SIERRA & SIERRA
[2017] FCCA 596
•5 April 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SIERRA & SIERRA | [2017] FCCA 596 |
| Catchwords: FAMILY LAW – PROPERTY – 14 year relationship, modest pool – dispute about whether the parties owe a debt to the paternal grandmother – where contributions favour the husband and s.75(2) matters favour the wife – overall division of the non-superannuation assets in favour of the wife and the superannuation assets in favour of the husband. CHILD SUPPORT – Application by husband for recovery of child support paid for a child determined not to be his biological child – where the husband raised the child from birth and only demanded a DNA test 17 months after separation – application dismissed. |
| Legislation: Child Support (Assessment) Act ss.107,143 |
| Cases cited: NHC & RCH (2004)FLC93-204 |
| Applicant: | MR SIERRA |
| Respondent: | MS SIERRA |
| File Number: | NCC 1449 of 2014 |
| Judgment of: | Judge Terry |
| Hearing dates: | 12, 13, 25 and 26 November 2015 and 21 and 22 July 2016 |
| Date of Last Submission: | 26 August 2016 |
| Delivered at: | Newcastle |
| Delivered on: | 5 April 2017 |
REPRESENTATION
| Counsel for the Applicant: | Mr Gruzman |
| Solicitors for the Applicant: | Mark Evans Solicitor |
| Counsel for the Respondent: | Mr Rugendyke |
| Solicitors for the Respondent: | Baker Love Lawyers |
ORDERS
Parenting
BY CONSENT:
The parties shall have equal shared parental responsibility for the children W born (omitted) 2003, X born (omitted) 2005 and Y born (omitted) 2008 (collectively referred to as “the children”).
Z born (omitted) 2000 shall spend time with the husband in accordance with her wishes.
BY THE COURT
The children shall live with the mother.
The children shall spend time with the father as follows:
(a)During school terms:
(i)In week 1 from the conclusion of school Wednesday until the commencement of school on the following Monday morning;
(ii)In week 2 from the conclusion of school Wednesday until the commencement of school on Thursday.
(b)For one half of all school holidays being the first half in each year where the first day of the holiday period falls in an odd-numbered year and the second half in each year where the first day of the holiday period falls in an even-numbered year.
(c)If the children are not otherwise spending time with the father on Father’s Day, from 5.00pm on the day preceding Father’s Day until 5.00pm on Father’s Day.
(d)If the children are spending time with the father on Mother’s Day, then the father’s spending time shall be suspended from 5.00pm on the day preceding Mother’s Day until 5.00pm on Mother’s Day.
(e)On each of the children’s birthdays, the children shall spend time with the parent with whom they are not otherwise living or spending time pursuant to these orders from the conclusion of school or 4.00pm as applicable until 8.00pm;
(f)On each of the parent’s birthdays, the children shall spend time with the parent with whom they are not otherwise living or spending time pursuant to these orders from the conclusion of school or 4.00pm as applicable until 8.00pm.
The husband shall collect the children from the children’s schools or from the wife’s home at the commencement of his time and the wife shall, if the children are not at school on the day in question, collect the children from the husband’s home at the conclusion of the time.
Each party is at liberty to telephone the children at all reasonable times and each party will do such acts and things that are necessary to facilitate such communication including making a telephone available to the children to receive such telephone calls at all reasonable times.
Each party shall notify the other party by way of SMS text message of any change in their landline telephone number and/or mobile telephone number within seven (7) days of any change to any such number.
Each party shall promptly notify the other if:
(a)Any of the children becoming seriously ill;
(b)Any of the children becoming hospitalised; or
(c)Any of the children are involved in an accident requiring attendance at hospital.
Each party may obtain from the children’s schools copies of newsletters, reports, order forms for school photographs and information normally provided to parents and each party may attend events at the school normally attended by parents.
Property
Within 60 days of the date hereof the wife shall:
a)Pay to the husband the sum of $123,163.25;
b)Refinance into her sole name the loan from (omitted) Bank secured by mortgage over Property M (“the property”).
Contemporaneously with the wife complying with Order (10):
a)The husband shall sign all documents required to transfer to the wife at the expense of the wife the whole of his right title and interest in the property.
b)The wife shall indemnify the husband and keep him indemnified from liability for the said mortgage and for all rates and outgoings owing in respect of the property.
If the wife fails to comply with Order (10) the husband shall within a further 60 days
(a)Pay to the wife the sum of $150,686.75;
(b)Refinance into his sole name the loan from (omitted) Bank secured by mortgage over Property M (“the property”).
Contemporaneously with the respondent complying with Order (1):
(a)The wife shall sign all documents required to transfer to the wife at the expenses of the husband the whole of her right title and interest in the property.
(b)The husband shall indemnify the wife and keep her indemnified from liability for the said mortgage and for all rates and outgoings owing in respect of the property.
If the wife fails to comply with Order (1) and the husband fails to comply with Order (4) then the parties shall do all acts and things required to sell the Property M property and for that purpose:
(a)The property shall be listed for sale by private treaty with a real estate agent agreed between the parties and failing agreement as nominated by the president of the Real Estate Institute of NSW.
(b)The listing price of the property shall be the amount agreed between the parties and failing agreement be as nominated by the agent.
(c)The sale price of the property shall be such amount as agreed between the parties and failing agreement as nominated by the agent.
(d)The parties shall co-operate in every way with the agent in relation to the marketing of the property for sale including making the key readily available and allowing inspection of the property at all times reasonably requested by the agent.
(e)Upon agreement being reached for sale of the property the parties shall execute the contract of sale and all other documents necessary to complete the sale including all transfer documentation forthwith upon its submission to them by the agent or their solicitor.
The proceeds of sale shall be utilised:
(a)To pay the costs, commissions and expenses of sale including any rates adjustments.
(b)To pay the (omitted) Bank the amount owing pursuant to the mortgage registered on the property.
(c)To pay the balance as to 45% to the husband and 55% to the wife.
Pursuant to Section 90MT(1)(a) of the Family Law Act 1975 (“the Act”) whenever a splittable payment within the meaning of Section 90ME of the Act becomes payable in respect of the interest of the husband in the (omitted) Superannuation Fund (“the Fund”) under Member No. (omitted), the wife shall be entitled to a base amount of $112,479.80 and there shall be a corresponding reduction in the entitlement of the person to whom the splittable payment would have been made but for these Orders.
Having being afforded procedural fairness in relation to the making of this Order, the Order binds the Trustee of the Fund, namely (omitted) Superannuation (omitted) (“the Trustee”).
Order (16) shall have effect from the operative time.
The operative time for the purposes of Order (16) of these Orders is four (4) business days after the date of service of these orders upon the Trustee.
Subject to Order 21 the wife shall within 28 days make available for collection by the husband the following items:
(a)(omitted) mulcher 4 stroke mower (silver)
(b)(omitted) 2 stroke lawn trimmer
(c)(omitted) 2 stroke blower vac
(d)Black power planer
(e)1 ladder
(f)(omitted) router bench including ½ drive router and bit set case
(g)(omitted) moulding nail gun
(h)Air Works PIN nail gun
(i)(omitted) amplifier
(j)(omitted) CD Player
(k)(omitted) Tuner
(l)Other tools and hardware at the absolute discretion of the wife
(m)Excalibur sword
(n)Pine Tall drawer chest of drawers and (at the absolute discretion of the wife) contents
(o)3 Framed (omitted) cow prints
(p)Slat door storage cupboard in store room and (at the absolute discretion of the wife) contents
(q)Vinyl records and turntables
(r)Boxing Bag
(s)Some of the fishing gear at the absolute discretion of the wife
(t)Red toolbox pastry cooking tools
(u)Sunbeam juice extractor
(v)Some of the pastry cooking accessories, stainless steel Barista fry pans and miscellaneous kitchen appliances and accessories at the absolute discretion of the wife
(w)Pasta machine
(x)Some of the CD collection at the absolute discretion of the wife
The wife shall use her best endeavours to provide the items in Order (20) to the husband but the wife’s determination as to whether the items are still in her possession is final and the husband shall accept the items in the condition in which they are delivered to him.
The wife is declared the owner to the exclusion of the husband of the Jayco caravan.
The husband is declared the owner to the exclusion of the wife of the (omitted) Football jerseys.
Each party is otherwise declared the owner of all assets in their possession or under their control.
In the event that either party refuses or neglects or is unable to execute any instrument or document being an instrument or documents the execution of which is provided for in these orders or is necessary to put into effect the provisions of these orders then at the request of the other party and Registrar of the Federal Circuit Court of Australia is hereby appointed pursuant to Section 106A to execute any such instrument or document in the name of the party refusing or neglecting or being unable to so execute the instrument or document.
