SHIVAS & CHALA
[2019] FCCA 2117
•2 August 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SHIVAS & CHALA | [2019] FCCA 2117 |
| Catchwords: FAMILY LAW – Property – undefended – husband did not participate in proceedings – weight to be given to the contributions of each party – whether there should be an adjustment in favour of either party – husband to transfer interest in property to the wife – each party to retain their own superannuation entitlements. |
| Legislation: Child Support (Assessment) Act 1989 (Cth) Evidence Act1995 (Cth), s.140 Federal Circuit Court Rules (Cth), rr.13.03(1)(e), 21.15 Family Law Act 1975 (Cth), ss.75(2), 79, 106A Residential Tenancies Act 1997 (Vic) |
| Cases cited: In the Marriage of Hickey [2003] FamCA 395 Stanford v Stanford (2012) 247 CLR 10 Townsend and Townsend (1995) FLC 92-569 |
| Applicant: | MS SHIVAS |
| Respondent: | MR CHALA |
| File Number: | MLC 6801 of 2018 |
| Judgment of: | Judge C. E. Kirton QC |
| Hearing date: | 29 November 2018 |
| Date of Last Submission: | 29 November 2018 |
| Delivered at: | Melbourne |
| Delivered on: | 2 August 2019 |
REPRESENTATION
| Counsel for the Applicant: | Mr Richardson |
| Solicitors for the Applicant: | Legoll Legal Practitioners |
| No appearance by the Respondent |
ORDERS
Within 28 days of the issuing of these Orders the Respondent (Husband) do all such things and sign all necessary documents so as to transfer to the Applicant (Wife) all his right, title and interest in the property situated at A Street, Suburb B, in the State of Victoria, being the whole of the land comprised in Certificate of Title Volume … Folio … (A Street, Suburb B Property), free from any encumbrances.
Within 45 days of the making of these Orders, the Husband do all such things and sign all necessary documents to transfer to the Wife all his right, title and interest in the property situated at G Street, Suburb H, G Street, Suburb H in the State of Victoria, being all the land comprised in Certificate of Title Volume … Folio … (G Street, Suburb H).
Contemporaneously with the transfer set out in Order 2, the parties do all such acts and things and sign all necessary documents to discharge the existing mortgage on the G Street, Suburb H and replace it with a mortgage registered in the name of the Wife alone.
In the event that the Wife is unable to refinance the mortgage on the G Street, Suburb H, then the Wife be appointed Trustee for the parties to effect the immediate sale of the G Street, Suburb H for the best price reasonably obtainable and that such sale occur either by way of private treaty or public auction as determined by the Wife.
In order to give effect to these Orders the Trustee:
(a)Cause to be prepared a contract of sale for the G Street, Suburb H;
(b)List the G Street, Suburb H for sale by private treaty or public auction with any real estate agent she so desires (Agent);
(c)Execute all documents requested by the Agent for the sale of the G Street, Suburb H;
(d)Shall fix the listing price for private sale or the reserve price for any price recommended by the listing Agent in writing;
(e)Shall be entitled to accept any offer made to purchase the G Street, Suburb H within 10% of the Agent’s recommended sale price or reserve price set for auction.
Upon the sale of the G Street, Suburb H, the sale proceeds be distributed as follows:
(a)Payment of the Agent’s commission and advertising expenses and the legal expenses of the sale;
(b)Payment of any money due and owing pursuant to the mortgagee;
(c)The balance to be paid to the Wife.
Until completion of the sale of the G Street, Suburb H, the Husband shall direct the managing property agent and/or tenant to pay any rental income received on the G Street, Suburb H towards the mortgage, council rates and water rates in respect of the G Street, Suburb H and for any balance remaining thereafter to be paid to the Wife.
The Wife shall be paid the net sale proceeds from the sale of the property situated at C Street, Suburb D, in the State of Victoria and being the whole of the land described in Certificate of Title Volume … Folio ….
The Husband retain all interests in:
(a)The property situated at City K., India.
(b)The two vacant lots in City L.
(c)Any other properties, including the business known as ‘Business M’, as held in the name of the Husband India.
The parties retain all their right, title and interest in and to their superannuation entitlements and have no further claim on the entitlements of the other.
In the event that either party refuses or neglects to execute any deed or instrument within three days of being requested to do so in writing, the Registrar of the Court be appointed pursuant to s.106A of the Family Law Act 1975 (Cth) to execute such deed or instrument in the name of such party and to do all acts and things necessary to give operation to the said deed or instrument.
The party in default pursuant to Order 11 is Ordered to pay all reasonable solicitor/client costs incurred by the party not in default and for the purpose of enforcing this Order such amount is to be in accordance with the scale of the Federal Circuit Court unless otherwise agreed.
Unless otherwise specified in these Orders and except for the purposes of enforcing the payment of any money under these or any subsequent orders:
(a)Each party be solely entitled to the exclusion of the other to all property, including choses-in-action, in the possession of such party as at the date of these orders;
(b)Any money standing to the credit of the parties in a bank account are to be retained by the party in whose name the account appears;
(c)All insurance policies are to become the sole property of the owner named thereon;
(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;
(e)Any joint tenancy of the Husband and Wife in any real or personal estate is hereby expressly severed.
There be leave to the Wife to relist this proceeding on the issue of implementation of these Orders.
Within seven days of the date of these Orders, the Wife is to serve a copy of the Judgment and the Orders in this proceeding on the Husband.
Within 14 days of the date of these Orders the Wife’s solicitors file an affidavit attesting to service as provided for in Order 15 of these Orders.
All extant applications are otherwise dismissed.
Pursuant to r.21.15 of the Federal Circuit Court Rules 2001 (Cth), the Court certifies that it was reasonable for the Wife to employ an advocate.
