S and W
[2009] FCWA 163
•23 DECEMBER 2009
[2009] FCWA 163
| JURISDICTION | : | FAMILY COURT OF WESTERN AUSTRALIA |
| ACT | : | FAMILY COURT ACT 1997 |
| LOCATION | : | PERTH |
| CITATION | : | S and W [2009] FCWA 163 |
| CORAM | : | MONCRIEFF J |
| HEARD | : | 8 & 9 DECEMBER 2009 |
| DELIVERED | : | 23 DECEMBER 2009 |
| FILE NO/S | : | PTW 864 of 2007 |
| BETWEEN | : | S |
| Applicant | ||
| AND | ||
| W Respondent | ||
| Catchwords: |
FAMILY LAW - jurisdiction - de facto relationship - substantial contribution - serious injustice
Legislation:
Family Court Act 1997 Part 5A, s 205Z
Interpretation Act 1984 s 13A(2)
Category: Not Reportable
Representation:
Counsel:
| Applicant | : | Mr H Moser |
| Respondent | : | Self Represented Litigant |
Solicitors:
| Applicant | : | Friedman Lurie Singh & D'Angelo |
| Respondent | : | Self Represented Litigant |
[2009] FCWA 163
Case(s) referred to in judgment(s):
Jones and Dunkel (1958-1959) 101 CLR 298
Marsh and Garland (2006) FCWA 1
Tristram and Olifent [2007] FCWA 43
Van Joe v Cole [2000] NTSC 18
Varga and Kelty [2005] FCWA 80
[2009] FCWA 163
1 [Ms S] (the applicant) and [Mr W] (the respondent) are unable to agree, firstly,
as to whether or not the Family Court of Western Australia has jurisdiction to hear a claim by the applicant for settlement of property and, secondly, if the Court has jurisdiction, what entitlements the applicant may have by way of settlement of property.
Jurisdiction
2 Jurisdiction to determine this dispute can be founded in a Part 5A of the Family Court Act 1997. Section 205Z sets out the requirements to be satisfied for a court to make an order by way of property adjustment:
“205Z(1) [Requirements to be satisfied]
A court may make an order in relation to a de facto relationship only if satisfied —
(a)
there has been a de facto relationship between the partners for at least 2 years;
(b)
there is a child of the de facto relationship who has not yet attained the age of 18 years and failure to make the order would result in serious injustice to the partner caring or responsible for the child; or
(c)
the de facto partner who applies for the order made substantial contributions of a kind mentioned in section 205ZG(4)(a), (b) or (c) and failure to make the order would result in serious injustice to the partner
205Z(2) [Considerations to determine length of relationship]
In deciding whether there has been a de facto relationship between the partners for at least 2 years, the court must consider whether there was any break in the continuity of the relationship and, if so, the length of the break and the extent of the breakdown in the relationship
205Z(3) [Matters for consideration not limited]
Subsection 2 does not limit the matters the court may consider
3 The parties are able to agree that they had a de facto relationship for a period.
They do not agree that the period was at least two years. If I find that the parties have not been in a de facto relationship for at least two years, then the applicant says that I still am able to make an order, having regard to subsection 205Z(1)(c) in support of which she asserts that she made “substantial contributions” of a kind mentioned in s 205ZG(4)(a), (b), or (c) and failure to make the order would result in a “serious injustice” to her.
4 The contributions contemplated by s 205ZG(4)(a), (b) and (c) are as follows:
[2009] FCWA 163
In considering what order (if any) should be made under this section in proceedings with respect to any property of de facto partners, or either of them, the court must take into account —
(a) the financial contribution made directly or indirectly by or on behalf of a de facto partner to the de facto relationship or a child of the de facto relationship to the acquisition, conservation or improvement of any of the property of the de facto partners, or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the de facto partners or either of them; (b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a de facto partner or a child of the de facto relationship to the acquisition, conservation or improvement of any of the property of the de facto partners or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the de facto partners or either of them; (c) the contribution made by a de facto partner to the welfare of the family constituted by the de facto partners and any children of the de facto partners, including any contribution made in the capacity of homemaker or parent;
5 The Court is aided in its determination as to whether or not a de facto
relationship exists by s 13A(2) of the Interpretation Act 1984 which sets out a list of factors that are indicators of whether or not a de facto relationship exists between two persons. The section emphasises that the factors are indicators, but they are not essential.
Section 13A(2) states:
(2) The following factors are indicators of whether or not a de facto
relationship exists between 2 persons, but are not essential:
(a) the length of the relationship between them; (b) whether the 2 persons have resided together; (c) the nature and extent of common residence; (d)
whether there is, or has been, a sexual relationship between them;
(e)
the degree of financial dependence or interdependence, and any arrangements for financial support, between them;
[2009] FCWA 163
(f) the ownership, use and acquisition of their property (including property they own individually); (g) the degree of mutual commitment by them to a shared life; (h) whether they care for and support children; (i) the reputation, and public aspects, of the relationship between them.
