SCHOPP & SCHOPP
[2013] FCCA 434
•6 June 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SCHOPP & SCHOPP | [2013] FCCA 434 |
| Catchwords: FAMILY LAW – Application for alteration of property interests – short marriage – husband considerably older than the wife – husband bringing significant assets to the relationship – substantial amounts of money sent to the Philippines. |
| Legislation: Family Law Act 1975, ss.75(2), 79(2), 79(4) |
| Cases cited: Erdem & Ozsoy [2012] FMCAfam 1323 In the Marriage of Elias (1977) 29 FLR 393; (1977) 3 Fam LR 11,496; (1977) FLC 90-267 In the Marriage of Lutzke (1979) 5 Fam LR 553 In the Marriage of Jordan (1996) 21 Fam LR 382; [1996] FamCA 15 (29 February 1996); (1997) FLC 92-736 In the Marriage of Kennon (1997) 138 FLR 118; (1997) 22 Fam LR 1; [1997] FLC 92-757 Martin & Crawley [2012] FamCA 1032 Stanford v Stanford (2012) 87 ALRJ 74; (2012) FLC 93-518; (2012) 47 Fam LR 481; (2012) 293 ALR 70; [2012] HCA 52 Thomson Brindal Ltd v McLachlan (2007) 207 LSJS 90; (2000) SASC 58 Tinker v Tinker [1970] P 136; [1970] 1 All ER 540; [1970] 2 WLR 331 Watson v Ling (2013) FamCA 57 |
| Parkinson, Patrick Family Property Law and the Three Fundamental Propositions in Stanford v Stanford (2013) 3 Fam L Rev 80 |
| Applicant: | MS SCHOPP |
| Respondent: | MR SCHOPP |
| File Number: | MLC 3415 of 2012 |
| Judgment of: | Judge Riley |
| Hearing dates: | 8 & 9 April 2013 |
| Date of Last Submission: | 9 April 2013 |
| Delivered at: | Melbourne |
| Delivered on: | 6 June 2013 |
REPRESENTATION
| Counsel for the Applicant: | Mr Howe |
| Solicitors for the Applicant: | Hughes Watson Marks Kennedy |
| Counsel for the Respondent: | Mr Young |
| Solicitors for the Respondent: | Zeljko Stojakovic Barristers & Solicitors |
ORDERS
Within 30 days, the husband pay to the wife the sum of $18,351.72.
Save for the purpose of enforcing any monies due under these or any subsequent orders:
(a)each party be solely entitled to the exclusion of the other to all property in his or her possession;
(b)each party forego any claims that they may have to any superannuation benefits belonging to or earned by the other;
(c)insurance policies remain the sole property of the beneficiary thereof;
(d)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders; and
(e)any joint tenancy of the parties in any real or personal property is hereby expressly severed.
IT IS NOTED that publication of this judgment under the pseudonym Schopp & Schopp is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLC 3415 of 2012
| MS SCHOPP |
Applicant
And
| MR SCHOPP |
Respondent
REASONS FOR JUDGMENT
Introduction
This is an application under s.79 of the Family Law Act 1975 for the alteration of the parties’ interests in property.
The husband and wife met in the Philippines in late April 2006. The husband was then separated from his first wife and had two adult children. The wife had never previously been married. The husband, when he met the wife, was 61 years old and the wife was 27 years old. The parties became engaged two weeks after meeting. They applied for a spouse visa to enable the wife to live in Australia with the husband. They were married in Australia [in] 2007. They separated in May 2009, on the husband’s case, or on 11 April 2011, on the wife’s case. There are no children of the marriage.
The husband and wife entered into a prenuptial agreement shortly before their marriage. It provided for each party to retain the assets they brought to the marriage and to share their future earnings. This agreement was very much to the husband’s advantage, as the wife had no assets and the husband was close to retirement. However, neither party submitted that the agreement was of any legal effect, so I take that matter no further.
The wife argued that she should receive 30% of the combined total of the parties’ assets. The husband argued that the wife should receive 10% of the amount by which the former matrimonial home had increased in value during the marriage and otherwise each party should keep their own assets. The husband estimated the former matrimonial home increased in the value during the marriage by about $85,000. The husband also said that he was entitled to 50% of the money that the wife sent to the Philippines from her earnings.
The wife initially made a spousal maintenance claim but it was expressly abandoned in closing submissions.
The legislation
Section 79 of the Act gives the court power to alter the interests of the parties to a marriage in the property of the parties to that marriage. Sub-section 79(2) of the Act provides that:
The court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
Section 79(4) of the Act sets out the matters the court must take into account when considering what orders, if any, should be made for the alteration of the interests of the parties in property. Those matters are:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage 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 parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage 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 parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e)the matters referred to in subsection 75(2) so far as they are relevant; and
(f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
The matters to be taken into account under s.75(2) of the Act are as follows:
(a)the age and state of health of each of the parties; and
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g) where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party’s role as a parent; and
(m)if either party is cohabiting with another person—the financial circumstances relating to the cohabitation; and
(n)the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties; or
(ii)vested bankruptcy property in relation to a bankrupt party; and
(naa)the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i)a party to the marriage; or
(ii)a person who is a party to a de facto relationship with a party to the marriage; or
(iii)the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv)vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any financial agreement that is binding on the parties to the marriage; and
(q)the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.
The approach to applications under s.79
In Stanford v Stanford (2012) 87 ALRJ 74; (2012) FLC 93-518; (2012) 47 Fam LR 481; (2012) 293 ALR 70; [2012] HCA 52, the High Court explained the proper approach to an application under s.79 of the Act as follows:
37.First, it is necessary to begin consideration of whether it is just and equitable to make a property settlement order by identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property. … The question posed by s 79(2) is thus whether, having regard to those existing interests, the court is satisfied that it is just and equitable to make a property settlement order.
38.Second, although s 79 confers a broad power on a court exercising jurisdiction under the Act to make a property settlement order, it is not a power that is to be exercised according to an unguided judicial discretion. In Wirth v Wirth, Dixon CJ observed23 that a power24[1] to make such order with respect to property and costs "as [the judge] thinks fit”, in any question between husband and wife as to the title to or possession of property, is a power which "rests upon the law and not upon judicial discretion”. …
39.Because the power to make a property settlement order is not to be exercised in an unprincipled fashion, whether it is "just and equitable" to make the order is not to be answered by assuming that the parties' rights to or interests in marital property are or should be different from those that then exist. All the more is that so when it is recognised that s 79 of the Act must be applied keeping in mind that "[c]ommunity of ownership arising from marriage has no place in the common law”.26[2] Questions between husband and wife about the ownership of property that may be then, or may have been in the past, enjoyed in common are to be "decided according to the same scheme of legal titles and equitable principles as govern the rights of any two persons who are not spouses”.27 The question presented by s 79 is whether those rights and interests should be altered.
40.Third, whether making a property settlement order is "just and equitable" is not to be answered by beginning from the assumption that one or other party has the right to have the property of the parties divided between them or has the right to an interest in marital property which is fixed by reference to the various matters (including financial and other contributions) set out in s 79(4). The power to make a property settlement order must be exercised "in accordance with legal principles, including the principles which the Act itself lays down”.28[3] To conclude that making an order is "just and equitable" only because of and by reference to various matters in s 79(4), without a separate consideration of s 79(2), would be to conflate the statutory requirements and ignore the principles laid down by the Act.
