SCOFIELD & SHAW - [2012] FamCAFC 193

FAMILY COURT OF AUSTRALIA

SCOFIELD & SHAW

[2012] FamCAFC 193

FAMILY LAW ─ APPEAL ─ PROPERTY SETTLEMENT ─ Contributions ─ Challenge to the Federal Magistrate’s conclusion and assessment of the contributions of the parties pursuant to s 90SM(4) ─ Where the appellant contended that the Federal Magistrate had erroneously disregarded and/or devalued, the contributions made by him for the benefit of himself and the respondent ─ Where the Court concluded that the Federal Magistrate’s findings with respect to the parties’ overall contributions in the period October 2006 to October 2007 were not reasonably open to him ─ Where the Court was satisfied that it was not reasonably open to the Federal Magistrate to regard the parties’ overall contributions in the period October 2006 and October 2007 as equal by, inferentially, concluding that the respondent’s non-financial contributions so exceeded those of the appellant during this period as to counter balance his substantially greater financial contributions ─ Where given the ages and earning capacities of the parties, and the modest value of their assets, the Court was unable to conclude that the Federal Magistrate’s error of fact was immaterial to the exercise of his discretion ─ Where his Honour’s failure to find, as the evidence required him to, that the appellant’s ultimate contribution based entitlement was enhanced by the disparity of the parties’ financial contributions between October 2006 and October 2007 vitiated the exercise of his discretion ─ Appellate intervention enlivened ─ Where both parties sought an order for the sale of the property if the appeal were allowed and the discretion of the Federal Magistrate re-exercised ─ Appeal stood over for further consideration, with respect to the re-exercise of the discretion of the Federal Magistrate’s Court, pending receipt of further evidence and submissions.

Family Law Act 1975 (Cth) Part VIIIAB, ss 90SF, 90SL, 90SM, 93A

Allesch v Maunz (2000) 203 CLR 172
Coulton v Holcombe (1986) 162 CLR 1
De Winter v De Winter (1979) 23 ALR 211
Metwally (No 2) v University of Wollongong (1985) 60 ALR 68
Norbis v Norbis (1986) 161 CLR 513
Suttor v Gundowda Pty Ltd (1950) 81 CLR 418

APPELLANT:

Mr Scofield

RESPONDENT:

Ms Shaw

FILE NUMBER:

CAC

1478

2010

APPEAL NUMBER:

140

2011

DATE DELIVERED:

21 November 2012

PLACE DELIVERED:

Sydney

PLACE HEARD:

Canberra

JUDGMENT OF:

Finn, Coleman and May JJ

HEARING DATE:

23 October 2012

LOWER COURT JURISDICTION:

Federal Magistrates Court

LOWER COURT JUDGMENT DATE:

30 November 2011

LOWER COURT MNC:

[2011] FMCAfam 1296

REPRESENTATION

APPELLANT:

Self Represented

COUNSEL FOR THE RESPONDENT:

Mr Gill

SOLICITOR FOR THE RESPONDENT:

Warren McKeon Dickson Lawyers

Orders

The two (2) Applications in an Appeal to adduce further evidence filed by the appellant on 28 March 2012 be dismissed.
The appeal be stood over for further consideration, by way of written submissions of the parties.
The respondent file and serve any evidence upon which she wishes to rely in relation to the re-exercise by this Court of the discretion of the Federal Magistrate’s Court within 21 days hereof together with such further submissions as the respondent wishes to make in reliance upon such evidence.
Within 14 days thereafter the appellant file and serve any submissions he wishes to make in response to the evidence or submissions of or on behalf of the respondent referred to in order 3.
All questions of costs of and incidental to the appeal, and the two (2) Applications in an Appeal that were dismissed by way of order 1 of the orders hereof, be reserved.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Scofield & Shaw has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT CANBERRA

Appeal Number: EA 140 of 2011

File Number: CAC 1478 of 2010

Mr Scofield

Appellant

And

Ms Shaw

Respondent

REASONS FOR JUDGMENT

introducton

By Notice of Appeal filed 8 December 2011 Mr Scofield (“the appellant”) challenged orders for settlement of property made on 30 November 2011 by Brewster FM pursuant to Part VIIIAB of the Family Law Act 1975 (Cth) (“the Act”) in proceedings between the appellant and Ms Shaw (“the respondent”).
The effect of the orders of the learned Federal Magistrate was that the property situated at S in the State of New South Wales (“the S property”) held by the appellant and the respondent as tenants in common in shares of 37 per cent to the appellant and 63 per cent to the respondent respectively, be apportioned as to 41 per cent to the appellant and 59 per cent to the respondent. The respondent was granted the option of acquiring the interest of the appellant in the said property by payment to him of $186,595, together with daily interest thereon after 45 days from the date of his Honour’s orders (order 1). The orders of the learned Federal Magistrate were stayed, on the application of the appellant, on 16 December 2011.
In lieu of the orders of the learned Federal Magistrate, the appellant essentially sought that the property be sold and the proceeds of sale be divided in equal shares between the parties.
The respondent resisted the appellant’s appeal and sought to maintain the orders of the learned Federal Magistrate.
On 28 March 2012 the appellant filed an application seeking leave to adduce further evidence of two matters in the appeal pursuant to s 93A of the Act. The respondent resisted that application.