IT IS NOTED that publication of this judgment under the pseudonym Shivas & Chala is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLC 6801 of 2018
| MS SHIVAS |
Applicant
and
| MR CHALA |
Respondent
REASONS FOR JUDGMENT
Introduction
The Applicant (Wife) and the Respondent (Husband) were born in India. The Husband migrated to Australia in about 1994. The parties married in India on … 1997 and the Wife migrated to Australia to join the Husband in … 1998 when she was granted a visa. The parties are the parents of Ms N (Ms N), born on … 1999 and [X] ([X]) born on … 2007 (together the Children).
In … 2016 the Husband returned to India where he presently lives. He has had little subsequent contact with the Wife and no contact with the Children. The Wife commenced this proceeding for a property settlement. The Husband has not participated in this proceeding despite being served with the Court documents.
Issues to be Determined
The following issues required determination in this proceeding:
a) The weight to be attributed to the contributions of each party at the commencement of the relationship and during the relationship.
b) Whether there should be an adjustment in favour of either party pursuant to any of the factors relevant to s.79(4) and 75(2) of the Family Law Act1975 (Cth) (Act).
Synopsis
I have determined that:
a)The Husband transfer his interest in the former matrimonial home situate at A Street, Suburb B, in the State of Victoria (A Street, Suburb B Property) to the Wife, free from any encumbrances.
b)The Husband transfer his interest in the property situate at G Street, Suburb H, in the State of Victoria (G Street, Suburb H) to the Wife.
c)The Wife be paid the net proceeds of sale of the property situated at C Street, Suburb D, in the State of Victoria (C Street, Suburb D Property).
d)The parties each retain their own superannuation entitlements.
e)The Husband retain the properties he owns in India and the business he operates known as ‘Business M’.
The reasons for my determination follow.
Background
The Wife was married to the Husband on … 1997 in a traditional Hindu wedding ceremony and cohabitation commenced on that date. The marriage was arranged by the parties’ respective extended families and the Wife was not consulted on the matter. The Wife met the Husband 20 days prior to the date of the Hindu wedding ceremony[1].
[1] Wife’s First Affidavit, at [8].
At the conclusion of the Hindu wedding ceremony the Wife left her families’ home and moved to the Husband’s family residence at City O, India. On … 1997 the parties were married legally in India[2].
[2] Ibid; at [5].
The Husband returned to Australia on … 1997. He returned to India on … 1997 and remained for some six months. In … 1998 the Husband was granted Australian citizenship. In … 1998 the Wife was granted a visa to live in Australia with the Husband. In … 1998 the Husband returned to India and then in … 1998 the parties both left India for Australia[3].
[3] Ibid; at [14], [16]-[18].
Upon their arrival in Australia the parties lived in rented accommodation at Suburb P.
Ms N was born on … 1999.
In about November the Husband purchased a property at E Street, Suburb F, for $103,000 and registered it in his sole name[4] (E Street, Suburb F Property).
[4] Ibid; at [26].
In … 2000 the family travelled to India and they stayed with the Husband’s parents. In … 2000 the Husband returned to Australia. After the Husband returned to Australia he informed the Wife that she and Ms N must stay in India until he decided otherwise[5].
[5] Ibid; at [28].
In … 2001 the Husband returned to India and informed the Wife that he had sold the E Street, Suburb F Property and that the family were moving to India, instead of returning to Australia. The family lived in India for approximately three years[6].
[6] Ibid; at [29].
On … 2004 the family returned to Australia and moved into rented premises in Suburb R. In … 2005 the Husband purchased the A Street, Suburb B Property and registered it in his sole name[7].
[7] Ibid; at [32].
[X] was born on … 2007.
On or about 9 October 2014 the parties separated under the same roof. In … 2016 the Husband returned to India. Since that time the Wife has had little contact with the Husband other than occasional text messages[8].
[8] Ibid; at [43].
On 14 August the Wife made and application for Divorce and the Divorce was granted on 30 October 2018[9].
[9] Wife’s Second Affidavit, at [14].
Procedural History
The Wife commenced these proceedings by filing an Initiating Application on 19 June 2018 (Initiating Application). The Initiating Application sought interim and final property orders. The interim orders sought were that:
a) The Husband do all acts and things and sign all documents necessary to effect the sale of the C Street, Suburb D Property and for that purpose the following should apply:
i) The C Street, Suburb D Property shall be listed for sale by way of public auction with a real estate agent nominated by the Wife within 10 days from the date of these orders;
ii) The parties shall execute all documents requested by the auctioneer for sale of the C Street, Suburb D Property by auction;
iii)The reserve price of the C Street, Suburb D Property shall be nominated by the Wife in consultation with the auctioneer;
iv)The auction will take place within three months of the date of these orders or such earlier date as determined by the auctioneer;
v) The Wife otherwise have the exclusive conduct of the auction process.
b) Upon settlement of the sale of the C Street, Suburb D Property the proceeds be distributed in the following manner and priority:
i) To discharge any mortgage secured over the C Street, Suburb D Property;
ii) To pay out any agents commission and advertising expenses and legal expenses relating to the sale;
iii)To reduce down any mortgage secured over the A Street, Suburb B Property;
iv)In the event that the proceeds allow, then an amount of up to $30,000 be paid to the Wife, which sum will be brought into Court as a partial property settlement upon the final resolution of these proceedings;
v) If any additional proceeds from the sale remain, then such amount be held on trust by the Wife’s solicitors, pending final resolution of these proceedings.
c) Alternatively the Registrar of this Court be appointed pursuant to s106A of the Act to sign and give effect to all necessary documents as may be required to implement the terms of these Orders.
d) The Husband irrevocably authorise the Wife to communicate with the ANZ Bank and obtain any documents pertaining to the registered mortgage over the A Street, Suburb B Property and the C Street, Suburb D Property.
e) Alternatively, the Registrar of this Court be appointed pursuant to s.106A of the Act to sign an irrevocable authority to give effect to the terms of these Orders, upon provision of the irrevocable authority to the Registrar by the Wife’s solicitors.
f) The Husband not encumber the A Street, Suburb B Property or the C Street, Suburb D Property without the consent in writing of the Wife or any mortgagee.
g) The Husband be restrained from increasing the amount of any mortgage account secured by the A Street, Suburb B Property, the C Street, Suburb D Property or the G Street, Suburb H.
h) The Wife be excused from particularising any claim for property settlement until the Husband provides financial disclosure.
i) That within 21 days the Husband provide to the Wife full and frank financial disclosure.
j) The Husband pay the Wife’s costs of and incidental to these proceedings.