Child Support
The husband’s application for repayment of child support paid for the child Z is dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Sierra & Sierra is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT NEWCASTLE |
NCC 1449 of 2014
| MR SIERRA |
Applicant
And
| MS SIERRA |
Respondent
REASONS FOR JUDGMENT
Introduction
These proceedings involve applications for parenting orders, property settlement and repayment of child support.
The parenting matter concerns W 14, X 12 and Y 8.
Since August 2014 the children have lived with the wife and spent time with the husband from Wednesday to Monday in week one and from Wednesday to Thursday in week two, effectively an 8/6 nights per fortnight arrangement.
For a long time the husband’s proposal was simply that this should be changed to a week about arrangement. However close to trial he amended his application to seek orders that the children live with him and spend time with the wife from Friday to Monday each alternate weekend and for one week in each of the school holidays.
It was the husband’s case that the wife had an alcohol problem and had introduced the children to several undesirable new partners since separation and that it was preferable for the purposes of minimising risk that they live primarily with him. It was also his case that W had a strong wish to live primarily with him.
The wife’s proposal was that the children continue to live in the 8/6 arrangement.
The wife said that the children were comfortable with this and that there was no good reason to change it. She denied that she had an alcohol problem or that she had exposed the children to problematic new relationships and disputed that W was expressing a clear wish to live with the husband.
The property pool is modest. The principal assets are the encumbered former matrimonial home in which the wife has been living since separation and superannuation which is largely in the husband’s name.
The husband sought an order that the former matrimonial home be transferred to him in exchange for a payment to the wife of $30,000.00 and that the wife receive $60,000.00 of his superannuation by way of a splitting order.
Overall the husband proposed a division of property which is between 60-70% in his favour in respect of the non-superannuation assets and about 81/19% in his favour in respect of the superannuation.
It was the husband’s case that his contributions to the non-superannuation assets greatly exceeded the wife’s because of cash provided by his mother and the efforts his family put into constructing the former matrimonial home. It was his case that there should either be no s. 75(2) adjustment or a 5% adjustment in his favour if the orders he sought about the children were made.
The husband said that his proposal about the superannuation was justified because of the large pre-separation and post-separation contributions he had made to his fund.
The wife proposed that she retain the former matrimonial home in exchange for a payment $94,570.01 to the husband and that she should receive $112,479.80 of the husband’s superannuation.
The wife’s case was that her family’s efforts in constructing the home exceeded the efforts by the husband’s family and that notwithstanding the cash gifts from the paternal grandmother contributions to the non-superannuation assets should be assessed as equal. She submitted that she should receive a 10% adjustment for s.75(2) matters and that when contributions and s. 75(2) matters were taken into account a split of the superannuation 45% to her and 55% to the husband was justified.
Finally the husband sought an order pursuant to s. 143 of the Child Support (Assessment) Act that the wife pay him $12,733.08 being the child support he paid between separation and 19 March 2015 for the parties oldest child Z whom a DNA test established in February 2015 was not his biological child.
It was the wife’s case that the application should be dismissed.
The evidence
The husband did not comply with the trial directions which required him to file a trial affidavit containing all of the evidence on which he intended to rely. He filed an affidavit on 23 October 2015 but it only contained updating evidence.
The husband had filed an earlier affidavit on 10 June 2014 and at the commencement of the hearing he was asked to choose which affidavit he wanted to rely on. He chose the 10 June 2014 affidavit.
The husband also relied on his financial statement filed on 23 October 2015 and the affidavits of his father Mr S, the wife’s former partner Mr M and a neighbour Mr B filed on 23 October 2015, a builder Mr M filed on 23 October 2014, the wife’s sister in law Ms A filed on 5 August 2014 and his mother Ms C filed on 18 March 2015.
The husband’s 10 June 2014 affidavit was lengthy and frustratingly numbered. Twice during the affidavit the husband ceased numbering in order and went back to an earlier number (but not back to 1) and started again. On page 41 of the affidavit he arrived at paragraph 334 and then jumped back to 204 before concluding the affidavit shortly afterwards with a lengthy unnumbered section headed “Father’s Proposal”.
The affidavit consists largely of a series of entries in chronological order which appear to have been copied from a diary and it contains a plethora of irrelevant material. In one paragraph for example the husband tells the court that on a particular day he gave the children devon sandwiches for tea.
There is a real risk when an affidavit such as this is filed that important points will be missed because the reader’s eyes glaze over or because the reader misses something vital due to irritation and exasperation.
The husband filed an additional affidavit on 7 June 2016 which was read.
The wife relied on her affidavit and financial statement filed on 23 October 2015, a proof of evidence dated 26 November 2015[1], her affidavit filed on 8 June 2016, the affidavits of her father Mr G and friend Mr J filed on 23 October 2015 and the affidavit of Mr C filed on 21 July 2016.
[1] Exhibit I
A family report was prepared by Ms K, a family consultant, in April 2015 when the matter was in the docket of Judge Coakes who subsequently retired.
Prior to the conclusion of the trial in July 2016 the husband asked that an up dated family report to be prepared. He was particularly keen for the children’s views to be further explored. I refused the request for reasons given at the time. In summary I felt that any changes in circumstances could be put to the family consultant in the witness box and I was concerned about the children being re-interviewed given the tense and highly conflicted family dynamic. The children had already been interviewed three times, twice at child inclusive child dispute conferences and once for the family report.
Mr M, Mr S and Ms A were not required for cross-examination. It was accepted that the paternal grandmother Ms C could not be cross-examined due to her mental state and her affidavit was admitted into evidence. All of the other witnesses were cross-examined.
A letter dated 22 July 2016 was tendered confirming that the Trustee of the husband’s superannuation fund had no objection to the court making a base amount splitting order in respect of the husband’s superannuation in the terms proposed.[2]
[2] Exhibit W
In respect of the child support matter the husband relied on an Application in a Case and supporting affidavit filed on 31 March 2015.
On 22 June 2015 following the filing of this application an order was made by consent declaring that the husband should not be assessed in respect of the costs Z as he was not a parent of the child. It is an order pursuant to s. 107 of the Child Support (Assessment) Act although the section is not referred to in the order.
It was further ordered by consent that determination of the application under s. 143 of the Child Support (Assessment) Act for repayment of the child support the husband had paid for Z be adjourned to the final hearing of the parenting and property matter.
The trial unavoidably took place in two parts separated by 8 months. At the conclusion of the trial the parties were asked to provide written submissions and the last submission was received on 26 August 2016.
The Newcastle Registry of this court has been under pressure for over two years and while most judgments are delivered in a timely fashion competing priorities sometimes result in delivery of a decision being delayed. That has happened in this case and I apologise to the parties for the delay in delivery of this decision.
An assessment of the witnesses
There were unpleasant undercurrents in this case. The husband and the wife have both at different times behaved in ways which show them in a poor light.
In February 2015 after the parties had been separated for well over a year the husband demanded that a DNA test to be carried out in relation to Z, a child born early in the parties’ relationship who the husband had always accepted as his child. He is named on Z’s birth certificate as her father and she knows no other father. The test determined that the husband was not Z’s biological father. His decision to have the test done and the manner in which he informed the children of the outcome caused a great deal of anger and distress within the family.
The husband relied at trial on an affidavit by Mr M, a man with whom the wife was in a relationship for a period after separation. The affidavit contained a plethora of scurrilous and salacious allegations about the wife.
It was revealed at trial that after the wife’s relationship with Mr M ended he demanded that she pay him money and promised to cause her damage if she refused and Mr M was shown by cross-examination to be a most unsatisfactory witness. I cannot place weight on the material in this affidavit when there is a real possibility that Mr M was motivated by spite to give it and the husband displayed poor judgement relying on it to disparage the wife.
The husband also called the wife’s former sister in law to give evidence and he proposed using the wife’s aunt to assist him to care for the children if they lived primarily with him well knowing that the wife was estranged from her aunt. He even brought the aunt to court to sit with him on the last day of the hearing.
The best spin that can be put on the husband’s behaviour as outlined above is that he lacks empathy but I consider that there is a real possibility that he has been motivated by a strong desire to hurt the wife in any way he could regardless of whether others, such as Z, might also be harmed in the process.
In 2015 when the wife and Mr M were still in a relationship a poster denigrating the husband as a wife-basher was placed in letter-boxes in the husband’s street. The wife blamed Mr M for distributing the poster but I consider it highly likely that she played her part in it.
Later in 2015 the wife was complicit in a letter being sent to the husband’s employer suggesting without any reasonable foundation that the husband may be a sexual predator and questioning why they continued to employ him.
These were vindictive and mean-spirited actions which do the wife no credit at all.
I have considerable concern that the evidence of both the husband and wife may be unreliable because it is tainted by the ill-feeling they obviously have about each other.
