Spencer and Marks (No 2)

FAMILY COURT OF AUSTRALIA

SPENCER & MARKS (NO 2)

[2011] FamCA 932

FAMILY LAW – Property settlement – Where there is disparity between the parties’ salaries – Where both parties have large credit card debits – Where there are substantial expenses for the children, educational and otherwise.

FAMILY LAW – Child Support – Departure order – s 117(2)(ia) Child Support (Assessment) Act 1989 (Cth) – “Special circumstances” – Disparity in parties’ income.

Child Support (Assessment) Act 1989 (Cth)
Family Law Act 1975 (Cth)
Family Law Rules 2004 (Cth)

Gyselman & Gyselman (1992) FLC 92-279
Hickey & Hickey & Attorney-General for the Commonwealth of Australia (2003) FLC 93-143
Sheahan and Sheahan (1993) FLC 92-375

APPLICANT:

Mr Spencer

RESPONDENT:

Ms Marks

FILE NUMBER:

SYC

2429

2010

DATE DELIVERED:

9 December 2011

PLACE DELIVERED:

Brisbane via telephone

PLACE HEARD:

Sydney

JUDGMENT OF:

Bell J

HEARING DATE:

10 - 11 November 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Richards of Counsel appearing for the Applicant Husband

SOLICITORS FOR THE APPLICANT:

Paltos Briggs Family Lawyers

COUNSEL FOR THE RESPONDENT:

Mr Millar of Counsel appearing for the Respondent Wife

SOLICITORS FOR THE RESPONDENT:

Barkus Doolan Kelly

Orders

Property Issues

IT IS ORDERED:

That within three (3) months of today’s date the Wife do as and by way of property settlement receive an amount of $484,601.
That upon the Wife’s receipt of the sum referred to in Order (1), the Wife do all such acts and things necessary to transfer her right, title and interest in the property located at B Street, Suburb C, in the state of New South Wales, being the whole of the land in Certificate Title Folio Identifier 11/7749 (“the former matrimonial home”).
That in the event the Husband fails to pay the sum referred to in Order (1) within the three (3) months aforesaid, the former matrimonial home forthwith be sold by public auction at a reserve price of not less than $1.6 million or such other amount as may be agreed upon between the parties.
That until the Wife receives the sum referred to in Order (1) or until the settlement of any such sale of the former matrimonial home, whichever is first:
(a) The Wife have the right to remain resident therein;
(b) The Husband do pay all mortgage instalments on the aforesaid property.
That in the event the former matrimonial home has to be sold and is sold at a figure less or greater than the agreed value, then the amount to be paid to the Wife be varied in accordance with the percentage differential in the sale price from $1.6 million.
That the parties shall otherwise retain, to the exclusion of the other, all property currently held wholly in their name.

Child Support

That there be a departure from administrative assessment of child support payable by the Husband to the Wife for the children D born … 1997, E born … 1999 and F born … 2002 (“the children”).
That pursuant to sections 117 and 118 of the Child Support (Assessment) Act 1989 (Cth) the weekly rate of child support payable by the Husband in respect of the children be fixed at $300.00 per child from the date of these orders.

Parenting Issues

IT IS ORDERED BY CONSENT THAT:

Pursuant to Rule 10.17 of the Family Law Rules 2004, Orders, declarations and notations be made in terms of the document titled “Minutes of Consent” sealed and attached hereto.

IT IS FURTHER ORDERED THAT:

Pursuant to s 62B and s 65DA(2), the particulars of the obligations these Orders create and the particulars of the consequences that may follow if a person contravenes these Orders, and details of who can assist parties to adjust to and comply with an order, are set out in the document entitled “Parenting orders – obligations, consequences and who can help”, a copy of which is annexed to these Orders.

IT IS DIRECTED THAT:

The Minutes of Consent remain upon the Court file.

MINUTES OF CONSENT

THE COURT NOTES:
A.The following definitions for the purpose of these Orders:

A.1."Husband or Father" means Mr Spencer.
A.2."Wife or Mother" means Ms Marks.
A.3."the Children" means D, E and F.
A.4."D" means D Spencer born … 1997.
A.5."E" means E Spencer born … 1999.
A.6."F" means F Lara Spencer born … 2002.