background

At the date of the judgment of the learned Federal Magistrate the appellant was aged 65 and the respondent was aged 62.
The parties commenced living together in south eastern New South Wales in October 2006. The parties returned to north Queensland in about March 2007, and commenced to live together in the respondent’s home in April of that year.
In August or September 2007 the parties resolved to move to the B area of New South Wales. The respondent then sold the home she had owned for some years. The appellant realised his entitlement to a property which he and his former partner had for some years jointly owned, and accessed his superannuation entitlements.
In November 2007 the parties purchased the S property as tenants in common in shares of 37 per cent to the appellant and 63 per cent to the respondent.
The parties separated on 5 April 2010, whereafter, the appellant resided away from the S property in rental accommodation. The respondent continued in occupation of the S property, which was, and remained, unencumbered.
It was not controversial before the learned Federal Magistrate, or this Court, that the provisions of Part VIIIAB of the Act were enlivened.
The learned Federal Magistrate found that the appellant had contributed $160,861 to the acquisition of the S property and that the respondent had contributed $270,000 for that purpose. The purchase price of the property was approximately $415,000, plus Stamp Duty and other expenses and adjustments.
For reasons which do not assume significance for the present purposes, the learned Federal Magistrate concluded, pursuant to s 90SL of the Act, which relates to, “Declaration of interests in property”, that the legal interests of the parties in the S property reflected their equitable entitlements to the property.
For the purpose of s 90SM of the Act, which relates to “Alteration of property interests”, the learned Federal Magistrate found that the appellant contributed $189,967 by way of acquisition or improvement costs of the S property whilst the respondent contributed $274,250 for those purposes.
For the reasons which the learned Federal Magistrate articulated in his judgment, his Honour said that the “share” of the appellant was 41 per cent and the “share” of the respondent was 59 per cent.
The entitlement of the appellant was increased by the sum of $3,522, being one half of the liability of $7,044, which was the debit balance of a credit card at separation, for which the appellant subsequently assumed responsibility. One half of the interest from separation to the date of hearing, $773, was also ordered to be paid by the respondent to the appellant. The resultant adjustment in the appellant’s favour was thus $4,295.
The appellant’s entitlement was increased by a further $6,000 with respect to personalty acquired during the parties’ cohabitation, and substantially retained by the respondent when the parties separated.
The learned Federal Magistrate declined to adjust the entitlement of either party by virtue of s 90SF(3) of the Act, on the basis that both parties were retired, that neither was capable of employment, and that, whilst there would be a discrepancy between the capital positions of the parties as a result of the Court’s decision, the short duration of the parties’ relationship did not justify altering the parties’ interests in reliance upon that, or any other s 90SF(3) matter.
The learned Federal Magistrate’s conclusion with respect to s 90SF(3) is not controversial in the appeal. His Honour’s conclusion with respect to the parties’ contributions is highly controversial.

grounds of appeal

In his Notice of Appeal, the appellant articulated his complaints in considerable detail. Although not universally expressed in terms readily identifiable as grounds of appeal, the substance of the appellant’s complaints emerges clearly from his grounds.
Paradoxically, in his “Summary of Argument”, the appellant did little more than re-iterate some parts of the grounds of appeal appearing in his Notice of Appeal. Learned Counsel for the respondent replied to the appellant’s grounds in detail in his Summary of Argument.
Albeit not necessarily in the sequence in which the appellant agitated them before us, we will consider the various challenges he has raised.