6 The respondent acknowledges that the parties were in a de facto relationship from September 2004 to February 2006, a period of between 16 and 17 months.
7 The applicant asserts that a de facto relationship commenced when the
respondent moved into her home at [her address](the [Ms S] property) “in or around July 2003” and continued until separation on 17 February 2006, a period of “about two years and seven months living together as a de facto relationship”.
8 If the applicant is right then clearly I have jurisdiction to make orders about
settlement of property under Part 5A of the Family Court Act 1997. If the applicant is wrong and the respondent is correct, then I must determine whether the applicant made “substantial contributions” of the kind mentioned, as a first step, and secondly, that failure to make any order would result in a “serious injustice” to the applicant.
The evidence
9 The applicant relied on her affidavits filed on 18 June 2009 and 3 December
2009, together with a Statement of Financial circumstances which she filed on 18 June 2009. She also filed an affidavit of [Ms G] on 3 December 2009, and an affidavit of [Mr K] filed on 18 June 2009. The respondent relied on affidavits he had filed on 7 May 2009 and 1 September 2009, and a Financial Statement that he filed on 7 May 2009.
10 A Statutory Declaration from a [Mr G] was also admitted as part of the respondent’s case.
11 Neither Mr K nor Mr G were required for cross-examination. The applicant was
represented by Mr Heinrich Moser of Counsel and [Mr W] appeared for himself at trial, although he had been previously represented by solicitors who had prepared some of the documents filed on his behalf, particularly his Amended Response to Final Orders and his principal trial affidavit.
Credibility
12 A great deal of this matter turns on the party I believe to be giving the more
probable version of events. In this case, I have no difficulty in determining which party is the more credible. As will appear later in some detail in these reasons, the applicant presented as a person who would give a version of facts to suit her needs at
[2009] FCWA 163
any given point in time and to any tribunal, court or authority, irrespective of the remarkable inconsistencies between the versions when compared. Such was her willingness to represent different versions of facts, particularly in two sets of proceedings in the Family Court, proceedings in the Supreme Court (referred to below) and proceedings before a Magistrates Court (where her evidence was that “partner” meant “friend”), that I formed the view that at any point where there is a discrepancy between the applicant’s evidence and that of any other person in these proceedings, I prefer the evidence of the other person.
13 The applicant wilfully and deliberately lied in these proceedings, and has lied, to this Court previously and other courts, to suit her then purposes.
14 Her witness, Ms G, was equally unimpressive. Her palpable hostility towards
the respondent could not be contained in the witness box and when confronted with a simple question as to when she and the respondent first met, I formed the view that she was unable to acknowledge the date that had been put to her by the respondent because she perceived that to do so would not assist her friend’s case. She refused to accept that, given the respondent’s hours of work, the opportunity for he and Ms G to meet was rare and when they did meet, it was usually on weekends. This meant that, for her to have made certain statements in her affidavit, she must, at least in part, have relied upon what she was told by the applicant. Ms G struggled to accept this very obvious proposition; it was not only obvious as a matter of logic, but obvious on the face of her affidavit.
15 In remarkable contrast to the applicant and her witness was the respondent. The
respondent struck me as somebody who did his very best to tell the truth, was open, frank and someone who had presented as having a remarkably generous spirit. That is not to say that throughout the course of his evidence there were not one or two matters that were put to him that caused him some embarrassment. What, however, enhances the respondent’s credibility was that when he was caught out over two matters in particular, his embarrassment was so obvious and his presentation changed so remarkably that it was very easy to determine where he had “stretched the truth” or added a gratuitous comment. For example, in paragraph 12 of his later affidavit he says in part:
“The agreement dated 4 July 2003 was dictated to me by [Ms S] and as I do not have knowledge of any legal implications this agreement may have had, I signed it in good faith believing that it reflected what we had discussed as I stated in this clause. I also signed this to stop the verbal abuse I was constantly being subjected to by [Ms S].”
16 The last sentence was included as a gratuitous “swipe” against the applicant because on both parties’ versions of events (at trial) the agreement dated 4 July 2003 pre-dated their cohabitation and at that point it is highly unlikely the respondent would have signed the agreement to “stop verbal abuse”. When the respondent was questioned about this particular paragraph his embarrassment was obvious and it became clear that the last paragraph had been included in the affidavit, which he drafted, to offer a negative comment about the applicant.
[2009] FCWA 163
17 Similarly, when questioned about whether the applicant’s children had
sometimes called him “Dad”, which he denied, his embarrassment was obvious when an earlier statement, where he acknowledged that they had sometimes done so, was put to him. Nothing turned on the point in my finding as I accept that the applicant’s children may have “slipped” sometimes when referring to the respondent, who they usually called [by first name or nicknames].
