S and S
[2006] FCWA 65
•28 JUNE 2006
JURISDICTION:
FAMILY COURT OF WESTERN AUSTRALIA
| ACT: | FAMILY LAW ACT 1975 |
| LOCATION: | PERTH |
| CITATION: | S and S [2006] FCWA 65 |
| CORAM: | THACKRAY J |
| HEARD: | 27 JUNE 2006 |
| DELIVERED: | 28 JUNE 2006 |
| FILE NO/S: | PT 2065 of 2005 |
| BETWEEN: | S |
Applicant/Wife
AND
S
Respondent /Husband
(Page 2)
Catchwords:
Property settlement - contributions - s 75(2) factors - relevance of prior
informal agreement.
Jurisdiction - property overseas.
Legislation:
Family Law Act 1975, s 75 s 79
Category: Not Reportable
Representation:
Counsel:
| Applicant: | Mr S French |
| Respondent: | Self Represented Litigant |
Solicitors:
| Applicant: | Dwyer Durack |
| Respondent: |
Case(s) referred to in judgment(s):
British South Africa Co v Companhia de Mocambique [1893] AC 602
Davut & Raif (1994) FLC 92-503
Dupont & Dupont (No. 3) (1981) FLC 91-103
Khademollah and Khademollah (2000) FLC 93-050
Williams and Williams (1985) FLC 91-628
Woodland and Todd (2005) FLC 93-217
(Page 3)
1 [Mr and Mrs S] came to Australia from [overseas] in 1989 with almost no assets. By virtue of hard work and thrift they have been able to acquire assets worth in the region of $670,000. Unfortunately, their marriage ended in November 2003 and they have been unable to resolve the division of their property.
Orders sought
2 The orders sought by [Mrs S] are contained in her Papers for the Judge. She seeks 60% of the assets/superannuation. She wants to retain her home in [the suburb] and is agreeable to [Mr S] retaining the matrimonial home in [the suburb].
3 In a document filed on 10 June 2006, which I have treated as being his Papers for the Judge, [Mr S] proposed he receive 60% of the assets/superannuation. [Mr S]’s Response filed in June 2005 indicates he agrees with [Mrs S]’s proposals about the two homes. He is opposed to the Court dealing with the real estate the parties own [overseas]. If the Court does deal with the [overseas] properties, he would prefer [Mrs S] to take two of them as part of her settlement.
Brief background
4 [Mrs S] is 45 years of age. She is employed as a [teacher] in the [education system]. [Mr S] is also 45 years of age. He is [academically qualified], but is currently working as a [customer services officer] for a [government agency].
5 [Mr S] and [Mrs S] were married [overseas] in August 1986. They have three children, [F], born in 1987, [A], born in 1995 and [C], born in 1997. [F], now 19, is enrolled in a university [overseas]. [A] and [C], now aged 11 and 9, attend [a private school] in Perth.
6 [Mrs S] and [Mr S] were working [in the education system] when they married. I was not persuaded either had any assets of significance at the time. They had virtually nothing by the time they arrived in Australia in 1989. Upon their arrival, they set about becoming fluent in English, whilst working in menial occupations. They quickly acquired their first home in [the suburbs]. Over time,
(Page 4)
they acquired employment more in keeping with their ability and qualifications. By 1997 they were both again working as [teachers]. They saved money, which they used to buy blocks in [various locations overseas] and a property in [another location overseas]. They also acquired further property in Perth.
7 In 2002, [Mr S] took extended sick leave from his [current position]. He continued to be paid until he resigned near the end of 2002. He then commenced working as a [cleaner] and later as a [carer].
8 In November 2003, [Mrs S] left the family home in [the suburb] and moved into an investment property the family owned [nearby]. At that stage there was about $10,000 owing on the mortgage on [the matrimonial home] and $18,000 owing on [the investment property].
9 [F] remained with his father until January 2004, when he went [overseas] to complete his secondary education. [A] and [C] moved with their mother to [the investment property].
10 [Mr S] went to visit [F] [overseas] in late 2004. At that stage [F] was still living with relatives. Whilst [Mr S] was [overseas], he purchased an apartment in [the city] for [F] to use whilst attending university. The apartment cost about $60,000. [F] has lived rent-free in the apartment ever since. [Mr S] says he funded the purchase with:-
• $20,000 borrowed from his father; • $29,000 drawn on the mortgage on the former matrimonial home, which he had reduced significantly following separation; • finance provided by the developer of the apartment complex; and • savings he accumulated after separation. 11 At around the same time he purchased the apartment in [the city], [Mr S] also purchased another block in [the suburb overseas] at a cost of $8,000. He did not say in his affidavit how he funded this purchase, but in his oral evidence he claimed he was assisted with money borrowed from his sister.
