Ms C
Ms C is the daughter of the applicant. She is 23 years of age. She was articulate and responsive in her answers to questions in cross-examination.
I am satisfied that Ms C was mistaken about the year in which a diamond ring was purchased because it became clear that this event occurred at Christmas 2011, not Christmas 2013 as Ms C had deposed.
But generally I considered Ms C to be an impressive witness and apart from the above mistake I would accept generally the accuracy of her evidence. I regard her as being a witness of the truth.
Mr B
Mr B is the son of the applicant. He is 29 years of age.
Mr B was asked questions about the circumstances concerning the transfer to him of the Suburb H property. He did not demonstrate any detailed knowledge of this transaction. He was unable to recall the form of discussion between his mother and himself about the matter. This was a significant transaction involving a loan from ANZ Bank of some $225 000. He was unable to recall what happened to the $225 000. He acknowledged that he had signed relevant documents, including a loan application for the ANZ Bank. He was unable to recall details of certain disclosures made by him to the Bank in that document. These included that he had been working for Company P for two years fulltime and that his earnings from that activity were $49 000 in 2009. He was able to recall attending a lawyer and some mortgage brokers. I shall refer to this matter again below.
Mr B was also asked questions about the extent to which the respondent stayed at the various homes occupied by the applicant. Mr B’s evidence was consistent with that of his sister and the applicant.
It is true that Mr B was hesitant in relation to the questions concerning details about the transfer of the property to him. His recollection concerning details about this was poor. But I also have the view that he was probably being evasive in respect of the suggestion to him that certain matters contained in the loan application, which contained his declaration about the truth thereof, were in fact untrue.
Accordingly, I have some reservations about the reliability of his evidence.
Ms Q
Ms Q has been a friend of the applicant for more than 15 years. She has known the respondent since shortly after the parties met.
Ms Q was forthright and responsive.
I have no hesitation in accepting her as a witness of the truth.
Ms R
Ms R has been a friend of the applicant for more than 17 years. She has known the respondent since shortly after the parties met.
Ms R was responsive to questions. She gave detailed evidence about what she observed about the parties’ belongings in their bedroom and their toiletries but she was somewhat confused about the time when she saw this. It became clear that she saw this after they had moved into the new home at the Suburb H property in 2009.
With this caveat I accept her evidence as being likely to be reliable.
The Respondent
On most occasions the respondent was able to give a responsive answer to the questions. But at times, like the applicant, he said things which were not called for in the question but appeared likely to be perceived by him to favour his case.
He appeared to find it difficult to make concessions and minimised the nature of the parties’ sexual relationship and the basis upon which they were living in the Suburb H property.
I have reservations about the reliability of his evidence.
Mr E
Mr E was responsive to questions.
His evidence was mainly consistent with that of his father apart from in relation to his father’s occupation of the main bedroom. I prefer Mr E’s evidence in relation to this.
The Applicable Law
Requirements for a property order
Section 90SB of the Act provides, in effect, that a court may make an order for property settlement after the breakdown of a de facto relationship only if the Court is satisfied:
(a)that the period, or the total of the periods, of the de facto relationship is at least two years; or
(b)that there is a child of the de facto relationship; or
(c)that:
(i)the applicant for the property order made substantial contributions as referred to in s 90SM(4)(a), (b) or (c); and
(ii)a failure to make the property order would result in a serious injustice to the applicant; or
(d)that the relationship is or was registered under a prescribed law of a State or Territory.
Subsection 90RD(1) of the Act provides, in effect, that if an application is made for an order for property settlement after the breakdown of a de facto relationship the Court may declare that a de facto relationship existed, or never existed, between the relevant parties.
In the present proceedings, there is no child of the parties’ relationship, nor has the relationship been registered under State or Territory law. The applicant’s case was not presented on the basis of her having made substantial contributions. Accordingly, in order to establish that the Court has jurisdiction to make a property order in her favour, it is incumbent on the applicant to establish that she and the respondent were in a de facto relationship for a period of at least two years.
Meaning of “de facto relationship”
Section 4(1) of the Act provides that “de facto relationship” has the meaning given by s 4AA of the Act.