23 (1956) 98 CLR 228 at 231–2; [1956] HCA 71 (Wirth).
26 Hepworth v Hepworth (1963) 110 CLR 309 at 317; [1964] ALR 259 at 264; [1963] HCA 49
28 Watson at CLR 257; ALR 560; Fam LR 11,305.
…
42.In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s 79(4). (emphases added)
In Stanford, the critical fact was that the parties had not separated. The wife had suffered a stroke and had moved into a nursing home, but the parties’ marriage was intact. It was the wife’s case guardian, a daughter from an earlier marriage, who sought the alteration of property interests.
The wife died while the judgment of the Full Court of the Family Court was reserved. Consequently, when the Full Court of the Family Court came to re-exercise the discretion, the wife had no future needs, but the husband did. The High Court noted at [47] that the courts below had not adequately considered the consequences for the husband of the orders made, namely, that his home would have to be sold.
Against that backdrop, the High Court emphasised that the just and equitable requirement of s.79(2) of the Act is not necessarily satisfied merely by a consideration of the contributions of the parties as described in s.79(4) of the Act. However, in the usual case before this court, where the parties have separated, the High Court acknowledged at [42] that the just and equitable requirement would be “readily satisfied”.
Following Stanford, it is no longer appropriate to think of “contribution based entitlements” or the “adjustment” based on future factors. Rather, the court is required to take into account all the relevant matters and then determine what order, if any, is just and equitable. It is also no longer appropriate to think of a pool of assets.[4]
[4] Parkinson, Patrick Family Property Law and the Three Fundamental Propositions in Stanford v Stanford (2013) 3 Fam L Rev 80 at 88.
Additionally, and significantly for this case, the High Court emphasised that marriage, at common law, does not create a community of ownership: [39]. The rights a person might have in his or her partner’s property and income arise from the Act, notably s.79(4) and s.72(1) respectively.
In relation to income, s.72(1) of the Act provides that:
(1) A party to a marriage is liable to maintain the other party, to the extent that the first-mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately whether:
(a) by reason of having the care and control of a child of the marriage who has not attained the age of 18 years;
(b) by reason of age or physical or mental incapacity for appropriate gainful employment; or
(c) for any other adequate reason;
having regard to any relevant matter referred to in subsection 75(2).
In other words, there is not an absolute right to share equally in the income of a partner. Rather, such a right only arises where a person is not able to adequately support himself or herself and the other party is reasonably able to support the first-mentioned party. Consequently, there is no obligation to contribute all of one’s earnings to the matrimonial endeavour. However, if one party to a marriage spends a substantial part of his or her income on extraneous pursuits, it will obviously have an effect on that person’s contributions to the parties’ assets.
Stanford requires the following matters to be determined in applications brought under s.79 of the Act:
a)whether the parties have separated;
b)the assets and liabilities of each party;
c)the contributions of each party;
d)the future needs of each party;
e)bearing in mind all of the foregoing matters, whether it is just and equitable to make any orders altering the interests of the parties in their property; and
f)what orders, if any, are just and equitable in all the circumstances of the case.
Stanford does not require these matters to be addressed in any particular order. In most cases, it would seem rational to consider them in the order set out above. It does not seem to me to possible to determine whether it is just and equitable to make an order altering the parties’ interests in their property without the other matters mentioned above having been previously determined. That seems to be clear from the opening words of s.79(4) of the Act, which are that:
In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account [the various matters set out in s.79(4)] … .
I note that Coleman J, in Martin & Crawley [2012] FamCA 1032 said, at [98], without definitively deciding the point, that deciding whether an alteration of property interests was just and equitable, without first determining the contributions and future factors under s.79(4) of the Act was of questionable logic.
I acknowledge that Walters FM, as his Honour then was, expressed a different view in Erdem & Ozsoy [2012] FMCAfam 1323 at [116]. However, for the reasons set out above, I consider, with the greatest respect, that his Honour was plainly wrong and I should not follow that decision.
As the law following Stanford is still in a state of flux, and as there does not yet appear to be a definitive statement from the Family Court on appeal, I will deal with the various issues in the order set out above.
Notice to admit
The husband served on the wife a notice to admit. The wife admitted some things and otherwise said, “do not admit”. The husband said this amounted to a deemed admission. He cited no authority for that proposition. During the hearing, I rejected that argument. Following the hearing, my associates found a decision of the Supreme Court of South Australia, Thomson Brindal Ltd v McLachlan (2000) SASC 58 which does support the husband’s argument. However, that case concerns rule 54 of the Rules of the South Australian Supreme Court. That rule is very different to the applicable rule in this court, namely, rule 15.31 of the Federal Circuit Court Rules 2001. That rule does not require the recipient of a notice to admit to expressly deny the truth of an allegation to avoid making a deemed admission. Under the rules of this court, saying “do not admit” is sufficient to avoid a deemed admission. Consequently, I will not treat the wife’s “do not admit” response to the notice to admit as a deemed admission.
Whether the parties have separated
The parties agreed that they had separated. They disputed the date of separation. The husband argued that separation occurred when he retired and the wife started working in May 2009. The wife argued that separation occurred on 11 April 2011. She said the parties then remained under the one roof, with the husband charging the wife rent, until she left the matrimonial home in June 2012.
Neither party dealt with the date of separation in cross examination. I can only conclude that neither party considered the date of separation to be particularly important.
The husband exhibited to his affidavit sworn on 7 May 2012 a letter to him from Centrelink that said that, according to their records, the husband had been separated since 16 March 2010. Those records were presumably based on statements made to Centrelink by the husband or by both the husband and wife.
For reasons explained below, I did not consider either party to be an entirely reliable witness. Consequently, I consider that the most reliable indication of the date of separation is the Centrelink letter, as it is a more or less contemporaneous record derived from statements made by at least one of the parties to a government authority. That conclusion also accords with the Elias principle, which is discussed below.
I find that separation occurred on 16 March 2010. The relationship started in about May 2006, when the parties were engaged. Although they spent some time apart between their engagement and their marriage, on 28 May 2007, I consider that the relationship commenced at the time of their engagement. The husband began to financially support the wife from that time. Consequently, the relationship lasted about four years.
The assets and liabilities
The parties agreed that the wife’s assets at the time of trial were as follows:
ASSETS
VALUE
The land and partly constructed property situate at [omitted], the Philippines
$37,159.00
Funds standing to the credit of the wife
$500.00
Grand Vitara motor vehicle
$5,000.00
Wife’s total assets
$42,659.00
Wife’s superannuation
$7,000.00
Wife’s total assets including superannuation
$49,659.00
The parties agreed that the husband’s assets at the time of trial were as follows:
ASSETS
VALUE
Property K
$425,000.00
Funds standing to the credit of the husband at the Commonwealth Bank of Australia, Fixed Term Deposit
$17,000.00
Funds standing to the credit of [B] at the Commonwealth Bank of Australia
$1,500.00
Funds standing to the credit of the husband at the Commonwealth Bank of Australia
$700.00
Funds paid by husband into his solicitor’s trust account
$54,897.00
Toyota Hilux motor vehicle
$3,000.00
Campervan
$5,000.00
Furniture and household contents
$10,000.00
Husband’s total assets
$517,097.00
The parties agreed that neither of them had any liabilities at the time of trial.