Asserted erroneous findings in relation to non-financial contributions

The appellant challenged the learned Federal Magistrate’s conclusion that the contributions of the parties pursuant to s 90SM(4) favoured the respondent by 59 per cent to the appellant’s 41 per cent. As is apparent from his Notice of Appeal, and clarified during his oral submissions, the challenge to the learned Federal Magistrate’s conclusion pursuant to grounds 1 and 2 was:
The Magistrate in effect dismissed the first 12 months of the defacto relationship as inconsequential in terms of financial contributions to the totality of the defacto relationship. He disregarded the documented expenditures of $12038 for the period Oct.2006 ─ Mar.2007 and $22162 for the period April ─ Oct/Nov.2007.
In the period Oct.2006 (the beginning of the defacto relationship) to Mar.2007, my bank statements show a total expenditure of $12037-36 while in the same period the respondent contributed $3289-94 (her bank statements) which included $567-10 for vehicle registration and $476-31 for vehicle insurance. It should be noted that at no time have I included any expenses regarding my vehicle as a contribution to the relationship.
In the period April2007 to Oct/Nov2007 the respondent had no income. Magistrate Brewster has again erred when he stated (paragraph 29 (c)) that the respondent contributed financially in this period as she did not, except for perhaps a minor property expensed. So I supported her fully when we lived in her home and later when we moved to [B]. My bank statements show total expenditure for this period as $22160-91. At no time did I spend money on luxury goods or leisure items.
I emphatically reject Magistrate Brewster’s disregard for these figures as an error of discretion on his part. That contribution of $34200 ($12038 + $22162) for the 12 months Oct.2006 ─ Oct/Nov 2007 was of equal benefit to the respondent as it was myself and ultimately it enabled her to be better placed financially (as she had no debts) when the time came to purchase the house. I effectively subsidised her contribution to the purchase of the property at [S]. (Errors as in original)
The appellant contended that the learned Federal Magistrate had erroneously disregarded and/or devalued, the contributions made by him for the benefit of himself and the respondent, totalling the sum of $12,038, during the period October 2006 to March 2007. The appellant submitted that, at most, during that period, the evidence established that the respondent had contributed the sum of $3,289.94 for the benefit of the parties. We do not understand either of the amounts relied upon in support of this compliant to be controversial, or to have been controversial at trial.
It was submitted by the appellant that the learned Federal Magistrate had erroneously concluded, at paragraph 29(b) of his reasons for judgment, that his greater financial contributions during that period should not elevate his entitlement over that of the respondent, on the basis that, it could be inferred, his Honour regarded the non-financial contributions of the parties during that period as having favoured the respondent. It was submitted that, neither party had contended at trial that his or her non-financial contributions were materially greater than those of the other party, during this period, or at any time.
The appellant further submitted, correctly we are satisfied, that neither party cross-examined the other party at trial to suggest that the non-financial contributions of either party were greater than those of the other party. It was accordingly submitted by the appellant that no finding, other than one of essential equality of non-financial contributions having been reasonably open to the learned Federal Magistrate, the disparity of financial contributions to which we have referred, could not be dismissed in the way, or on the basis that it was asserted that the learned Federal Magistrate must have.
In response, Counsel for the respondent submitted:
23.It is apparent that His Honour did not disregard the financial and non-financial contributions of both of the parties during both periods referred to. His Honour found that the evidence did not allow him to determine any balance between financial and non-financial contributions. For this reason (bearing in mind His Honour’s earlier reference at paragraph 12 of the need to go no further than justice demands), His Honour did not adjust the interests of the parties in relation to this time period. In the absence of evidence that allowed him to find such a balance he was unable to adjust to meet such a balance.
24.His Honour considered and assessed the contributions made by both from October 2006 to March 2007 where the finding is “they effectively lived together and whilst there was no financial interdependence each would have made contributions both financial and non-financial to the relationship.” His Honour found it was “likely” the Appellant contributed more financially during this period but found it was no [sic] possible to make any assessment of non-financial contributions. His Honour specifically referred to the assertion that the Appellant had “contributed an amount of over $12,000.00”
25.On the evidence available the finding was open to His Honour and was within his discretion to so find. On the evidence it was correct for His Honour to again consider that no balance between the party’s contributions could be assessed for this period. (Footnotes omitted)
Paragraph 12 of the learned Federal Magistrate’s reasons for judgment recorded:
Surmounting the hurdle imposed by section 90SM(3) is not a given. In Rogers & Rogers (1980) FLC 90-874 the Full Court of the Family Court of Australia commented on the equivalent provision found in section 79 of the Act. That section deals with an alteration of property interests with respect to couples who have been married. Section 79(2) is in the same terms as section 90SM(3). The Full Court cited with approval a decision of Strauss J in Ferguson & Ferguson (1978) FLC 90-500 where his Honour said:
It seems to me that the main purpose of section 79(2) is to ensure that the court will not alter the property rights of the parties unless it is satisfied that cogent considerations of justice require it to do so, and that if the court decides that it is requisite to make any order under the section, the court must be satisfied that the alteration so ordered, will go no further than the justice of the matter demands.
The appellant also submitted that the learned Federal Magistrate had erroneously failed to have adequate regard, in his favour, to the contribution by him of the sum of approximately $22,161 for the benefit of the parties from April 2007 to the date of purchase of the S property in November 2007.
It was submitted by the appellant that in the period April 2007 to October 2007, the respondent had no income, and that, “except for perhaps a minor property expense”, contributed no monies for the benefit of the parties. The respondent’s bank statements confirm that, between October 2006 and April 2007 the only source of regular deposits of $420.90 on each occasion (with a deposit of $473.50 on one occasion), which later increased to $424.30, was the respondent’s Centrelink payments. For that period, the respondent’s Centrelink payments approximated the sum of $5,106.80 in total.
In his written submissions in response to this complaint, Counsel for the respondent submitted:
26.His Honour made findings in relation to the contributions of the Appellant. His Honour noted “the Applicant drew on his superannuation and most of these monies were contributed to the welfare of the couple. However the respondent also contributed financially to the relationship and each made non-financial contributions”
27.In cross examination the Appellant conceded that he lived rent free for a period in the unencumbered home of the Respondent. The Respondent also gave evidence in cross examination that she did not concede that the Appellant supported her financially during that time and she utilised savings to pay bills and provide her own support. (Footnotes omitted)
In oral submissions, Counsel for the respondent referred the Court to the affidavit of the respondent sworn 2 September 2011 in which she asserted:
16.When the Applicant moved in to my [North Queensland] Property he did not pay me any rent. He also used my motor vehicle to travel to his work, some 75 kilometres away, 5 days a week. Throughout this time I had to get around via buses as I did not have access to a motor vehicle. The Applicant was responsible for fuel costs during this period and some repairs. I felt that this was reasonable given the additional kilometres he was driving which ultimately depreciated the value of my motor vehicle.
17.As I was no longer in receipt of my widow’s allowance I drew down on my savings and withdrew money from my superannuation. This money from my superannuation was transferred into my Bendigo Bank account. I would withdraw large amounts and use cash to fund everyday purchases.
18.I continued to pay costs in relation to my [North Queensland] property after the Applicant moved in. The Applicant would assist with grocery bills and utility expenses but I paid all Body [Corporate] fees, council and water rates.
It is not in doubt that the respondent did not have a source of regular income subsequent to April 2007. We have not been referred to any evidence of the respondent amplifying the assertions in paragraphs 17 and 18 of the respondent’s affidavit, or to any evidence of the appellant challenging them.
The appellant’s contention that he provided the sum of approximately $22,161 for the benefit of the parties during this period was not challenged by Counsel for the respondent, and sensibly so, having regard to the source documentation advanced by the appellant at trial in support of his allegation. Nor was the appellant’s contention with respect to the absence of direct financial contributions by the respondent during this period.