The parties both told the family report writer that the husband had long had problems with members of the maternal family although the husband blamed the maternal family and the wife blamed the husband. A number of family members on both sides were called to give evidence in support of the parties’ respective cases and I will need to bear in mind that their evidence may be unreliable due to the ill-feeling between the two sides of the family or between various family members.
Background
The husband and wife met when they were 26 and 19 and were employed by (employer omitted) as a (occupation omitted) and as a (occupation omitted) respectively.
About four years later, in either late 1998 or early 1999, the parties commenced cohabitation.
The wife’s daughter Z was born on (omitted) 2000. The wife maintained that she told the husband when she was pregnant that he might not be Z’s father and that he made a conscious choice not to make an issue of it. The husband denied that the wife told him that there was a doubt about Z’s paternity but said that he always had his suspicions.
I have reservations about the evidence of both parties and I cannot decide where the truth lies but the uncontroversial facts are that the parties accepted Z as their child at the time of her birth, she was christened Z and while the parties remained together the husband never raised any issue about her paternity.
After the relationship ended the husband insisted that a DNA test be carried out and it transpired that Z was not his biological child.
The parties married on (omitted) 2001 and they have three biological children, W (W) born on (omitted) 2003, X born on (omitted) 2005 and Y born on (omitted) 2008.
The parties separated on 2 September 2013 after an incident at their home which led to the husband being charged with assault and made the subject of an Apprehended Domestic Violence Order (ADVO). Their relationship/marriage was approximately 14 years in length.
The husband worked for (employer omitted) throughout the relationship and he continues to work for (employer omitted).
The wife worked (for (employer omitted) and later for (employer omitted)) until W was born in 2003. She was then out of the workforce and involved in parenting the children until May 2012 when she commenced working part time at the (omitted).
Considerable conflict occurred between the parties once the wife started working at the (omitted) and it continued until they separated in September 2013.
The only significant property the parties acquired during their relationship was the former matrimonial home at Property M. The husband’s father, who has an (business omitted) and the wife’s father, who is a builder, were both heavily involved in assisting with construction of the home as were some other members of the family on both sides.
Following separation the children remained with the wife in the former matrimonial home. The husband rented premises elsewhere and began spending regular time with the children but there were disputes over the implementation of the time and in June 2014 the husband commenced court proceedings. This was before the DNA test but his relationship with Z was already poor and he sought an order that the three younger children live in a week about shared care arrangement and that Z spend time with him in accordance with her wishes.
In August 2014 interim orders were made for the three younger children to live 8 nights per fortnight with the wife and six with the husband and for Z spend time with the husband in accordance with her wishes.
The wife would be content for the same orders to be made on a final basis.
For a long time the husband continued to press for week about equal time in respect of the three younger children but recently his position has been that the children should live primarily with him.
The parenting matter
The children’s best interests
Any orders I make about the children must be orders determined by treating their best interests as the paramount consideration and s.60CC(2) and (3) of the Family Law Act set out the matters to which I must have regard in order to determine the children’s best interests.
The primary considerations in s.60CC(2) are the benefit to the children of having a meaningful relationship with both of their parents and the need to protect the children from physical or psychological harm as a result of being exposed to or subjected to abuse, neglect or family violence.
Both parents pay lip service to the desirability of the children having a meaningful relationship with each of their parents.
I accept that the wife has the capacity to at least not undermine the husband’s relationship with the children. She sought to harm the husband personally by her actions with the poster and the letter to his employer but the wife has not recently repeated this behaviour and she did not run a case at trial designed to disparage or belittle the husband.
The husband ran exactly such a case and he sought to enlist on his side disaffected family members of the wife and a disaffected former partner. I have a considerable concern about his capacity to ensure that the children have a good relationship with the wife and not to undermine that relationship and this militates against an order that the wife’s time with the children be reduced.
The husband’s actions in regard to arranging for W to talk to the school counsellor in 2016 suggest a willingness to use issues which arise from time to time with the children to drive a wedge between the wife and the children rather than a willingness to work co-operatively with the wife in parenting the children.
Both parents pay lip service to the desirability of the children being protected from harm as a result of being subjected to abuse neglect or family violence.
I accept that the children are not likely to be exposed to those things in the husband’s care. The incident between the husband and wife at separation was an isolated incident and there is no history of family violence in this matter.
The children could be at risk of neglect or harm in the wife’s care if the husband’s allegations about her alcohol consumption and her choice of new relationships have substance but this is better to deal with in the context of assessing the wife’s parenting capacity than in the context of trying to determine whether the children might be neglected in her care.
The first of the additional considerations in s. 60CC (3) is any views expressed by the children and the weight to be given to those views.
In her March 2015 report the family consultant noted that the children had been interviewed twice previously at child inclusive child dispute conferences. She said that all four children told her that their main concern was the parental conflict.
W told the family consultant that the current 8/6 arrangement was ok but he felt that an extra night with the father would be an option because it was fair.
The husband alleged that in 2016 that W began telling him that he wanted to live with him. He contacted the school and the school counsellor spoke to W and reported back to the husband.
The counsellor saw W on 13 May 2016, 20 May 2016 and 16 June 2016. In the 13 May 2016 meeting W did not express a view about his living arrangements. On 20 May 2016 he said that he would like to see his Dad more often and would like his Mum to stop telling lies about his dad. On 16 June 2016 he said that his parents had recently been to court and that he had called his mother while at his Dad’s to tell her he wanted to live with his Dad and repeated that his mother often told lies about his Dad hitting her.
I cannot place weight on this evidence as a genuine expression of a preference by W about where he would like to live. It has all the hallmarks of utterances by a child caught in conflict and struggling with divided loyalties.
X told the family consultant that she liked the 8/6 arrangement and wanted it to stay that way.
Y said that he liked the current arrangement because it was even.
The wife said that Y sometimes did not want to go to the husband’s place and would prefer to stay with her but I cannot place any weight on this.
I must consider the nature of the children’s relationship with each of their parents and any other person including a grandparent of the children.
The family consultant observed a good relationship between the children and each parent. She said as follows:
The younger three children were observed with both parents and with Z when with the mother. It is common ground that they have positive relationships with both parents and with each other and this was consistent with the observation sessions where they appeared to present in a warm, relaxed and comfortable manner with all family members.[3]
[3] Family Report paragraph 46
There was nothing to suggest that anything had changed since the report was released.
The husband alleged that Z and W had issues which had led to Z punching W. I cannot make a finding that there are issues between these siblings which are relevant to the configuration of their time with the parents.
The husband’s solicitor submitted that it was concerning that the court had no evidence about how the children got on with Mr C, the mother’s most recent partner or with Mr M her previous partner. This is a deficiency in the evidence but it is noteworthy that the husband, who levied every criticism he possibly could at the wife, did not suggest that the children had complained to him about either man.
I must consider the extent to which each parent has fulfilled, or failed to fulfil, the parents’ obligations to maintain the children.
The husband earns a good income and he has been assessed to pay and does pay child support. When the wife filed her financial statement in 2015 he was paying $300.00 per week.
I must consider the extent to which each parent has taken or failed to take the opportunity to participate in making decisions about major long-term issues in the relation to the children, to spend time with the children and to communicate with the children.
This is not a relevant issue in this case.
I must consider the likely effect of any change in the children’s circumstances including the likely effect of their separation from either of their parents or any other child or person including any grandparent or other relative of the children with whom they have been living.
The husband told the family report writer in March 2015 that the children had adjusted well to the 8/6 night per fortnight arrangement. At trial he proposed a significant change for them but absent his evidence about W’s wishes it was not because of any concerns about how the children were coping with the current arrangements but because of a concern about the wife’s parenting capacity.
I cannot make findings about the likely effect of this change on the children until I make findings about the remaining s. 60CC (2) matters.
If the children commence living primarily with the husband they will see considerably less of their sister Z. It could be inferred from the evidence that the husband would consider this a good thing because it would mean that X would be less exposed to what he considers the questionable choices of her teenage sister. The husband’s solicitor articulated this in his written submissions.
It would also mean a greater separation than is presently the case between Z and her younger siblings but Z is 17 and is likely to be increasingly living a separate life in any event.
I must consider the practical difficulty and expense of the children spending time with and communicating with a parent and whether that difficulty or expense will substantially affect the children’s right to maintain personal relations and direct contact with both parents on a regular basis.
The parents live in close proximity to each other and this is likely to continue regardless of the outcome of the property matter so this is not an issue.
I must consider the capacity of each parent and any other relevant person to provide for the needs of the children including their intellectual and emotional needs.
The husband is capable of ensuring that the children are fed and clothed and I have no doubt that he could make appropriate arrangements to get them to school and ensure that they were cared for after school. However I have concerns about his capacity to provide for their emotional needs.
The husband told the family report writer that he arranged a DNA test for Z after separation because he felt that it was in her best interests. He said that she needed to know for medical reasons (there was breast cancer in his family) and so that she was not inadvertently shocked by the news at an unexpected time.