Section 4AA of the Act provides relevantly as follows:
(1)A person is in a de facto relationship with another person if:
(a)the persons are not legally married to each other; and
(b)the persons are not related by family …; and
(c)having regard to all the circumstances of their relationship, they have a relationship as a couple living together on a genuine domestic basis. [emphasis added]
Paragraph (c) has effect subject to subsection (5).
(2)Those circumstances may include any or all of the following:
(a)the duration of the relationship;
(b)the nature and extent of their common residence;
(c)whether a sexual relationship exists;
(d)the degree of financial dependence or interdependence, and any arrangements for financial support, between them;
(e)the ownership, use and acquisition of their property;
(f)the degree of mutual commitment to a shared life;
(g)whether the relationship is or was registered under a prescribed law of a State or Territory as a prescribed kind of relationship;
(h)the care and support of children;
(i)the reputation and public aspects of the relationship.
(3)No particular finding in relation to any circumstance is to be regarded as necessary in deciding whether the persons have a de facto relationship.
(4)A court determining whether a de facto relationship exists is entitled to have regard to such matters, and to attach such weight to any matter, as may seem appropriate to the court in the circumstances of the case.
(5)For the purposes of this Act:
(a)a de facto relationship can exist between 2 persons of different sexes and between 2 persons of the same sex; and
(b)a de facto relationship can exist even if one of the persons is legally married to someone else or in another de facto relationship.
The applicant has the onus of establishing that a de facto relationship existed: Ricci v Jones [2011] FamCAFC 222 at [23]. The onus of proof is on the balance of probabilities: see s 140(1) of the Evidence Act 1995 (Cth).
The decision of Murphy J in Jonah & White (2011) 45 Fam LR 460 provides assistance about what is required in this regard. At page 466 his Honour said as follows:
39.In my view, the making of a declaration of the type contemplated by s 90RD of the Act does not involve the exercise of a judicial discretion. The question of whether a de facto relationship exists is a determination of fact (albeit based on findings in relation to a non-exclusive number of statutory considerations) which founds the jurisdiction to make orders of the type contemplated by that part of the Act. The ultimate question is in the nature of a jurisdictional fact. In Corporation of the City Enfield v Development Assessment Commission (2000) 199 CLR 135 ; 169 ALR 400 ; 60 ALD 342 ; [2000] HCA 5 at [28] the High Court held:
[28] The term “jurisdictional fact” (which may be a complex of elements) is often used to identify that criterion, satisfaction of which enlivens the power of the decision maker to exercise a discretion.
Murphy J went on to examine various authorities which dealt with the concept of “living together” and ultimately arrived at what he regarded as the essence of a de facto relationship as defined in Part VIIIAB of the Act holding as follows at page 471:
60.In my opinion, the key to that definition is the manifestation of a relationship where “the parties have so merged their lives that they were, for all practical purposes, “living together” as a couple on a genuine domestic basis”. It is the manifestation of “coupledom”, which involves the merger of two lives as just described, that is the core of a de facto relationship as defined and to which each of the statutory factors (and others that might apply to a particular relationship) are directed.
61.Differences in nomenclature tend to confuse the picture rather than illuminate it. For example, counsel for the applicant submitted – in my view correctly – that a relationship which one party regards as “an affair” might in fact be a de facto relationship as defined. So, too, a woman who might be described as “a kept woman” (an expression accepted by the respondent upon suggestion from counsel for the applicant) might, similarly, describe one party’s perception of the relationship but, when all factors and the circumstances are considered, the relationship might nevertheless meet the definition of a “de facto relationship”.
…
66.The issue, as it seems to me, is the nature of the union rather than how it manifests itself in quantities of joint time. It is the nature of the union — the merger of two individual lives into life as a couple — that lies at the heart of the statutory considerations and the non-exhaustive nature of them and, in turn, a finding that there is a “de facto relationship”.
Accordingly, in my view, the question of whether the parties were in a de facto relationship must be considered on a case by case basis and without circumscribing any particular factor. No particular finding in relation to any circumstance is to be regarded as necessary in deciding whether the persons have a de facto relationship.
The Section 4AA(2) Matters
I now turn to consider the various matters in s 4AA(2) of the Act.
