S, Da v S, K
[2016] SADC 81
•13 July 2016
DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
S, DA v S, K
[2016] SADC 81
Judgment of His Honour Judge Tilmouth
13 July 2016
LIMITATION OF ACTIONS - EXTENSION OR POSTPONEMENT OF LIMITATION PERIODS - OTHER CAUSES OF ACTION AND MATTERS
Discussion of the requirement to demonstrate 'serious injustice to an applicant' to obtain an extension of time in which to bring an application for a property adjustment order.
Domestic Partners Property Act 1996 (SA) s9(1), s10, s10(c), s11(1), referred to.
Cooper v Lees (2009) 267 LSJS 553; A,WM v S,J [2014] SADC 41, applied.
FAMILY LAW AND CHILD WELFARE - DE FACTO RELATIONSHIPS - ADJUSTMENT OF PROPERTY INTERESTS
Consideration of the principles applicable to making property adjustment orders.
Evidence Act 1929 (SA) s50; Commonwealth Powers (De facto Relationships) Act 2009 (SA); Domestic Partners Property Act 1996 (SA) s3, s9(1), s9(2), s9(3), s10, s11(1); D,NH v T,LE [2015] SADC 147; Arnold v Dalton (2002) 84 SASR 482; Evans v Marmont (1997) 42 NSWLR 70; Parker v Parker (1993) 16 Fam LR 863; Harris v Harris (1997) 22 Fam LR 263, referred to.
S v B [2005] 1 Qd R 537; Hogg v Roberts (2003) 87 SASR 248, applied.
S, DA v S, K
[2016] SADC 81Table of Contents
Introduction
The proceedings
The course of the proceedingsOverview of the relationship
The Koolunga property
The Maslin Street Red Hill property
The Fisherman’s Bay property
The David Street Port Pirie propertySummary of Property Contributions
The orders as sought
Financial Arrangements
Property Adjustment Order
An Extension of Time?
Analysis – Extension of Time
The Respective Contributions to the Relationship
Findings of Primary Fact
Property Adjustment OrderOrders
Introduction
These proceedings between Mr DAS and Ms KS, concern applications for orders in the nature of property settlement, following the dissolution of their de facto relationship. Both further seek an extension of time in which to bring these proceedings. These reasons explain why the limited orders at the foot of this judgment were made.
The proceedings
By Statement of Claim of 12 September 2013, DAS applied for a property adjustment order by means of the division of property, within the meaning of s 9(1) of the Domestic Partners Property Act 1996 (SA). This followed the ending of what was undoubtedly a ‘genuine domestic relationship’ between them. The relationship commenced somewhere between June 2002 and no later than mid-July 2003 according to the pleadings filed by the applicant and the respondent, respectively. It ended at sometime between middle to late 2009, again according to the pleadings. Either way, this Court retains jurisdiction over the proceedings despite the transfer of the de facto partners jurisdiction to the Federal Courts by the Commonwealth Powers (De facto Relationships) Act 2009 (SA): A, WM v S, J,[1] D, NH v T, LE.[2]
[1] [2014] SADC 41.
[2] [2015] SADC 147.
The course of the proceedings
Proceedings in this court took a somewhat truncated and unsatisfactory course. Both parties appeared in person when the matter was first listed for trial on 10 December 2015. They made conflicting accusations as to their respective contributions to the purchase of several properties. The matter was adjourned so as to allow them to produce such documents as they could to support their competing claims, and to allow DAS to ascertain the prospects of crystallising his superannuation entitlements so as to facilitate the prospect of resolution.
Upon resuming on 22 December 2015, the court was informed DAS was not presently entitled to access those funds. That position remains. The proceedings were adjourned at the request of KS who was unwell, to 3 March 2016. KS failed to appear on this latter occasion, however DAS gave brief evidence on oath. A transcript of that evidence was sent to KS by letter informing her the matter would be heard on 4 April 2016. On that day she appeared but was unprepared to proceed, bringing with her into court an unsupervised child.