12 In September 2004, [Mr S] and [Mrs S] had entered into an informal agreement to divide their property. [Mr S] drafted the agreement, which provided for him to pay [Mrs S] $90,000 before the end of March 2005. Under the terms of the agreement, [Mrs S] was to
(Page 5)
keep [the investment property] and [Mr S] was to keep [the matrimonial home]. Each would otherwise retain the assets and superannuation in their possession or control and would not make any further financial claims, including for child support. It was understood that [Mr S] would be responsible for maintaining [F] and [Mrs S] would maintain the two youngest children.
13 In February 2005, [Mrs S] engaged solicitors with a view to preparing an application for Consent Orders to give effect to the informal agreement. [Mr S] was prepared to cooperate but was initially not prepared to pay any associated legal costs. To cut a long story short, [Mrs S] elected not to proceed with her efforts to enforce the agreement and instead commenced these proceedings in May 2005.
Jurisdiction
14 Courts, other than those exercising matrimonial jurisdiction, ordinarily do not exercise jurisdiction over disputes concerning title to land situated abroad: British South Africa Co v Companhia de Mocambique [1893] AC 602. However, the Family Court frequently makes orders that either affect property held overseas or take such property into account – see, for example, Davut & Raif (1994) FLC 92-503. This is so because Family Court orders are made in personam – i.e. the orders are directed at the parties and not the land itself.
15 I consider it is appropriate to exercise jurisdiction in relation to the [overseas] properties for a number of reasons, including:-
• the parties spent most of their marriage in Australia and it is appropriate the distribution of their property be dealt with under the law of their adopted country; • the funds representing the equity in the properties were accumulated by the parties whilst living in Australia; • the properties form a relatively modest portion of the asset pool; • there would be significant cost and inconvenience associated with further disputation [overseas]; and • any orders in relation to the [overseas] properties can be enforced against the parties, both of whom reside in Australia. (Page 6)
Property settlement approach
16 I am required to follow a four-step process in dealing with an application for property settlement pursuant to the Family Law Act 1975. Those steps are:
• identify and value the assets and liabilities; • assess the parties’ contributions to the assets; • assess a range of factors set out in s 75(2) and s 79(4) of the Act; and • consider whether the order proposed is just and equitable.
The prior agreement
17 [Mr S] made repeated reference to the previous agreement in relation to settlement of property and the support of the children. The law in relation to such informal agreements was summarised by Nygh J in Dupont & Dupont (No. 3) (1981) FLC 91-103 where his Honour said:-
“where there has been an [informal] agreement between the parties … and an application is made subsequently under sec. 79 seeking orders inconsistent with the terms of such agreement, the Court must determine that application on its own merits having regard to the factors as set out in sec. 79(4) as they exist at the time of the application under sec. 79 and not at the time of making the agreement … The agreement should be considered but its provisions only enforced if they coincide with the order which it is just and equitable to make under sec. 79 at the time of the hearing.”
18 In Woodland and Todd (2005) FLC 93-217, the Full Court once again confirmed the law as stated by Nygh J in Du Pont (No. 3). The Court (Finn, May and O’Reilly JJ) did observe at [38] that the earlier agreement could be considered as “an indication of what the parties may have regarded as just and equitable at the time”. The evidence satisfies me that perhaps neither party really thought the agreement was just and equitable. I am satisfied [Mrs S] in particular simply accepted the arrangement as a means of avoiding legal proceedings and getting on with life.
19 The only qualification to the general principle may be the one suggested by Nygh J, when he said in Du Pont:
| (Page 7) |
“[i]t may be that where a party to an agreement allows the other to assume by tacit acceptance of compliance with the agreement that no claim will be made under sec. 79 and the other party acts on that assumption to his or her detriment, something akin to an estoppel may arise by reference to sec. 75(2)(o), although it cannot of course be an estoppel in the strict sense.”
20 Although [Mr S] asserts that he acquired the apartment [overseas] on the basis of an assumption that [Mrs S] would comply with the informal agreement, the fact of the matter is that [Mr S] failed to comply with his side of the bargain. He also failed to cooperate with what I regarded as being [Mrs S]’s reasonable proposal to ensure the agreement was properly documented in a way that would be enforceable. I therefore do not intend to take the agreement into account in coming to my decision.