I consider that these are excuses rather than genuine reasons for the husband’s actions.
The family consultant was concerned about the husband’s decision to arrange a DNA test for Z. She said as follows:
Clearly both parents were aware that Z may not have been the father’s biological child but both made a deliberate decision to assume that Z was the father’s biological child. The father relates to having undertaken all aspects of parenting with Z and states that he remains her “dad” and Z continues to consider him to be her “dad”.
The father reports that his request for DNA testing was for Z’s benefit, however if his rationale for the testing was motivated by other means (such as alleged by the mother – to minimise child support payments, hurt the mother, and/or distance himself from a child who has rejected him) then this would be of considerable concern and would reflect poorly on his attitude to parenting.
In any case his immediate cessation of the child support and re-payment request (although he says this was done on advice) and his failure to contact Z after the DNA test results (if Z’s version is correct) when he still considers himself to be Z’s father has demonstrated a poor attitude to parenting and a very limited insight into the impact of his behaviour on both Z and potentially the other children.
The wife said and I accept that the husband told the three younger children of the results the day they were received despite her request to allow Z to absorb the news first.
I do not accept that the husband was motivated by a desire to benefit Z in applying for the DNA test. The decision was poorly thought and the delivery of information about the results to the children poorly executed. The husband gave no thought to the impact on the children of his news and I cannot exclude the possibility that the real reason the test was done was to reveal the wife as an immoral person for the husband’s personal gratification. He was not focussed on the needs of the children during this episode.
I also have a concern about the husband’s actions in arranging for W to see the school counsellor in May 2016. It bespeaks a desire by the husband to obtain evidence to help him in the trial rather than a focus on W’s needs. If he had been focussed on W’s needs his first thought would have been to discuss the matter with the wife, not to arrange for W to see a counsellor without the wife’s knowledge.
The wife is also capable of feeding and clothing the children and getting them to school and there was no evidence that she was an absent mother as alleged by the husband’s solicitor in submissions. She needs to work and has a right to a social life and this requires that the children spend some time being cared for by others and there was no evidence that the wife was hiving the children off and spending little time with them while she went out partying. However I do have concerns about the wife arising out of the evidence about her alcohol consumption and about the people with whom she formed relationships since or around the time of separation.
The husband alleged that the wife was often drunk after she began working at the (omitted) and that her brother, father, brother in law and sister were also drunk on occasions. By implication he suggested that heavy consumption of alcohol was a problem rife in the wife’s family which might make it difficult for the wife to extricate herself from a drinking culture.
The wife told the family consultant in March 2015 that she did not have an alcohol problem and that she drank two or three mid or full strength beers two or three days a week and more if it was a special occasion. Her counsel submitted that the husband’s complaints about the wife’s alcohol consumption were just another example of him being intrusive into and overly critical of her personal and social life and also arose out of a desire to demonstrate his moral superiority.
There may be elements of this in in it but other evidence in the case means that I cannot simply dismiss the husband’s concerns as fanciful, overstated or malicious.
The wife admitted that she has been drinking before she went to (omitted) Hospital after X was injured at a skate park. She claimed that she had consumed only four glasses of wine but hospital records confirm that she was intoxicated and she got into an abusive argument with the husband.
The wife blamed the husband saying she had just found out about the way he had handled the DNA test results but the whole episode causes me concern when added to it is that on 4 February 2016, between the two parts of the trial, the wife was charged with low range PCA. She was convicted and fined $450.00 and lost her licence for 3 months.
Before considering the implications of this evidence I also need to consider the evidence about the wife’s relationships around and after the time of separation.
On four occasions in August 2013, the month before the parties separated, the wife visited a man named (omitted) in (omitted) Correctional Centre and after he was released from prison she introduced him to the children. (omitted) was in prison for breaching an ADVO. The wife denied having visited (omitted) in prison until confronted at trial with an extract from the (omitted) Correctional Centre visitor’s book.
Subsequently the wife commenced a relationship with Mr D (Mr D) Mr D. Mr D has a criminal record dating back nearly twenty years and he has been charged with and convicted of among other things assault, filming for indecent purposes and sexual assault.
Mr D aided and abetted the wife preparing a defamatory poster about the husband and leaving it in letter boxes and he reacted with spite and tried to cause the wife harm after the relationship ended. He approached the husband and offered to give evidence in his case and he affirmed an affidavit containing graphic detail of him and the wife consuming alcohol, using MDMA and engaging in group sex.
Mr D was cross-examined and came across as an unreliable witness and a spiteful unpleasant man. I cannot place weight on Mr D’s evidence about the wife but it is of concern to me that the wife introduced a person such as Mr D into the children’s lives.
In late 2015 the wife ended her relationship with Mr D and began a relationship with Mr C who had commenced work at the (omitted). Mr C has convictions for low range PCA in 1998 and mid-range PCA and drive recklessly/in a manner dangerous in 2008 and in May 2016 after leaving the (omitted) Hotel he was involved in an accident in the wife’s car in which the car was written off.
Mr C left the scene of the accident and was found by the police at the wife’s home some time later. He was charged with negligent driving and failing to stop and give particulars.
Mr C denied that alcohol was involved in the accident but when his prior convictions and his fleeing the scene are factored in one has to feel a degree of scepticism about this.
If the wife does indeed have a propensity to misuse alcohol the fact that she is in a relationship with someone who has got into trouble because of alcohol misuse in the past adds an additional layer of concern. It is not conducive to the wife dealing with an alcohol problem if she has one.
The wife’s counsel submitted that the court should be sceptical about whether the husband truly believed that the children were at risk in the wife’s care when on the one hand he made serious allegations about alcohol consumption, drug use and lax parenting but on the other hand proposed that the children spend each alternate weekend and one week during each of the school holidays with her.
The wife’s counsel submitted that the husband’s proposal was motivated by anger at the wife for the assault complaint at the time of separation, a desire to demonstrate that he was a morally superior person and an obsession with the wife’s social activities.
The husband is upset about the assault conviction and there were aspects of his evidence and the presentation of his case which do suggest something of an obsession with the issue of the wife’s “faithfulness,” an unhealthy focus on her social life and a desire to cause her harm.
At the same time when taken in combination the wife’s decision to visit (omitted) in prison, her choice of Mr D as a partner, her drink driving conviction in 2016 and her choice of Mr C as a partner against a background of other evidence about the wife’s alcohol consumption gives rise to concern in my mind about whether the wife at the very least has or is bordering on having an alcohol problem and about whether she is making child focussed choices about new relationships.
I cannot disregard the issues the husband raised simply because of the orders he sought. The children have a good relationship with the wife, this is clearly not a “no time” case and it is often a difficult balancing exercise trying to come up with appropriate orders to mitigate risk but meet the children’s need to spend time with the other parent. The husband might well have considered that limiting the wife’s time with the children was an appropriate response.
No testing was ever carried out in an endeavour to clarify whether the wife’s alcohol consumption was at a concerning level and I cannot make a definitive finding about her level of drinking. There was no evidence that at this time it was leading to the children being abused in the home or not taken to school or in the wife being involved in violent incidents but I have misgivings about whether the wife was frank with the court about her drinking and about what the future might hold for the wife in this regard.
I also have concerns about the nature of the men the children have been introduced to by the wife since separation. At the very least they are potentially poor role models and at worst they could expose the children to risk of harm.
The husband expressed concern about what was happening with Z who was 15 when the trial commenced. He alleged that she was engaged in a sexual relationship with her 15 year old boyfriend and was allowed to smoke and consume alcohol, in other words that the wife was not placing appropriate parental boundaries around her. He expressed concern about the path X might go down when she became a teenager.
I can understand the husband’s concerns but whether he will ultimately be successful in imposing stricter controls on X given the society in which we live is unknown.
I must consider the maturity, sex, lifestyle and background (including lifestyle, culture and traditions) of the children and of either of the children’s parents and any other characteristics of the children that the court thinks are relevant.
There are no separate issues which are relevant under this heading. The husband’s solicitor mentioned in his submissions that the children were of Italian heritage through the husband but there was nothing in the evidence at trial to suggest that this had any bearing on the issue of the amount of time the children spent with each parent.
I must consider any family violence involving the children or a member of the children’s family.
There was an incident between the parties on 2 September 2013 which resulted in the husband’s face (with glasses) striking the wife’s nose causing a cut. The husband was charged with assault and pleaded guilty.
The husband maintained at trial that this was more or less an accident, and there was nothing to suggest that the husband was a violent man in a broad general sense. There were no other allegations of that the husband had committed acts of family violence.
The husband alleged that when the wife came to (omitted) Hospital to see X after the accident at the skate park she was drunk and berated him about the DNA testing and lunged at him with her fingernails saying “I could fucking kill you.”