At the adjourned hearing on 28 April 2016, KS again failed to appear. She was contacted by mobile phone. She, by telephone, and DAS in person, made further representations in support of their respective claims. At her request the court issued two Bankers Orders under s 50 of the Evidence Act 1929 (SA), directed to the Westpac and ANZ Banks, with respect to loan facilities over a property, hereinafter referred to as ‘Koolunga’.
The ANZ material became available to the court shortly thereafter on 28 April 2016, whereas the Westpac material did not reach the court until 18 May 2016. A summary of the contents were sent to both parties by email on 30 May 2016, in which they were requested to address a number of issues upon resumption on 24 June 2016. The nub of the information forwarded to them appears in the references to banking records under the section in relation to ‘Koolunga’, below.
The matter came on again on 24 June 2006 when KS yet again failed to appear. She was uncontactable by telephone at this time. A further transcript of the proceedings was sent to her. She was given liberty to make any further representations she wished to in writing, within 10 business days, expiring on 8 July 2016. No response was received from her in any form, as of the date of this judgment. In the result KS has regrettably not given sworn evidence.
Proceedings with respect to custody and access to the children before the Family Court of Australia, resulted in final orders made on 22 February 2016 giving KS sole parenting responsibilities for the two boys of the relationship. Neither party produced formal property valuations for any of the subject properties.
Overview of the relationship
A general review of the course of the domestic relationship is this. The couple produced two boys, born in June 2004 and October 2005 respectively. KS has a son by a previous liaison born in November 1993. He lived with and was supported by the couple during the course of their relationship.
The parties first commenced cohabitation in a farmhouse in the mid North of the State. At the present time DAS resides in very modest self-contained circumstances in Redhill, for which he pays $80 per week rent. KS lives in Port Broughton with the three children, paying $220.00 per week rent. DAS estimates his current income as a shearer at around $45,000 pa before tax,[3] whereas KS appears to be on a Disability Support Pension and her eldest son on a carer’s pension.[4] She provides no further details.
[3] T93.36.
[4] T81.7-.9.
The Koolunga property
In around about November 2002 they purchased a dwelling on a property of 5 acres, located between Koolunga and Red Hill in the mid-North as an investment registered in KS’ sole name (Koolunga).[5] The purchase price was $77,000, with an original mortgage in the sum of $67,000, supported by a joint loan agreement. DAS claims the original deposit came from joint savings of around $6,000 and a First Home Owner’s Grant of $7,000, and that he applied his own earnings to the acquisition and household expenses thereafter. KS contends a deposit of 25 per cent originated from a Compensation for Victims of Crime Award of $10,000 received by her in about 2000, and from savings from her previous employment.
[5] Certificate of Title Registered Volume 5213 Folio 101, more accurately described as Lot 4, 95 Behennas Track, Koolunga.
It appears that DAS was declared Bankrupt at sometime in the immediately preceding period. Accordingly KS claims he was financially unable to secure a loan at this time. The fact that the property was registered solely in her name tends in part to support that view. While DAS did not deny his bankruptcy, he did deny having insufficient income to contribute to the purchase Koolunga and in fact claims that he was the sole income earner at the time.
It is unclear from the tax returns to what extent DAS’ supposed inability to contribute to the purchase is substantiated. He did however earn an estimated $19,263.60 in the 2001 financial year and $18,637.10 in the 2002 financial year, which therefore tends to support his position.[6] As to contributions to the household, DAS claims to have taken responsibility for internal and external cleaning and general maintenance of the yards, and that he continued contributing to upkeep after separation. He variously claimed to have paid the mortgage since they first commenced cohabitation in Koolunga until as late as 2012.[7]
[6] See income table below.
[7] Statement of Claim para 22, T65.21-.33, T94.7-.12.
For her part KS ceased employment shortly before the birth of their first son in mid-2004. Thereafter she devoted her time to homemaking and parenting duties of the kind contemplated by s 11(1)(b) of the Domestic Partners Property Act. She claims both made contributions to the mortgage and food, as their means permitted. KS claims that from 2009 she made sole contributions to Koolunga following separation, although she agrees DAS made equal contributions between 2003 and 2009.[8]
[8] T24.36-25.2.