Assets and liabilities
21 I find the assets and liabilities of the parties to be as follows:
| Description | Wife | Husband |
| Assets | ||
| [Matrimonial home] | $132,500 | $132,500 |
| [Investment property] | 122,500 | 122,500 |
| [Overseas property] | 12,000 | |
| [Overseas property] (to be sold) | NK | NK |
| [Overseas property] | 4,000 | 4,000 |
| [Overseas property] | 60,000 | |
| [Overseas property] | 8,000 | |
| Equity in [overseas property] | 6,000 | |
| Wife’s motor vehicle | 14,900 | |
| (Page 8) | ||
| Husband’s motor vehicle | 1,000 | |
| Wife’s superannuation | 52,934 | |
| Husband’s superannuation | 71,571 | |
| Furniture retained by parties in Perth | NK | NK |
| Furniture in apartment [overseas] | 4,000 |
| Total Assets | 326,834 | 421,571 |
| Liabilities | ||
| [Investment property] mortgage | 20,036 | 20,036 |
| [Matrimonial home] mortgage | 13,081 | 13,081 |
| Debt to husband’s father | 12,000 | |
| Debt to building company re [overseas property] | NK | |
| Total liabilities | 33,117 | 45,117 |
22 There was agreement in relation to almost all of the assets and there was no suggestion the superannuation should be treated differently from the other assets. I make the following findings in relation to those items where there was any disagreement or doubt:-
[One particular overseas property]
23 There was a significant dispute about the current value of this property, which cost about $10,000 in 2000. It was ultimately agreed the property would be sold and it is therefore unnecessary for me to determine the value. For the purposes of the s 75(2) adjustment, I find the value of $12,750 suggested by [Mr S] might be closer to the real value, given the purchase price in 2000.
| (Page 9) |
[Mrs S]’s vehicle
24 [Mrs S] acquired a car in or about October 2004 at a cost of $16,500, plus on-road costs bringing the total cost to $18,500. She now estimates its value at $13,500. [Mr S] says he does not know how much the car is worth because he is not a valuer. It is notorious that vehicles depreciate in value over time (in the same way the furniture in the apartment [overseas] has deteriorated rapidly in value since purchased). There was no evidence to suggest [Mrs S] has spent any money doing up the vehicle, as [Mr S] suggested might have happened. In any event, I take the view that the party asserting the higher value of an asset generally has the obligation to provide evidence to support their assertions. Khademollah and Khademollah (2000) FLC 93-050.
25 I have included the car in the asset pool at $14,900, rather than the figure of $13,500 originally suggested by [Mrs S]. I did so because the questions put to [Mr S] based on “Red Book” values were admissions against interest and [Mrs S]’s counsel asked [Mr S] to agree the value at $14,900 based on the “Red Book” value.
Furniture in [overseas apartment]
26 [Mr S] disclosed in his oral evidence that he had spent $7,000- 8,000 on furniture for the apartment [overseas], which he had not included in his statement of financial circumstances. He believed it was now worth between $4,000-5,000. [Mrs S]’s counsel made his closing submissions on the basis the furniture was worth the bottom end of that range. That is the value I have adopted.
Furniture in Perth
27 [Mr S] claimed that he had given all the best furniture in Perth to [Mrs S]. She denied this and neither party was cross-examined on their position. In the absence of any valuation evidence, I was not prepared to find that either party had furniture in Perth of any greater value than that owned by the other party.
Debt to building company
28 [Mr S] acquired the [city] apartment from a building company that had developed the complex. The evidence he gave in relation to the funding of the acquisition of the property was less than satisfactory. Apart from the $49,000 he borrowed from either his father or on the security of the former matrimonial home, he also says
(Page 10)
that he had savings of $5,000 or $6,000, only portion of which he used to acquire the apartment. The total cost of acquisition of the apartment was said to be $60,000.
29 [Mr S] said the building company was awaiting the outcome of an application for an “urban renovation allowance”. If the application were to be successful, [Mr S] would have nothing or very little to pay in order to complete the purchase of the apartment. If the application is not successful, [Mr S] said he might have to pay up to $11,000 to complete the purchase. [Mr S] produced no documents at all in relation to the acquisition of this property nor of the amount that might end up being payable to the building company. I found his evidence in relation to the properties [overseas] to be generally less than convincing. In the absence of any documentary evidence, I am not prepared to find that [Mr S] is likely to have to pay any money to the building company.
Debt to father
30 [Mr S] originally claimed to owe his father $20,000 relating to funds advanced to acquire [the city] apartment. It emerged during the course of cross-examination that at least $8,000 of this money has been repaid. At most therefore, he owes his father $12,000 relating to this property. I should say I was not entirely convinced that [Mr S]’s father had not received more of the $16,000 [Mr S] sent to his sister (via [F]) in 2005. I will, however, give him the benefit of the doubt on that issue.