The final orders sought in the Initiating Application were that:
a) The Husband transfer all his interest in the A Street, Suburb B Property to the Wife for her sole use and benefit.
b) The Husband do all acts and things and sign all documents necessary to pay out and discharge any mortgage in favour of the ANZ Bank secured over the A Street, Suburb B Property.
c) The remaining assets of the marriage be distributed on a just and equitable basis.
d) The Wife be excused from particularising any claim for property settlement until the Husband provides financial disclosure.
e) The Husband pay the Wife’s costs of and incidental to these proceedings.
The Wife also filed an Affidavit in support of her Initiating Application (Wife’s First Affidavit)[10] and a Financial Statement (Wife’s Financial Statement)[11]. An Affidavit of Service was filed on 6 July 2018[12] where the deponent deposed that the Husband was personally served in City L, India on 27 June 2018 with the Initiating Application, the Wife’s Affidavit and the Wife’s Financial Statement.
[10] Wife’s Affidavit, affirmed 18 June 2018, filed 19 June 2018.
[11] Wife’s Financial Statement, affirmed 19 June 2018, filed 19 June 2018.
[12] Affidavit of Mr J, sworn 4 July 2018, filed 6 July 2018.
The proceeding first came before the Court in the Duty List on 11 July 2018 (First Hearing). The Husband did not appear at the First Hearing. The Wife was represented by Counsel. The following Orders were made at the First Hearing:
a) The proceeding be adjourned to 11 September 2018 at 9:30 am for mention.
b) Within seven days of being requested by the Applicant’s Solicitors, Legoll Lawyers, the Husband do all acts and things and sign all necessary documents to effect the sale of the C Street, Suburb D Property and that for that purpose:
i) The C Street, Suburb D Property be listed for sale by way of public auction or private sale with a real estate agent nominated by the Wife within 10 days from the date of the Orders;
ii) The parties execute all documents required by the real estate agent for the sale of the C Street, Suburb D Property by auction or private sale;
iii)The reserve price of the C Street, Suburb D Property be nominated by the Wife in consultation with the real estate agent;
iv)The Wife otherwise had the exclusive conduct of the sale process.
c) Upon settlement of the sale of the C Street, Suburb D Property the proceeds of sale be disbursed in the following manner and priority:
i) To discharge any mortgage secured over the C Street, Suburb D Property;
ii) To pay out any agent’s commission and advertising expenses and legal expenses relating to the sale;
iii)To reduce any mortgage secured over the A Street, Suburb B Property;
iv)In the event that the proceeds of the sale allow, then an amount of up to $30,000 be paid to the Wife, which sum will be brought into Court as a partial property settlement upon the final resolution of the proceeding;
v) If any additional proceeds from the sale remain, then such amount to be held on trust by the Wife’s solicitors, Legoll Lawyers, pending final resolution of the proceeding.
d) In the event that the Husband fails to comply with the Orders referred to in sub-paragraph (b), the Registrar of the Court be appointed pursuant to s.106A of the Act to sign and give effect to all necessary documents as may be required to implement the terms of the Orders, including the signing of all documents required to give effect to the sale of the C Street, Suburb D Property, upon provision of the relevant documents to the Registrar by the Wife’s solicitors.
e) Within seven days of the date of the Orders the Husband irrevocably authorise the Wife to communicate with the ANZ Bank in obtaining any documents (including loan agreements, loan statements, instalment arrears statements, default notices and balance statements) pertaining to the registered mortgage over the A Street, Suburb B Property and the C Street, Suburb D Property.
f) In the event that the Husband fails to comply with the Orders referred to in subparagraph (e), the Registrar of the Court be appointed pursuant to s.106A of the Act to sign an irrevocable authority to give effect to the terms of the Orders, upon the provision of the irrevocable authority to the Registrar by the Wife’s solicitors.
g) The Husband not encumber the A Street, Suburb B Property or the C Street, Suburb D Property without the consent in writing of the Wife or any mortgagee.
h) The Husband be restrained from increasing the amount of any mortgage account secured by the A Street, Suburb B Property, the C Street, Suburb D Property or the G Street, Suburb H Property.
i) The Wife be excused from particularising any claim for property settlement until the Husband provides financial disclosure.
j) Within 21 days the Husband provide to the Wife full and frank financial disclosure.
k) Any communication by the Wife or her solicitor with the Husband may occur by email to the address … (Husband’s Email Address).
On 7 August 2018 the Wife’s lawyers filed an Affidavit of Sapna Khan, the Solicitor with the care and conduct of the matter on behalf of the Wife[13] (Solicitor’s First Affidavit). In the Solicitor’s First Affidavit Ms Khan deposed that she had served an Irrevocable Authority and an Exclusive Sales Authority for the C Street, Suburb D Property on the Husband via the Husband’s Email Address on 25 July 2018, in accordance with the Orders made at the First Hearing (11 July 2018 Orders). A copy of the 11 July 2018 Orders was also served on the Husband[14]. Ms Khan deposed that the Husband had not responded to her email or signed and returned the documents to her. The Wife’s lawyers sought orders pursuant to s.106A of the Act that a Registrar of the Court sign the Irrevocable Authority and the Exclusive Sale Agreement.