The ANZ banking records secured under Bankers Order, show the Koolunga property was secured by the draw-down of a loan of $62,000 in her name on 4 September 2002. The loan agreement executed by KS required fortnightly repayments of $193.66. Repayments commenced on 2 January 2003 and recorded simply as ‘loan repayment’, whereas from June 16 2003 they appear as ‘periodic transfers’ from both, right through to 13 October 2005, immediately before the account was closed. At some time later the Koolunga property was refinanced. It remains registered on the title solely in the defendant’s name.[9] KS claims that in about October 2008 she received another compensation payout permitting the loan to be refinanced, when a further $20,000 was borrowed to clear existing debts.
[9] T10.9-.12.
The ANZ documents end as of 17 October 2005, with the loan account then closed at $59,093.15, thus clearing the mortgage with the ANZ. This must have marked the point of refinancing with the Westpac Bank. There is however some confusion as to what precisely occurred at the time. Westpac bank records going back to 11 February 2010 disclose an initial drawing of $111,100, and regular fortnightly repayments at $200.00 by way of direct debit from a joint deposit account.
Banking records before the Court reveal that as of December 2015, the balance of the joint loan account with Westpac over the Koolunga property was $129,251.51 and that repayments were $10,178 in arrears, whereas as of 11 September 2015 the loan was $127,588.33 with arrears standing at $7,997.00. As of 10 June 2016 the closing balance had grown to $132,012.94 and fell into arrears of $13,813.00. The parties informally estimate the value of this property at $130,000, so on this basis there is no equity in the property.[10]
[10] T16.10-.12
The Koolunga property remains unoccupied and in a state of disrepair and neglect. The banking records produced by Westpac of the joint loan account 037-154 37-2201 demonstrate the last direct debit was a deposit of $200 made on 3 September 2010.[11] Thereafter deposits of $726 were made on 13 September, 12 October, 12 November and 13 December 2010, and on 12 January, 14 February, 14 March, 12 April and 12 May 2011, from the same direct debit source 556580, increasing to $756 per month from 13 June 2011 to 12 January 2012.[12] From 13 February 2012 deposits from the same source reduce to $720 per month until 12 July 2012, except for one internet online funds transfer of $198.78 on 3 March 2011.[13]
[11] Statement 7, p 2.
[12] Statement 8, p 2 - 15 p 2.
[13] Statement 25, p 2 - 29, p 2.
On 13 August 2012 the monthly deposits fell to $689 by means of the same direct debit mechanisms, until 12 November 2012.[14] There was an electronic transfer of funds into the joint home account on 10 December 2012 of $600 and again on 14 January and 11 February 2013.[15] An online funds transfer of $460 was deposited on 11 March 2013,[16] and then on 12 April 2013 an electronic funds transfer was made of $680,[17] increasing to $760 on 13 May, 12 June, 12 July and 12 August 2013.[18] On 13 September 2013, an online banking transfer was deposited of $800, of $760 on 14 October, 11 November, and 11 and 12 December 2013, although there was also a withdrawal of $760 on 11 December.[19]
[14] Statement 31, p 2 - 33, p 2.
[15] Statement 34 p 2, 36, p 2.
[16] Statement 37, p 2 - 38, p2.
[17] Statement 37, p 2 - 38, p 2.
[18] Statement 38, p 2.
[19] Statement 44, p 2 and 3.
Thereafter the deposits in discharge of the mortgage become irregular. The bank statements indicate internet online banking transfers by way of reducing the mortgage, as follows:
2014 Payments Account Source 13 January $700 12 February $ 31 12 February $652 24 February $100 3 March $200 3 March $ 50 3 March $ 50 11 April $680 12 May $600 Westpac eSa 12 May $ 80 Westpac Cho 13 June $270 Westpac eSa 13 June $ 48 Westpac Cho 23 June $130 Westpac Cho 23 June $200 11 July $635 Westpac Cho 15 August $325 Westpac eSa 15 August $250 Westpac Cho 15 August $ 73 Westpac Cho 15 September $300 Westpac eSa 15 September $ 50 Westpac eSa 26 September $283 Westpac Cho 27 October $630.95 Westpac eSa
There was one payment in 2015 on 28 August of $632, designated as ‘overdue home loan payment’.