The wife’s assets, including superannuation, have an agreed value of $49,659. The husband’s assets have an agreed value of $517,097. The combined total of their assets is therefore $566,756. Consequently, the wife presently holds about 8.7% of the parties’ combined assets.
Addback
In addition to the matters mentioned above, the husband argued that $80,000 should be added back to the wife’s assets. He said that she had sent that amount of money to her family overseas without his consent. The wife conceded that she had sent about $60,000 overseas but said that she had sent it with the husband’s consent and blessing. She said that, because the husband had consented to her sending money overseas, no amount should be added back to the pool.
Professor Parkinson AM has discussed the question of addbacks post Stanford in Family Property Law and the Three Fundamental Propositions in Stanford v Stanford (2013) 3 Fam L Rev 80. Professor Parkinson AM said at pages 88 to 89 of that article:
After Stanford, only in very limited circumstances can ‘addbacks’ be considered as notional property to be included at step 1 of the process.
This emerges in particular from the decision of Murphy J in Watson and Ling [2013] FamCA 57. He indicated that the question which ought to be asked at step 1 of the process is whether the real position in law concerning ownership of an asset is at variance with the apparent ownership (at para 29):
Where, but for the disposal of money or other property by one party, legal or equitable interests in it would have been part of those existing at trial, it may be possible to assert, in the particular circumstances of a case, that the money or property is nevertheless to be considered as part of the existing legal or equitable interests of the disposing party (sham transactions and circumstances where it can be established that the property is held, for example, on trust by another for the disposing party are examples). The investigation of issues of that type might be seen to be part of the establishment of the existing legal and equitable interests at trial…
Put differently, an ‘addback’ might be included at step 1 in circumstances where the transfer of the property has been effective to bring about an alteration in the legal title but not the equitable title with the consequence that the transferee holds that property on a constructive trust for a party to the relationship. In such a case, the ‘add-back’ results from a determination of equitable ownership of property, the legal title to which is held in the name of a third party.
Murphy J went on to review the existing case law on how addbacks might be dealt with if not treated as notional property (paras 33-34):
First, consistent with existing authority, it can be recognised pursuant to s 75(2)(o) (cf s 90SF(3)(r)) (see, for example, Omacini & Omacini [2005] FamCA 195; (2005) FLC 93-218, Browne & Green [1999] FamCA 1483; (1999) FLC 92-873 and Cerini [1998] FamCA 143). Secondly, it might be contended that it might be recognised within the assessment of contributions. This Court has long eschewed the notion of “negative contributions” (see, for example Antmann & Antmann (1980) FLC 90-908). Nevertheless, it might be argued that the “non-dissipating party” can be seen to have made a disproportionally greater indirect contribution to the existing legal and equitable interests (for example to their preservation) if it is established that, but for the other party’s unilateral dissipation, those existing legal and equitable interests would have been greater or had a greater value.
The assessment of the circumstance under discussion is, ultimately, a matter of discretion (see, for example, Cerini at [46] and Townsend at 81,654). Equally, however, authority dictates that it will be “the exception rather than the rule” (Cerini at [46]) that a direct dollar adjustment equivalent to the amount of the alleged dissipation of the pool is made to the otherwise entitlement of a party.
He noted that the way in which paid out legal fees are dealt with might require some reconsideration.
There has for a long time been a gulf between law and practice in relation to addbacks. Indeed the practice of the Family Court encourages consideration of addbacks at step 1. The balance sheet that must be prepared prior to a trial has room for the inclusion of addbacks and it is the value of the actual property, together with the value of the ‘notional property’ constituted by the addbacks, that produces a dollar figure, which is identified by each side as the value of ‘the pool’. The inclusion, on a trial balance sheet, of ‘notional property’ in which neither party has a legal or equitable interest cannot survive Stanford if the purpose of the balance sheet is to identify and place a value on the assets to which the parties, or either of them, have legal or equitable title. The better way, and consistent with years of Full Court authority, would be to have a separate section of a balance sheet document which records property that has been disposed of, and that a party wishes the Court to take into account under s.79(4) and s.75(2)(o). That would include paid out legal fees.
With respect, I agree with the view of Professor Parkinson AM that, post Stanford, it is no longer appropriate to treat any money or property that has been dissipated as an addback.
Murphy J said in Watson & Ling (2013) FamCA 57 that, where property that has been disposed of prior to trial:
33.… it might be argued that the “non-dissipating party” can be seen to have made a disproportionally greater indirect contribution to the existing legal and equitable interests (for example to their preservation) if it is established that, but for the other party’s unilateral dissipation, those existing legal and equitable interests would have been greater or had a greater value.
Murphy J made that statement somewhat tentatively, saying it was arguable, rather than deciding that the law was as stated. Moreover, because Watson & Ling was not decided on appeal, it is not, strictly speaking, binding on this court. I also note that the Act does not authorise an enquiry into what the assets of the parties or either of them might have been if the parties had behaved differently.
In my view, with respect, the better approach is to simply proceed on the basis that the parties’ assets are what they are, and each party contributed whatever he or she actually contributed, whether through direct or indirect, financial or non-financial or welfare contributions. Obviously, if one party has spent a lot of money on extraneous pursuits, that money was not contributed to the parties’ existing assets.
On the other hand, it is appropriate to take into account the dissipation of assets under s.75(2)(o) of the Act. The dissipation of assets is quintessentially a fact or circumstance that the justice of almost any imaginable case would require to be taken into account.
In the present case, the husband alleged that the wife sent $80,000 overseas and it was all spent on her family. The husband did not squarely suggest that the wife had retained any money in her Filipino bank account, such that there is an existing sum that should be included in the wife’s list of assets. In other words, the husband did not allege that the wife had retained the legal or equitable title to any property arising from the $80,000 allegedly sent overseas. Consequently, in view of Stanford, on the husband’s case, there can be no addback or additional amount included in the wife’s assets.
On the other hand, the wife claimed that $25,000 of the money sent overseas was used on the acquisition of the Filipino property. If that is correct, the $25,000 has already been included in the wife’s assets.
Normally, it would be appropriate to leave the discussion of the money sent overseas until the s.75(2)(o) matters were being addressed. However, because the money sent overseas was pivotal to the cases of both parties, and because there is a fundamental dispute about the amount, source and nature of the money sent overseas, it is appropriate that the question be dealt with immediately.