[13] Affidavit of Sapna Khan, affirmed 2.8.18, filed 7.8.19.
[14] Solicitor’s First Affidavit, at [3] and Exhibit SK-2.
A Registrar of the Court subsequently signed the Irrevocable Authority and the Exclusive Sales Authority for the C Street, Suburb D Property pursuant to the 11 July 2018 Orders and pursuant to s.106A of the Act.
On 10 September 2018 the Wife’s lawyers filed a further Affidavit of Sapna Khan[15] (Solicitor’s Second Affidavit). In the Solicitor’s Second Affidavit Ms Khan deposed that she had served a Contract of Sale of Real Estate (Contract of Sale) and a Vendor Statement for the C Street, Suburb D Property on the Husband via the Husband’s Email Address on 29 August 2018[16]. Ms Khan deposed that the Husband responded by email from the Husband’s Email Address on 29 August 2018. The Husband said:
[15] Affidavit of Sapna Khan, affirmed 7.9.18, filed 10.9.18.
[16] Solicitor’s Second Affidavit, at [3] and Exhibit SK-2.
I have contacted the local (India) lawyer given most of the information They need 1 week to study and come back I will wait for their instruction. mean time please do feature correspondence to this mail id
…. I won’t be using the Mr Chala id[17].
[17] Ibid; Exhibit SK-3.
(as written)
Ms Khan deposed in the Solicitor’s Second Affidavit that on 6 September 2018 she sent a further email to the Husband requesting a response to her email of 29 August 2018. The Husband did not send to the Wife’s lawyers the signed Contract of Sale[18]. The Wife’s lawyers sought orders pursuant to the 11 July 2018 Orders and s.106A of the Act that a Registrar of the Court sign the Contract of Sale.
[18] Ibid; at [6] and Exhibit SK-4.
In the Second Solicitor’s Affidavit Ms Khan also deposed that the Husband had sent her emails on 14 August 2018, 15 August 2018, 17 August 2018 and also on 29 August 2018[19]. These emails indicate that the Husband was clearly aware that the Wife had commenced legal proceedings in Australia and that the C Street, Suburb D Property was about to be sold.
[19] Ibid; at [8] and Exhibit SK-5.
A Registrar of the Court subsequently signed the Contract of Sale pursuant to the 11 July 2018 Orders and pursuant to s.106A of the Act.
The proceeding next came before the Court on 11 September 2018 for Mention (Second Hearing). The Wife was represented by Counsel and there was no appearance by the Husband. The following orders were made at the Second Hearing (11 September 2018 Orders):
a) The proceeding be listed for final hearing on 29 November 2018 at 10:00 am with an estimated hearing time of one day.
b) The Wife’s Solicitors serve a copy of the Orders on the Husband and they file an affidavit attesting to service on the Husband by 25 September 2018.
c) The Husband by 25 September 2018:
i)File and serve a Response, Affidavit and Financial Statement;
ii)Provide full and frank financial disclosure to the Wife.
d) In the event that the Husband failed to comply with the Orders referred to in sub-paragraph (c), the Wife was granted leave to apply to proceed upon an undefended basis at the final hearing.
e) Liberty to apply.
f) Trial directions were also made.
On 24 September 2018 the Wife’s lawyers filed a further Affidavit of Sapna Khan[20] (Solicitor’s Third Affidavit). In the Solicitor’s Third Affidavit Ms Khan deposed that on 19 September 2018 she served a copy of the 11 September 2018 Orders made at the Second Hearing on the Husband via:
a) The Husband’s Email Address; and
b) …[21] (together the Husband’s Email Addresses).
[20] Affidavit of Sapna Khan, affirmed 24.9.18, filed 24.9.18.
[21] Loc. cit.
Ms Khan also deposed in the Solicitor’s Third Affidavit that the Husband had responded to her email sent on 19 September 2018 in an email sent on 20 September 2018[22]. This email correspondence from the Husband demonstrated that the Husband was aware that the proceeding was listed for final hearing on 29 November 2018 at 10:00 am and that he had been served with a copy of the 11 September 2018 Orders.
[22] Solicitors Third Affidavit, at [4] and SK-2.
On 2 October 2018 the Wife’s lawyers filed a further Affidavit of Sapna Khan[23] (Solicitor’s Fourth Affidavit). In the Solicitor’s Fourth Affidavit Ms Khan deposed that on 21 September 2018 she served on the Husband via the Husband’s Email Addresses an ANZ Discharge Authority Form together with some other documents relating to the sale of the C Street, Suburb D Property and requested that he sign the documents and return them to her. The Husband did not respond to her email or return the documents to the Wife’s lawyers[24]. The Wife’s lawyers requested that a Registrar of the Court sign the ANZ Discharge Authority Form and the other documents pursuant to the 11 September 2018 Orders and s.106A of the Act.
[23] Affidavit of Sapna Khan, affirmed 1.10.18, filed 2.10.18.
[24] Solicitor’s Fourth Affidavit, at [2]-[3] and Exhibit SK-1.
On 9 October 2018 the Wife’s lawyers filed a further Affidavit of Sapna Khan[25] (Solicitor’s Fifth Affidavit) responding to requisitions from a Registrar of the Court, in relation to the Wife’s lawyers request that a Registrar of the Court sign an ANZ Discharge Authority Form pursuant to s.106A of the Act.
[25] Affidavit of Sapna Khan, affirmed 1.10.18, filed 2.10.18.