18 I also observe, particularly having regard to the “Rule” in Jones and Dunkel (1958-1959) 101 CLR 298, that there were many matters uniquely within the knowledge and province of the applicant that she chose not to place before the Court. Further, the failure to properly disclose the circumstances regarding her land holding in Malaysia and the disposition of rents she received from that property does nothing to assist her cause. Indeed, the only mention of the applicant’s property in [Asia], by her, comes in her affidavit filed on 3 December 2009 (that is the last business day before the commencement of the trial) and the information provided is ambiguous and minimal.
19 As I have mentioned earlier, the applicant has previously made representations
to the Family Court of Western Australia in other proceedings. There were matters that arose during the course of the dispute between the parties where the applicant’s version of events could have been corroborated (or otherwise) in documents that had been filed in the proceedings between her and her former husband in this Court. Despite her counsel indicating that he had what he believed was almost the entire file, and directions previously made for its availability for this trial, the only document from those earlier proceedings that was presented into evidence was presented by the respondent. The respondent, at several points in his case, suggest that the applicant did things to conceal the existence of assets or otherwise frustrate the claim of her former husband against her in this court. It was within the applicant’s province and power to place evidence before me that would have indicated that she had made proper disclosure contrary to the position as suggested by the respondent. She chose not to produce such evidence.
Background
20 The respondent is 57 years of age and was born in [a country town], Western
Australia. The applicant is 50 years of age and she was born in [Asia]. The applicant has two prior marriages, the first ending in divorce in 1992.
21 The applicant then married [Mr S] in June 1993. They separated on 11 April
2003 according to her affidavit in proceedings filed between them in this court, being
Case No PTW XXXX of 2003 (the 2003 proceedings).22 The respondent was previously married and although he separated in 1994, he
was not divorced until 2004. There are no children of the relationship between the applicant and the respondent, although the respondent has four children of her marriage to Mr S, namely [N] now 15, [J] 12, [A], [J’s] twin, and [D] 9.
23 The respondent has six adult children from his previous marriage who were all over the age of 18 at the time that he met the applicant.
[2009] FCWA 163
24 The respondent says the parties met in November 2002 through a mutual friend.
He says that at that time the applicant represented to him that she was separated from Mr S. In early 2003, they commenced a sexual relationship. At the time that the parties met the respondent was living in a rental property in [the suburbs] and the applicant was living in her then home, [the address] with her four children and her then husband Mr S.
25 In April 2003, the applicant made the respondent aware of land at [ the suburb]
that was for sale and was apparently subject to an option for purchase between her and/or her husband Mr S. It appears that, no doubt as a result of the matrimonial difficulties the applicant was experiencing, she did not wish to complete the purchase of the property and the contract was effectively assigned to the respondent. He paid a deposit for the land and then entered into a contract with [the building company] Homes for the construction of a home on the block, paying only a small deposit. The respondent did not proceed with the purchase of the block of land, or with the contract to construct a home on that land.
26 In about June 2003, he says he received a notice to vacate the rental property in
which he was then residing. He says that at this time the applicant offered to rent the front bedroom of her house to him for $60 per week. He says he agreed and moved into the front bedroom of [her] property around early July 2003. At the time that he moved in the applicant was visiting her father in [Asia] with her four children. It appears to be common ground between the parties, based on the evidence at trial, that the respondent did not commence to live in [her] property until July 2003 and during the period that the applicant was overseas in Asia, despite the statements made in her affidavit filed 3 December 2009, where the applicant swears that “we lived together in a de facto relationship from April 2003 in the [suburban] property” and further “[Mr W] and my mutual friends and my family knew [Mr W] and I were in a de facto relationship from about April 2003 to 17 February 2004”. The applicant represented to the Family Court of Western Australia in the earlier proceedings, and in these proceedings, that she and her former husband had finally separated on 11 April 2003.
27 It is from the point that the respondent commenced to reside in [her] property that the parties’ versions of events commenced to differ remarkably.
28 The respondent says that he paid rent to the applicant. In her affidavit filed
3 December 2009, the applicant says “[Mr W] did not pay me rent at all in respect of the [residential] property”, yet, in an affidavit filed by the applicant in the Supreme Court of Western Australia, sworn on 3 August 2006, the applicant deposed:
“About a month after my husband left I rented a room of the house to [Mr W]. I had met [Mr W] through a friend a few months before this. At the time [Mr W] worked on the mines. He paid approximately $120 per week, but would often buy food instead of paying rent”.
29 There is no doubt that the parties were engaged in a sexual relationship and this
is a factor that is relevant to a determination as to whether or not there was a de facto relationship between the parties. However, in contemporary times the existence of a sexual relationship between two persons is not conclusive evidence of a de facto
[2009] FCWA 163
relationship, as observed by Thackray J, as he then was, in Marsh and Garland (2006)
FCWA 1 at 38(C):“The fact this middle-aged couple had an active sex life is not a strong indication of the existence of a de facto marriage. In modern Western society, regular sexual intercourse is far from being the preserve of those living in marriages or marriage-like relationships. It is a common element of boyfriend, girlfriend relationships and, in fact, is common amongst those in no relationship at all.”