The money sent overseas
The wife relied on her affidavits sworn on 16 April 2012 and 25 March 2013. In her 25 March 2013 affidavit, the wife said:
a)she had a degree from a university in the Philippines;
b)she worked as an [omitted];
c)her job gave her a good secure income;
d)the wife’s father died before she was born;
e)the husband was aware that the wife had been morally obliged since 2002 to financially support her widowed mother;
f)the wife’s mother has a number of serious medical conditions;
g)all of the wife’s family and friends lived in the Philippines;
h)the husband knew that the wife was concerned that her university degree would not be recognised in Australia;
i)the husband induced the wife to come with him to Australia by assuring her that he would look after her and her mother financially;
j)the husband told the wife that she would not need to work as he would look after her financially;
k)at their engagement party, the husband told the wife’s mother and other family members and friends that he would take care of the wife and her mother;
l)after the engagement, for work and immigration reasons, the husband returned to Australia alone in June 2006;
m)shortly after the engagement, the husband wrote a letter to the wife’s mother, in Indonesian, saying, among other things:
I … promise that I will willingly help you.[5]
n)the husband returned to the Philippines in September 2006;
o)in December 2006, the husband asked the wife to stop working and she did so, in order to appease him;
p)the husband gave the wife $2,000 at that time to support herself in addition to giving financial support to her mother;
q)the wife and the husband attended a migration interview at the Australian Embassy in the Philippines on 17 January 2007;
r)at the interview, the husband assured the interviewer that he would be financially responsible for the wife and take care of everything;
s)the immigration officer’s interview notes state:
Sponsor asked pa to stop working and he supported pa financially (first, she received check [sic] and the second was deposited in her bank) … ;
[5] Exhibit BS-2 to the affidavit of the wife sworn on 25 March 2013.
t)the wife and husband were told their visa application was successful on 22 January 2007;
u)they came to Australia on 21 February 2007 and were married in [Melbourne suburb omitted] on [omitted] 2007;
v)but for the husband’s assurances that he would support the wife and her mother financially, the wife would not have left her home, family and job to come to Australia and marry the husband;
w)the husband had financially supported the wife’s mother prior to the wedding and afterwards agreed to continue paying her about $200 per month;
x)in October 2007, after discussion with the husband, the wife bought a block of land near her mother’s house in the Philippines;
y)the husband transferred the required $8,000 to the wife’s bank account in the Philippines;
z)the husband insisted that the property be registered in the wife’s sole name;
aa)the parties visited the Philippines for a holiday in August 2008;
bb)the husband transferred $3,000 to the wife’s account for expenses;
cc)on 26 September 2008, the wife’s mother was hospitalised;
dd)the husband transferred $2,758 to the wife’s mother so she could meet her medical expenses;
ee)between 7 December 2006 and 2 December 2008, the husband transferred $21,788 to the Philippines;
ff)of that sum, $8,000 was for the property, $3,000 was for the holiday, and the balance, being $10,788, was paid for the financial support of the wife’s mother; (that averages about $450 per month);
gg)the husband stopped sending money overseas on 2 December 2008;
hh)in about April 2009, the husband retired;
ii)the wife began working in a [omitted] in about May 2009;
jj)the wife earned about $640 per week after tax, and more if she worked overtime;
kk)the wife became the sole breadwinner, and paid for household expenses including groceries;
ll)the wife continued her home duties, as the husband considered these to be the wife’s role;
mm)the wife, from her wages, sent about $25,000 overseas for the construction of a holiday home on the property in the Philippines;
nn)the construction is incomplete because the wife can no longer afford the construction costs;
oo)when the wife started working, she took over the payments to financially support her mother;
pp)the husband was aware of the payments;
qq)the wife’s mother was hospitalised on numerous occasions in 2010;
rr)over the period 23 July 2010 to 19 December 2011, the wife sent her mother about $17,000 for her care, support and medical expenses; (that period is about 17 months long, so the amount sent averages about $1,000 per month)
ss)in 2010, the wife bought a second hand 2000 Suzuki Grand Vitara for her own use for about $9,300;
tt)the wife funded the purchase from her own savings from her employment;
uu)the total amount that the husband and wife put in the wife’s bank account in the Philippines was $60,344.27;
vv)some of that money was spent by the husband and wife when they were in the Philippines on holiday, some was spent on the land and house in the Philippines and some was spent on the wife’s mother’s medical and living expenses;
ww)the wife also made two payments to her sister which totalled $755.00;
xx)the husband and wife each made a statutory declaration to the Department of Immigration in which they said that they jointly owned real estate;
yy)the husband and wife believed at the time that all of their properties were owned equally;
zz)in 2010 and early 2011, the parties started arguing about financial matters;
aaa)the husband wanted the wife to contribute to household bills, and she thought she was contributing enough by paying for her car and mobile telephone expenses and buying the weekly groceries;
bbb)the parties finally separated in April 2011;
ccc)at that time, the husband wrote the wife a letter stating:
If you want to live in this house, you have to pay rent for use of one bed room.
…
If our relationship is genuine then you will bring your pay slip and money next friday, but if uor [sic] relationship is not genuine then you are out next saturday… [6];
[6] Exhibit BS-13 of the affidavit of the wife sworn on 25 March 2013.
ddd)the wife then began paying rent of $100 per week to the husband;
eee)the wife continued paying rent to the husband until about November 2011;
fff)the parties then had a holiday in Queensland together, which the wife paid for;
ggg)the wife was unable to pay rent after that, because of the costs of the holiday, because she had to pay $1,650 to repair her car and because she spent $1,200 on a laptop for her own use;
hhh)in March 2012, the wife was made redundant;
iii)she received a redundancy payout of $9,854.07, which was used on living expenses;
jjj)the wife moved out of the former matrimonial home in June 2012;
kkk)the wife then began receiving Centrelink payments;
lll)in August 2012, the wife obtained employment at a [omitted] in [Melbourne suburb omitted].
The wife exhibited to her 25 March 2013 affidavit (BS-10) a bundle of statements for her Filipino bank account and a summary of the transactions. The summary was apparently prepared by the wife or her advisers. It uses a particular exchange rate. On that basis, the wife asserts that she and the husband deposited $60,344.27 into her Filipino account from the commencement of the relationship until April 2011, when the wife says separation occurred.
As there has already been a finding that separation actually occurred on 16 March 2010, it is necessary to deduct the amounts sent overseas between 16 March 2010 and April 2011. Those amounts total $35,297.44. That amount was from the wife’s post separation earnings. Deducting the sum of $35,297.44 from $60,344.27 results in a figure of $25,046.83 that the wife admits sending to her bank account overseas during the relationship. That figure includes the $8,000 for the purchase of the land.
In addition, the wife exhibited to her 25 March 2013 affidavit (BS-11) a copy of a Western Union statement that indicates that the wife sent her sister in the Philippines $335 on 7 May 2008 and $420 on 27 July 2008, totalling $755. Adding $755 to $25,046.83 results in a figure of $25,801.83 that the wife admits sending overseas during the relationship.
The wife’s claims in relation to her Filipino bank account and her Western Union statements were not challenged in cross examination and I accept them.
In cross examination, the wife said that:
a)the husband told her on the first day that they met, and repeatedly after that day, that he would look after her and her mother financially;
b)the husband and wife argued about money, because the husband thought the wife was sending all of her salary to the Philippines;
c)the husband was well aware that the wife was sending some money to the Philippines;
d)the husband did not lend her $8,000 to buy the property in the Philippines;
e)she wrote in her own hand and signed a note, which the husband also signed, saying:
2nd October 2007
I will borrow 300,000 pesos by next month (November) for the payment of the block of land and old house at [omitted], the Phillipines.
I will pay back, if I have a money already by next year.
f)the $8,000 was for the joint property of the parties, to have a shared holiday house in the Philippines, rather than a loan;
g)she sent to the Philippines, with the knowledge of the husband, $60,334, which included:
i)$8,000 for the land;
ii)$25,000 for the partial construction of the house on the land; and
iii)$17,000 for her mother’s financial support and medical expenses;
h)she sent to the Philippines less of her spare money than she kept in the bank here; and
i)she did the housework, as “a proper housewife” (as the husband’s counsel put it) and helped the husband in his business four hours per day.