The learned Federal Magistrate’s conclusion with respect to the period from April 2007 until the acquisition of the property acknowledged that, whilst the appellant “would have been making financial contributions”, he “had the benefit of occupying the respondent’s home which was unencumbered” (par 29(c)). Before this Court, neither of these findings was suggested to have been inaccurate.
In his reasons for judgment at paragraph 29(b), the learned Federal Magistrate recorded that each party “would have made contributions both financial and non-financial to the relationship”, and did not suggest that the non-financial contributions of either party were superior to those of the other. His Honour found that “most” of the monies which the appellant obtained from his superannuation “were contributed to the welfare of the couple”. Nothing to the contrary appears to have been put at trial.
To the extent that the learned Federal Magistrate found that the respondent “also contributed financially to the relationship” in this period, the Court has not been referred to any evidence confirming that to have occurred, or to have been possible on any significant regular basis, on the respondent’s own evidence.
In her affidavit of 2 September 2011 the respondent had alleged that:
19.Throughout our cohabitation I was responsible for the majority of the domestic tasks, including but not limited to:
(a)Cooking for the Applicant and I the majority of the time;
(b)Cleaning the inside and outside of the home;
(c)Washing for both the Applicant and myself; and
(d)Gardening, although gardening was a shared activity with the Applicant.
In his affidavit in reply, although referring specifically by number to paragraphs of the respondent’s affidavit with which he disagreed, the appellant did not dispute the allegations of fact which we have recorded above.
In the Case Outline document filed by Counsel then appearing for the respondent at trial, the statement of issues for trial did not refer to non-financial contributions of the kind referred to by the respondent in the affidavit to which we have referred.
As we have earlier recorded, at no time during the trial did either party seek in cross-examination, or otherwise, to suggest that non-financial contributions of either party were superior to those of the other, at any time during the parties’ relationship.
The parties’ relationship was of short duration, on either party’s version of events. At trial, there was no suggestion by either party that his or her non-financial contributions were superior to those of the other party. The learned Federal Magistrate was not required, or possibly even able to make precise findings with respect to the parties’ contributions between October 2006 and October 2007. However, his Honour’s conclusion, at least inferentially, that the parties’ financial and non-financial contributions during this period were equal because the respondent’s greater non-financial contributions counterbalanced the appellant’s greater financial contributions, was not reasonably open on the evidence.
In relation to the period from October 2006 to March 2007, there was, relative to the value of the property of the parties, and their means, a significant imbalance in the financial contributions of the parties favouring the appellant. With respect to him, in our view it was not reasonably open to the learned Federal Magistrate to regard the parties’ overall contributions in that period as equal by, inferentially, concluding that the respondent’s non-financial contributions so exceeded those of the appellant during this period as to counter balance his substantially greater financial contributions.
The position in relation to the period from April 2007 to October 2007 is less straightforward. In terms of indirect financial provision, the evidence is clear, as the learned Federal Magistrate recognised, that the provision by the respondent of rent-free accommodation in her home in North Queensland was a matter which clearly reduced the impact of the direct financial contributions of the appellant in circumstances where the other non-financial contributions made by the parties could not be found to have been unequal.
The difficulty which confronted the learned Federal Magistrate, and this Court, in this regard is the absence of any evidence by reference to which the benefit referrable to having rent-free accommodation in the respondent’s home in North Queensland could begin to be quantified.
Significantly however, the learned Federal Magistrate did not suggest that such benefit effectively offset the appellant’s substantially greater direct financial contributions. To the extent that his Honour relied, as inferentially he did, upon the respondent having made greater non-financial contributions than the appellant in other respects during this period, it was not reasonably open to him to so find, for the reasons we have earlier suggested.
We are accordingly satisfied that, with great respect to the learned Federal Magistrate, and accepting that precision was not required, his Honour’s findings with respect to the parties’ overall contributions in the period October 2006 to October 2007 were not reasonably open to him. The exercise of his Honour’s discretion was potentially vitiated by his reliance upon erroneous findings of fact. The issue becomes whether the errors of fact were material or immaterial to the exercise of his Honour’s discretion (see De Winter v De Winter (1979) 23 ALR 211).
Whilst the sums involved are not great, particularly after regard is had to the probable real value to the appellant of rent-free occupancy of the respondent’s North Queensland property from April 2007 to October 2007, given the ages and earning capacities of the parties, and the modest value of their assets, we are unable to conclude that the learned Federal Magistrate’s error of fact was immaterial to the exercise of his discretion.
As is not in doubt, when exercising the Court’s discretion pursuant to s 90SM of the Act, the learned Federal Magistrate was required to have regard to the evidence with respect to the contributions of the parties over the entirety of their relationship. His Honour’s failure to find, as the evidence required him to, that the appellant’s ultimate contribution based entitlement was enhanced by the disparity of the parties’ financial contributions between October 2006 and October 2007 vitiated the exercise of his discretion.