These records tend to support the applicant’s position that he was making substantial contributions to the mortgage, as he was the sole source of income until 2012.[20] Her position is that she continued the payments once they separated, but that they ceased in August 2015.[21]
[20] T4.8, T12.37-T13.8, T65.21-.33.
[21] T7.8-.21, T25.1-.2.
The Westpac Banking Corporation has not as yet attempted to enforce the loan which is in joint names, one assumes awaiting the resolution of these proceedings.
The Maslin Street Red Hill property
This property, situated at 23 Maslin Street, Red Hill was purchased in early 2010.[22] They moved into this house later that year, sometime after refinancing Koolunga,[23] and shortly before the dissolution of the relationship.[24] This was jointly purchased for $139,000. According to KS, $20,000 was taken from the Koolunga refinancing and applied to the purchase of this property.[25] KS claims to have made sole contributions of $800 per month to the mortgage on Maslin Street, since January 2010.[26]
[22] T8.14.
[23] Certificate of Title Volume 5197, Folio 963.
[24] Certificate of Title Volume 4032, Folio 572, Allotment 17, Town of Red Hill, Hundred of Red Hill.
[25] T8.25-.27.
[26] T8.17-9.13.
Maslin Street is secured by mortgage of $120,000 in both names. Banking records to December 2015, reveal the joint mortgage was $112,501.55 and in arrears by $8,216 and that monthly repayments were in the order of $1,896. It was suggested in court that there is no equity in this property, and yet no estimate of value was forthcoming from either party,[27] although DAS gave an informal guess of $150,000.[28] A Westpac Statement issued by its MPC Adelaide Branch at Lockleys, records this loan stands at a balance of $115,406.56 with $11,376.00 in arrears, as of 10 June 2016. KS made the oral suggestion that there was no equity in the property, an assertion not contradicted by DAS.[29]
[27] T16.22-.23.
[28] T103.18-.21.
[29] T16.23.
The Fisherman’s Bay property
Matters are further compounded by the fact that from her second compensation award, KS purchased a leasehold property at Fisherman’s Bay, situated about 3 km North of Port Broughton, for $49,000 in 2007. This property appears to be a small beach shack for which lease payments of $2,000 p.a. are met by her, a situation acknowledged by the applicant.[30] He lays no claim to have made any contribution of any kind towards this property, as the property was always treated as hers.
[30] T63.9-.29.
The David Street Port Pirie property
The remainder of KS’ second compensation payment allegedly of $60,000,[31] was applied to the purchase of a property at 36 David Street Port Pirie, informally estimated by the parties to be valued at $110,000, in their pleadings.[32] Both executed a joint mortgage as security for a borrowing of $55,000. KS claims to make continuing contributions to the mortgage since separation in something of the order of over $1,000 per month towards this property. DAS made a vague claim to have invested money in it until May 2012, but he was unable to specify how much, beyond saying he continued to pay money to KS for the mortgage until about May 2012.[33] David Street is tenanted by her through an Estate Agent. Presumably the mortgage and upkeep are serviced from this income source. Whether there is a surplus is not known.
[31] T8.35-.36.
[32] Statement of Claim para 21, Defence para 5.
[33] T63.32-.37.
Westpac statements with respect to David Street Port Pirie show there was a home loan in the name of both parties of $110,820.38 on 12 March 2010. The initial loan was drawn down on 15 February that year of $111,100. Regular fortnightly repayments of $200 originated from a direct debit account.[34] The same cluster of documents show this loan reduced to $108,100.01 as of 12 August 2013, and increased to $110,432.75 as of 11 September 2015, when it stood at $5,688.00 in arrears. The parties agree in their pleadings that this particular property was valued at around $110,000.[35]
[34] Account No. 037-154 37-2201.
[35] Statement of Claim, para 21, Defence, para 5.
Summary of Property Contributions
The series of bank statements before the court are indecisive as to the original source of the respective contributions to the several mortgages. By and large, funds were drawn from joint bank accounts, so that it is impossible to trace the primary origin of those funds to either one or the other party. As noted earlier, until 2 June 2002 the ANZ records reveal regular monthly deposits with respect to the Koolunga property simply as ‘loan payment’. Thereafter deposits are recorded as ‘period transfers’ by way of loan repayment in the name of both parties. The fact that Koolunga was purchased in the sole name of KS confirms some problem with DAS’ financial capacity to contribute at the time of purchase. On the other hand his income tax records – reproduced later - suggest a capacity to contribute to the purchase and later mortgage commitments as of the 2001 financial year.