The husband’s counsel conceded in his opening that the husband had agreed to support his wife and:
perhaps signified a modest amount of support to his mother-in-law that one would expect in a normal family situation.
The husband relied on his affidavits sworn on 7 May 2012, 7, 8 and 9 November 2012 and 27 March 2013.
In his affidavit sworn on 7 May 2012, the husband said that:
a)when the wife started work in May 2009, he asked her to contribute to their daily expenses but she was not prepared to do so as she was forwarding a regular sum of money to her family in the Philippines;
b)after she started working, the wife paid for her own food and the husband paid all household bills;
c)he lent the wife $8,000 for the land in the Philippines;
d)she has not repaid that sum despite his demand; and
e)he is dependent on the aged pension and income from investments of about $2,800 per year.
In his affidavit sworn on 7 November 2012, the husband said that:
a)the marriage ended in May 2009 when the wife refused to share her income with the husband, even though he was sharing his property and income with her;
b)after the wife arrived in Australia, the husband provided the wife with “significant” amounts of money, most of which she put in her bank account in the Philippines and sent to her family in the Philippines;
c)after the wife commenced work in May 2009, she sent “most” of her earnings to her family and her bank account in the Philippines;
d)the husband sometimes told the wife that he did not agree with her sending a large amount of their financial resources to the Philippines;
e)the husband lent the wife $8,000 to buy a block of land in the Philippines; it was not a joint purchase;
f)early in the relationship, he said that he would take care of the wife but did not say that he would financially “look after” her mother;
g)before the marriage, the wife did not tell him that she was concerned about her qualifications being recognised in Australia or that she was concerned about leaving her family and friends in the Philippines;
h)he did give the wife $2,000 during their engagement;
i)early in the marriage, he gave the wife money for her mother to stop arguments;
j)in about September 2008, the husband transferred to the wife $2,758 for her mother’s medical expenses;
k)between 7 December 2006 and 2 December 2008, the husband gave the wife $21,788, including the $8,000 loan for the property and $3,000 for their holiday in the Philippines;
l)it was the wife who transferred that money to the Philippines, not the husband;
m)after he retired in May 2009, the husband’s pension and savings were used for household expenses, with the wife contributing only for food;
n)between May 2009 and March 2012, the wife earned $113,000 clear of tax, plus $7,000 in superannuation;
o)the wife transferred all available funds to the Philippines and left the husband feeling that he had been taken advantage of and financially and emotionally abused;
p)he sent the wife the letter dated 11 April 2011; and
q)when the wife received permanent residence and her Australian passport, she told the husband:
I am not cleaning for you and I am not washing for you. I am entitled to maintenance and half your property.
In his affidavit sworn on 8 November 2012, the husband said that, between 13 July 2009 and 9 April 2012, the wife took more than $80,000 from the matrimonial assets for her exclusive benefit. He said more particularly, she took:
a)$8,002.00 from the parties’ joint account, which the wife operated solely;
b)$72,957 from her personal account for her own use; and
c)$4,500 for gambling.
Those three figures total $85,459.
In relation to gambling, the husband referred to numerous cash withdrawals from the bank accounts of $200, many of which occurred on the same day. The wife denied the gambling allegation in her affidavit sworn on 25 March 2013. The allegation of gambling was not put to the wife in cross examination and was not pressed in submissions. I disregard it. There was insufficient evidence to conclude that the wife spent any money at all on gambling.
The husband exhibited to his 8 November 2012 affidavit bank statements for the parties’ Australian joint account and the wife’s Australian personal account. The joint account was opened on 30 May 2009 with a credit of $1,371.81. That amount might have been provided by the husband, because the wife only began working in May 2009. However, neither party gave evidence about this or cross examined the other about it. Otherwise, all of the deposits to the joint account were the wife’s wages. In the absence of any evidence to the contrary, I infer that the opening credit of $1,371.81 to the joint account was also the wife’s wages.
The payments from the Australian joint account appear to be for a mobile telephone, clothing, electrical items, supermarket expenses, petrol, pool products and restaurants. There are also withdrawals of $62,000 and two withdrawals totalling $9,505.40. The $62,000 had previously been deposited into the account from [C] Limited. The husband did not take issue with the withdrawal of that sum, so I assume he knew what it was and was content with where it went. The husband did not query the withdrawals totalling $9,505.40, so I assume he knew what they were for. They may have been for the wife’s car. Otherwise, there were cash withdrawals in sums of $200 or more which totalled $8,800.
The wife’s Australian personal account was opened on 3 June 2010, the day before the Australian joint account was closed. The deposits to the wife’s Australian personal account appear to be entirely the wife’s wages. The payments from that account seem to be similar to those from the Australian joint account. There are numerous cash withdrawals of over $200 from the wife’s Australian personal account. They total $43,854. Adding that figure to the $8,800 from the Australian joint account makes a total of $52,654 that the wife appears to have withdrawn from her Australian personal account and the Australian joint bank account.
None of the cash withdrawals of over $200, or any other details of the bank statements, were put to the wife in cross examination. There were other cash withdrawals of smaller amounts, but, in relation to the gambling allegation at least, the husband himself seemed to consider that the suspect cash withdrawals were those of $200 or more. As stated, they total $52,654.
In his affidavit sworn on 9 November 2012, the husband said that:
a)the wife’s mother was not entirely dependent on the wife;
b)the wife’s mother lives with her oldest daughter and the oldest daughter’s husband and children and her middle daughter and the middle daughter’s child;
c)the middle daughter was earning four times as much as the wife when the husband and wife met;
d)the wife’s mother received a government pension; and
e)she has 10 children and 54 family members within one kilometre of her home who are able to help her.
In his affidavit sworn on 27 March 2013, the husband repeated some of his previous evidence and also said that he had spent $30,000 for the wife to come to Australia, including his three trips to the Philippines.
In cross examination, the husband said that:
a)the wife helped him in his [business] for about 48 hours in total;
b)he did not write the letter to the wife’s mother in exhibit BS-2 to the wife’s affidavit sworn on 25 March 2013;
c)the signature looks like his but it is not;
d)the letter in exhibit BS-7 to the affidavit sworn by the wife on 25 March 2013, being a letter from [J] Money Changers Limited addressed to him and saying that he has remitted $21,788 to the Philippines through their office, did not concern money sent by him but money sent by someone else in his name;
e)he had sent some money through [J], but the wife sent money through the same agency;
f)he knew about the $21,788 sent to the Philippines;
g)there was other money the wife sent but he did not know why it was sent or to whom it was sent;
h)he only found out last year that the wife was constructing a house in the Philippines;
i)in relation to exhibit BS-9 to the affidavit sworn by the wife on 25 March 2013, which is a letter to the immigration department signed by both parties in which they say:
I help my husband in his business ([B]), and I am enjoying myself with this kind of a work. Sometimes, he teaches me how to operate the machines. …
it was the wife’s letter, in which she tried to create the impression that she worked continually in the husband’s business;
j)although he signed that letter, it was the wife who was trying to give a false impression to the Immigration Department;
k)he signed a lot of things to enable the wife to stay in Australia;
l)in relation to the statutory declaration made on 22 May 2009 contained in exhibit BS-11 to the affidavit sworn by the wife on 25 March 2013, he signed the second and third pages, which contains the declaration, but not the first page;
m)he asked to see the first page, but the wife refused to let him see it;
n)the first page contains a statement that the husband and wife own real estate jointly;
o)the statement on page 2 of the declaration, that the parties have a joint bank account and share household bills, was not true;
p)he signed page 2 because the wife wanted him to;
q)he sent money to the wife’s bank account, and she did what she wished with it;
r)he knew and did not mind that some money was going to the wife’s mother because “she is a great woman” and she needed help;
s)the wife had a moral responsibility to help her mother, as well as the husband and herself;
t)he calculated the $80,000 that he claimed the wife sent overseas as follows:
i)he worked out that she earned $113,000 after tax in the relevant period;
ii)he examined her bank statements and found that she had spent $11,000 on food;
iii)he doubled that figure, making $22,000;
iv)he took $22,000 from $113,000, which left $91,000; and
v)he concluded that she must have sent at least $80,000 overseas.