Asserted erroneous finding in relation to capital contributions to the acquisition of the S property

The appellant complained that the learned Federal Magistrate erred in concluding that the legal title to the S property reflected the respective capital contributions of the parties to its acquisition. Whilst it may be strictly unnecessary to deal with this challenge, having regard to our conclusion with respect to the learned Federal Magistrate’s exercise of discretion pursuant to s 90SM of the Act, nothing to which we have been referred establishes that the learned Federal Magistrate erred in fact in finding as he did with respect to the contributions of each of the parties to the acquisition costs of the S property.
With respect to the appellant, the learned Federal Magistrate accepted that a significant part of the appellant’s superannuation payout in the sum of $74,548.88 was applied for the benefit of the parties prior to the acquisition of the S property. The appellant’s own bank statements are consistent with such finding. The submissions of the appellant in his Notice of Appeal suggest a double counting, at least to the extent that the appellant may be asserting that his contribution to the acquisition of the property total the sum of $211,945.34. No source documentation advanced at trial, or by the appellant supports such a contention.
Nothing to which we have been referred persuades us that the learned Federal Magistrate erred in finding that the parties had contributed the sums which his Honour found that each had to the acquisition of the S property.

Asserted inadequate adjustment in relation to post separation payments by the appellant

The appellant further complained that the learned Federal Magistrate had erroneously:
3.... miscalculated the debt compensation owed to myself, the applicant. He completely ignored the repayments that I alone made during the relationship, of $3898.00. He also ignored the repayments I have had to make (pertaining to the $7045 component of the debt) since separation and continuing to this very day.
In his Notice of Appeal, the appellant amplified this complaint in the following terms:
Regarding the debt compensation that Magistrate Brewster included in his orders ─ reference paragraph 27 ─ the figure of $4295 takes no account of the repayments - $3898 (annexure K) that I alone made during the relationship. Nor does it take into account the figure for the repayments I have had to make (pertaining to the $7045 component of the debt) ─ (annexure Q) since separation. The ANZ bank demands a minimum repayment of $140 per month on a debt of $7045 which calculates to $2520 (18 months @ $140 per month ─ annexure R ─ as at the hearing date and continues to this day (see bank statements). (Errors as in original)
Counsel for the respondent submitted:
31.Annexure K annexed various credit card statements from 28 April 2008 until 21 March 2010. It was not in dispute that this period was during the course of the relationship. The evidence of the Appellant was that “our general practice was to pay for some things with the credit card that was in my name.” Accordingly the $3898 allegedly paid during the relationship would not be an amount that any consideration of adjustment was, or was required to be, considered by His Honour. As referred to in paragraph 24 above, His Honour did not disregard the financial and non-financial contributions of both of the parties during the relationship.
32.His Honour specifically ordered at paragraph 27 of his reasons to “a payment by the respondent to the applicant of an amount to reflect a credit card liability of $7044 assumed by the applicant on separation” Further His Honour found that the credit card was used for the benefit of the parties. The total adjustment ordered was half of the amount plus a calculation of interest, in total $4295.00. (Footnotes omitted)
In his reasons for judgment, the learned Federal Magistrate recorded with respect to this topic:
27.I will also order a payment by the respondent to the applicant of an amount to reflect a credit card liability of $7,044 assumed by the respondent [sic] on separation. Whilst this card was in the name of the applicant alone it was used for the benefit of the parties. Half of this is $3,522. The card carried interest at a rate of 13.24% which equates to $933 per annum or $2.56 per day. From the date of separation until the date of judgment this amounts to $1,546. Half of this is $773. I will order that the respondent pay this amount to the applicant. The total adjustment is therefore $4,295.
Although we accept that it would have been open to the learned Federal Magistrate to adjust in favour of the appellant with respect to this topic to the extent asserted by him, we are not persuaded that the adjustment made by his Honour was erroneous. As is not in doubt, his Honour was exercising a broad discretion (see Norbis v Norbis (1986) 161 CLR 513). The fact that other conclusions may reasonably have been open to him does not render erroneous the conclusion which his Honour made.
In the re-exercise of the learned Federal Magistrate’s discretion, different conclusions may be reached with respect to this topic, particularly given, that, as the appellant submitted before this Court, a further 12 payments of $140 have been made by him, and will continue to be made by him into the future.