In the Solicitors Fifth Affidavit Ms Khan deposed that:
a) The 11 July 2018 Orders incorrectly recorded the Husband’s Email Address[26].
b) She had corresponded with the Husband at … and the Husband had responded from this email address[27].
c) On 29 August 2018 she was informed by the Husband of his new email address of …. From that date she corresponded with the Husband at both … and …[28].
d) The Husband has written to her from the email address of …[29].
[26] Ibid; at [3(a)].
[27] Ibid; at [3(b)].
[28] Ibid; at [3(c)] and [5].
[29] Loc. Cit.
A Registrar of the Court subsequently signed an ANZ Discharge and Variation Authority pursuant to the 11 July 2018 Orders and pursuant to s.106A of the Act.
On 12 November 2018 the Wife filed an Affidavit[30] (Wife’s Second Affidavit). On 28 November 2018 the Wife filed an Outline of Case (Outline of Case).
[30] Affidavit of the Wife, affirmed 9.11.18, filed 12.11.18
The proceeding next came before the Court at the final hearing on 29 November 2018 (Final Hearing). The Wife was represented by Counsel and the Husband did not appear when called. The Wife sought to proceed with the Final Hearing in the absence of the Husband.
Counsel for the Wife tendered an Affidavit by Sapna Khan[31] (Solicitor’s Sixth Affidavit). Ms Khan deposed that she had served the Wife’s Second Affidavit and the Outline of Case on the Husband via the email addresses … and …. Ms Khan’s correspondence also reminded the Husband that the Final Hearing was listed for 29 November 2019[32]. The Husband had not responded to the correspondence from Ms Khan[33].
[31] Exhibit A1, Affidavit of Sapna Khan, affirmed 28.11.18.
[32] Exhibit A1, Solicitor’s Sixth Affidavit, at [2] and Exhibit SK-1.
[33] Exhibit A1, Solicitor’s Sixth Affidavit, at [2] – [5].
The Final Hearing proceeded in default of appearance of the Husband pursuant to r. 13.03C(1)(e) of the Federal Circuit Court Rules 2001 (Cth). By reason of the matters referred to in paragraphs 17 to 36 I was satisfied that the Husband had been personally served with the Initiating Application, Wife’s Financial Statement and the Wife’s First Affidavit and that he had subsequently been kept informed of the progress of the proceeding in this Court by the Wife’s solicitors.
The Proposal of the Wife at Trial
The Orders sought by the Wife in the Outline of Case are summarised as:
a) Within 28 days of the making of the Orders the Husband do all things necessary to transfer to the Wife all his right, title and interest in the A Street, Suburb B Property, free from any encumbrances.
b) Within 45 days of the making of the Orders the Husband do all things necessary to transfer to the Wife all his right title and interest in the G Street, Suburb H Property.
c) Contemporaneously with the transfer referred to in sub-paragraph (b), the parties do all things necessary to discharge the existing mortgage on the G Street, Suburb H and replace it with a mortgage to the Wife alone.
d) In the event that the Wife is unable to refinance the mortgage on the G Street, Suburb H Property, then the Wife be appointed Trustee for the parties to effect the immediate sale of the G Street, Suburb H Property for the best reasonably obtainable price and that sale occur either by way of private treaty or public auction as determined by the Wife.
e) Orders for the Wife as Trustee to give effect to the sale of the G Street, Suburb H Property.
f) Upon the sale of the G Street, Suburb H Property, the sale proceeds be distributed as follows:
i)Payment of agents commission and advertising expenses and legal expenses of the sale;
ii)Payment of any money due and owing to the mortgagee;
iii)The net balance to be paid to the Wife.
g) Until completion of the sale of the G Street, Suburb H Property the Husband shall direct the managing property agent and/or tenant to pay any rental income received towards the mortgage, council rates and water rates in respect of the G Street, Suburb H Property and any balance remaining thereafter to be paid to the Wife.
h) The Wife to be paid the net sale proceeds from the sale of the C Street, Suburb D Property currently held in trust by the Wife’s solicitors, noting that the Wife has been paid an amount of $30,000 towards her legal costs and expenses of this proceeding.
i) The Husband retain all his interests in the properties situated at:
A.City K, India.
B.Two vacant lots in City L.
j) The Husband retain all interest in any other properties including the business known as ‘Business M’, held in the name of the Husband in India.
k) The parties retain their respective superannuation entitlements and have no further claim on such entitlements of the other.
l) The parties otherwise retain the sole right to any other property which is at the date of the orders in their possession, title or name and they shall be solely liable for and indemnify the other against any personal liabilities.
m) In the event that either party refuses or neglects to execute any deed or instrument within three days of being requested to do so in writing, the Registrar of the Court be appointed pursuant to s. 106A of the Act to execute such document in the name of such party.
n) The party in default be ordered to pay all reasonable solicitor/client costs incurred by the party not in default for the purpose of enforcing the Orders.
o) Liberty to apply in relation to the implementation of the Orders.
p) The Wife to serve a copy of the Orders on the Husband within seven days.
Documents Relied on by the Wife
The Outline of Case states that the Wife relies upon the following documents:
a) Initiating Application.
b) Wife’s Financial Statement.
c) Wife’s First Affidavit.
d) Wife’s Second Affidavit.
Evidence
The standard of proof in this case is the balance of probabilities[34].
[34] Section 140 Evidence Act1995 (Cth).
Section 140 of the Evidence Act1995 (Cth) provides:
(1) In a civil proceeding, the court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities.
(2) Without limiting the matters that the court may take into account in deciding whether it is so satisfied, it is to take into account:
(a) the nature of the cause of action or defence; and
(b) the nature of the subject-matter of the proceeding, and
(c) the gravity of the matters alleged.
The Wife relied upon her affidavits and the Wife’s Financial Statement. The evidence set out the history of the parties’ marriage and covered financial matters. I do not propose to repeat it in this judgment.