It would be unsafe given the unreliable evidence of both parties for me to make a finding that the wife lunged at the husband with her fingernails and the context suggests that words were said to dramatically emphasise the wife’s anger and not to convey an actual threat.
I must consider if a family violence order applies any inferences which can be drawn from it.
A 6 month family violence order was made for the protection of the wife following the husband being charged with assault in September 2013. It was made without admissions and arose out of the husband being charged over the incident at separation. It does not add any force to the wife’s allegation about what occurred on that occasion.
A 6 month ADVO was made against the maternal grandfather for the protection of the husband following an incident where the husband alleged that the maternal grandfather threatened to head butt him. The order was made by consent and without admissions.
The fact that the order was applied for illustrates the tense relationship between both sides of the family since separation but it has no implications for the parenting matter.
On 24 March 2016 a 12 month ADVO was made protecting the husband from the wife. The husband made the application based on the flyer that was placed in his letterboxes in his street in May 2015, the encounter at the hospital in early 2015 and the letter sent to his employer in August 2015. The order was made in the wife’ absence and has all the flavour of a tit-for-tat application and not an application made because the husband felt in need of personal protection. It illustrates the depth of ill-feeling the husband has for the wife.
I must consider the attitude to the children and the responsibilities of parenthood demonstrated by each of their parents.
Both parents can be criticised for post-separation actions which demonstrate lack of child focus (eg the DNA test and the poster distributed to letterboxes). However going over these things again in this section of the judgment will not help me.
I must consider whether it would be preferable to make the order that would be least likely to lead to the institution of further proceedings in relation to the children.
No order stands out as such an order. I have considerable disquiet about the issue of the wife’s alcohol consumption in particular and if this problem is in fact severe or escalates then it may well be necessary to consider a change of arrangements for the children in the future but there are other things in this matter for example the depth of the husband’s dislike of the wife and his undermining behaviour which could also lead to further proceedings.
I must consider any other fact or circumstance which the court thinks is relevant.
The family consultant noted when the family report interviews took place in March 2015 that direct personal communication between the parents was non-existent and that the parents were communicating either through the children or by text message. She also noted that both parents alleged that the other had sent inappropriate or abusive text messages.
The family report writer accurately summarised the relationship between the parents when she said as follows:
The parents mirror each other in their views about the other parent. Each steadfastly claims that the other is hostile, is not child focussed and is compromising the children’s emotional wellbeing in an attempt to hurt the other parent. There is no trust between the parents. The father believes that the mother is a pathological liar and the mother believes that the father is deliberately engaging in a campaign aimed at undermining her coping capacity.[4]
[4] Family Report paragraph 51.
There was nothing to suggest at trial that there had been any improvement in this situation.
Parental responsibility
Pursuant to s.61DA of the Family Law Act I am required to apply a presumption that it is in the children’s best interests that their parents have equal shared parental responsibility for them absent a finding that one of them or a person living with one of them has engaged in family violence or abuse of the children.
The parents’ communication is appalling and there was an incident of family violence which negatives the presumption but they agreed that an order should be made for equal shared parental responsibility. As they wish for that to occur and as they will both be substantially involved in the children’s lives I will make the order the parties proposed.
The recommendations in the family report
When the family report interviews were conducted in March 2015 the children were living in the 8/6 night per fortnight arrangement. The mother was proposing that this continue and the father was proposing week about time.
The family report writer felt that the core issue for the children was parental conflict and said as follows:
Whilst the children are stating that the parental conflict has reduced considerably (to the point where it is not a major concern for them) the co-parenting is exceedingly poor with no flexibility which means that ultimately child focussed arrangements will not prevail. Further, if the children remain in a shared care arrangement then this will increase the exposure of the children to the adverse outcomes associated with parental conflict (more co-parenting is required, not less and there is more opportunity for disputes to arise about issues on a week to week basis).[5]
In the absence of any change in the dynamic of the parental relationship (in fact it has deteriorated further) and each parent denying any responsibility for it (thus not being willing to change their approach) I am pessimistic as to the parents’ capacity to improve the parenting relationship for the benefit of the children. In an attempt to do so, however, I have previously recommended the Keeping Contact program. Both parents report enrolling but stated that there is a current waiting list.[6]
For the reasons noted above I do not support a shared care arrangement; however I accept that it is likely to occur given that the parents and the children are in agreement for it to continue in at least some form. In this regard it is noted that the children are well settled in the current arrangement and that the current arrangement ensures that the children are able to maintain meaningful relationships with both parents. Given this, it would appear that there is little advantage to potentially de-stabilising the children by changing the arrangement.[7]
[5] Paragraph 52 of the Family Report.
[6] Family Report paragraph 53
[7] Family Report paragraph 55
By the time of trial the husband’s position had altered so that he at least was no longer seeking shared care and I will have to consider the competing proposals based on my findings about the s. 60CC(2) and (3) matters.
Conclusion about the parenting matter
As I will be making an order for equal shared parental responsibility I am required by s. 65DAA of the Family Law Act to consider whether it would be in the children’s best interests and reasonably practicable for them to spend equal time or substantial and significant time with each of their parents and if so to consider making an order of that kind.
The wife proposed a continuation of the 8/6 arrangement which comes within the definition of substantial and significant time but is also very close to equal time.
The husband proposed that the children live with him and spend alternate weekends and one week during each of the school holidays with the wife which does not constitute substantial and significant time.
The parents have been implementing the 8/6 arrangement without incident since August 2014, they live close enough to make it reasonably practicable and are likely to continue to do so, there was no evidence that the arrangement was impacting adversely on the children and the husband did not submit that the poor relationship or any communication problems between the parties suggested that it was not in the children’s best interests or not reasonably practicable for this arrangement to continue. Rather it was his case that the change he proposed was in the best interests of the children because it was in accordance with W’s wishes and because the wife had issues with alcohol and had made a series of very poor choices post-separation choices about partners which meant that the children could be exposed to risk if they lived eight nights a fortnight with her.
There are several difficulties with this argument.
First, there was no evidence that X and Y were agitating for any change to the current arrangements and such an outcome would be a huge change for them. They have lived in the current arrangement for 2 ½ years and prior to that lived in an intact family. They have never lived primarily with the father.
Making a major change to children’s living arrangements is sometimes necessary if there are risk issues but while I have concerns arising out of the evidence about the wife’s alcohol consumption and about the men she has introduced into the children’s lives since separation the evidence is not sufficient to allow me to conclude that at present the children will be unsafe or exposed to risk of harm if they live 8 days a fortnight as opposed to 2 days a fortnight with the wife.
Making a major change can also be necessary if an older child is expressing a strong view but it is by no means clear that W is expressing a strong wish to change residence as opposed to making statements to please the husband, and the husband did not suggest that the children should be separated and did not address the issue of why the younger children should be dragged along if W was expressing a view.
I would be loath to make a major change to the children’s residence based only on unclear evidence about W’s views when I have concerns about the husband’s empathy for the children and his sensitivity to their emotional needs and about his capacity to promote a relationship with the wife.
If the wife has successfully masked an incipient serious problem with alcohol abuse there is a real potential for this matter to come back before the court but at present I cannot be satisfied that the children’s lives would be enhanced if I made the orders sought by the husband and I intend to make orders continuing the 8/6 arrangement.
It goes back to the family report writer’s recommendation which to repeat was as follows:
…..it is noted that the children are well settled in the current arrangement and that the current arrangement ensures that the children are able to maintain meaningful relationships with both parents. Given this, it would appear that there is little advantage to potentially de-stabilising the children by changing the arrangement.
I am conscious of a risk that this matter could return to court but I intend to make orders about the children similar to the orders which have been in place since 2014.
Property
The assets, liabilities and superannuation
The parties assets are as follows:
Description
Ownership
Value
Property M
Joint
$580,000.00
Jayco Caravan
Joint
$4,000.00
(omitted) Football Jerseys
Joint
$1,500.00
Toyota (omitted) (insurance claim)
Wife
$7,500.00
(omitted) Shares
Husband
$835.00
Total
$593,835.00
There was a dispute about whether the (omitted) football jersey or jerseys were worth $1,500.00 or $2,000.00. There was no evidence which would allow me to resolve this dispute and the difference in the two values is minimal. I have included the jersey or jerseys at $1,500.00.
The parties both have household contents. The wife’s are from the marriage and the husbands were purchased post-separation using money derived during the marriage. The household contents were not valued and the parties agreed that their respective household contents should not be included in the pool.
The wife had a Toyota (omitted) at separation. It still existed when the hearing commenced but was written off in an accident while driven by the Mr C in 2016 and the insurance proceeds have been included as an asset.