Asserted errors in relation to post separation occupation of the S property

The appellant complained that the learned Federal Magistrate had erred by rejecting his claim for an occupation fee with respect to the S property subsequent to the parties’ separation. As is not in doubt, in the post separation period, which was a little over 18 months at the date of judgment of the learned Federal Magistrate, the appellant had not occupied or otherwise benefited from the S property, which had been occupied by the respondent. It is not in doubt that, during her occupancy of the S property, the respondent had met the outgoings with respect to the property, which was unencumbered.
The appellant’s ground of appeal, and Summary of Argument in support of it, focussed almost exclusively upon the learned Federal Magistrate’s asserted error with respect to the appellant’s equitable claim for an “occupation fee” with respect to the post separation period. During the course of the appellant’s oral submissions however, it became apparent to the Court that, although inelegantly articulated, the appellant was also contending that the circumstances which gave rise to his claim for an occupation fee should have resulted in his entitlement pursuant to s 90SM of the Act being enhanced.
With respect to the appellant, nothing asserted by him, either in writing or orally persuades us that the learned Federal Magistrate erred in law in declining to allow the appellant an occupation fee with respect to the S property in the context of s 90SL of the Act. The real issue is whether, in the context of his s 90SM determination, the learned Federal Magistrate erred by failing to have regard, either pursuant to s 90SM(4) or s 90SF(3) to the reality that, for a period slightly exceeding 18 months after the parties separated, the respondent had the benefit of sole occupancy of the S property. The appellant was obliged to find, and pay for, alternative accommodation during that period.
As the transcript of the hearing of the appeal would confirm, given the circumstances in which this aspect of the appellant’s complaints emerged, the Court raised the issue squarely with learned Counsel for the respondent, and invited submissions directed to that issue.
Counsel for the respondent submitted that the learned Federal Magistrate’s discretion pursuant to s 90SM had not miscarried by reason of his failure to make any adjustment in favour of the appellant by virtue of the post separation use and enjoyment of the property.
It was submitted by Counsel for the respondent that the fact that the appellant had chosen to absent himself from the property in the post separation period was a factor upon which the learned Federal Magistrate was entitled to rely in refusing to make an adjustment.
On behalf of the respondent it was further submitted that the reality that the respondent had maintained the S property and paid the outgoings on it during that period, together with the fact that the appellant’s evidence was that he was paying rent of $50 per week, and absence of any evidence of the rental value of the property were matters supporting the learned Federal Magistrate’s refusal to take into account in the appellant’s favour the post separation use and enjoyment of the S property.
The learned Federal Magistrate carefully considered, in the context of s 90SL, the appellant’s claim for an occupation fee in relation to the post separation period. We set out below what his Honour recorded in that regard as it could not be, and was not suggested that anything there said impacted upon the present complaint to the respondent’s advantage:
17.However, as I have indicated, were I to proceed under section 90SL the position would be more complicated than simply dividing the property to 63%/37%. In a common law partition suit there would also need to be a taking of accounts with respect of transactions which occurred after the purchase of the property.
18.In taking accounts regard can be had to the benefits to a co-tenant who is in sole occupancy of the property and an order can be made charging the co-tenant in occupation with an occupation fee. On separation the applicant left the property. The respondent has continued to occupy it. While she has maintained it and paid rates and other outgoings she has not had to make any mortgage payments. The respondent would have me charge her with such an occupancy fee.
19.I do not believe the applicant is entitled to any form of occupation fee. The relevant principle is that a co-tenant is liable to pay an occupation fee to his or her other co-tenant if, and only if, there has been an ouster, that is if the co-tenant in occupation has excluded the other co-tenant from the property. See Dennis v McDonald [1982] Fam 63 and the cases cited therein and Foregeard v Shanahan (1994) 35 NSWLR 206 per Meagher JA at 223. In the present case the respondent did not exclude the applicant from the property but rather he was excluded by operation of law. There was an incident between the parties and the applicant conceded to assaulting the respondent. In consequence of this he was charged by the police with assault and a bail condition was that he not occupy the property. Later an apprehended violence order was taken out by the police which included a similar condition. Under these circumstances I find there has been no ouster and that the applicant is not entitled at common law to payment of an occupation fee.