IT IS ORDERED THAT:

Parenting

The Father and Mother have equal shared parental responsibility for the children.
Commencing from Thursday 24 November 2011 to the conclusion of the 2011 school term 4 the children live with the Father as follows:-
2.1.For the child F:
2.1.1.In week 1 commencing 24 November 2011 and each alternate week thereafter from after school on Thursday until the commencement of school on Monday or where the children do not attend school on that day or are required to be collected from school before the conclusion of that day, then at 3:10 pm that afternoon; and
2.1.2.In week 2 commencing 1 December 2011 and each alternate week thereafter from the conclusion of school on Monday until the commencement of school on Tuesday or where the children do not attend school on that day or required to be collected from school before the conclusion of that day, then at 3:10 pm that afternoon.
2.2.For the children E and D commencing from 24 November 2011 until the conclusion of the 2011 school term 4 each alternate week from after school on Thursday until the commencement of school on Wednesday or where the children do not attend school on that day or are required to be collected from school before the conclusion of school that day then at 3:10 pm that afternoon.
Commencing term 1 of the 2012 school year the children shall spend time with the Father during the school term each alternate week from after school on Thursday until the commencement of school on Wednesday or where the children do not attend school on that day or are required to be collected from school before the conclusion of that day, then at 3:10 pm that afternoon.
The children spend time with the Father during school holidays for one half of each school holiday period by agreement of the parties and failing agreement for the second half of each school holiday period commencing 2011 and each odd year thereafter and for the first half of each school holiday period commencing at the end of school term 1 2012 and each even calendar year thereafter;
Notwithstanding any Order herein where the children are not already spending time with the Father then, if not otherwise agreed between the parties in writing, the children shall spend time with the father as follows:
5.1.From 9.00am to 5.00pm on Father’s Day;
5.2.On each of the children’s birthday's as follows:
5.2.1.Where the birthday falls on a non-school day then for 4 hours at times agreed between the parties and in the absence of agreement then from 10:00am to 2:00pm on that day; and
5.2.2.Where the children's birthday falls on a school day as agreed between the parties and in the event of no agreement from the conclusion of school until 6:00 pm on that day;
5.3.On the Father's Birthday:
5.3.1.Where it falls on a school day from the conclusion of school until 6:00 pm that evening; and
5.3.2.Where it falls on a non-school day from 9:00 am until 5:00 pm.
5.4.From 9.00am Christmas Eve until 9.00am Christmas Day in each even year and from 9:00pm 23 December until 9:00pm Christmas Eve in each odd year; and
5.5.At such other times as may be agreed between the parties.
That notwithstanding any order herein where the children are not already spending time with the mother then, if not otherwise agreed between the parties in writing, the children shall live with the mother as follows:
6.1.From 9:00 am until 5:00 pm on each Mother's Day;
6.2.For the Mother's Birthday as agreed between the parties and in the event of no agreement from 9:00 am until 5:00 pm on that day.
6.3.On each of the children's birthdays by agreement between the parties and in the event of no agreement then:
6.3.1.where the birthday falls on a school day from 6:00 pm until 9:00 pm; and
6.3.2.where the birthday falls on a non-school day from 5:00 pm until 9:00pm that day.
6.4.From 9:00 am Christmas Day until 5:00 pm Boxing Day in each even year and from 9:00 pm Christmas Eve until 5:00 pm Boxing Day in each odd year, commencing after 2011.
6.5.At such other times as may be agreed between the parties.
Except as otherwise set out in these Orders the children live with the Mother at all other times.
Each party shall permit and not prevent or interfere with and do all things necessary to facilitate and encourage the children making telephone calls to and receiving telephone calls from the mother or father whilst in the care of the other.
The Father shall, prior to spending time with the children at G Street, H Town ("H Town property"), facilitate the children contacting the mother by telephone, by ensuring that the children either have a working mobile telephone coverage and in the event that they do not shall cause at his expense either a fixed line telephone or a satellite telephone to be installed and remain operational at the H Town property.
The Mother and Father forthwith provide to the other party all proper particulars of his/her residential address and all telephone numbers (including mobile, fixed line and satellite telephone) and further that each party henceforth provide to the other party not less than 48 hours notice of any change of residential address or telephone numbers.
The Father will forthwith:
11.1.create an emergency evacuation plan for use in the event of a fire emergency at the H Town property;
11.2.ensure that the children are made aware of the plan; and