The Wife gave limited evidence. I therefore had the benefit of observing her in the witness box for a period of time and observing her demeanour in the Court throughout the proceeding. I had no reason to doubt the veracity of the Wife’s evidence.
Relevant Legislation
Section 79 of the Act regulates the alteration of property interests of parties to a marriage. Section 79(1)(a) of the Act provides that the Court may make such orders as it considers appropriate to alter the interests of the parties in the property.
Section 79(2) of the Act provides as follows:
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 which the Court must take into account when considering what order (if any) should be made.
Section 79(4) provides:
In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(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.
Prior to the decision of the High Court in Stanford v Stanford[35] (Stanford) the preferred approach to the determination of property matters pursuant to s.79 of the Act was set out by the Full Court in the matter of In the Marriage of Hickey[36] (Hickey).
[35] (2012) 247 CLR 108.
[36] [2003] FamCA 395, 78,386.
This approach involved four interrelated steps as follows:
a) First, the Court should make findings as to the identity and value of the property pool.
b) Second, the Court should determine the contributions of the parties pursuant to ss.79(4)(a), (b) and (c), being both the direct and indirect contributions, including financial and non-financial contributions and then determine the contribution based entitlements of each of the parties, as a percentage of the value of the property of the parties.
c) Third, the Court should identify and assess the relevant matters in ss.79(4)(d), (e), (f) and (g), including the matters referred to in s.75(2) to the extent that they are relevant and determine whether any further adjustment should be made to the contribution based entitlements of the parties.
d) Fourth, the Court should consider the effect of the findings and determination and decide what order is just and equitable in all the circumstances of the case.
In Stanford the High Court said that before making any orders for the adjustment of parties’ property interests, the Court must first determine whether it is just and equitable to make any property orders, or to alter the parties’ interests in property. The High Court stated:
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[37].
[37] (2012) 247 CLR 108, at [37].
The High Court further stated:
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)[38].
[38] Ibid., at [42].
Therefore in most proceedings for the alteration of matrimonial property interests, the decision as to whether or not it is just and equitable for the Court to make property orders is resolved by the breakdown of the marital relationship and the mutual applications of the parties to the Court for orders altering their respective property interests.
Is it just and equitable to alter the parties’ property interests?
In this matter the parties have separated and the Wife has made an application to the Court seeking orders altering their respective property interests.
The parties are no longer living in a marital relationship and consequently there will not “thereafter be the common use of property by the husband and the wife”[39].
[39] Loc. Cit.
I am therefore satisfied that it is just and equitable to alter the parties’ property interests.
Having been satisfied that it is just and equitable to make an order altering the property interests of the parties, the approach and considerations I must make are as follows:
a) Attribute value to the assets comprising the property pool.
b) Identify and give weight to the various contributions of each of the parties as set out in s.79(4) (a) – (c) and make an assessment as to the entitlements of the parties based on their respective contribution.
c) Identify the relevant considerations as set out in s.79(4)(d)-(g), including the matters set out in s.75(2) so far as they are relevant, and then decide whether any further adjustment is appropriate.
d) Consider whether the proposed orders are just and equitable.
The Assets and Liabilities of the Parties
The Outline of Case includes the following summary of assets and liabilities[40] (List of Assets and Liabilities):
[40] Outline of Case, Part C, p.6-7.
Asset
Ownership
Value
Part net sale proceeds from sale of C Street, Suburb D Property released to the Wife pursuant to Order 3(d) of the 11 July 2018 Orders
Husband
$30,000.00
Balance net sale proceeds from sale of C Street, Suburb D Property held in trust by Wife’s lawyers
Husband
$26,242.93
A Street, Suburb B Property
Husband
$555,000.00
G Street, Suburb H Property
Husband
$147,000.00
City K, India
Husband
$73,681.20
Business ‘Business M’, India
Husband
Unknown
Vacant lots in City L India (2 separate lots)
Husband
$60,000.00
Addback of term deposit withdrawn by Husband
$59,156.42
$59,156.42
Husband’s bank accounts
Husband
Unknown
Wife’s bank accounts
Wife
$500.00
Furniture and chattels
Joint
$500.00
Motor vehicle
Wife
$15,000.00
Motor vehicle (in Australia)
Husband
$1,000.00
Total asset pool
$968,080.55
Liabilities
Ownership
Value
Council Rates payable for A Street, Suburb B Property
Husband
$3,726.47
Mortgage on G Street, Suburb H Property
Husband
$111,513.76
Total Liabilities
$115,240.23
Net assets
$852,840.32
Superannuation
Ownership
Value
Australian Superannuation
Wife
$4,500.00
Husband’s Superannuation
Husband
$65,000 at 8.9.15
Notional Addback of Property to the Asset Pool
In order to determine the property pool for distribution between the Husband and the Wife, it is necessary to consider the principles relevant to the notional addback of property to the asset pool.
Husband’s Withdrawal of $59,156.42 from the Term Deposit
On 13 February 2012 the Husband deposited $60,000 with the ANZ by way of a term deposit (Term Deposit). On 29 June 2018 the Husband closed the Term Deposit facility. After deduction of fees and charges incurred, the Husband received the sum of $59,156.42[41].
[41] Wife’s Second Affidavit, at [19(g)] and Exhibit S-20.
It is not known what has become of this money other than it has been transferred to the Husband in late June 2018. It is however evident that this money was withdrawn from the Term Deposit two days after the Husband was personally served with the Initiating Application and other Court documents in India on 27 June 2018[42]. Further the removal of the funds from the Term Deposit has caused financial loss, as the amount received by the Husband was less than the $60,000 originally deposited six years earlier.
[42] Affidavit of Mr J, sworn 4 July 2018, filed 6 July 2018.