u)the figure of $113,000 was a rough estimate of the wife’s earnings over two and a half years (from May 2009 to November 2011);
v)he did not take account of the amount the wife paid for her car, or the costs of running the car;
w)he did not take account of the amount the wife paid for her mobile telephone or the ongoing costs of the mobile telephone;
x)it was possible that the wife’s figure of $60,000 was correct; and
y)she was the one who had to prove how much she sent overseas.
In further evidence in chief, the husband said that he did not tell the wife when they first met that he would financially support her mother.
The evidence about the money that was sent overseas was very confused, perhaps partly because both parties were not native speakers of English. Also, they were talking about somewhat different things. The husband alleged that the wife sent $80,000 from her earnings overseas. The wife conceded that about $60,000 was sent overseas to her bank account, but she said that some of that money was the husband’s own money which he sent himself and some of it she sent with the husband’s knowledge and consent.
The wife said that the approximately $60,000 included:
a)$8,000 for the Filipino property;
b)$25,000 for the partial construction of the house on the land; and
c)$17,000 for her mother’s financial support and medical expenses.
That totals $50,000. There were also amounts spent on holidays in the Philippines.
Contrary to the husband’s claim in the witness box, it is not for the wife to prove how much money was sent overseas. The husband asserted that the wife sent $80,000 so it was for him to prove it.
The husband’s calculation of the $80,000 obviously involved a very flawed reasoning process. The husband conceded that his calculation of the wife’s total after tax earnings was a rough estimate. He conceded that he made no allowance for the capital cost of the wife’s car or its running costs, or for that matter, her mobile telephone. The husband did not dispute that the wife bought a laptop for herself. She presumably also had expenditure on clothes, toiletries, hairdressing, outings and other usual expenses. There is simply no proper basis for accepting that the wife sent overseas $80,000 from her earnings.
The husband did not challenge the wife’s Filipino bank statements or the summaries of them. Because those figures were not challenged in cross examination, and because the court’s attention was not drawn to any evidence in this case that contradicts them, I accept the figures set out in the summaries. The husband did not point to any actual evidence, as opposed to speculation, to indicate that the wife or the husband or both of them jointly sent any more than about $60,000 overseas.
The summaries show that someone transferred to the wife’s Filipino bank account about $60,000. The husband conceded in his affidavit sworn on 7 November 2012 at [59] and [60] that:
a)in about September 2008, he transferred $2,758 to the wife for her mother’s medical expenses; and
b)between 7 December 2006 and 2 December 2008, he gave the wife $21,788, including the $8,000 loan for the property and $3,000 for their holiday in the Philippines.
The concession on affidavit that he gave the wife $21,788 coincides with exhibit BS-7 to the affidavit of the wife sworn on 25 March 2013, being the letter from [J] Money Changers Limited which says that the husband had transmitted $21,788 to the wife overseas. The husband’s denial in cross examination that he sent that money to the wife’s overseas account through [J] Money Changers is surprising, given that he had previously conceded on affidavit that he had given the same amount of money to his wife.
The husband seemed to be trying to say that he did not know what his wife did with the money he gave her. I find this wholly unconvincing. The husband said himself on affidavit that he gave the wife $2,758 for her mother’s medical expenses. The husband freely admitted that he made a false statement in a statutory declaration lodged with the Immigration Department. He told the court that he did not sign the first page of the statutory declaration and said that he had not seen the first page, although he had asked the wife for it. I do not accept the husband’s evidence about this matter.
I consider the husband to be an unreliable witness. The husband told the court that he signed a lot of things so that the wife could get a visa. He was evasive in the witness box. Instead of being open and frank, he sought to split hairs and give a false impression. He admitted giving a false impression to the Immigration Department, in the statement about the amount of time the wife worked with him, and said that was the wife’s document, even though he signed it. The husband has been slippery and dishonest. He seems to be a person who would say anything to anyone to further his own interests.
The impression of the husband being slippery is bolstered by the fact that the husband chose to make an affirmation when giving oral evidence, rather than swearing an oath, although he had sworn his affidavits and claimed to be a Catholic.
Nor do I accept that the wife was an entirely honest witness. The parties agreed that the husband provided the $8,000 used to purchase the block of land in the Philippines, which is in the wife’s sole name. However, the wife said that the husband gave her the money. The husband said that he lent his wife the money.
The husband produced a hand written note dated 2 October 2007, signed by the husband and the wife, in which the wife agreed to borrow the money from the husband to buy the block in the Philippines and pay it back if she had “the money already by next year”.
The wife agreed that she had signed the note but denied that it indicated that the husband had lent her the $8,000. She said in oral evidence that:
a small piece of paper is not a kind of a loan.
She said that she signed the document because she respected her husband a lot. She said that the money was to be used for the parties to buy a holiday house jointly in the Philippines. She said that she intended that the property be registered jointly in the parties’ names but the husband refused.
I consider that the note was clearly intended by both parties to be a record of a loan, albeit a loan with a loose repayment date. I consider that the registration of the property in the wife’s sole name confirms that the husband lent rather than gave his wife the money to buy the block in the Philippines and did expect to be repaid. I consider that the wife could not have mistaken this arrangement for a gift. Her persistent claim that the $8,000 was a gift indicates that she is an unreliable witness.
In any event, the husband now accepts that the wife should retain the property in the Philippines. He does not seek orders that the wife repay him the $8,000.
The $8,000 appears in the summaries of the deposits to the wife’s Filipino bank account on 31 October 2007, being the time of the purchase. I accept that the $8,000 is part of the $60,000 acknowledged by the wife. The $8,000 was entirely the husband’s money.
The $8,000 was part of the $21,788 of the husband’s money that was sent overseas. The husband also acknowledged that he provided $3,000 for a holiday in the Philippines enjoyed by the parties jointly. I consider, on the balance of probabilities, that the $3,000 was also part of the $21,788. I consider, on the balance of probabilities, that the $2,758 that the husband acknowledged that he paid for the wife’s mother’s medical expenses in September 2008 is part of the $21,788.