31 In the absence of any documents or details, I was not prepared to accept that during his last trip to [overseas], [Mr S] had also borrowed more money from his father in order to meet “expenses” which he says he has to repay in the future.
Paid legal costs
32 [Mr S] was unrepresented at trial and did not ask that the paid legal costs be taken into account. In making my assessment of contributions, I intend to take account of all the income each party has earned since the separation. I have also included in the asset pool the assets [Mr S] has acquired with his post-separation income. In these circumstances, it would only be fair to [Mr S] to have [Mrs S]’s paid legal fees taken into account as a notional asset. To do otherwise would mean he has subsidised her legal costs and, if I were to order
(Page 11)
him to pay her costs, as she asks, he would in effect pay some of her
costs twice over.33 Further enquiry now reveals, however, that [Mrs S] has not paid any of her legal costs and it is [Mr S] who has paid more on lawyers – somewhere in the region of $800-1,000. As [Mrs S] did not ask to take this into account, I propose to ignore it.
Contributions
34 [Mrs S] asks the Court to find that she contributed to the extent of 52.5% and [Mr S] contributed to the extent of 47.5% of the asset pool. [Mr S]’s Papers for the Judge did not indicate what contribution finding he wished the Court to make, but he obviously considers he made the greater contribution.
Contributions before separation
35 I do not propose to trace the parties’ careers and their acquisition and disposal of assets before separation. It is abundantly clear that [Mr S] and [Mrs S] are both hardworking and industrious people. Apart from short periods of maternity leave, [Mrs S] earned an income throughout the marriage. Similarly, [Mr S] was employed throughout almost the entire marriage.
36 It is common ground [Mr S] earned nearly $29,000 more than [Mrs S] from 1990 to the end of 2003/2004. [Mr S] placed emphasis on this in his Papers for the Judge. For her part, [Mrs S] placed emphasis on what she claimed was the far greater contribution she made to the welfare of the family in looking after the home and the children, whilst at the same time holding down employment. She acknowledged that [Mr S] assisted her when [F] was younger, but that his involvement in the care of the two younger children had been minimal. She also says [Mr S] spent some of his spare time engaged in social, sporting or personal development activities, whilst she was left to care for the home and the children.
37 There was little, if any, cross-examination of the parties’ competing claims in relation to their domestic and indirect contributions, which made it difficult to arrive at any finding. Nevertheless, I found [Mrs S] to be generally a credible witness, whereas [Mr S]’s evidence on a number of other issues was less than persuasive. I consider it is more likely than not that [Mrs S]’s contribution as a homemaker and parent and her indirect contributions
(Page 12)
were somewhat greater than similar contributions made by [Mr S], although I did consider she may have exaggerated her claims to some extent.
Contributions after separation
38 [Mr S] does not have the benefit of legal advice and therefore wrongly considers all of the assets he has accumulated post-separation should be ignored: Williams and Williams (1985) FLC 91-628. He says these assets have been accumulated because he has worked hard, sometimes at two jobs, and been thrifty – both of which propositions are true.
39 What his argument ignores, however, is that [Mrs S] too has been working very hard – and there is no evidence to suggest she has been a spendthrift. [Mrs S] has not only been required to work full-time, but also has had primary responsibility for the care of the two children. [Mr S] only has the children for daytime visits, since they do not spend any overnight or extended periods with him. If he had been required to care for the two children, he could not, for example, have worked two jobs during part of 2005.
40 [Mrs S] will be given credit for, in effect, working two jobs for the whole period of the separation, just as [Mr S] will be given credit for earning more than she did during the same time. It will be recalled the parties separated in November 2003. In the year to 30 June 2004, [Mrs S] actually earned $1,271 more than [Mr S]. (This is already accounted for in the $28,852 discrepancy mentioned above). In 2005/05 [Mr S] earned about $73,000 whereas [Mrs S] earned about $58,600. In 2005/06 he expects to have earned around $60,000 and [Mrs S] has probably earned much the same. [Mr S] has therefore earned about $14,400 more than [Mrs S] post-separation, but has done very much less than she has in looking after the younger children (although he has spent more time with [F] [overseas]).
Child support payments – impact on contributions
41 [Mr S] has been able to acquire more assets than [Mrs S] post- separation not only because he has earned more but because he has not been contributing adequately to the support of [A] and [C]. He paid nothing at all by way of child support until very late in 2005 and since then has paid a grand total of $1,177. He also paid $500 for a computer for [A]. I do not accept that he has paid anything else of significance for their benefit, save for entertaining them on occasions.