30 I respectfully agree with and adopt his Honour’s observations.
31 I find that from July 2003 the respondent did rent a room from the applicant in
the suburban property and that, whilst renting the room, he and the applicant had a sexual relationship. The difficulty facing the applicant however, is that she is unable to demonstrate that there were other elements present which would suggest that the parties were in a de facto relationship. Indeed, she had elsewhere actively represented that they were not, or failed to mention the existence of a relationship at all. For example, in her trial affidavit, styled as her “final affidavit”, for the purposes of the 2003 proceedings and despite the relevance of such a relationship for the purpose of those proceedings under the Family Law Act (particularly s 75(2) and the relevance of that relationship to contested child related proceedings between the parties) no mention is made of the existence of a relationship at all, although I accept that the respondent may have been mentioned in earlier affidavits, yet an affidavit had been prepared by the applicant’s solicitors for the respondent to swear, which he did for the applicant’s earlier proceedings, the facts deposed to are consistent with the respondent’s representations of the relationship.
32 It would appear that at some stage information was passed to Centerlink that the
applicant had been receiving benefits to which she was not entitled. A copy of the decision of the Authorised Review Officer dated 29 August 2008 is annexed to the December 2009 affidavit filed by the applicant. The Authorised Review Officer sets out in detail various contacts between Centrelink and the applicant. Centrelink had, presumably on the advice of the applicant’s former husband, been supplied with information where the applicant had represented that the respondent was “my partner” and had made enquiries of her as a consequence of that information.
33 On 7 October 2003, it is recorded that the applicant contacted Centrelink by
telephone and denied a marriage-like relationship and stated “[Mr W] is a friend and boarder only”, that “he is definitely not her boyfriend” and further, that she is “not interested in men after 10 years with her estranged husband”.
34 A face to face interview was requested and on 10 October 2003 she represented to Centrelink again, in relation to Mr W –
• “he is just a friend” • “he needed somewhere to live and [she] was frightened by her ex husband so that is why he moved in. He paid $60 per week and sometimes pays for the shopping”.
[2009] FCWA 163
35 Again to Centrelink on 14 October 2003, she denies being in a marriage-like
relationship: “[Mr W] is a friend and a tenant/boarder”. The Authorised Review
Officer quotes from a form supplied by the applicant in dot points, as follows:
• Denied being in a marriage-like relationship; • [Mr W] is a friend and a tenant/boarder; • Never shared at another address; • Claims he moved in 7/7/03 – states “he needed a place to stay so I helped him out”; • He can stay as long as he wishes; • He pays $60 per week board and lodgings; • She uses his car when he doesn’t need it; • Denies any financial involvement; • No shared payment of bills; • [Mr W] is employed by [a building company]; • He does his share of cleaning etc; • Denies social and leisure activities; • Denies going on holiday together; • States that others would not see them as an MLR (marriage-like relationship); • Denies sexual relationship; • He sometimes babysits her children; • He does not attend school/sporting/leisure activities with the children or contribute to their financial support. 36 Elsewhere, the applicant had represented to Centrelink that she and the respondent had commenced “living at [my] address” in October 2004.
37 Generally the representations by the applicant to Centrelink are more consistent
with the evidence of the respondent, where he says that during the period between July 2003 and September 2004 he paid rent and at other times contributed to other expenses and continued to assist with the applicant’s expenses, when requested, during a period when the respondent was living in a caravan park.
38 The applicant paid the utilities and other outgoings on the property consistent
with her ownership and principal use of the property. Whilst I have no doubt that the respondent contributed additional funds and met payments for various expenses from time to time during this period, he did so without commitment. Indeed throughout his evidence Mr W presented as an individual with a generous spirit and I have no doubt that he did contribute from time to time when the applicant was short of funds or the children had a need, but did so more because that was in his nature rather than being indicative of the nature of the relationship between the parties
[2009] FCWA 163
39 Further, during this period, there is no evidence suggesting that social interaction between the parties was any more than just that.
40 Ms G’s evidence was singularly unhelpful. She says
“From my observations and knowledge [Mr W] started staying over at [Ms S’s] home at [the address] about April 2003 and [Mr W] moved into [Ms S’s] home in July 2003”
| and further |
| “Often when [Mr W] and [Ms S] went out for dinners and dancing at [a club] about once a month they invited me and I accepted.” |
41 She then goes on to make various statements, some from her own observation
and some clearly based on what she had been told by the applicant, about the nature of
a close relationship that existed between the parties.42 However, in her cross-examination the respondent put to her that they, namely
Ms G and the respondent, first met on 31 December 2004 (that is at a time after which he acknowledges a de facto relationship had commenced with the applicant). Ms G refused to accept the proposition, but could not offer any alternate answer and I formed the opinion that she did not want to admit the correctness of the statement made by the respondent as she saw it as being adverse to her friend’s claim. The respondent himself reaffirmed this date in his own evidence and he was not challenged about it. Accordingly, I find that Ms G’s affidavit adds nothing to the assertion by the applicant that she was in a de facto relationship with the respondent prior to September 2004.