That leaves a balance of $8,030 that was the husband’s money that was sent overseas. The wife claimed that $10,788 was spent on the financial support of her mother. I consider that, in reaching that figure, the wife did not allow for the $2,758 spent on her mother’s medical expenses.
I consider, based on the husband’s affidavit evidence, that he did know that $21,788 of his money was being sent overseas. He knew perfectly well that some of it was being spent on land, some on a holiday and some on his mother’s medical expenses. As to the remaining $8,030, I consider that the husband did know that it was being provided ostensibly for the support of the wife’s mother.
I accept the wife’s evidence that, when agreeing to marry the husband, she expressed concerns about her mother’s financial security. His counsel conceded in opening that the husband had:
perhaps signified a modest amount of support to his mother-in-law that one would expect in a normal family situation.
I accept that the husband agreed, in a vague way, to provide financial support for his mother in law. I do not accept that any particular figures were agreed upon. Being a verbal and vague family arrangement, I do not accept that the husband’s agreement constituted an enforceable promise. To the extent that the wife’s affidavit material suggested that she was raising an estoppel argument, I note that no submissions along those lines were put to the court.
There is no reasonable basis to conclude that more than $21,788 of the husband’s money was sent overseas. As the husband provided $21,788 of the $60,000 sent overseas, about $38,000 of the wife’s money must have been sent overseas. The analysis above of the cash withdrawals of $200 or more made by the wife shows that she had sufficient money from her earnings to send that amount overseas. Indeed, the wife acknowledged that she sent overseas $25,000 of her own money for the construction of the house in the Philippines and $17,000 of her own money for the financial support and medical expenses of her mother. That totals $42,000. There is obviously another $4,000 that has not been accounted for. That discrepancy may be explained by minor calculation errors and differences in the exchange rate. In any event, it seems clear that the wife sent overseas about $40,000 of her own earnings.
The husband suggested that $33,000 was a lot to spend on a house in the Philippines. However, the parties accepted a valuation of the Philippines property that indicated that it is now worth about $37,000. Accordingly, the claimed expenditure on that property does not seem excessive.
The husband also suggested that $17,000 was a lot to spend on medical care in the Philippines. There was no expert evidence about the general cost of medical care in the Philippines and no evidence about the particular cost of the wife’s mother’s medical care. Although I consider the wife to be not an entirely reliable witness, there is no proper basis, on the evidence before me, to reject the wife’s claim that she spent $17,000 on her mother’s medical care in the Philippines.
These findings will now be used in the consideration of the parties’ contributions and future needs.
Contributions
a. Initial contributions
The parties agreed that the wife had no assets of value at the commencement of the relationship.
The parties agreed that, at the commencement of the relationship, the husband owned the property at [K]. At around the time of marriage, the husband discharged the mortgage on that property. It seems that the husband might also have had some savings at the commencement of the relationship. The parties agreed that the husband brought to the marriage assets worth about $340,000.
b. Contributions during the marriage
The husband conceded in his case outline and in opening that the wife did the bulk of the household chores. The wife claimed, without challenge, that she did virtually all of the shopping, cooking, cleaning, clothes washing, ironing and gardening and the husband did some work maintaining the home and rarely mowed the lawn. I accept that evidence.
The husband was the principal breadwinner until his retirement in May 2009. Until then, he was a self-employed [omitted] who worked from home. The wife commenced working outside the home in May 2009 as a [omitted]. The parties agreed that the husband began to receive the aged pension on 2 July 2009. If the wife was working immediately after his retirement, the husband was presumably not entitled to a full pension.
In any event, there was a significant dispute in this case about the amount of assistance that the wife gave the husband in his [omitted] business, before he retired and she started working in a [omitted].
The wife said in her affidavit sworn on 16 April 2012 that she spent about 30% of her time assisting the husband. In oral evidence, she said she helped the husband in his business four hours per day. I take that to mean four hours per week day, or 20 hours per week.
The husband said in his affidavit sworn on 7 May 2012 that the wife assisted him in his business “occasionally”, “rarely” and “infrequently” by getting out accounts and helping to run the machinery. He said in oral evidence that she assisted him in total for no more than 48 hours.
It was common ground that the husband did not pay the wife for the hours she worked and those hours were not documented or covered by Work Cover. As such, the husband was in breach of an array of rules and regulations designed to protect vulnerable workers.
In their jointly signed letter dated 15 October 2007 to the Immigration Department, the husband and wife said:
I help my husband in his business ([B]), and I am enjoying myself with this kind of a work. Sometimes, he teaches me how to operate the machines. …
This letter was signed by both parties. The husband acknowledged that it was intended to give the impression to the Immigration Department that the wife provided substantial assistance to the husband in his business. However, the husband said in cross examination that it was the wife’s letter and he just went along, even though he signed it himself.
In this context, the wife relied on the principle in In the Marriage ofElias (1977) 29 FLR 393; (1977) 3 Fam LR 11,496; (1977) FLC 90-267, which is to the effect that a party cannot give an account of his financial circumstances to a revenue authority and not be held to that account by the court. See also In the Marriage of Jordan (1996) 21 Fam LR 382; [1996] FamCA 15 (29 February 1996); (1997) FLC 92-736 per Chisholm J. The wife sought to expand that principle to include statements made to other authorities, such as the Department of Immigration. That seems to me to be entirely appropriate. The genesis of the Elias principle was the English case of Tinker v Tinker[1970] P 136; [1970] 1 All ER 540; [1970] 2 WLR 331, where the husband had put the family home in his wife’s name to defeat possible future creditors. Lord Denning MR considered that the husband was bound by his statements to the land registration authorities. Consequently, I consider that the Elias principle applies to statements made to any authority.
However, the application of that principle in the present case is complicated by the fact that the letter to the Department of Immigration did not precisely quantify the amount of time that the wife worked in the husband’s business. The parties gave quite different accounts of how much time the wife worked for the husband.
On the basis that, overall, I consider the wife to be a somewhat more reliable witness than the husband, and given that her work history indicates that she is a willing worker, I accept that she did a significant amount of work in the husband’s business from about the time of her arrival in Australia in February 2007 until the husband’s retirement in about April 2009.
However, my impression of the witnesses is that the wife exaggerated the amount of time she spent in the husband’s business and the husband understated it. All in all, I consider that, from the time of her arrival in Australia until the husband’s retirement, the wife worked for about 10 hours per week in the husband’s business. That amounts to about two years work at 10 hours per week.
After the husband’s retirement in about April 2009, the wife began working in a [omitted]. From that time on, it seems that the husband continued to provide accommodation for both parties and paid for the household utilities, while the wife paid for many of her own expenses, including her car, mobile telephone, clothes and so on.
The wife said that she also paid for the food for both parties until separation, while the husband said that she only bought her own food. Again, because overall I found the wife to be a less unreliable witness than the husband, I accept that the wife did provide the food for both parties. This was also in keeping with her claim that she did the shopping. There was no evidence of the husband paying the wife for his share of any food that she bought.
As is usual in family law cases, evidence was not provided to the court of just how much food and utilities and so on cost the parties in this case. Nor was there any evidence about how much the husband would have had to pay someone to do for him the shopping, cleaning, gardening, laundry and so on. The court must therefore take a somewhat broad brush and intuitive approach to these questions.