In her financial statement the wife declared that she had savings of $7,000.00. However the parties have been separated for three years and amounts in bank accounts usually fluctuate and I do not intend to include the wife’s bank balance as shown in her financial statement as an item in the pool available for distribution between the parties.
During the trial there was reference to the husband currently having a small number of (omitted) shares but neither party sought to have any (omitted) shares included in the pool.
It was the wife’s case that the husband should be required to account by way of add-back for money taken by him at or after separation which was in the nature of a premature distribution of matrimonial assets.
During cross-examination the husband was questioned about $2,700.00 and $10,000.00 which he withdrew soon after separation and $21,000.00 which he obtained from the sale of (omitted) shares which he had become entitled to during the relationship and sold after the relationship ended.
The husband conceded that he withdrew the $2,700.00 to pay initial legal fees, that $1,500.00 of the $10,000.00 was used to pay legal fees and that $3,000.00 of the money from the shares was also used to pay legal fees.
He said that he used the remainder of the $10,000.00 and the money from the sale of shares to re-establish himself: to buy bedding, linen and cooking appliances for his rented property and to pay the bond and rent. He also said that he had to pay tax on the money from the sale of the shares.
In the end the wife did not press for the money the husband spent to re-establish himself and purchase household items to be included in the pool as a notional asset and this is in accordance with authority.[8]
[8] NHC & RCH (2004)FLC 93-204
The money the husband used to pay legal fees is a different matter. Whether amounts are added back as notional assets is a matter of discretion but there is clear authority for the proposition that if one party uses joint money to pay their legal fees it may well be appropriate to include the amount in the pool as a notional asset because otherwise the other party has de facto been compelled to pay part of the legal fees.[9]
[9] Omacini & Omacini (2005) FLC93-213
I intend to add the $7,200.00 which the husband used to pay legal fees to the pool as it clearly came from money or an entitlement accrued during the marriage.
The assets therefore are:
Assets in table at paragraph 163 $593,835.00
Notional asset – paid legal fees 7,200.00Total assets: 601,035.00
The parties have the following liability:
Description
Ownership
Value
Loan secured over the Property M property
Joint
$306,150.00
Total
$306,150.00
Both parties sought to have an additional liability included.
The wife said that she owed her parents $6,000.00 being money she borrowed after separation to assist her to repair the Toyota (omitted). Her counsel submitted that this debt should be included because it had added to the value of the Toyota (omitted).
I will refer to the money the wife allegedly owes her parents when considering s. 75(2) matters but it is not appropriate to include this amount as a debt in which the husband should share. He was not consulted about it and there was no evidence about the necessity for this exact amount or why the wife could not have paid some of it off after separation. She had $7,000.00 in the bank when she prepared her financial statement.
The husband alleged that the parties owed his mother Ms C $80,000.00.
There was no dispute that Mr R advanced $80,000.00 to the parties on 3 November 2011. The wife admitted that the money was received and it was common ground that it was used for family purposes including in connection with the house and the mortgage.
It was the husband’s case that the money was loaned to the parties and he sought to have it included in the pool as a debt owed by the parties to his mother.
The wife disputed that the money was loaned or at least that there was an enforceable loan.
An affidavit sworn by Mr R was filed in March 2015. There is no reference to the $80,000.00 in the body of the affidavit but Mr R annexed a document dated 3 November 2011 which is headed “loan agreement” and which refers to money being advanced to the parties as an interest free loan. It does not contain a requirement for repayment as such and it goes on to provide as follows:
This loan will be forgiven upon the death of Ms C and Mr R and gifted to keep thereafter.[10]
[10] Annexure A to the affidavit of Ms C
The document is signed by the husband, the wife and by Mr R and her husband Mr R.
The wife’s counsel submitted that Mr R may not have had the capacity to make the affidavit but that is really neither here nor there; the wife admitted that the document existed.
A problem with the document is that the amount of $80,000.00 appears to have been added into a space left in the document at a different time and it is not initialled by any of the parties who signed the document. Mr R did not have the capacity to give evidence when the trial commenced in November 2015 and she was not in a position to clarify the issue of how the figure of $80,000.00 came to be added to the document.
In support of his case that there was a loan rather than a gift the husband relied on the fact that Mr R advanced $70,000.00 to the parties in 2006 and that $50,000.00 was repaid but it does not automatically follow that the advance of $80,000.00 was also a loan.
The wife’s counsel submitted that even if there was a loan it was repayable on demand and the limitation period ran from the date of the advance and had expired and the loan was therefore unenforceable.
It is possible to seek leave to bring proceedings out of time but there was no evidence to suggest that this was likely to be given if sought.
It is open to question in my mind whether the $80,000.00 would in fact go back to Mr R if it was treated as a debt. The husband said that she had limited assets and was in a nursing home and needed the funds and moreover she had three children and the money had to be returned to her so that her estate could be properly divided between her children in due course. However the order he sought about it was that he indemnify the wife against liability to Mr R, not that the loan to be repaid to Mr R.
There are elements in the 3 November 2011 document which are as consistent with a gift as with a loan and I cannot be satisfied on the balance of probabilities that the parties owe an enforceable debt of $80,000.00 to Mr R. I will not include it as a liability for the purpose of determining the pool but I will it into account in assessing contributions.
The parties have the following superannuation:
Description
Ownership
Value
(omitted)
Wife
$29,625.00
(omitted)
Wife
2,500.00
(omitted) Super
Husband
$289,219.00
Total
$321,344.00
The parties have non-superannuation assets worth $294,885.00 and superannuation worth $321,344.00, a total of $615,929.00.
The applicable law
S.79 (1) of the Family Law Act 1975 empowers the court to make such orders as it considers appropriate altering the parties’ interests in property.
S.79 (2) provides that the court shall not make an order under this section unless it considers that it would be just and equitable to do so.
In Stanford & Stanford the High Court stressed that when an application for a property settlement was made the court must first identify the parties interests in property and then consider whether it was just and equitable to make an order altering those interests. It stressed that this question could not be answered simply by considering whether a party had made contributions as set out in s. 79(4) of the Family Law Act.
I am satisfied that it is just and equitable to consider making property settlement orders in this case as it clearly comes within the following situation referred to in Stanford:
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).[11]
[11] Stanford & Stanford (2012)HCA52
I intend to take the usual steps to resolve the question of what particular alteration of interests would be just and equitable and those steps are:
i)to assess the contributions of the parties under s79(4)(a), (b) and (c) and to express those contributions as a percentage;
ii)to consider the matters in s.79(4)(d), (e), (f) and (g), which includes the matters in s.75(2) so far as they are relevant, and determine whether any adjustment should be made as a result to the contribution based entitlements;
iii)to consider the effect of those findings and resolve what orders are just and equitable in all the circumstances of the case.
Contributions
Both counsel made submissions on the basis that contributions to the non-superannuation assets and the superannuation should be assessed separately. This is consistent with the recommendation in C & C[12] and I will adopt that approach.
[12] C & C (2005) FLC 93-220
The non-superannuation assets
Neither party had any significant assets at the commencement of the relationship.
The husband worked full time throughout the relationship and was the primary income earner.
The wife worked between 2000 and 2003 and between 2012 and separation. She was the primary homemaker and parent and between 2003 and 2012 she was exclusively involved in this role although I accept that the husband made homemaker and parenting contributions when he was at home.
From this perspective contributions must be assessed as equal and the issue in the case is how the assessment of contributions is affected by input from the parties’ families.
The parties both gave extensive evidence about physical work and provision of machinery by their respective family members to assist with construction of the house on the Property M property and they each maintained that the other party was grossly overstating the extent to which their family members were involved in such work.
The impression I gained was that family members on both sides pitched in to help the husband and the wife build their home. The wife’s father endeavoured to reconstruct the cost of the work he provided but I do not consider that on the state on the evidence I can find that one side of the family contributed more than the other.
The parties were provided with accommodation by both sides of the family prior to the home being completed. They lived with the husband’s family for 18 months and with the wife’s family for five years. They both submitted that the savings they made as a result of not having to pay accommodation costs assisted them to fund the construction of their house.
I accept this as a general proposition but it is a general proposition; no concrete evidence was put forward about the savings they made by residing in the home of either side of the family.
The parties also benefitted from cash provided by Mr R. She gave the parties:
i)$70,000.00 in 2006, $50,000.00 of which was repaid by the parties.
ii)$80,000.00 on 3 November 2011 which assisted the parties with living costs including costs associated with the house at a time when they were in serious financial need. The wife had not yet returned to work and the parties were dealing with Y recovering from leukaemia.
In effect Mr R gave the parties $100,000.00 and also gave them the use of $50,000.00 interest free for a period of time.
The husband asserted that Mr R also advanced $20,000.00 to assist the parties with the wedding costs. There was no independent evidence of this and in any event it did not translate into any property in the pool.
The financial contributions by Mr R must be treated as contributions of the husband and they are a significant matter given the size of the pool.