Duration of the Relationship
It is common ground that the parties met in December 2006 and commenced their relationship very soon thereafter. Their relationship continued until the respondent departed from their home on 11 May 2015.
Whether a sexual relationship existed
There is no issue that the parties commenced a sexual relationship in December 2006 and that this continued until the respondent left the home in May 2015. The respondent endeavoured to minimise the significance of their sexual relationship after May 2011, saying that he occupied a separate bedroom from that occupied by the applicant and that they only had sex when she came to his room and suggested they engage in this.
The nature and extent of their common residence
There is considerable issue between the parties about the extent of their common residence.
There is no issue that between approximately August 2009 and 11 May 2015 the parties lived under the same roof at the Suburb H property. There is some issue about the circumstances in which they lived there and I shall refer to this below.
Period from December 2006 to August 2009
There is considerable issue about whether the parties had a common residence from shortly after the time they commenced their relationship in December 2006 until August 2009 which is the later of the dates contended as the commencement of their residence in the new home at the Suburb H property.
The applicant’s evidence about this was as follows. She and the respondent lived primarily in the Suburb H property during the relationship. Until mid-2007 they would normally stay at Suburb H mid-week and at the respondent’s Suburb K rented property on a weekend. In mid-2007 the Suburb H property was demolished by fire. T Insurance funded the family to live at the Suburb S Inn for approximately six weeks. They were provided two adjoining suites, one for herself and the respondent and the other for her children. Thereafter, T Insurance provided rented accommodation at U Street, Suburb V where the parties lived for several months. They then commenced to reside at the respondent’s Suburb K rented property until they moved to the Suburb H property on completion of the new home in 2009. They moved into the new home in approximately February 2009 despite there being no driveway, no carpets, tiles, blinds, air conditioning, landscaping, fencing and similar.
The applicant’s adult daughter, Ms C said as follows. The respondent moved into their Suburb H residence in 2007 and commenced to occupy the same bedroom as her mother. This was before the fire. After the fire the family, including the respondent, moved into a Suburb S motel for approximately six weeks. Thereafter they all moved into rented accommodation at Suburb V. There was a fire in the kitchen at the Suburb V property so the family moved in to live with the respondent at his Suburb K property. They remained living there until the Suburb H home was rebuilt.
The applicant’s adult son, Mr B, said as follows. In 2007 the respondent moved into their home at the Suburb H property and commenced to occupy the same bedroom as his mother. Shortly thereafter the property was the subject of a fire. As a result the family and the respondent were provided with rental accommodation in a Suburb S motel for approximately six weeks. Thereafter they all moved to rented accommodation at Suburb V. After a fire in the kitchen there they commenced residing at the respondent’s rented home at Suburb K. They remained living at Suburb K for a few months before moving into the rebuilt home at the Suburb H property. He remained resident at the Suburb H property until his marriage in 2013 when he vacated it. At all times the respondent and his mother occupied the main bedroom at the Suburb H property from the commencement of their relationship until termination in May 2015. At no time did the respondent move to a separate bedroom within the residence. He observed the personal items of the respondent in the main bedroom and the ensuite together with those of his mother at all times during their relationship.
The respondent’s evidence about this was as follows. He said that he lived in his rented townhouse at the Suburb K property with his two children, Mr E and Mr F, between January 2004 and August 2009.
The respondent denied that when the parties commenced seeing one another he would spend the night at the Suburb H property. He said that the applicant did not want him there when the children were there. But he conceded that he would stay over there on occasional weekends. The respondent also denied that he stayed with the applicant at the Suburb S Inn or that he was living with her at the Suburb V property.
The respondent’s son Mr E Mohsin said that from around 2007, although he and his younger brother Mr F had lived full-time at the respondent’s Suburb K property, they commenced living with each of their parents on a week about basis. He said that when he lived at the Suburb K property he never saw clothes or belongings there which were not those of the respondent, Mr F or him, and that the respondent stayed there almost every night. He further said that he could not recall the applicant ever staying the night during the period he lived there.
I am unable to find whether or not the parties had a common residence during this early period of their relationship, namely from early 2007 until August 2009. Their accounts are quite inconsistent and the children on each side support the account of their respective parents. One possible explanation might be, if Mr E’s evidence is correct, that he and Mr F lived with their father only each alternate week and that the respondent stayed with the applicant at one or other of her residences each alternate week. But this would be pure speculation and it is not what the applicant’s children have said.