20.An allowance can also be made for money expended by a co-tenant on the property. In this case each of the parties made lump sum contributions towards renovating the property. Whilst they shared the premises the applicant contributed $29,106 and the respondent $4,250. Taking accounts however does not involve reimbursing each for the amount expended but involves making a pro-rata adjustment to reflect any increase in the value of the property resulting from the expenditure. See for example Brickwood v Young (1905) CLR 387 and Foregeard v Shanahan to which reference has been made.
21.I add for completeness that some of the authorities could be read as establishing a rule that no allowance will be made in favour of a party making improvements unless that party is in sole occupation of the property. For example in Brickwood v Young both Griffith CJ and O’Connor J said that a co-tenant in sole occupation of a property is entitled to a taking of accounts with respect to improvements made by him or her. However it seems to me that those judges were simply reciting the facts of that case and it is one thing to make the type of observation I have referred to and quite another to say that a co-tenant who expends money on improvements whilst sharing the premises with the other co-tenant is not entitled to any compensation. Such a rule would be illogical. None of the authorities of which I am aware require such an interpretation. Given the conclusion I have reached it would be an academic exercise were I to research the authorities to come to a definitive conclusion and I do not propose to do so.
In fairness to the learned Federal Magistrate, it should be recorded that, in final submissions, the appellant did not agitate his claims with respect to post separation occupancy of the S property in the way in which they were ultimately agitated before this Court. The appellant said in that regard only:
MR [SCOFIELD]: ... If I then add the claim of a half rent compensation for the loss of my home, the figure becomes in the high two hundred and eighty thousand dollars. That’s calculated at 75 weeks at $150 per week half rent. So on the strength of the aforesaid, I am asking the court to make a finding of fifty-fifty division of proceeds from the sale of the property. ...
Fairly, learned Counsel for the respondent did not contend, whatever the appellant asserted, or failed to assert at trial, that he should be precluded from raising this issue before this Court. In our view, such a stance was sensible having regard to the principles emerging from the decisions of the High Court in Suttor v Gundowda Pty Ltd (1950) 81 CLR 418, Metwally (No 2) v University of Wollongong (1985) 60 ALR 68 and Coulton v Holcombe (1986) 162 CLR 1.

With respect to the learned Federal Magistrate, and perhaps unsurprisingly, although there is no doubt, having regard to his Honour’s findings of fact, that he appreciated that the respondent had, during her occupancy of the property “maintained it and paid rates and other outgoings” but “not had to make any mortgage payments” (par 18), the issue of post separation use and enjoyment of the S property was not considered in the context of s 90SM of the Act.
Accepting the deficiencies in the evidence to which Counsel for the respondent referred, given the substantial contributions the husband was found to have made to the acquisition, conservation and improvement of the S property until the date of the parties’ separation, failing to have regard to the use and enjoyment of the property in the post separation period, relative to the duration of the parties’ cohabitation, was potentially erroneous.
As we have earlier recorded, Counsel for the respondent submitted that the appellant having chosen to absent himself from the premises provided further support for not adjusting the contribution based entitlements of the parties in favour of the appellant pursuant to s 90SM of the Act.
We are not persuaded that, in the circumstances of this case, the appellant having chosen, to the extent that he did, to absent himself from the premises obviated the need for the learned Federal Magistrate to consider the occupancy of the S property in the post separation period. Had he done so, the learned Federal Magistrate would, in our view, have been obliged to adjust, albeit not on a substantial, but on a more than nominal basis, the entitlements of the parties, to the advantage of the appellant.
In reality, one party was always going to have the considerable advantage of occupying the S property after the parties separated, whilst the other would have to find alternate accommodation. We cannot accept that, to the extent that the appellant “chose” to absent himself from the property, so doing precluded, or should have precluded him from successfully asserting, in the context of s 90SM or s 90SF(3) that an adjustment in his favour by virtue of that fact was appropriate. Each case turns on its own facts and circumstances. It was clearly undesirable, and probably untenable, that the parties continue to occupy the S property after the breakdown of their relationship.