43 Having regard to the factors enumerated in s 13A(2) of the Interpretation Act and the evidence, together with my findings on credit, I am satisfied that the parties were not in a de facto relationship between July 2003 and September 2004.
44 I find, on the basis of the common position of the parties, that between September 2004 and February 2006, the parties lived in a de facto relationship.
Did the applicant make substantial contributions of the relevant kind and would my failure to make an order result in a serious injustice to the applicant
45 In support of the claim by the wife, the central focus of her case related to the transfer of the suburban property to the respondent.
46 Sometime prior to September, the parties entered into discussions about the possibility of the respondent purchasing the suburban property from the applicant.
47 The respondent asserts that at about the time that the respondent commenced to
reside in the property the applicant required him to execute a document confirming his agreement that he would never make a claim against her property. On 4 July 2003,
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Mr Watkins signed a handwritten note, in terms that he says the applicant required, stating as follows:
“To whom it may concern
I, [Mr W] , will not sue or take any action against [Ms S]for any part of her property, being [the address] whether I live with her for 6 months or 6 years said property is hers and her children alone and will always remain. So give my word that I will live up to this agreement for as long as I live.
Dates this day 4th July 2003”.
48 The applicant counter-signed it on 26 July 2003.
49 Certainly, the applicant was very keen to ensure that any transaction as between
her and Mr W would not entitle him to claim as against the property. The requirement that he sign the document, and its existence, suggests that Mr W was assisting her financially from time to time prior to him renting the room at the suburban property, as he has suggested in his trial material.
50 In any event, the respondent says that not long after he moved in the applicant
started raising issues with him about the problems she was having paying the home loan secured by the suburban property. He says that she was scared the bank would take possession of the house and initially she asked him if he would pay the mortgage. The respondent refused to do so and suggested that the applicant might consider selling the suburban property and that thereafter she, the children and the respondent could relocate to a rental property until his own house and land package was completed.
51 He says that the applicant told him she wished to remain in the suburban
property, that she would prefer the children to remain in the suburban property and to live in the home they grew up in and accordingly, she suggested that the respondent purchase the property from her.
52 There were some other discussions about the possibility of her extending the
mortgage, but in any event, the parties finally resolved that the respondent would
purchase the property from the applicant.53 To determine price the applicant arranged three different real estate valuers to
value the property and then the parties agreed that a sale price should be the average of the three “valuations” [more likely appraisals]. The sum agreed was $180,000 and the applicant offered to sell the property to him for that sum.
54 The respondent then contacted a [Mr G], a mortgage broker, who he says he
found in the Yellow Pages. He met with him in July 2004, with a view to arranging finance for the purchase of the property. It is noteworthy that the copies of the applications for finance attached to the applicant’s December affidavit show the respondent describing himself as “separated” (he not being divorced at that time) and not as “de facto” despite there being provision on the forms for him to do so.
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55 It would appear that there were some issues, although not clearly defined, about
obtaining finance, given the amount the respondent needed to borrow as against the
agreed price for the house.56 It would also appear that Mr G, in an endeavour to secure finance for the
respondent (and no doubt to ensure the consequential up-front and trailing commission to himself), may have made representations to the financiers that the value of the property was higher than the price agreed between the parties, preparing documents entitled “Confirmation of non repayable gift” which was signed by the applicant, variously, for the sum of $15,000 and for $67,000 to account for any differential between the purchase price and the represented value
57 There was a further difficulty when the contract and the transfer were submitted
for stamping in that the Office of State Revenue assessed stamp duty as if the value of the property was $255,000. This had the effect of increasing the amount of duty originally calculated as being payable on the transaction, but it appears it may also have had the effect of eliminating the requirement for mortgage insurance. If it was not the State Revenue assessment that had that effect, then it would appear that Mr G, who was not required for cross-examination, may have inflated the price or the value of the property for the purposes of securing finance from Macquarie Bank.
58 At the time the parties agreed the terms of the sale of the suburban property, the
applicant also required the respondent to agree to “sign this house back to you Ms S, within 6 months to 1 year per this agreement when property is bought in July” (July being the anticipated date for settlement of the sale).
59 A further difficulty arose as the consequence of the additional stamp duty that
was assessed as payable was that the respondent now had a short fall in funds to complete the purchase and pay the additional duty. Enquiries were made about the possibility of borrowing further funds, however that would have delayed settlement and for reasons that were not clear, there appeared to be some urgency in the conclusion of the transaction.