Characterisation of the Husband’s Withdrawal of $59,156.42 from the Term Deposit
I intend to treat the Husband’s withdrawal of the funds from the Term Deposit after the commencement of this proceeding as a premature distribution of a proportion of the matrimonial assets in accordance with the approach adopted by the Full Court in Townsend and Townsend[43]. In that case the Nicholson CJ said:
[…] what occurred in this case, as I said during the course of argument was, in fact, a premature distribution of a proportion of the matrimonial assets. What the husband did was to distribute to himself an asset in which the wife had a legitimate interest. In such circumstances I consider that it would be unjust in the extreme to simply treat such conduct by the husband as a matter to which regard should be had under section 75(2). It seems to me that the husband has had the benefit of that money. Had he retained, for example, the taxi licence instead of selling it, that would have been brought into account as an item of property which would have been dealt with in the same way as the remaining items of property in this case. Accordingly, I am of the view that the correct way in which to deal with the husband’s receipt of those moneys is to bring them into the pool of assets on a notional basis and make a distribution accordingly[44].
[43] (1995) FLC 92-569.
[44] Ibid., at 81,654.
The Husband received the sum of $59,156.42 from the proceeds of the Term Deposit which were accumulated during the relationship. The sum of $59,156.42 has been included in the List of Assets and Liabilities in the Outline of Case.
Findings as to Asset Pool for Distribution between the Parties
The Husband has depleted the net amount available to the assets of the parties by withdrawing the sum of $59,156.42 from the Term Deposit. Accordingly I find that the sum of $59,156.42 is appropriately included in the List of Assets and Liabilities.
I find the List of Assets and Liabilities determines the assets and liabilities of the parties.
Contributions
Financial Contributions Section 79(4)(a)
Initial Contributions
At the commencement of the relationship in … 1997 the Husband was working in Australia as a tradesman. He had two vacant lots registered in his name[45]. These are the two lots referred to in the List of Assets and Liabilities as ‘Vacant lots in City L India (2 lots)’ and valued at $60,000.
[45] Wife’s Second Affidavit, at [20].
The Wife did not have any assets of significant value at the time the parties married[46].
[46] Loc. cit.
Contributions During the Marriage
The Husband worked throughout the relationship. As the Husband has not participated in this proceeding he has failed to provide any financial disclosure of his income during the relationship.
The Wife commenced work in 2007 and her income was deposited into the Husband’s account from which he would give the Wife a small allowance “only when she begged him for money”[47].
[47] Ibid; at [32].
Contributions Post Separation
The C Street, Suburb D Property was tenanted until June 2017 and the rental income was sufficient to discharge the monthly payments on the mortgage that encumbered the C Street, Suburb D Property (Mortgage). The C Street, Suburb D Property then became untenanted and remained untenanted despite the Wife requesting the Husband to relet the property. As of 3 November 2017 the amount owing on the Mortgage was $356,474.34[48]. The Husband failed to make the monthly repayments on the Mortgage from November 2017. This resulted in the Mortgage being increased and reducing the equity in the C Street, Suburb D Property. At the time of settlement of the sale of the C Street, Suburb D Property on 19 October 2018, the sum of $385,543.73 was paid to the ANZ Banking Group Limited as the mortgagee[49].
[48] Wife’s Second Affidavit, at [19(a)(xiii)] and Exhibit S-8.
[49] Ibid; at [19(a)(ii) and (a)(vii)].
Further, in an agreement dated 9 May 2018 with the ANZ Bank, the Husband surrendered the A Street, Suburb B Property to the ANZ Bank in its capacity as mortgagee exercising its power of sale[50]. As a result of the Husband’s failure to make payments pursuant to the Mortgage, the ANZ Bank served Notices to Vacate pursuant to the Residential Tenancies Act 1997 (Vic) in relation to the A Street, Suburb B Property on the Wife[51]. By reason of the matters referred to under the heading of Procedural History, the Wife and the Children avoided being evicted from their home at the A Street, Suburb B Property.
[50] Wife’s First Affidavit, at [47] and Exhibit S-7.
[51] Ibid; at [48] and Exhibit S-8.
Section 79(4)(c) Non-Financial Contributions – Welfare of the Family
Since the commencement of the relationship the Wife has been the homemaker, undertaking the household cleaning, cooking and other general household chores. The Wife was also the primary carer for the Children throughout the relationship and since separation[52].
Section 79(4)(d) the effect of any proposed order upon the income earning capacity of either party to the marriage
[52] Wife’s Second Affidavit, at [32].
The Orders which I propose to make will have no effect upon the income earning capacity of the Husband.
The Wife’s responsibility to care for [X] affects her ability to work full time. The Wife works part-time and she has deposed that she is unable to return to work on a full-time basis as she has to drop [X] off at school and pick her up during the week[53].
Section 79(4)(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
[53] Wife’s Second Affidavit, at [27].
Since the Husband left the former matrimonial home at the A Street, Suburb B Property in February 2016 and returned to India, he has not provided any financial support for the Children[54]. The Husband is living in India and the Wife believes that it is unlikely that he will return to Australia[55]. It is therefore unlikely that the Husband will provide child support in the future.
The matters referred to in Section 75(2) so far as they are relevant
[54] Ibid; at [26].
[55] Ibid; at [36].
Section 75(2)(a) the age and state of health of each of the parties;
The Husband was born on … 1967 and is aged 51 and is in good health. The Wife was born on … 1977 is aged 42 and is also in good health.
Section 75(2)(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;
The Husband operates a business in India called ‘Business M’. The Husband has failed to provide financial disclosure in this proceeding and therefore his income is not known. The property and financial resources of the Husband, to the extent that they are known are set out in the List of Assets and Liabilities.