Since Koolunga was purchased for $77,000 and the original loan from the ANZ was for $62,000, it is more likely than not in the circumstances, that KS did provide an original deposit of around $15,000 at least from her first compensation award. It is equally likely that since she stopped work sometime before June 2004, they both contributed to all the living expenses according to their means beforehand and thereafter DAS assumed responsibility for such commitments as the sole breadwinner.
The Maslin Street Red Hill property is somewhat of an enigma, in that nothing is before the court as to present usage although it appears that it lies vacant. The David Street Port Pirie property appears to be in the control of KS, from which she derives an income.
In the result the real property picture presently looks something like this:
Koolunga - Joint mortgage $133,012.34 (June 2016)
In arrears $13,813 (June 2016)
Equity $Nil
Title holder KSMaslin St Red Hill Joint mortgage $115,406.56 (June 2016)
In arrears $11,376 (June 2016)
Equity $Nil
Title holder DAS & KS, jointlyDavid St Port Pirie Joint mortgage $110,642.75 (September 2015)
In arrears $5686.00 (September 2015)
Equity ?
Title holder KSFisherman’s Bay Sole Mortgage ?
In arrears ?
Equity ?
Title holder KSThe orders as sought
Apart from an extension of time, DAS originally sought an order for the transfer of the Koolunga property to him, that the property at Redhill be transferred from joint names to KS (for which she should assume responsibility of servicing the mortgage), and that she should refinance all joint loans into her sole name, other than the loan on Koolunga. Otherwise his pleadings seek that each retain entitlement to their respective superannuation benefits, as well as the costs of the proceedings.
For her part KS sought the transfer of all properties jointly owned into her name, an indemnity with respect to the mortgages on the properties at Koolunga, Maslin Street Red Hill and David Street, Port Pirie. She joins in the retention of their respective superannuation benefits and the application for an extension of time. She seeks orders for costs against DAS. Pleadings to the above effect were drafted by their respective solicitors. During the course of the proceedings in this court, they were however at all times unrepresented.
Financial Arrangements
It appears KS has no superannuation interest, whereas DAS holds a statutory superannuation benefit presently worth in the order of $70,000, to which he is presently not entitled. It is not clear when this commenced, but it is likely to have been from around the 2001 financial year, so far as his tax returns indicate. During the greater part of the relationship, DAS worked as a shearer. His tax returns submitted to the Court show the following gross income and income after deductions (the incidence of tax is an estimate):
DAS: Summary of income based on tax returns
Year Gross income Income after deductions Est. Net tax paid Est. Net income
(after tax)[36]2001 25,190 22,348 3,084.4 19,263.6 2002 26,017 21,453 2,815.9 18,637.1 2003 31,637 24,696 3,788.8 20,907.2 2004 41,906 32,349 5,876.7 26,472.3 2005 45,383 39,723 8,088.9 31,634.1 2006 46,413 40,563 8028.9 32,534.1 2007 43922 36,143 6,192.9 29,950.1 2008 40,305 32,687 4,406.1 28,280.9 2009 36,528 31,134 3,770.1 27,363.9 2010 53,697 47,722 8,166.6 39,555.4 2011 55,106 49,696 8,458.8 41,237.2 2012 54,410 45,775 7,282.5 38,492.5 2013 2014 2015 [36] Note: these are estimates only, based on the tax returns provided by the plaintiff and rates found at type="1">
From March 2007 it appears KS was in receipt of a Centrelink Sole Parenting Payment, despite the continuing relationship. As mentioned, she quit work shortly before the birth of the couple’s first child in June 2004 and it appears she is still fully occupied by domestic and parenting obligations, having the present custody of the two children and therefore no employment related earnings.