(Page 13)
[Mrs S] has been responsible for almost every aspect of their
maintenance, as well as payment of their school fees.42 [Mr S]’s failure to support the two younger children is to be understood in the context of the agreement between the parties that he would take care of [F] whilst [Mrs S] would take care of the younger children. It is not important for me to determine whether or not this was a mutual agreement or a fait accompli which [Mrs S] accepted. What is important to determine is the extent to which [Mr S] has, in fact, supported the children. This was a matter of considerable controversy in the case of [F].
43 [Mr S] claims that [F] was mainly living with [Mr S]’s family [overseas] for his first year [overseas]. He says he was providing about $600 per month for [F]’s support during that time. He says this support increased to $1,000 per month when [F] moved into the apartment in early 2005. In addition, he has been paying the interest on the fairly modest loan he obtained to acquire the apartment. (He has also paid the rates and costs of some repairs on the properties [overseas]. He estimated the rates were between $1,000-$2,000 per annum.)
44 Conflicting information was provided concerning [F]’s views about the level of support he had received from his father. [Mr S] attached to his affidavit an unsworn statement, in which [F] acknowledged in September 2005 that [Mr S] had met his expenses of about $1,000 per month. This statement was not strictly evidence, although it was not sought to be struck out. I do not know the circumstances of the execution of this document, but I do know that [Mr S] has quite inappropriately involved all of the children, especially the younger ones, in his financial disputes with [Mrs S]. Furthermore, [F] later swore an affidavit which contradicted his unsworn statement. [Mr S] did not give notice of his desire to cross- examine [F] on his affidavit until the commencement of the trial yesterday. This was, of course, too late, since [F] is [on another continent].
45 I placed greatest weight on [F]’s sworn statement, which indicates that [Mr S] sent [F] a total of $2,750 in the period from February 2005 (when [F] moved into the apartment) until 24 August 2005. I note that [F]’s affidavit did not mention what support, if any, his father provided whilst he was staying with relatives. I consider it
(Page 14)
likely [Mr S] did make some payments to his relatives for his son’s support in this period, but I was not persuaded it was as much as $600 every month.
46 Apart from the payments mentioned in [F]’s affidavit, I accept
[Mr S] also:
• paid the cost of [F]’s travel when he went [overseas] in 2004; • made a major contribution to [F]’s expenses when he was [overseas] for about 3 months in the first part of 2006; and • possibly allowed [F] to keep $1,000 from the $16,000 he sent to him to pass on to his aunt (although [F] made no mention of this when giving evidence about the $16,000 in his affidavit). 47 [Mr S] was aware that his support of [F] was a significant issue for the trial, but he did not bring to Court any documents that would in any way corroborate his claims. Instead he made bald and vague assertions about having previously provided the documentation to the Court or to [Mrs S]’s solicitors or to the Child Support Agency.
48 In November/December 2005, [Mr S] obtained significant relief from payment of child support for the two youngest children on the basis of his undertaking to the Child Support Agency that he had been providing, and would be continuing to provide, significant support to [F]. Ironically, as soon as the Child Support Agency decision was handed down, [Mr S] ceased making any lump sum payments to [F].
49 The Child Support Agency decision had reduced [Mr S]’s child support obligation for the two youngest children to $8 per week per child from 9 November 2005 until 30 June 2006 and thereafter, until February 2007, he was to pay only $196 per month per child (an amount calculated in accordance with his estimate of his income). Even though he had previously been assessed to pay a total of $1,122 per month, [Mr S] did not regard the decision of the Child Support Agency as a “victory”, since he had asked that he not be required to pay anything. Whether his chagrin at the outcome was the reason for him stopping making payments to [F] is unclear; however, his cessation of payments to [F] has meant that [Mrs S] has had to commence making payments. I accept that she has sent [F] $4,500 since October 2005 and she expects to be sending him about $1,000 every two months in the future.
| (Page 15) |
Other factors relevant to contributions
50 Although [Mrs S] has mainly supported the youngest children and has started to provide some support to [F], she has not paid the $562 per month mortgage on the [investment property] since March 2005. I accept that she ceased making mortgage payments because of [Mr S]’s failure to pay child support and his failure to pay to her the previously agreed lump sum. As a result of ceasing the payments, the debt on the mortgage has continued to grow. [Mr S] appears to have kept making the payments on the mortgage on the former matrimonial home, although he fell behind with one payment.