60 The applicant agreed to the respondent then utilising some monies that she had
received from an insurance claim and then paid into an account in the respondent’s name, to be released to and used by the respondent to complete the transaction. The respondent says that the use of the funds by him in reality only represented a repayment to him of the accumulation of funds that he had paid on the applicant’s behalf and that it did not represent a contribution by her in the final analysis.
61 What is particularly curious is the reason why the funds were placed in the
respondent’s account in any event. I accept that they were placed in the account by the respondent at the applicant’s request. I accept that at the time the respondent did not know the full nature and extent of any proceedings that were occurring between the respondent and her former husband. For example, he did not know that there were orders with an injunction restraining the applicant from disposing of the suburban property.
62 I strongly suspect that the funds were placed in the respondent’s account at the
request of the applicant so that she did not have to disclose them for the purpose of the
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2003 Family Court proceedings. It was within the province and power of the applicant to demonstrate otherwise by reference to documents she had filed in the 2003 proceedings. She did not do so.
63 The applicant’s version of events in these proceedings, in her affidavit of 18 June 2009, is as follows:
“44. I realised by then [late 2003] that my liabilities to [the finance company] were increasing instead of reducing despite my making monthly payments of $951 which later increased to $1,125 per month. This was because of the arrears and the delay in having the additional loan of $10,000 processed caused by my second husband placing the caveat. 45. I then decided to control my liabilities and to do so the only way was to sell the suburban property. 46. Before I sold the suburban property I obtained three appraisals from real estate agencies and I decided to sell the suburban property for $180,000 being the average of the three appraisals. 47. I sold the suburban property to [Mr W] for $180,000 in September 2004. 48. Between about July 2003 and July 2004 [Mr W] said to me that once the suburban property has been transferred to him, once I finish my court proceedings and once I have sorted out what happened regarding the further $10,000 I borrowed from [the finance company], then he would transfer the suburban property back to my sole name within about 6 to 12 months. 49. [Mr W] told me he was not interested in “your family home (the suburban property)”, “it is yours and your kids’ home, I am only doing this for you”.
64 She then goes on to refer to the agreement signed by the respondent to which I have already referred.
65 Then in paragraph 54 she notes:
“In my Family Law proceedings involving my second husband my second husband wrote a handwritten letter dated 14 October 2005 which forms part of [Mr W]’s discovery stating that I undervalued the suburban property and the true value of the Suburban property at the time was about $225,000.”
66 The handwritten note, which is annexure 39 to the respondent’s affidavit filed 7 May 2009, reads as follows:
“I [Mr S] spoke to the other party [Ms S] with regards to the property transaction that occurred contrary to the injunction that was placed on the
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family home (sic). She said she was misled by [Mr W] who fraudulently undervalued the property to his gain. She insisted that I filed papers to set aside the transactions.
Signed … Dated 14 October 2005”
67 It is unclear as to why the applicant has referred to this correspondence in her
affidavit, particularly given that it would appear to suggest that, in addition to any other representation she has made about the transaction, the applicant represented to her former husband, Mr S, that the respondent acted fraudulently in trying to reduce the value of the property.
68 Such an assertion is in marked contrast to the position that the applicant took in
her 2003 proceedings against Mr S. Her sworn representations to the Court in her final affidavit as to the facts surrounding the sale of the suburban property, in part, bear a remarkable similarity to what she has represented to the Court on this occasion. Materially she states:
“65. I then decided to control my liabilities and to do so the only way
was to sell the suburban property.66. Before I sold the property I obtained three appraisals from real estate agencies and I decided to sell the suburban property for $180,000 being the average of the three appraisals. 67. I sold the Suburban property to [Mr W] for $180,000 in September 2004. 68. It was a term of the sale of the Suburban property to [Mr W] s that the children and I are to occupy the house except the master bedroom without paying rent for 5 years from September 2004. The master bedroom is occupied by [Mr W] and the common area such as the lounge, kitchen, dining and family rooms are shared. Annexed hereto and marked SHS 1 is a copy of the written agreement between myself and [Mr W] dated 21 September 2004.”
69 The agreement itself records:
“Agreement between Ms Shirley Scala/Mr [Mr W]
I [Mr W] of [address] hereby make a (sic) agreement between [Ms S] of [the address] to buy her house from her and let her and her four children stay in the said premises for 5 years or until she needs to move.
This agreement is made in good faith on this day 21/9/2004 for a (sic) agreed value which [Ms S] and I [Mr W] have agreed to with 3 appraisals made by 3 real estate reps of her choice, the document being signed by each of the parties.”
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70 Interestingly, in her cross-examination by the respondent, she attempted to
suggest that the respondent had tried to influence the choice of real estate agents,
although this line was not pursued when the respondent gave his evidence.71 What is significant however about the affidavit filed in the 2003 proceedings is
that it attempts quite clearly and deliberately, in my finding, to paint a picture of a transaction that is at arms length and as I mentioned previously in these reasons, nowhere in the “final affidavit” does the applicant mention that the relationship with the respondent is as she now represents.