There is no objective evidence which would lend support to one or other of these accounts. It is the applicant who bears the onus of proof, as I have said, and in my view she is unable to establish that the parties had a common residence during the period from early 2007 until August 2009.
Period from 2009 to May 2011
The respondent said that when the new home at the Suburb H property was ready for occupation they only moved into the home because they could not sell it. He said that the parties had come to a commercial arrangement to build the home. He said that they could not sell it because the value it would have realised would have been lower than what they had spent on the home. He said, therefore, they decided to move into the home. He said that the applicant was sick of living with her mother and he had been paying rent on Suburb K. He suggested that they could rent the Suburb H property but the applicant did not wish to do that. Therefore they moved into the home in 2009. He emphasised that they were moving in as part of this alleged commercial arrangement and they were doing so not as domestic partners but as boyfriend and girlfriend. He said that as part of this commercial arrangement the applicant was going to take care of the housework and cleaning and he would pay for the food for the household, including for the applicant’s three children. He said that he would take care of the outside of the house presumably meaning he would do all the outside maintenance and cleaning. He was going to pay for some bills and the applicant would pay for others such as electricity, gas and telephone. The applicant made some payments to his bank account which were referred to in the account as home payments.
This alleged commercial arrangement included that the applicant would provide her land at the Suburb H property, the parties agreeing that it had a then current value of $240 000, and the respondent would fund the construction of a house to an equivalent value, namely $240 000. The respondent said that this was on the basis that at the time he understood the land was unencumbered. He said at the time he had approximately $270 000 in savings which I understand represented most of the property settlement which he had previously had with his former wife. He said the agreement included provision that once the house was built the property would be sold and they would divide the net proceeds equally.
There were difficulties with the builder and, in addition, it is common ground that outside the initial building contract further money had to be found to enable construction of a driveway, installation of carpets, blinds, a replacement swimming pool pump for one that had been stolen and certain other expenditure necessary to complete the home. The parties have quite different versions about how this additional necessary expenditure was funded.
The applicant’s version was as follows. Neither she nor the respondent could obtain further finance because they were both working in the Company P business which had been purchased fairly recently at the time. Her son, Mr B, was considered likely to be more able to obtain the refinancing than she and the respondent. Accordingly, they agreed with him that the applicant would transfer the title to the property into Mr B’s name so that he could obtain increased funding which would enable the home to be completed. The applicant transferred the title to the Suburb H property to Mr B on 3 July 2009. An application was made by Mr B to the ANZ Bank for the mortgage to be increased to $225 000. The funds produced were used to pay the costs necessary for completion of the home.
In approximately January 2011 Mr B was engaged to marry his fiancée. Upon Mr B’s engagement, the respondent said to the applicant that she would need to arrange to remove the title to the property from Mr B’s name because he was about to be married and his fiancée would have a claim on the property. It was in these circumstances that the title to the property was transferred from Mr B to the respondent. There is no issue that this occurred on 24 May 2011.
The respondent’s version was as follows. He knew nothing about the transfer of the applicant’s interest in the property to Mr B n 3 July 2009. He did not become aware of this, or about the fact that the property was encumbered, until April/May 2011. Upon the transfer of the property to Mr B’s name on 3 July 2009 the sum of $66 274.60 was deposited to the applicant’s Commonwealth Bank account.
The parties moved into the Suburb H property in August 2009.
In April 2011 the applicant informed him that she had taken out a loan secured against the Suburb H property in respect of which she was unable to meet the repayments. She informed him that she owed the bank $225 000 but did not inform him what she had used the funds for. She also informed him that she was unable to resolve the problem and, that if he did not buy her out the Bank would repossess the property and he would lose money. The respondent agreed to do this. At settlement of this transfer on 24 May 2011 he discovered that the transferor was not the applicant but her son, Mr B. He was shocked. The applicant explained that she was unable to obtain a loan but Mr B was, so she transferred the property to him in order to obtain the loan. The respondent took out a loan of $250 000 to pay the outstanding mortgage, stamp duty costs and legal costs, and became the owner of the Suburb H property.