Property Adjustment Order
Although there is a disagreement as to when the domestic relationship precisely ended, it is tolerably clear that by late June 2009 there was no consensus as to the future, and that KS had all but determined not to continue with it, despite an apparent attempt at resolution in the period from around the middle of 2009 to sometime in 2012. In that situation, the relationship is taken to have come to an end, since one party at least no longer wanted to live in the required degree of mutuality with the other: S v B.[37] There can be no doubting the other requirements of s 9(2) of the Domestic Partners Property Act are satisfied. Both parties remain resident in the State of South Australia, the relationship pertained for more than three years, and there are two children of the union.
[37] [2005] 1 Qd R 537.
Of greater moment is the limited nature of the powers available to the court to make property adjustment orders for the division of property. That power resides in s 10 of the Domestic Property Partners Act, in these terms:
10—Power to make orders for division of property
(1)On an application for the division of property after the end of a domestic partnership, the court may make such orders as it considers necessary to divide between the domestic partners the property of either or both partners in a way that is just and equitable.
(2)For example, the court may make orders for—
(a)the transfer of property from one domestic partner to the other; or
(b)the sale of property and the division of the net proceeds between the domestic partners in proportions decided by the court; or
(c)the payment by one domestic partner of a lump sum to the other.
It is immediately obvious that most of the orders sought by the parties are beyond the reach of the court to make. In essence, the court is limited to orders for the transfer or sale of property, or the payment of lump sums. There are no powers permitting splitting superannuation entitlements, and none to relieve one party of obligations under mortgage, or that another party assume responsibility for them. Furthermore, there is a fundamental procedural impediment in making orders impinging upon the rights of mortgagees to enforce, without giving them an opportunity to be heard. To bring the Banks into these proceedings is only likely to add unnecessarily to the costs of the litigation, and to compound matters from the parties’ point of view, given the limited equity retained in the properties. The question of what orders are appropriately made, if any, is considered later.
An Extension of Time
First there is the requirement for proceedings to be brought within one year following the dissolution of the relationship. Section 9(3) of the Domestic Partners Property Act provides as follows:
An application for the division of property must be made within one year after the end of the domestic relationship unless the court, after considering the interests of both domestic partners, is satisfied that extension of this period of limitation is necessary to avoid serious injustice to the applicant.
A time limit of this restrictive magnitude is significant and unusual. It is designed to promote the orderly and prompt resolution of failed de facto relationships, to enable the participants to move on with their lives with certainty by making a ‘clean break’, and to more readily reorganise their lives without the prospect of long running financial disputes impeding those ends: Harris v Harris.[38]
[38] (1997) 22 Fam LR 263.
This limitation period of one year is markedly shorter than most in this area. Ordinarily two years applies as I explained in A,WM v S,J.[39] Furthermore, s 9(3) of the Domestic Partners Property Act contains the unique requirement that an extension of time must be necessary ‘to avoid serious injustice to the applicant’.[40] In contrast, equivalent jurisdictions require an assessment of greater hardship to an applicant than would be caused to a respondent by refusing an extension of time.[41] The adjective ‘serious injustice’ imposes a significant restraint on the capacity of the court to grant an extension of time: A,WM v S,J.[42]
[39] [2014] SADC 41, [19].
[40] Ibid, [22].
[41] Family Law Act 1975 (Cth) s 44(5), Domestic Relationships Act 1994 (ACT) s 13(2); Property (Relationships) Act 1984 (NSW) s 18(2); De Facto Relationships Act 1991 (NT) s 14(2); Property Law Act 1974 (Qld) s 288(2); Relationships Act 2003 (Tas) s 38(2); Relationships Act 2008 (Vic) s 43(2); Family Court Act 1997 (WA) s 205ZB(2).
[42] Above, [22].
Assuming for the moment in favour of both parties that the relationship ended around May 2010, proceedings were required to be instituted by May 2011. As noted, they were in fact commenced on 12 September 2013, well over a year out of time. The explanation for the failure to institute earlier were attempts to seek resolution and to negotiate with the banks over the respective mortgage responsibilities.
These efforts were frustrated and ultimately forestalled by the imposition of a succession of intervention orders against DAS, from as early as 11 September 2009. These prevented him from contacting the defendant, and effectively from entering or remaining in premises at which she was likely to be present, other than for the purposes of resolving the custody issues.[43] He was particularly desirous of maintaining the Koolunga property in order to avoid diminution in value, but not unreasonably felt constrained from doing so.