72 I accept that the respondent’s knowledge of the applicant’s then Family Law
proceedings were as he has sworn, and about which he was not challenged, namely,
that he knew little, and that he accepted the applicant at face value.73 He did not know about the injunction restraining her from selling the house, as I
have mentioned, and the overwhelming inference to be drawn from the totality of the applicant’s conduct and the nature of the presentation of her evidence to the Court in the 2003 proceedings, is that she was attempting to mislead her former husband and the Court.
74 I find that the bargain struck between the parties was that the property was to be
sold for a price of $180,000, that the price was determined by taking an average of three appraisals from three real estate agents chosen by the applicant, as acknowledged and sworn to by her in the 2003 proceedings, and that despite the assessment of stamp duty as if the property were valued at a greater sum, the applicant continued with the transaction at the agreed sum of $180,000.
75 Despite what would appear to be the applicant’s assertions to her former
husband, as to the respondent’s conduct (well after the event) there was absolutely no
evidence of fraud as to the value of the property by the respondent.76 Mr Moser makes much of the assessment by the Office of State Revenue in
support of a claim that the applicant made a significant direct contribution to the respondent’s acquisition of the Suburban property. On 21 October 2009, the applicant’s solicitors wrote to the Office of State Revenue requesting, in the following terms:
“We would be obliged for the State Revenue Office to provide us with copies of the file including the contract for sale of land by offer and acceptance, documents records handwritten notes typed notes stamping and assessment of the stamp duty payable on the transfer and the mortgage regarding the transfer of the Suburban property from [Ms S] to [Mr W].” (Referring obviously to the suburban property.)
77 The documents forwarded indicate only that a value of $255,000 was utilised by the Office of State Revenue for assessing duty and are not definitive of value.
78 The applicant’s solicitors also wrote to the Valuer-General’s Office asking for
documents about the transaction in the same terms. The response was an email addressed to Ms Anna Carr, the applicant’s solicitor. [Ms S], the Acting FOR
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Coordinator of Records and Information Services at Landgate, wrote, on 2 November
2009:
“Good morning Anna
Further to our discussion on Thursday afternoon I have checked and the State Revenue Office stamp duty valuation form which contains Valuation Services Branch valuations has been destroyed in the 2007/2008 financial year under the Landgate Retention and Disposal Schedule but as I advised the State Revenue Office holds the original records so they probably can satisfy you request.”
79 The state of the evidence is therefore that a value of $255,000 was utilised for
the purpose of assessing stamp duty. There is no evidence of value that can be measured or assessed by the Court to determine how that sum was arrived at, whether it was a fair market value or indeed, how it was that that sum was used. The assessment is not definitive evidence of value and no attempt has been made to introduce any other admissible evidence of the historical value of the property.
80 The other financial contribution that could be said to have been made by the
applicant was by way of contribution to household expenses through Centrelink
benefits, to which she was not entitled.81 I have earlier referred to the representations that she has made to Centrelink.
Centrelink determined ultimately that she had been over-paid a significant amount of benefits to which she was not entitled through her failure to notify them of the relationship between her and the respondent, and as a result of Centrelink’s assessment of the nature of that relationship.
82 The applicant took the matter to an Authorised Review Officer and was partially
successful in having the determination reviewed. She then appealed the decision of the authorised review officer as to the balance that was left payable to the Social Security Appeals Tribunal. I was not provided with the reasons for decision of the Social Security Appeal Tribunal, nor any other documents from the Social Appeals Tribunal that were lodged by the applicant, however, she has annexed to her December 2009 affidavit a copy of the outcome, which was to affirm the decision made by the authorised review officer.
83 The applicant then appealed that decision to the Administrative Appeals
Tribunal.
84 At that point, her debt to Centrelink was $44,277.86. A settlement was reached
between the applicant and Centrelink under which she agreed to repay to Centrelink the sum of $30,000 in settlement of the claimed amount. Again, I have not been provided with copies of the documents lodged by her with the Administrative Appeals Tribunal. Presumably, she was alleging that for at least some portion of the time Centrelink determined that she and the respondent were in a relationship, they were not. I do not know, as information that was within the applicant’s province to provide was not provided.
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85 It was suggested to the respondent in cross-examination that he knew full well
that the applicant was in receipt of Centrelink payments and that he had derived a benefit there from and that the liability, were jurisdiction to be found, should be brought into account.
86 The respondent’s evidence was that certainly after September 2004, he had
advised the applicant to ensure that she told Centrelink of the change in the nature of their relationship and secondly, that he understood she was still entitled to a family benefit, to use his words –“whatever it’s called now, you know what I mean, the old child endowment” and that that was the extent of benefits she was receiving.