conclusion

For the reasons we have earlier recorded, we are reluctantly persuaded that the learned Federal Magistrate erred in concluding that the appellant should be entitled to 41 per cent of the S property.
The learned Federal Magistrate’s discretion having miscarried, the order pursuant to s 90SM cannot stand. Given our conclusion, it is unnecessary to consider the appellant’s complaints with respect to the learned Federal Magistrate’s rejection of the appellant’s valuation evidence at trial. The issue will assume no significance in the re-exercise of his Honour’s discretion, given that both parties now seek an order for the sale of the property if the appeal is allowed and the discretion of the learned Federal Magistrate is re-exercised.
As the learned Federal Magistrate clearly recognised, when the appellant sought to rely at trial on his valuation evidence, in the event of a sale, a precise finding as to the valuation of the property was unnecessary. Whether the property was worth $430,000, as found by the learned Federal Magistrate at trial, or $445,000, as the appellant’s valuation asserted, could not have had more than minimal significance, so small is the disparity in those valuations ($15,000 over $230,000 at most).
Although nothing now turns upon it, we are not satisfied that the learned Federal Magistrate erred in rejecting the appellant’s valuation evidence at trial on the basis upon which his Honour did. The transcript reveals, cumulatively, a sufficient basis for refusing to allow the appellant to rely upon his valuation at trial.
The appellant’s application for leave to adduce further evidence in relation to matters asserted to have been said by the learned Federal Magistrate, but not recorded in the transcript, can have no practical significance. Even if the learned Federal Magistrate used the words which the appellant and his sister assert in their affidavits of further evidence, as Counsel for the respondent submitted, so doing, could not in any way have advanced any argument urged by the appellant at trial or, before this Court on appeal.
In his oral submissions, the appellant suggested that the alleged missing words of the learned Federal Magistrate demonstrated that the orders made by his Honour “contradicted his own acknowledgment that 63 per cent to 37 per cent was a flagrant misrepresentation of my true entitlements in this case”. Even if his Honour said that, which seems improbable having regard to the statements preceding and following the alleged omitted statements, that does not demonstrate that his Honour erred in any relevant sense. Given that, if the words were used, it was in the course of final submissions at trial, it could not possibly be suggested that they indicated any prejudgment of the matter, or otherwise could have induced the appellant to fail to agitate anything which he otherwise might have.

Consequences of allowing the appeal

Having concluded that the learned Federal Magistrate erred in his assessment of the parties’ contributions between October 2006 and October 2007, and that his Honour erroneously failed to take into account to the appellant’s advantage the post separation use and enjoyment of the S property, appellate intervention is enlivened.
Sensibly in our view, both parties are most anxious to avoid a re-hearing of the proceedings at first instance. As we have earlier recorded, given that both parties now seek the sale of the property, the difficulty potentially confronting this Court in relation to determining the market value of the property has dissolved.
At the conclusion of the hearing, the appellant confirmed that he does not wish to adduce further evidence for the purpose of the re-exercise of the learned Federal Magistrate’s discretion (see Allesch v Maunz (2000) 203 CLR 172).
On instructions, learned Counsel for the respondent informed the Court that his client would file evidence of a recent beneficial change in her financial circumstances. Given that the appellant had no knowledge of such change, and would be unlikely to be able to dispute the evidence of the respondent in relation to it, it is improbable that the filing and serving of such further evidence by the respondent could either prolong the proceedings, or render it inappropriate for this Court to re-exercise the learned Federal Magistrate’s discretion.
For more abundant caution however, and by agreement between the appellant and Counsel for the respondent, we will provide an opportunity for the appellant to either dispute such further evidence of her financial circumstances as the respondent files, and/or make submissions with respect to its significance.
Upon reviewing the further material we will consider whether we can re-exercise the discretion of the Federal Magistrate Court as opposed to remitting the proceedings for re-determination. There is little to be gained, and the risk of detriment to the appellant, if the appeal is now allowed and the orders of the learned Federal Magistrate are set aside, thereby retaining the parties’ legal ownership of the S property. Accordingly, we shall at this stage do no more than record that the appeal is stood over for further consideration pending receipt of further evidence and submissions.

costs

Costs will be dealt with when we finally determine the appeal.

I certify that the preceding eighty-five (85) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Finn, Coleman and May JJ) delivered on 21 November 2012.

Associate:

Date: 21.11.2012