Which of these versions is to be preferred?
I must say I have difficulty in relying on the evidence of each of these parties generally. Having said this, there does seem to be a flaw in the applicant’s explanation that she had to rely on Mr B to obtain the loan because neither the respondent nor she could obtain further finance on the basis that they were both working in the Company P business. Yet the loan application prepared by Mr B described him as having worked in the Company P business for the previous two years. It is not clear to me why Mr B’s situation in these circumstances would have been more attractive to the Bank than that of the principal of the business, the respondent.
I have seen no document which would indicate that the respondent was involved in the circumstances of the loan application by Mr B to the ANZ Bank. When Mr B was cross-examined in relation to this matter, as indicated above, he was unable to recall details about it and gave me the distinct impression he was reluctant to be forthcoming, possibly because he thought his answers might show him and the applicant in a poor light.
On the other hand, the respondent said that it was unnecessary to raise additional funds to pay for the driveway and other items of expenditure required to complete the home. He said that this was because he had the required funds and, in fact, paid for the items. Yet the evidence demonstrated only that he paid for carpet and blinds, a total of approximately $5,600. How he would have had the funds required to pay the totality of the costs of completing the home is unclear in circumstances where he had previously used the bulk of his funds to purchase the franchise of the Company P business.
In my view, this is all most unsatisfactory and I am unable to be comfortably satisfied one way or the other on the state of the evidence at this point about which version is more likely to be correct.
After May 2011
The respondent said that upon Mr B transferring the property title to him and upon him assuming the responsibility for the repayment of the home loan, he considered cohabitation to be at an end. He said that the parties had the following conversation:
He said:
“Now that you don’t own the property anymore, you need to find your own place. The only reason we were living together was because we both owned the property. Now that it is effectively sold, you need to move out. I am happy if you still want to see each other, but as you know, we were only living together until the property was sold.”
The applicant said:
“I have applied for Housing Commission and I am on their waiting list. Can I stay with you until I am placed in a Commission home?”
He said:
“Yes, but you have to pay $200.00 per week towards my home loan as rent as well as electricity, gas and phone bills as you have four people in the house and I am on my own.”
She said:
“Okay”
and she commenced paying fortnightly payments to his account for rent from 16 June 2011 to 26 July 2012.
The parties are at issue about whether the respondent moved out of the main bedroom which at all times was occupied by the applicant.
The respondent said that after the transfer of the Suburb H property to him (in May 2011) he moved out of the main bedroom and commenced sleeping in a bedroom which had been previously occupied by Ms C. He said that Ms C was not living there because she was under the care of the Department of Community Services at the time. He said that he did this because he wanted to make it clear to the applicant that they were living separately and apart in the same residence. He said that he still used the ensuite in the applicant’s bedroom. He said that at the time he explained to the applicant that there was no need for her to keep living in the home. He said that if she wanted to keep their relationship going as boyfriend and girlfriend he was happy to do so. He said that he was happy to continue to have sex but only did so when she came to his bedroom and asked for sex. The same arrangements continued, that is, the applicant cooked, cleaned inside the house and otherwise attended to household duties. The respondent continued to maintain and clean the outside areas.
The applicant denied that the respondent moved out of the main bedroom.
Ms C said that she moved out of the new Suburb H property “after a few weeks” of the family taking occupancy therein. She said that she lived with her aunty for a period of approximately 18 months and then returned to live at the Suburb H property.
As indicated above, the parties were in dispute about when they moved into the new home at the Suburb H property. The applicant said this was February 2009. The respondent said it was August 2009. Even if it was August 2009, on Ms C’s evidence, she would have moved out in September 2009, remained living with her aunty for say 18 months which would mean that her bedroom would have been vacant until approximately March 2011. But on her evidence she would have moved back to occupy her room at Suburb H in March 2011. If this is correct, her bedroom would not have been available for the respondent in May 2011 when the respondent said he moved into it upon moving out of the main bedroom.
Ms Q said that such was the close nature of her relationship with the parties that from time to time she would enter the new home unannounced, walk upstairs where the main bedroom was situated and say to the parties “get your clothes on”. She said she saw them in bed “probably 8 or 10 times” between 2008 and 2014.