51 [Mrs S] gave evidence of post-separation expenditure of funds on the [investment] home. I accept the money was spent, but it seems some of the expenditure was met from the $25,000 she drew down from the mortgage in August 2004 at the time she was looking for her car, which ended up costing only $18,500. The balance presumably came from surplus income earned after separation.
52 Both parties have expended money on travelling [overseas] since separation. [Mr S] appears to have paid for his trips from his post- separation income, whereas [Mrs S] obtained a $5,000 loan, on which she still owes $4,700. As best I could ascertain from her evidence, this was a personal loan, which she does not ask me to take into account, even though it was reasonable that she and the younger children travel home to visit [F] and her family.
53 [Mr S] gave evidence of support his family had provided by paying bills and administering the property [overseas]. The evidence was very vague and I was not persuaded the efforts his family had made were such as to make any difference to the outcome.
54 I turn finally to consider two items of what might loosely be called “negative contributions”.
55 [Mr S] places reliance on the fact that he accumulated more superannuation than [Mrs S], using money he saved when he gave up smoking. He criticises her for her failure to do likewise and he also says she spent too much on alcohol. [Mr S] favours a frugal lifestyle and was offended by [Mrs S]’s expenditure on what, in other families, might be perceived as minor luxuries. There was no evidence that [Mrs S] spent inappropriate amounts on alcohol and I find her nicotine habit was not as expensive as [Mr S] alleged.
| (Page 16) | |
| 56 | [Mrs S] asks the Court to take into account [Mr S]’s actions in allowing the condition of the [matrimonial home] property to deteriorate after separation. She said in her affidavit: |
“there is no garden anymore. That [sic] flooring needs to be replaced. The walls need to be repainted. There is rubbish and dirt all around the house. To the outsider, it looks as if the house has been abandoned. Since separation its value has depreciated at least $20,000.”
57 In support of these assertions, [Mrs S] relies upon an affidavit of [Mr E], a qualified valuer. Photographs attached to his valuations show the garden at [the investment property] as neat and well maintained, whilst the garden at [the matrimonial home] is in a quite appalling state. The home does, indeed, appear abandoned. In his report, [Mr E] said: -
“there would appear to have been no maintenance of the gardens or grounds over the past few years and apart from some mature shrubs, the gardens are non-existent.”
58 He also noted that although the home was structurally sound, it “requires considerable maintenance, including external and internal painting to bring it to a reasonable standard”. [Mr S] accepted that these were all accurate descriptions, although he later added that it “didn’t look that bad”.
59 [Mr E] did not give any opinion concerning the impact on the valuation of the poor state of the property. His report was brief and referred to only three comparable sales in the neighbourhood. Perusal of those sales satisfies me that the poor state of the property has had some impact on value, but I was not persuaded the impact was as high as $20,000. Nor was I satisfied that [Mr S] should bear responsibility for anything other than the deterioration in the appearance of the garden. I did not accept his excuse for the deterioration in the appearance of the property, namely that he was too busy working two jobs. He has no one but himself to look after and he could, at least, have put a sprinkler on the garden and kept the lawn mowed. He could also surely have found someone to live in the house rent-free to look after the property whilst he travelled [overseas].
Assessment of contributions
60 I have found that:-
| (Page 17) | ||||||||
| • | [Mr S] contributed somewhat more income and made somewhat greater contributions to superannuation than [Mrs S] prior to separation. | |||||||
|
61 Taking all of these matters into account, I consider there is a sufficient basis to find that [Mrs S]’s contributions were slightly more valuable than those made by [Mr S]; however, I consider that the division suggested on [Mrs S]’s behalf would bring about too great a disparity. I am of this view because such a disparity would result in an overall disparity of 5% between the parties, which is a significant gap in such a large asset pool. I instead find that contributions were made in proportions 51:49 in [Mrs S]’s favour. On the basis of contribution alone, therefore, [Mrs S] would receive $341,787 from the assets and [Mr S] would receive $328,384.
Section 75(2) and other factors
62 [Mrs S] seeks an adjustment of 7.5% of the assets to take into account factors under s 75(2) of the Act. [Mr S] was not specific about what adjustment (if any) he saw as being appropriate for s 75(2) factors.
