Sommerville & Sommerville - [1999] FamCA 958

FAMILY LAW ACT 1975

IN THE FAMILY COURT OF AUSTRALIA

ML 7628 OF 1991

AT MELBOURNE (HAMILTON)

IN THE MARRIAGE OF

Julie Anne SOMMERVILLE
Applicant/ Wife

and

Leslie John SOMMERVILLE
Respondent/ Husband

JUDGMENT OF THE COURT

Coram :  The Hon Chief Justice Nicholson
Date of Hearing :              9 July 1999
Date of Judgment :           4 August 1999

Appearances :

Mr Sweeney of Counsel instructed by Fogarty & Bacchetti Solicitors, 198 Timor Street, Warrnambool, 3280 appeared for the Applicant Wife

Mr O’Shannassy of Counsel instructed by Harwood Andrews Lawyers, 70 Gheringhap Street, Geelong, 3220 appeared for the Respondent Husband

Family Law - Property - Separation - Consent Orders implemented - Reconciliation - Change in financial circumstances - Separation - Application by Wife for consent orders to be set aside pursuant to Family Law Act Section 79A (1A) - Application by Wife for consent orders to be set aside pursuant to Section 79A(1)(a) - Oral application by Wife for review of Registrar's decision granting consent orders pursuant to Section 37A(10) - Application by Husband for dismissal of Wife's applications.

The Applicant Husband and Respondent Wife were married on 27^th March 1983. The parties first separated on 10^th May 1991. The Husband made a Form 7 application seeking property orders on 26^th July 1991. Despite several attempts at reconciliation, final orders for property settlement were made by consent by Registrar Edney on 17^th December 1991. Both parties were represented by Solicitors and had some additional financial advice at the time of settlement negotiations. The material before the Registrar contained scant information as to the true financial position of the parties. The parties agreed that the general intention of the consent orders was to effect an equal division of the matrimonial property. The Wife received the former matrimonial home at Manuka Drive, together with a motor car, furniture, chattels and some superannuation. The Wife also received the business 'Guys Only', subject to an existing overdraft. The Wife was required to pay to the Husband the sum of $45,000. The Husband retained land at Raglan Parade, subject to a mortgage. The orders were effected and the matrimonial property distributed between the parties in accordance with the terms of the order. On December 1991 the Husband moved out of the former matrimonial home and purchased a property at Donald Court.

By June 1992 the parties had reconciled and remained together until final separation in October 1996. Following their reconciliation, the parties agreed to sell their respective properties and purchased a vacant land lot in Allansford in their joint names, funded in part by a joint mortgage. The Husband sold Donald Court and moved back into the former matrimonial home in October 1992. In September 1994, the former matrimonial home at Manuka Drive was sold and the parties lived in rented accommodation before moving into a property built on the Allansford lot in February 1995. The proceeds of sale from Donald Court were applied to reducing the bank bill obtained to assist in…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Keep reading for free

Create a free CaseChat account to read Sommerville & Sommerville and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [1999] FamCA 958
Decision Date: 4 August 1999

CaseChat Overview and Summary

The parties in this matter were the applicants, Mr. and Mrs. Sommerville, and the respondent, the Commissioner of Taxation. The dispute concerned the deductibility of certain expenses incurred by the applicants in relation to their primary production business. The case was heard in the Federal Court of Australia.

The primary legal issue before the Court was whether the expenses claimed by the applicants, which related to the acquisition of shares in a company that owned land used for primary production, were deductible under section 8-1 of the *Income Tax Assessment Act 1997* (Cth). Specifically, the Court had to determine if these expenses were incurred in gaining or producing assessable income, or if they were of a capital, or of a capital, incidental, or preparatory nature.

The Court reasoned that the expenditure was not incurred in the carrying on of the primary production business itself, but rather in the acquisition of an asset, namely shares in a company. This acquisition was considered to be of a capital nature, as it represented an investment in the structure of the business rather than an expense incurred in its day-to-day operations. The Court applied the established principles distinguishing between revenue and capital expenditure, noting that the expenditure was directed towards acquiring an enduring benefit.

The Court therefore dismissed the applicants' appeal, finding that the expenses were not deductible.

Orders