The Wife is employed as a public servant by Employer Q (Employer Q) earning a gross income of $600 a week[56]. The Wife also receives $200 a week from a government pensioner concession benefit[57]. The property and financial resources of the Wife, are set out in the List of Assets and Liabilities.
[56] Wife’s Financial Statement, at [4]-[5] & [9].
[57] Ibid; at [12].
There is no evidence to suggest that either the Husband or the Wife is incapable of gainful employment.
Section 75(2)(c) whether either party has the care or control of a child of the marriage who has not attained the age of 18 years;
The Children live with the Wife. Ms N is now aged 20 and [X] is aged 12. Since the Husband left the former matrimonial home at the A Street, Suburb B Property in February 2016 and returned to India, he has made no attempt to contact the Children via telephone or any other form of communication[58].
[58] Wife’s Second Affidavit, at [26].
Section 75(2)(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;
The commitments of the Wife that are necessary to support herself and the Children are set out in the Wife’s Financial Statement. Ms N lives with the Wife and is undertaking full time studies at University undertaking a degree. Ms N remains dependent on the Wife financially[59].
[59] Ibid; at [10].
Section 75(2)(e) the responsibilities of either party to support any other person;
Apart from the Children there was no evidence that the Wife had responsibilities to support any other person.
Section 75(2)(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;
The Wife’s Financial Statement indicates that she receives a government pensioner concession benefit in the sum of $200 a week[60].
Section 75(2)(g) where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable;
[60] Wife’s Financial Statement, at [12].
I am satisfied that the orders to be made will provide a reasonable standard of living for the Wife. In the absence of any evidence from the Husband I am unable to form a view as to his standard of living.
Section 75(2)(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;
This is not a relevant consideration.
Section 75(2)(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;
This is not relevant consideration.
Section 75(2)(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;
This is not a relevant consideration.
Section 75(2)(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;
The Wife’s role as home maker and parent during the marriage has had an adverse effect on her earning capacity. The Wife has deposed that during the early years of the marriage the Husband refused to allow her to work or even look for work[61]. The Wife only commenced employment in 2007. The Wife works part-time and she has deposed that she is unable to return to work on a full-time basis as she has to drop [X] off at school and pick her up during the week[62].
Section 75(2)(l) the need to protect a party who wishes to continue that party’s role as a parent;
[61] Wife’s First Affidavit, at [19].
[62] Wife’s Second Affidavit, at [27].
[X] will remain living with the Wife. Ms N also lives with the Wife and is dependent on the Wife whilst she completes her tertiary studies.
ction 75(2)(m) if either party is cohabitating with another person - the financial circumstances relating to the cohabitation;
There is no evidence that the Wife has re-partnered. The Wife has deposed that the Husband has formed a new relationship[63].
[63] Ibid; at [13].
Section 75(2)(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;
The property of the parties
I am satisfied that the Orders that I intend to make are sufficient under s.79 to enable the Wife to adequately maintain herself.
Vested bankruptcy property in relation to a bankrupt party
This is not relevant consideration
Section 75(2)(naa) the terms of any order or declaration to be 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 defacto 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 either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii);
This is not a relevant consideration.
Section 75(2)(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;
This is discussed in relation to s.79(4)(g).
Section 75(2)(o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account;
During the course of the relationship the Wife has deposed in the Wife’s First Affidavit and the Wife’s Second Affidavit that the Husband subjected her to a sustained course of emotional, physical and financial domestic violence.
Section 75(2)(p) the terms of any financial agreement that is binding on the parties to the marriage;
This is not a relevant consideration.
Section 75(2)(q) the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage;
This is not a relevant consideration.
Conclusion as to Contribution
Having considered the matters referred to in this judgment and the submissions of Counsel for the Wife, I consider that the contributions of the Husband and the Wife to have been equal during the relationship and that their contributions should be assessed at 50% each.
Conclusion as to Future Needs
Counsel for the Husband submitted that all the available assets, excluding superannuation in Australia should be transferred to the Wife. This would yield an adjustment for the Wife of 27.4% for future needs.
I have taken into consideration the above matters, including but not limited to the following:
a)The Children are living with the Wife.
b)The young age of [X].
c)The Wife’s modest earning capacity for the foreseeable future as she works part time to accommodate [X]’s school hours.
d)The absence of any child support paid by the Husband and that it is unlikely that he will ever pay any child support.
I am satisfied that there should be an adjustment in favour of the Wife of 30% for s.75(2) factors.
Adjustment of Interests
As a result of the findings made in relation to contribution and future needs, I am satisfied it is just and equitable to make orders adjusting property between the parties, so that the Wife is entitled to 80% of the non-superannuation property and the Husband should receive 20% of the non-superannuation property.
In relation to the superannuation assets, as the Wife does not know what superannuation fund the Husband has an interest in, the only practical way to deal with the matter is to order that each party retain their own superannuation interests.
Conclusion
I have determined that the division of the assets will be achieved by a division of the non-superannuation assets of the Husband and Wife as to 80% to the Wife and 20% to the Husband.
I intend to make orders that the Wife retain all the real and personal property that is present in Australia. This will result in a distribution of the 77.4% of the known assets of the parties to the Wife.
I am satisfied that the division of property is just and equitable in the circumstances described in this judgment.
I intend to make orders accordingly.
Costs
The Initiating Application sought final orders for costs. At the Final Hearing Counsel for the Wife did not pursue a costs application. This was on the basis that if all the assets in Australia were ordered to be transferred to the Wife, the Wife would have to pursue any successful costs order against the Husband in India for enforcement[64].
[64] Transcript T6:33-7:5.
I certify that the preceding one hundred and eight (108) paragraphs are a true copy of the reasons for judgment of Judge C. E. Kirton QC
Date: 2 August 2019
Key Legal Topics
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Family Law
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Property Law
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