Ms R was also a close friend of the applicant. She said that she had been in the main bedroom upstairs with the applicant on many occasions over the course of the parties’ relationship and had noticed the applicant’s belongings on her side of the bedroom and the respondent’s belongings on his side of the bedroom. As indicated above, there was some confusion on the part of Ms R about the timing of her observations about this. But she did make it clear that such observations related to the upstairs main bedroom in the rebuilt home and I accept her evidence about this.
Mr E’s evidence about this matter is also inconsistent with his father’s assertions that he removed himself from the main bedroom. Mr E said during the month in 2014 when he lived in the new home at the Suburb H property he saw his father and the applicant sharing a room.
In my view, the weight of the evidence about this matter falls clearly against the version asserted by the respondent. Accordingly, I do not accept that he moved out of the main bedroom. In all the circumstances, in my view, it is more probable than not that the parties continued to share a bedroom from the time they moved into the new Suburb H property until they separated in 2015.
The degree of financial dependence or interdependence, and any arrangements for financial support, between them
In 2008 the respondent funded the construction of a new home on the applicant’s land at Suburb H. He said this was a commercial venture. I am unable to discount this possibility. But, in any event, the parties resided in this home with the applicant’s children subject to both Ms C and Mr B being absent for periods, and, to a much lesser extent, with the respondent’s children. They arranged for the applicant to pay some of the household costs and the respondent paid other household and mortgage costs. I accept from 2011 to May 2015 the respondent paid most of the costs of the household, my understanding being that the applicant was not in a financial position to do so.
At the time of completion of the new home in approximately August 2009, the parties owned it together in reality. This was on the basis that the applicant owned the legal interest as registered proprietor, but the respondent would have had an equitable interest on the basis of the more than $225 000 he paid towards construction of the new home. Later in their relationship the parties entered into their joint venture property development with a third party.
The degree of mutual commitment to a shared life
The respondent said that he was not committed to having a shared life with the applicant. This was on the basis of his assertion that he only invested his money in rebuilding the Suburb H property as a commercial arrangement. As indicated above, he said that having completed the home he found that it could only be sold at a loss so he decided to occupy the home and live there with the applicant. He said that when the property was transferred to his name he made it clear to the applicant that he wanted her and her children to leave the home.
The difficulty with this is that in important respects, the objective evidence is against the respondent’s assertion that he was not committed to a shared life. The parties did share their lives. They lived together in the home and the respondent paid for much of the living expenses of the applicant and her children. The respondent supported the applicant emotionally. He supported her children emotionally, physically and financially. He and the children had a close loving relationship. The applicant in turn supported the respondent emotionally. Each party was kind, respectful and loving to the other. They went into business together in the joint venture. I do not accept the respondent’s assertion that this was for the purpose of assisting the applicant to be in a position to leave the home and to separate from the respondent. The applicant gave emotional and physical support to the respondent’s children.
The reputation and public aspects of the relationship
From the outset, the parties did not hide their relationship. They conducted it publicly in the sense that they disclosed it to the children, to relatives and to friends. They had an active social life as a couple and as a family with the applicant’s children.
The evidence from both Ms Q and Ms R was that they have been close friends of the family constituted by the parties and the applicant’s children. They have enjoyed a very considerable amount of social interaction with the parties not only in their respective homes but, including in the case of Ms Q, going on family holidays together.
It is the case that the applicant claimed a Centrelink pension from the commencement of the parties’ relationship until January 2013. I accept that to do this it would probably have been necessary for her to declare that she was not living in a de facto relationship.
For the applicant to be holding herself out to a government authority as a single parent would appear to be somewhat inconsistent with living in a de facto relationship. In Sinclair & Whittaker (2013) FLC 93-551 the Full Court noted that the trial judge, Loughnan J, dealt with representations made by a respondent to lending institutions and to government bodies where she had stated she was “single” when an available option was “de facto”. The Full Court referred at 87,391 to his Honour as having said as follows:
It is important to note that even if the representations of a party during the relationship or since were false and deliberately so, and even if that was done for the purposes of gaining a monetary or other advantage, the characterisation of the relationship remains a matter for me. The importance of a person not profiting from an earlier misrepresentation does not detract from the Court’s obligation to identify the true position, where that is practicable. In this case the issue is whether the parties’ relationship in fact meets the statutory definition. (Reference omitted)
Having noted this, I must say that the applicant’s behaviour in this regard reflects somewhat poorly on her credit.