[43] Magistrates Court files MCPAR-12-2713 and MCPAR-15-203.
Whether to grant an extension of time entails an examination of the nature and details of the relationship, the financial and other contributions to the acquisition of assets, whether serious imbalance in those contributions emerges and whether a significant or substantial wrong or injustice is occasioned to the applicant thereby: A,WM v S,J.[44] This exercise was considered in Cooper v Lees,[45] to require an examination of all the circumstances, the reasons for the delay before instituting proceedings, and of more significance, the prospects of the claim succeeding, the nature and amount of the claim and the impact on the applicant of a refusal to extend time.
[44] [2014] SADC 41, [28].
[45] (2009) 267 LSJS 553, [30], per Doyle CJ, Nyland and Duggan JJ agreeing.
Analysis – Extension of Time
The current financial arrangements between the parties are quite frankly an intractable tangle, because of the extant mutually binding obligations under the joint loans to the banks over three of the four properties involved. Although the Banks have restrained from enforcement so far, applications for possession and/or foreclosure appear inevitable so far as Koolunga and Maslin Street are concerned, as the mortgages progressively fall further and further into arrears.
To complicate his situation, DAS is solely pursued for outstanding Port Pirie Regional Council fees with respect to the Maslin Street property, by the Fires Enforcement and Recovery Unit of the Government of South Australia for amounts approximating $3,000. If unpaid he faces fines and the suspension of his driving licence, a severe penalty for one dependent on transport to and from seasonal shearing work around the mid-North rural areas of this State. Still further, since he has a much better source of income than KS, it is more than likely he will be sued for recovery of outstanding loans, as the liabilities are joint and several.
In the context of such distinct financial pressure, it is necessary so as to avoid serious injustice to DAS to grant him an extension of time to 12 September 2013. For more or less mirror reasons, it is equally necessary to avoid serious injustice to KS to grant her an extension of time in which to bring her application, to 24 October 2014 when her defence was filed, so as to as far as possible extricate her from continuing mutual financial obligations with DAS in the context of the intervention orders. Just what capacity the court retains to unscramble the financial tangle is quite another matter.
Having enlivened the power to make an order, the court is required to take into account in deciding whether to make an order under s 10, those matters referred to in s 11(1) of the Domestic Partners Property Act:
11—Matters for consideration by court
(1)In deciding whether to make an order for the division of property under this Part, and if so the terms of the order, the court—
(a)must consider the financial and non-financial contributions made directly or indirectly by or on behalf of the domestic partners to—
(i)the acquisition, conservation or improvement of property of either or both partners; or
(ii)the financial resources of either or both partners; and
(b)must consider the contributions (including homemaking or parenting contributions) made by either of the domestic partners to the other partner or to children of the partners or either of them; and
(c)must have regard to the terms of any relevant domestic partnership agreement; and
(d)may have regard to other relevant matters.
The Respective Contributions to the Relationship
The overall inquiry into the financial contributions to the relationship does not require the examination in minute detail of the value and disposal of every small item of personal property, but it does require a Judge to wield a broad axe with respect to the major items of property, and as to who contributed to their acquisition: Arnold v Dalton.[46]
[46] (2002) 84 SASR 482, Doyle CJ and Besanko J concurring
The requirement to make an order that is ‘just and equitable’ as required by s 10(c) of the Domestic Partners Property Act, does not confer a general and unfettered discretion, since the court is not settling all outstanding financial issues between the partners, so that the primary focus is on the property in question, contributions to property, contributions by one party to the other and to the children, the length of the relationship and the immediate needs of the parties: Hogg v Roberts.[47]
[47] (2003) 87 SASR 248, per Bleby J..
Still further, it is not the role of the court to remedy any grievances one party may have against the other, or to compensate for disappointed or unfulfilled expectations for the continuing maintenance of the parties, or their future financial prospects: Hogg v Roberts.[48]
[48] Ibid, [13].