Conclusion about contributions
The husband’s solicitor submitted that contributions should be assessed as 60 to 70% by the husband and 40 to 30% by the wife. He did not indicate why he chose a range but it may be due to the dispute about whether the $80,000.00 provided by Mr R was treated as a loan or a contribution.
The wife’s solicitor submitted when the greater level of free accommodation provided by the wife’s family and the greater assistance they provided in the construction of the home was weighed against the gifts provided by Mr R contributions should be assessed as equal.
I do not accept this submission.
I must assess all contributions from all sources as best I can and weigh into the mix contributions which can be given a monetary value and contributions which cannot.
Both parties worked hard during the marriage in their respective spheres as primary income earner and primary homemaker and parent respectively and they were together for 14 years and brought up four children.
The wife’s family did provide a greater amount of free accommodation which had an economic value to the parties although I cannot quantify it but I do not accept that it is open to me to find that the wife’s family made a greater contribution to the construction of the home than the husband’s family.
The cash of $100,000.00 provided by Mr R and the additional $50,000.00 she lent the parties interest free are significant matters when the pool is worth only $294,585.00.
Assessing contributions is not an arithmetical exercise and this significant cash contribution must be weighed and balanced against the diverse contributions made by or on behalf of the wife during the relationship but I am satisfied that the husband’s contributions exceeded the wife’s and that contributions should be assessed as 55% by the husband and 45% by the wife.
This creates a differential of $29,458.50 between the parties’ and entitles the husband to $162,021.75 of the non-superannuation pool and the wife to $132,563.25.
Superannuation
The husband commenced work as a (occupation omitted) at 16 and commenced accruing superannuation at that time. He was 30 when he commenced cohabitation with the wife.
The husband accrued superannuation during the marriage and continued to accrue it after separation which was almost three years prior to the conclusion of the hearing.
There was no evidence of the value of the husband’s superannuation at the commencement of cohabitation. There was evidence that he had $219,282.00 at separation and that his superannuation had increased by $69,937.00 to the date of trial but the husband’s solicitor while referring to this did not use it as the basis of his submission about how the superannuation should be divided. Instead he asked the court to adopt a formulaic approach.
The husband’s solicitor submitted that 43.75% of the husband’s superannuation accrued during the period the parties were together and that 43.75% of the husband’s superannuation was worth $126,533.53.
He submitted that 25% of the wife’s superannuation accrued during the time the parties were together which was worth $7,406.25[13] and he submitted that if each party received 50% of the total amount of $133,939.78 the wife would be entitled to a splitting order in the amount of $60,000.00 (or slightly under if exact figures are used).
[13] The husband’s solicitor appears to have overlooked the (omitted) superannuation worth $2,500.00 referred to in the wife’s financial statement
This would effectively represent the wife receiving about 19% of the superannuation and the husband about 81% although the husband’s solicitor did not do this calculation.
An immediate problem with this approach is that the husband would not have been earning much or accruing much superannuation as a 16 year old (apprentice?) (occupation omitted). Much more than 43.75% of his superannuation is likely to have accrued in the 14 year period he and the wife were together than the 14 year period before hand and the post-separation increase in the value of his superannuation is due not only to the husband’s continued employment but to earnings on the amount already in the fund.
The wife’s counsel did not separately address the issue of contributions to superannuation save to submit that the formulaic approach adopted by the husband’s counsel was flawed. He acknowledged that the husband had accrued superannuation prior to cohabitation and submitted that when both contributions and s. 75(2) were taken into account the overall division of superannuation should be 45% to the wife and 55% by the husband.
I cannot adopt a formulaic approach and must make an overall assessment of contributions. The husband accrued a considerable amount of superannuation during the relationship while having the support of the wife who stayed at home caring for the children. He has accrued superannuation since separation at a much greater rate than the wife because he had the benefit of uninterrupted employment on a steadily increasing salary during cohabitation and he had a higher salary when the relationship ended and a much larger base to build on.
The husband’s proposal is far too light and I assess contributions to superannuation overall as 40% by the wife and 60% by the husband. This entitles the wife to $128,537.60 and the husband to $192,806.40 and creates a differential of $64,268.80 which I consider adequately adjusts for the pre-separation contributions of the husband and the fact that his continued employment after separation assisted with building his entitlement.
S. 79(4) (d) (e) (f) and (g) matters
I am required to consider the matters in s. 79(4) (d) (e) (f) and (g) of the Family Law Act.
The only relevant subsection is (e) which requires me to have regard to the matters in s. 75(2) of the Act.
S. 75(2) matters
The husband is 48. He has been employed by (employer omitted) for 22 years and is currently a (occupation omitted) on a salary of $112,000.00 per annum. However he also received bonus shares in 2013, 2014 and 2015 and his 2015 taxable income was $124,591.00.
The husband (his evidence) is in excellent health.
The husband has not re-partnered.
The husband’s solicitor submitted that the letter the wife sent to the husband’s employer on 6 September 2015 should be taken into account as a s.75 (2) (o) matter as it may affect his future employment but there was no evidence to support this submission, and neither was there any evidence that the flyer put into the letterboxes was likely to have an impact on the husband’s employment.
On the basis of contributions the husband is entitled to $162,021.75 of the non-superannuation assets and $192,806.40 superannuation. He has no significant additional debts. He has paid some of his legal fees but may have to repay his family for money borrowed to pay additional legal fees.
The wife is 40. In her financial statement she said that she was employed as a (occupation omitted) but her evidence in 2016 was that she was employed as a (occupation omitted) earning $50,000.00 per annum.
The wife was a (occupation omitted) when she met the husband and she worked as a (occupation omitted) at (employer omitted) prior to W’s birth. She then had 9 years out of the workforce and resumed work as a (occupation omitted) and is now a (occupation omitted). She is in good health and vigorously denied that she had an alcohol problem, which if she did could impact on her earning capacity, and she should be able to earn an income in the future, but she does not have educational qualifications which are likely to result in her obtaining highly paid employment in the future.
When the trial concluded the wife was in a relationship with Mr C but it is impossible to be sure if that will last and there was no evidence that it delivered any financial benefit to the wife.
The wife will have the care of the children eight days a fortnight. The husband is assessed to pay and does pay child support and at the time of the trial was paying $300.00 per week. However the wife also has to support Z who unless things have changed should be about to commence Year 12. She receives no assistance from anyone in respect of the support of Z.
On the basis of contributions the wife is entitled to $132,563.50 of the non-superannuation pool and $128,537.60 of the superannuation.
The wife said that she owed her parents $6,000.00 for the repairs to her car and $58,000.00 for legal fees. Her family have provided her with a good deal of assistance over the years and it is unclear whether they are likely to enforce repayment.
Conclusion about s. 75(2) matters
The husband’s solicitor submitted that the s. 75(2) matters were evenly balanced in that both parties were employed and accruing superannuation. He submitted that it was a relevant matter that the husband was eight years older than the wife and that she would have an additional eight years to earn income and acquire superannuation. He submitted that there should be no adjustment for s. 75(2) matters unless the court ordered that the children live primarily with the husband in which case the husband sought a 5% adjustment in his favour. He did not articulate why that should be so and seemed to be relying on a presumption that there ought to be an adjustment in favour of the party who had the primary care of the children.
The wife’s solicitor submitted that given the disparity in the parties income earning capacities, the fact that the wife had been out of the workforce for 9 years which put her behind in terms of experience and that she would have the care of the children 8 nights per fortnight there should be a 10% adjustment in her favour for s. 75(2) matters in respect of the non-superannuation assets.
He submitted that the superannuation should be divided 45% to the wife and 55% to the husband but did not make clear the extent to which this was due to an assessment of contributions and the extent to which it was due to s. 75(2) matters.
It is significant that the wife was out of the workforce for 9 years. During that period she parented the children freeing the husband from the need to perform that role except when he was otherwise available.
The husband’s role in the marriage led to him gaining experience and seniority and leaving the marriage with a strong income earning capacity. The wife returned to the workforce a year before separation but is yet to catch up with the husband and indeed given her lack of qualifications she may never do so.
The wife will be receiving a reasonable level of child support but she has a significantly lower income earning capacity and I consider that a 10% adjustment in her favour in respect of the non-superannuation pool would be appropriate. It will create a $59,000.00 differential between the parties but it is less than one year’s differential between their incomes and barring misadventure the husband should have a further 20 years in the workforce (or at least the government will very likely expect him to).
The situation with the superannuation is different because the eight year age difference between the parties could result in the wife catching up to the husband to a degree. On the other hand the husband’s superannuation will increase at a greater rate from now on because of his superior income earning capacity and the wife forewent income earning and accrual of superannuation to care for the children. Balancing these matters I intend to make a 5% adjustment in the wife’s favour in respect of the superannuation.