63 I do not propose to detail my findings in relation to each of the s 75(2) factors, although I have taken them all into account in arriving at my assessment. I make only the following further findings:
• Both parties enjoy good health; (Page 18)
• Both parties are likely to continue working for many years; • [Mr S] is earning about $50,000 per annum, including overtime, as stated in his closing address; • [Mr S] may earn more in the future because he has qualifications which might allow him to get a better paid job and in any event it is possible he will again take on a second job (albeit he is concerned about the child support ramifications); • [Mrs S] is earning about $60,000 per annum; • [Mrs S] is likely to have long-term responsibility for accommodating, caring for and maintaining [A] and [C], who are aged only 11 and 9 years, and who attend a private school; • [Mrs S] is unlikely to be able to take on a second job because of her responsibilities to the children and because [Mr S] does not have the children stay with him for extended periods; • [F] is in the second year of his [particular] course [overseas], which he will complete in December 2009. He earns a little income but is probably unable to support himself. I was unable to determine whether [Mrs S] was correct in saying [F] receives some support from the [overseas] government. He lives rent-free in an apartment of modest value provided by [Mr S]; • I consider it is likely [Mrs S] will keep providing some support to [F] whilst he is unable to support himself, but I have doubts whether [Mr S] will do so, given his recent track record and his likely annoyance at the outcome of these proceedings; • I was not persuaded it is likely that [F] will be coming back to Australia and if he does so I do not know whether he is likely to live with one of his parents or with mates; • [Mrs S] can hope to receive $382 per month child support with effect from July 2006, although [Mr S] has shown he will do his best to ensure the child support is kept to the minimum. This figure is based upon [Mr S]’s estimate that he will earn only $40,129 per annum, when in fact he has consistently earned more for some years; and • Neither party has re-partnered and neither has any obligation to support any other person. (Page 19)
Assessment of s 75(2) factors
64 The most significant s 75(2) factor is [Mrs S]’s ongoing obligation to house, maintain and care for [A] and [C], both of whom are still quite young. Whilst she presently earns more than [Mr S], he has a demonstrated capacity to obtain additional work, which I feel confident he would seek were it not for his concerns about having to pay more child support. The 7.5% adjustment [Mrs S] seeks is a comparatively modest one, although in dollar terms it is fairly significant since the asset pool is quite valuable. I consider the adjustment she seeks is warranted.
65 I therefore intend to make the 7.5% adjustment sought to the contribution-based assessment, which will result in the assets being divided in proportions 58.5% to [Mrs S] and 41.5% to [Mr S]. [Mrs S] will therefore receive assets to the value of $392,050 and [Mr S] will receive assets to the value of $278,121.
Just and equitable?
66 The final stage of the property settlement process is to step back and determine whether the outcome based on assessment of contributions and s 75(2) factors is just and equitable.
67 It is, of course, most unfortunate that the matter has had to reach this stage and that the family has had to incur significant legal costs to achieve a result that could have been obtained much more simply and easily had common sense prevailed when the parties first reached an agreement.
68 I consider that the proposed outcome gives appropriate weight to the substantial contributions made by both parties and also appropriately takes into account [Mrs S]’s much greater needs as a result of her ongoing role in providing the accommodation, maintenance and care of two quite young children.
Credibility
69 I found [Mrs S] generally to be a reliable witness, although I consider her obvious hostility towards [Mr S] probably coloured her evidence concerning their respective contributions during the marriage.
70 I did not find [Mr S] to be a credible witness. He is very attached to his money and obviously considers that [Mrs S]’s claim is quite
(Page 20)
unreasonable. Aspects of his evidence that caused me to be very
careful in accepting what he had to say included:
•
His failure to disclose in his January 2006 affidavit that in November 2005 he had remitted $16,000 to [overseas] to repay funds allegedly advanced by members of his family. This fact should have been disclosed in paragraphs 37 and 61 of his affidavit, in which he gave evidence of having borrowed money from his father. Furthermore, in his statement of financial circumstances sworn in January 2006 he still showed his debt to his father as being $20,000.
•
His failure to give evidence of the fact he had acquired [another property] on his recent trip [overseas] at a cost of $12,000. I specifically invited him, on more than one occasion, to update his position at the commencement of his evidence. His excuse for not revealing this information prior to cross-examination was he did not consider it to be relevant. This did not sit well with the fact that he knew [Mrs S]’s claim was formulated on the basis she is asking the Court to take into account all of the assets acquired post-separation. When he first acknowledged he had bought the farm, he quickly added it had been acquired with funds from his family. Only when asked did he put any of his own money towards the property did he acknowledge he had paid $6,000 from his own savings.
•
When he was asked when he saved the $6,000 to put towards the farm, [Mr S] initially said he had saved most of it before November 2005. Later it was put to him that he had claimed in his January 2006 statement of financial circumstances he only had $1,200 in the bank. Thereafter he attempted to say the $6,000 came from the advance he received from his employer shortly before going [overseas] at the beginning of March 2006, not from the savings he had previously said he had accumulated before November 2005.