87 Quite clearly, the applicant was content to continue to misrepresent the situation
to Centrelink, having received a parenting payment through to February 2006. I am not satisfied that the payment was received with the knowledge and involvement of the respondent, nor was his evidence, in my finding, successfully challenged in cross- examination. Of particular significance is the notation in the Authorised Review Officers determination that “You have stated to Centrelink and the Family Assistance Office that you were the victim of Domestic Violence in the period June 2004 to February 2006 and you were not allowed to notify Centrelink of your change of circumstances under threat of violence to yourself and your children”. This proposition was not put to the respondent during the trial, nor was any evidence led from the applicant that supported it.
88 In terms of contribution generally, there is no doubt that the respondent was in a
superior financial position throughout the relationship, including the period of friendship prior to a de facto relationship existing between the parties, and that he was generous in the provision of funds to the benefit of the applicant and her household. Certainly, after the sale of the Suburban property to him, he assumed responsibility for the mortgage and all the outgoings for the property, and also contributed to the day to day expenses of the household.
89 I accept that the respondent worked hard, usually six days a week, frequently
leaving at 4:00 am in the morning and not returning until quite late in the evening. He said that for the most part he ate “on the road” in the course of his employment as a truck driver. The respondent’s current income is approximately $90,000 per year as a truck driver and I accept his evidence that at the time he was, in all probability, earning about $75,000.
90 The financial circumstances of the applicant during the course of the relationship
are difficult to determine. She speaks of the financial hardship that led her to enter into the sale of the property. I accept that she made the majority of the contributions to the upkeep of her children and that, in all probability, she did not receive a significant amount of child support or financial assistance from her former husband who, according to her “final affidavit” in the 2003 proceedings, was largely dependent on Centrelink benefits himself
91 The contribution to the household, in my finding, during the course of the de
facto relationship is equal. I accept that the respondent, whenever he could, did things around the home and undertook improvements to the home and was responsible for the outside maintenance.
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92 The respondent says that following the transfer of the suburban property to him,
and where he acknowledges the parties were in a de facto relationship, the parties still tended to keep finances separate and “we were each to be solely responsible for our personal living expenses such as the purchase of food and groceries, cosmetics and toiletry, health insurance, motor vehicle insurance, clothing, entertainment expenses and the like”.
93 However, he reflects that the applicant continued to struggle financially and that
he continued to assist her to meet her various expenses as he had done previously, including at times providing the children’s clothing, school books and other requirements, including cash when they were going out.
94 I have no doubt that the respondent derived benefit from the housekeeping duties
that the applicant says that she undertook, although I accept there is clear evidence that with one exception, he undertook his own washing, having resolved to continue to do so after the applicant put all his clothes in together with the consequential discolouration of some items.
95 Subsequent to the parties’ separation, the respondent has continued to meet all
expenses associated with the suburban property, including making improvements thereto, without contribution by the applicant, although I accept that he has derived the sole benefit of the property during that period. The respondent has also paid the sum of $15,000 towards the applicant’s legal costs for these proceedings, funded by increased borrowings secured against the suburban property, which the respondent will be left to discharge.
96 Having regard to the totality of the evidence I cannot find that the contribution
made by the applicant as “substantial” which connotes concepts of considerable importance, value or dimension. As Holden CJ observed in Varga and Kelty [2005] FCWA 80, “In my view, substantial means something more than usual or ordinary. In my view s 205X(b)(ii) is aimed at more exceptional circumstances where serious injustice may be caused by the application of sub-section (i).” a statement of principle approved and adopted by Thackray CJ in Tristram and Olifent [2007] FCWA 43.
97 However, I should add, having regard to the totality of the circumstances of this
matter, I would have significant difficulty in finding that my failure to make an order,
would lead to a “serious injustice”98 “Serious Injustice” has been described by the Full Court of the Northern
Territory Supreme Court in Van Joe v Cole [2000] NTSC 18, at page 23, as, “An injustice is the opposite of justice and includes the concepts of a wrong or unfairness. The word serious in this context suggests weighty, grave or considerable” [the context being an appeal to set aside a separation agreement]. To make such a finding I would have to be able to measure the circumstances of each of the parties with some degree of confidence. The respondent’s circumstances are relatively straightforward and relatively easy to measure. The applicant’s are not and I can have little confidence in her representation of any factual matter or her disclosure of relevant matters. To the extent that a determination of a “substantial injustice” denotes a degree of measurement or balance, I must be able to determine the items that are to be measured
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or weighed in the balance. Here I cannot. Absent that ability, the Court cannot make
such a finding.99 Accordingly, and for these reasons, the application will be dismissed.
Proposed orders
1. The orders with injunction made the 29 July 2008 be and the same are hereby discharged.
2. The Respondent is hereby released from his undertaking signed 4 November 2008 and filed in these proceedings on 7 November 2008.
3. The application for final orders filed on 17 February 2007 is hereby dismissed.
I certify that the preceding [99] paragraphs are a true copy of the reasons for
judgment delivered by this Honourable Court
Associate
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