Conclusion
The parties’ relationship commenced in December 2006 and continued until 11 May 2015, a period of more than eight years. They had a sexual relationship over the entirety of this period.
It was common ground that they lived under the same roof from August 2009 until May 2015, a period of more than five and a half years.
Their financial circumstances were enmeshed as I have said.
I have referred to their mutual commitment to a shared life.
The respondent has endeavoured to take a somewhat technical approach in his interpretation of the nature of the parties’ relationship. As indicated above, he asserts that the applicant and her children were only residing at the Suburb H property under a commercial arrangement. This was an arrangement under which the applicant was on notice from 2008 that although the parties were boyfriend and girlfriend, rebuilding Suburb H was a commercial arrangement under which, when completed and they could sell it at a profit, they would do so and the net proceeds would be divided between them equally. Another part of the commercial arrangement was that as from May 2011 the applicant was on notice that the respondent was desirous of her moving out of what had become his home and getting on with her own life. Another part of the alleged commercial arrangement was that their sexual relationship would change because the respondent wanted to give the applicant the message that he wanted her to move out.
The difficulty for the respondent is that even if the Court was satisfied that the parties were living under the same roof in accordance with the alleged commercial arrangement, and I am not so satisfied, the reality is that they continued to do the following:
·they resided in the home at the Suburb H property together;
·they continued to have a sexual relationship throughout the entirety of the remaining five and a half years or so of their relationship;
·their financial circumstances continued to be enmeshed, this increasing on the respondent’s evidence from 2011 when he was substantially responsible for the household costs and the living expenses of the applicant and her children;
·the respondent continued to support the applicant’s children emotionally, physically and financially and the applicant reciprocated towards his children in relation to emotional and physical support albeit with some difficulty concerning Mr E;
·the respondent socialised with the applicant regularly, going out together;
·they presented themselves including with the applicant’s children to relatives and friends and in public as a family;
·they went on holidays with friends as a family;
·the respondent did not sell the Suburb H property to realise his investment pursuant to what he asserted was the commercial arrangement; and
·he did not take any formal action to remove the applicant and her children from the home. In fact, quite the reverse. He continued to conduct his sexual relationship with the applicant. He supported her and the children, socialised with them and gave every appearance of being happy to be engaged with them in what appeared to have been a loving family.
The Full Court said in their recent decision in Sha & Cham [2017] FamCAFC 161 at page 9 as follows:
50.As was said in (Lynam v Director-General of Social Security (1983) 52 ALR 128) at 131:
… [e]ach element of a relationship draws its colour and its significance from the other elements, some of which may point in one direction and some in the other. What must be looked at is the composite picture. Any attempt to isolate individual factors and to attribute to them relative degrees of materiality or importance involves a denial of common experience and will almost inevitably be productive of error. The endless scope for differences in human attitudes and activities means that there will be an almost infinite variety of combinations of circumstances which may fall for consideration. In any particular case, it will be a question of fact and degree, a jury question, whether a relationship between two unrelated persons of the opposite sex meets the statutory test.
(Emphasis added)
In my view, the composite picture in the present case is that of two persons living in the same home over at least five and a half years, enjoying their sexual relationship, having a loving supportive relationship not only with one another but also with the children and sharing their lives. In all the circumstances, as referred to above, in my view, these parties during the period from at the latest August 2009 until their separation in May 2015 had arrived in their relationship at that position described by Murphy J in Jonah & White (supra) where “the parties have so merged their lives that they were, for all practical purposes, “living together” as a couple on a genuine domestic basis”.
I am satisfied that they had a de facto relationship which fell comfortably within the requirements of the Act to attract jurisdiction for the Court to make property orders. I propose to make the declaration sought by the applicant.
I certify that the preceding one hundred and twenty three (123) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Johnston delivered on 27 October 2017.
Associate:
Date: 27 October 2017
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