The wife will thus be entitled 55% of the non-superannuation pool and 45% of the superannuation. In dollar terms this will entitle her to $162,186.75 non-superannuation assets and $144,604.80 of the superannuation.
The husband will be entitled to 45% of the non-superannuation pool and 55% of the superannuation and this will entitle him to $132,698.25 of the non-superannuation assets and $192,806.40 of the superannuation.
The orders
There is a dispute about who should keep the former matrimonial home. The wife has lived there for the entire post separation period and the husband did not put forward any compelling reason why the wife should be forced to leave. Both parties’ families had input into the construction of the home.
I intend to give the wife first option to retain the home. There is however a chance that she may not be able to refinance the mortgage and pay the husband the amount required and if she is unable to do so then the husband will have the option of retaining the home and failing that the home will be sold.
If the wife keeps the home she will retain the following non-superannuation assets:
Description
Value
Property G
$580,000.00
Toyota (omitted) proceeds
$7,500.00
Jayco Caravan
$4,000.00
Less Mortgage
($306,150.00)
Less payment to husband
($123,163.25)
Total
$162,186.75
The husband will receive:
Description
Value
Payment from wife
$123,163.25
Notional asset
$7,200.00
(omitted) Football jersey
$1,500.00
(omitted) shares
$835.00
Total
$132,698.25
If the husband retains the home he will need to pay the wife $150,686.75.
If the home is sold then the proceeds will be divided 55% to the wife and 45% to the husband. The husband will be retaining additional assets which exceed the value of the additional assets the wife will retain by $69.25 but this is de minimis and I do not intend to order that this amount change hands.
I intend to make a splitting order providing for the wife to receive $112,479.80 of the husband’s superannuation which with her own superannuation of $32,125.00 gives her 45% of the superannuation pool.
I am satisfied that the outcome is just and equitable.
In his application the husband sought an order that the wife deliver up in good order and condition his personal property including tools, fishing rods and clothes.
During the trial he produced a 5 page list of items which he said the wife should be ordered to return to him. They ranged from such things as a lawnmower and a chest of drawers to “half of the Christmas lights” and “all hardware including all nails, screws, fasteners, adhesives, bolts and miscellaneous items.”
The husband also sought a “full download of all family photos off computer” and the return to him of jewellery gifted to Z and X.
The wife went through the list and marked the items she agreed to deliver to the husband, adding against the Christmas lights the comment “half don’t work”.
I intend to order that the items the wife agreed to return be delivered up but I do not intend to order that anything else be delivered up because I have no means of adjudicating on entitlement to them.
I also intend to note that the husband will have to accept the items in the condition they are in and accept that given the lapse of time since separation some may not now be able to be found.
These orders are not designed to advantage the wife; they are designed to head off enforcement proceedings which would not only be debilitating, expensive and ultimately dissatisfying for the parties but would be an unacceptable use of court time.
The parties agreed that the husband would supply a USB stick and the wife would copy the family photos. I do not intend to make an order about that.
The Child Support application
In his application in a case filed on 31 March 2015 the husband sought an order that the wife repay him $12,773.08 being child support he paid for Z prior to the DNA test results being received.
S. 143 of the Child Support (Assessment) Act, which is referred to in the consent orders made on 22 June 2015, relevantly provides as follows:
Amounts paid where no liability exists
(1)If:
(a)an amount of child support is paid by a person (the payer) to another person (the payee); and
(b)the payer is not liable, or subsequently becomes not liable, to pay the amount to the payee;
the amount may be recovered from the payee in a court having jurisdiction under this Act.
(3)In proceedings in a court under this section, the court may make such orders in relation to the payee as it considers just and equitable for the purposes of adjusting, or giving effect to, the rights of the parties and of the child concerned.
(3A) If:
(a)a person (the payer ) has paid an amount of child support to another person (the payee ); and
(b)the court has made a declaration under section 107 that the payer should not be assessed in respect of the costs of the child because the payer is not a parent of the child; and
(c)the court:
(i)is considering whether to make an order under this section; or
(ii)if such an order is to be made, is determining the amount that is to be recovered and whether payment is to be made in the form of a lump sum payment or a periodic amount;
then the court must have regard to the matters set out in subsection (3B).This subsection does not limit subsection (3).
(3B) For the purposes of subsection (3A), the court must have regard to the following matters:
(a)whether the payee or the payer knew or suspected, or should reasonably have known or suspected, that the payer was not a parent of the child;
(b)whether the payee or the payer engaged in any conduct (by act or omission) that directly or indirectly resulted in the application for administrative assessment of child support for the child being accepted by the Registrar;
(c)whether there was any delay by the payer in applying under section 107 for a declaration once he or she knew, or should reasonably have known, that he or she was not a parent of the child;
(d)whether there is any other child support that is, or may become, payable to the payee for the child by the person who is a parent of the child;
(e)the relationship between the payer and the child;
(f)the financial circumstances of the payee and the payer.
An amount paid to the Commonwealth under section 30 of the Registration and Collection Act is to be taken, for the purposes of this section, to have been paid to the payee.
The husband’s solicitor made no reference to the s. 143 application in his written submissions. His submissions do contain a heading “Child Support Application” and under it he makes submissions about the parties state of knowledge about whether the husband was Z’s father but he makes no reference to s. 143 and he concludes this section of his submissions as follows:
The father seeks an adjustment in his favour for child support paid for Z from the date of separation as set out in the Application in a Case filed by him.
Beneath this there is a heading “Conclusion” and a submission about the suggested percentage division in the property matter. It is as if the husband’s solicitor was proposing that the child support issue be dealt with as an s. 75(2) matter.
The wife’s counsel did address s. 143 and he started by submitting that there was a problem with the husband’s application in that he did not produce any evidence about the amount of child support he had paid for Z.
There is some merit in this submission.
In paragraph 8 of his 31 March 2015 affidavit the husband set out a list of the child support he said that he had paid for Z broken down into discrete periods. It totals $12,773.08 but it includes $3,435.08 for the period from 23 September 2013 to 6 February 2014 when he was paying voluntarily.
It seems clear from the husband’s affidavit that child support was not assessed under the Act until 6 February 2014; the husband attached to the affidavit Notices of Assessment for the periods 6 February 2014 to 19 August 2014, 20 August 2014 to 31 August 2014, 1 September 2014 to 11 November 2014 and 12 November 2014 to 30 November 2015.
I cannot include the amount the husband paid voluntarily and I cannot understand by referring to the assessments how the husband arrived at the figures for child support paid for Z during the assessment periods and his solicitor did not address the issue in submissions.
The bigger problem for the husband however is that his solicitor did not address the matters in s. 143 (3B) and that subsection provides that the court must have regard to those matters in determining whether to make an order for repayment of child support.
Dealing with the matters in s. 143(B) sequentially the husband’s own evidence was that he always suspected that Z might not be his child.
The fact that the wife swore in an affidavit on 22 July 2014 that she found such a suggestion insulting does not explain why the husband failed to seek a DNA test at or about the time of separation. The whole tenor of his evidence is that he did not believe the wife (ever) and he does not explain why he delayed seeking the test, including not seeking it until twelve months after the first assessment was made.
The husband is named on the child’s birth certificate as her father and this must have been with his agreement because he and the wife were not married at the time of Z’s birth, so his own conduct resulted in a successful application for an administrative assessment being made.
There is no prospect of any other person paying child support for Z.
The husband and Z did not have a good relationship prior to separation yet even at trial the husband was ambivalent about Z. He certainly did not want to cast her off completely and he proposed an order that she spend time with him in accordance with her wishes.
I finally take into account that the husband is in a far stronger financial position than the wife. He earns 2 ½ times her salary and the wife has no other person to turn to assist her with the support of Z. The property pool is modest and does not contain funds which would assist the wife to meet any payment to the husband. The husband placed the wife in a potentially very difficult financial position by his delay in seeking a DNA test.
In light of the husband’s conduct in agreeing at the time of Z’s birth to be named on her birth certificate as her father, in allowing her to believe for 13 years that he was her father, in taking no steps immediately after separation to arrange a DNA test resulting in him paying child support for Z voluntarily for six months and then pursuant to an assessment for 13 months, and in light of his lack of any real explanation for his delay in seeking the test and his far stronger income earning capacity, I do not consider that it would be just and equitable to require the wife to repay to the husband child support paid for Z even if I could accurately determine the amount she should be required to repay.
The husband’s application for an order that the wife repay child support to him will be dismissed.
I certify that the preceding two hundred and eighty eight (288) paragraphs are a true copy of the reasons for judgment of Judge Terry
Date: 5 April 2017
Key Legal Topics
Areas of Law
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Family Law
Legal Concepts
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Consent
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Jurisdiction
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Procedural Fairness
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Remedies
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Res Judicata
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