•
His failure to say in his trial affidavit that his sister had lent the money for [one of the properties]. When he did volunteer that the money had come from his sister, he did not explain why he would borrow the entire cost from his sister, when he already owns fairly substantial assets. I was ultimately not entirely convinced [Mr S]’s sister had lent him any money. I note he did
(Page 21)
not disclose any such liability in his June 2005 statement of financial circumstances, although he also did not disclose the property either. I also note that [F]’s affidavit made no mention of any of the $16,000 having to be paid for his aunt’s benefit. He said he had been told the money was to repay debt relating to the apartment.
• [Mr S] gave evidence in an affidavit in June 2005 that his income was $39,000 per annum. In fact, his income to the end of that year was $72,900 and his income in the year to 30 June 2006 will be in the region of $60,000. The last time he earned as little as $39,000 was in 1998/99. • The story provided by [Mr S] in his trial affidavit regarding the funding arrangements for the apartment differs significantly from the information set out on page 12 of his statement of financial circumstances sworn in June 2005. In particular, he failed to say in the statement of financial circumstances that the mortgage on the former matrimonial home had been used to make almost half the payment and he overstated the debt to the building company. • His inability to produce any documents to verify his claims regarding the size of his payments to [F], although allegedly such documents exist. 71 In making my unfavourable assessment of [Mr S]’s credibility, I have not overlooked the fact that English is his second language and that even after many years of living in Australia, there may be aspects of Australian law and custom with which he is not entirely familiar. However, it needs to be said that [Mr S] presented not only as an intelligent man but an exceedingly astute person, who was very quick to fire back firm and perceptive responses to questions put to him by [Mrs S]’s counsel. I therefore did not consider I was doing him an injustice in finding him to be less than a frank witness.
Legal costs
72 [Mrs S] seeks an order that [Mr S] pay all or portion of her legal costs. I consider it appropriate to make a decision in relation to costs after the handing down of the substantive property settlement orders.
Orders
73 The only contentious issue in determining the formulation of the orders relates to the disposition of the property [overseas]. In his
(Page 22)
original response, [Mr S] had proposed that [Mrs S] receive [two of the overseas] properties as part of her settlement and that she meet the costs associated with the transfer of the properties into her name. The parties have now agreed that [one particular] property should be sold. [Mrs S] has indicated she does not wish to have the [other] property as part of her settlement. [Mr S] has indicated that he would be prepared to take on all of the property so long as the price is “fair”.
74 [Mr S] also mentioned during the course of his closing address that he had been informed that it was likely to cost as much as $1,500 for each property that had to be transferred to him [overseas]. I had some difficulty accepting that the cost would be as high as alleged, but fortunately there will need to be a transfer of only the [one particular] property, since the other properties are either to be sold or are already in [Mr S]’s name. I propose to order both parties to meet half the cost of the transfer of that property if [Mr S] elects to take it as part of his settlement. Otherwise the property can be sold.
75 There is some strength in the submission made by [Mrs S]’s counsel that [Mr S] is the author of his own misfortune if he has difficulty in making arrangements to pay the required settlement sum to [Mrs S]. It was, after all, his decision to acquire property [overseas] after the date of separation. On the other hand, I accept that the major portion of his investment in property [overseas] has been in the apartment which he has allowed [F] to use whilst he is studying. Furthermore, I appreciate that [Mr S] genuinely did not anticipate that the newly acquired properties would be taken into account in the final settlement.
76 In these circumstances, I propose to give time to [Mr S], after publication of these reasons, to ascertain whether or not he wishes to borrow the entire amount he will need to pay [Mrs S] or whether he would wish to be given time in which to dispose of the property [overseas] to assist him to make the payment. If he elects to make part of the payment by disposing of property [overseas], [Mr S] needs to appreciate that he will not be able to delay making the entire payment to [Mrs S] until he has sold the property [overseas]. On the contrary, he will be required to make promptly a substantial payment to [Mrs S] representing 58.5% of the Australian assets and 58.5% of any of the [overseas] assets he does not propose to sell.
| (Page 23) | |
| 77 | I will ask counsel for [Mrs S] to prepare an appropriate Minute of Orders, once [Mr S] makes known his intentions concerning the payment required to give effect to this judgment. I will be going on annual leave at the end of next week and I am anxious for the matter to be finalised before my departure. Subject to the convenience of both parties, I propose to deal with the orders at a special appointment at 9.30 am on 7 July 2006. I will also deal with any costs issues at that time. |
I certify that the preceding [82] paragraphs are a true copy of the reasons for
judgment delivered by this Honourable Court
Associate
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