During the marriage, the husband contributed $10,788 of his own money to the welfare of the wife’s family overseas, and the wife contributed about $17,000 for the same purpose. However, s.79(4)(c) of the Act only allows the court to take into account contributions to the welfare of the family constituted by the parties to the marriage and their children. Although it might be said that caring for the wife’s mother contributed to the wife’s welfare, by relieving the wife of stress, I consider that would be an impermissible stretch of the legislative language.
The husband also contributed the $8,000 used by the wife for the purchase of the land in the Philippines. The wife contributed $17,000 for the development of that land.
Both parties contributed money for holidays enjoyed by both of them.
The wife argued that there ought to be a loading to her contribution, for reasons analogous to the Kennon principle, because the husband treated her virtually as a house slave. She alleged that he insisted that she get him drinks, for example, and said that was why he brought her to Australia.
That may be so. However, that does not amount to being a house slave. The wife presented a rosy picture of the relationship to the Immigration Department in her statutory declaration. Under the Elias principle, and on the evidence in this case, I see no reason to consider that the wife was treated particularly badly.
c. Contributions post separation
After separation, on 16 March 2010, the wife remained in the matrimonial home until June 2012. I gather that, during that period, the financial arrangements were the same as previously, with the husband paying the utilities and the wife paying for food, except that, from April 2011 until November 2011, the wife paid the husband rent of $100 per week.
The s.79(4)(d), (e), (f) and (g) and the s.75(2) factors
The wife is 33 years old and the husband is 68 years old. The wife said without challenge and I accept that she was diagnosed with depression and anxiety in June 2012. The husband said without challenge and I accept that he has chronic renal failure, hypertension, hyperlipemia, gout and tremors. Neither party suggested that their health problems were of any particular significance to these proceedings.
The wife, according to her financial statement sworn on 25 March 2013, earns $563 per week, entirely from wages. The husband, according to his financial statement sworn on 25 March 2013, earns $434.40 per week consisting of a Centrelink pension of $374.40 per week and interest on savings of $60 per week. The parties have the property described previously in these reasons. There was no evidence that they have any other financial resources.
The wife has the demonstrated physical and mental capacity for appropriate gainful employment. The husband has reached retirement age. There appears to be no prospect of him returning to the paid work force.
There were no children of the marriage. It was not suggested that either party has a duty, in the sense of a legal duty, to maintain any other person. The parties have the usual commitments to support themselves. The wife pays rent of $120 per week. The husband owns his own home.
The wife said that she had a moral responsibility to support her mother. The husband conceded in cross examination that the wife had such a responsibility. In In the Marriage of Lutzke (1979) 5 Fam LR 553, (1979) FLC 90-714, Lindenmayer J considered the meaning of s.75(2)(e) of the Act and said at 644 that the responsibility there contemplated included a moral responsibility. Consequently, in this case, the wife has a responsibility within the meaning of s.75(2)(e) of the Act to support her mother.
The husband receives an aged pension as mentioned above. The wife has no present entitlement to any sort of pension.
There was no specific evidence in this case about the parties’ standard of living while the marriage subsisted. I understand it to have been modest, by Australian standards. I consider that a modest standard of living would be reasonable for the parties now that they are no longer together.
The wife intends to undertake further education in Australia. However, it was not suggested that any order made in these proceedings would have any effect on the earning capacity of either party.
There was no evidence of any creditors of the parties.
The husband has contributed to the wife’s property by advancing an $8,000 loan, which he has now forgiven. That loan enabled the wife to acquire her property in the Philippines. The wife has contributed to the husband’s income by working in his business without pay. The wife has contributed to the husband’s property by undertaking virtually all of the domestic chores. If he had been required to pay commercial rates for those chores, he would have used a substantial part of his savings.
On any view, the marriage was of a short duration. The wife submitted that the marriage adversely affected her earning capacity because she gave up a good job in the Philippines to come here. The wife said that she earned about 2000 pesos per week in the Philippines. She agreed that the exchange rate was about 40 pesos to one Australian dollar. That means she was earning about $50 per week in the Philippines. She now earns about $563 per week. In purely financial terms, which is what s.75(2)(k) of the Act addresses, the wife’s move to Australia has increased her earning capacity.
Neither party has the role of parent to young children. The husband’s children are now adults.
The wife said that she is living in a house with another couple. The husband alleged that she was cohabiting with another man. There was no objective evidence either way. As mentioned above, overall I found the wife to be a less unreliable witness than the husband. For this reason, I prefer her evidence on this point as well.
The terms of any property order will be determined in this proceeding.
Part VIIIAB of the Act is not relevant.
No question of child support arises in this case.
The justice of the case requires that the money spent by the husband and the wife on the wife’s mother’s living and medical expenses be taken into account.
It was not suggested that there is any financial agreement that is binding on the parties to the marriage.
Whether it is just and equitable to alter the parties’ property interests
The parties agreed that it would be just and equitable to alter their property interests in this case. In view of paragraph 42 of Stanford, the fact that the parties are no longer living in a marital relationship and the various findings made above in relation to contributions and future needs, I also consider that it would be just and equitable to alter the parties’ property interests in this case.
What order is just and equitable
Taking into account all of the matters set out above, I consider that it would be just and equitable to alter the parties’ interests in their property so that the wife would receive 12% of the parties’ combined assets. This will require the husband to make a payment to the wife of $18,351.72
The wife currently has 8.7% of the parties’ combined assets. She has acquired the bulk of the assets in her name through her own earnings. However, the wife has also benefited from the husband’s contribution to her assets of the initial loan, now forgiven, of $8,000. The husband also contributed to the wife’s acquisition of assets by providing accommodation for her and paying the utilities for that accommodation. This meant that the wife could utilise a large part of her own earnings for extraneous purposes.
The husband currently has 91.3% of the parties combined assets. He brought the matrimonial home and substantial savings to the relationship. The wife did not contribute to the acquisition of those assets. However, during the time that the husband and wife lived together in the matrimonial home the wife contributed substantially to the welfare of the family consisting of the husband and herself by doing virtually all of the shopping, cooking, cleaning, washing, ironing and gardening. This was a significant contribution.
Additionally, the wife contributed to the husband’s income, when his business was still running, by doing unpaid work for him. This meant that the husband was able to retain as savings money that he ought to have paid the wife in wages. This also amounted to a significant contribution.
Moreover, the wife contributed by paying for food. This enabled the husband to conserve his savings.
As discussed at length above, large amounts of money generated by both parties were sent to the Philippines. Some of that money is now represented in the wife’s partly constructed house. A lot of it is gone. However, the court is not permitted to treat that expenditure as a negative contribution.
Taking into account all relevant matters, it seems to me that a property division giving the wife 12% of the parties combined assets is just and equitable. There will be orders that each party retain the assets in his or her name, save that the husband is to pay the wife $18,351.72 within 30 days.
I certify that the preceding one hundred and thirty-seven (137) paragraphs are a true copy of the reasons for judgment of Judge Riley
Associate:
Date: 6 June 2013
24Given by s.21 of the The Married Women’s Property Acts 1890–1952 (Qld), a provision which
corresponded with s.17 of the Married Women’s Property Act 1882 (Imp).(Hepworth) per Windeyer J.
27 Hepworth at CLR 317; ALR 264 per Windeyer J. See also Wirth at 231–2 per Dixon CJ.
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