It must be born firmly in mind that contributions as homemaker and parent are not treated as inferior to material or financial contributions and are therefore to be taken into account in a substantial way, that contributions of a non-material kind are to be assessed in a broad way, and not to be approached on the basis of an assumption that an equal division is appropriate: Hogg v Roberts,[49] Evans v Marmont,[50] and Parker v Parker.[51]
[49] Ibid, [15].
[50] (1997) 42 NSWLR 70.
[51] (1993) 16 Fam LR 863, 870.
Based on the authorities, the focal point of the inquiry must commence by reference to the property and contributions of the kind contemplated by s 11, and by incorporating matters relevant to the just and equitable division of property.
Findings of Primary Fact
The evidence is imprecise, imperfect and incomplete so far as the precise individual contributions to the relationship of the parties. It is however clear enough that KS contributed to no small extent to the purchase of Koolunga and that DAS contributed the majority of the monetary contributions to the various mortgages, certainly after KS stopped working to give birth to their first child. Thereafter his greater contributions in that respect is more or less offset by her contributions as homemaker and parent to the children to the point of separation.
On the other hand, it appears clear that she continued to maintain by herself the Fisherman’s Bay property and that she significantly contributed to the purchase of, and consequently assumed responsibility for the maintenance and upkeep of the David Street property. Each appears to have contributed as time permitted to the general maintenance and upkeep of all the properties, at least until separation. Furthermore, DAS continued to supply contributions to various degrees to the mortgages until sometime in 2012.
Property Adjustment Order
All things considered and doing the best one can with the unsatisfactory state of the evidence, it is clearly not appropriate to make any order with respect to the Fisherman’s Bay and David Street properties, on the premise that KS is the registered owner of each and played the exclusive part in the acquisition of the former and a substantial part in the acquisition of the latter and that she continues to manage and maintain both. Since Koolunga has fallen into disrepair and DAS was effectively prevented from salvaging it from falling in value below equity, it is neither just nor equitable to make any order with respect to that property.
It is however just and equitable to make a property adjustment order in respect of the Maslin Street Red Hill property, given DAS’ significant financial contributions at large, and in light of the fact that the purchase was facilitated by refinancing Koolunga, that he is registered on the title jointly, that he continued to service the mortgage after separation until 2012 and that he remains jointly liable under the mortgages in respect of all but the Fisherman’s Bay property.
Of course, no order can effect either party’s liability to the Banks under the extant mortgages, or their pre-existent liability to the Council. There is a further precondition to the efficacy of the proposed order, in as much as it would require the co-operation of Westpac as mortgagee over Maslin Street in allowing DAS to refinance.[52]
[52] T106.19-107.9. It holds the registered mortgage no. 11342821 over the property.
Given these conclusions and the history of the course of the proceedings, it is entirely just that there should be no order as to costs.
Orders
In light of the above findings and conclusions, it is ordered that:
1. DAS have an extension of time in which to bring his application for the division of property to 12 September 2013, pursuant to s 9(3) of the Domestic Partners Property Act 1996 (SA);
2. To the extent necessary, KS have an extension of time in which to bring her application for the division of property to 24 October 2014, pursuant to s 9(3) of the Domestic Partners Property Act.
3. The defendant do transfer to the plaintiff forthwith all her estate and interest both at law and in equity in the land comprised in Certificate of Title Register Book Volume 5197 Folio 963 being the home and land situated at 23 Maslin Street Redhill in the State of South Australia, to the intent that the plaintiff shall henceforth be entitled to the land for his sole use and benefit absolutely, subject however to such encumbrances, liens, mortgages and interests as are now registered on the Certificate of Title.
4. If the defendant refuses or neglects to execute a Memorandum of Transfer in Register Book form under the provisions of the Real Property Act 1886 (SA) her estate and interest in the land to the plaintiff within 21 days after the transfer shall have been tendered to her on behalf of the plaintiff, a Master of this Court be appointed to execute the transfer for and on behalf of the defendant.
5. There be no order as to costs.
6. Direct that a copy of this order be served forthwith by the Registrar of the Court on the Manager of the Westpac Banking Corporation, MPS Adelaide Branch, 25 Pierson Street Lockleys SA 5032, with liberty to Westpac to call the matter on before the expiration of 21 days referred to in paragraph 4 hereof.
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