11.3.provide a copy of the plan in writing to the mother.
Each party notify the other party of any serious illness, injury and/or hospitalisation suffered by the children or any of them as soon as it is practicable.
In the event that either party wishes to remove the children from school to travel on a holiday during the time that the children live with them, then they will obtain the consent of the other parent prior to making any arrangements for such a holiday.
Notwithstanding any Order herein, for the Christmas school holidays from 10 am 28 December 2011 to 13 January 2012 the children shall live with the mother and during this time the mother shall be permitted to travel with the children in 2011 only overseas on holiday.
Both parents forthwith ensure and continue to ensure that any medical, health, developmental, dental, behavioural and counselling professionals involved with the treatment of the children are directed and authorised by both parents to communication with and provide information and copies of documents to either parent at his or her request and cost.
For the purpose of changeover under these Orders the Father or his nominee shall collect the children from school at the commencement of each period the children live with him, and the Father or his nominee shall return the children to school at the conclusion of each such period and if a child or the children are not in attendance at school on that day then the Father shall collect the children from the Mother’s residence at the commencement of his time with them and the Mother or her nominee to collect the children from the Father’s residence at the conclusion of such period.
Each party forthwith authorise the principal and staff of the school(s) that the children may attend from time to time to supply to both parties all school reports, school photographs, school counsellor's notes, memos, school newsletters and any other information in relation to the children that either parent may request from the school(s).
The parties, without admission, be restrained from:
18.1.denigrating the other party and/or their family in the presence or hearing of the children or permitting any other person to do so; and
18.2.discussing the proceedings and/or the parties' relationship in the presence or hearing of the children or permitting any other person to do so.
18.3.using any illegal drug/s whilst the children are spending time with him or her or within 24 hours prior to the children spending time with him or her.
Either parent be permitted to take the children out of Australia on holidays for a period not exceeding 3 weeks provided that:
19.1.the proposed travel is not to take place during the other parent's time with the children unless otherwise agreed by the parents in writing;
19.2.he or she gives the other parent written details of the holiday not less than 42 days prior to the intended date of departure including:
19.2.1.dates of departure from and return to Australia;
19.2.2.copy of itinerary provided by travel agent or airline;
19.2.3.copy of return airline tickets;
19.2.4.the locations the children will be visiting whilst away from Australia;
19.2.5.details of how the children can be contacted whilst away from Australia including contact telephone number and address of the places they will be residing at during the holiday;
19.3.the travelling parent shall facilitate the children telephoning the other parent on not less than 3 occasions each week.
That in the event that either party is unable to care for the children for any period greater than 24 hours whilst the children are in their care pursuant to these Orders, then they shall give the other party first option to care for the children.
The mother retain the children's passport at all times except as they are required by the father pursuant to Order 19 and for this purpose the mother shall provide the passports to the father for the purposes of making travel bookings and other travel arrangements and the father shall return the passports to the mother within 72 hours of the children returning to the Commonwealth of Australia.
That each party do all acts and things necessary to ensure the children have current passports (with not less than 6 months currency) including but not limited signing applications for renewal and each party shall pay one half the cost associated with the renewal.
That there be no Order as to costs in relation to the parenting proceedings.

IT IS NOTED that publication of this judgment under the pseudonym Spencer v Marks is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 2429 of 2010

Mr Spencer

Applicant

And

Ms Marks

Respondent

REASONS FOR JUDGMENT

The applicant Mr Spencer was born in Country I in 1965. He came to Australia together with his parents in 1983. He received a degrees and diplomas from a number of Australian universities and is a professional by occupation.
He is the chief representative of the J Bank which is based in Country K. There is an office for the aforesaid bank in Sydney for investment purposes only.
The respondent Wife, Ms Marks, was born in Canberra, Australia in 1963. She is employed by L Bank and receives approximately $130,000 as and by way of income plus superannuation and a rare bonus (paragraph 68 of Wife’s affidavit dated 12 August 2011).
The Husband indicates that his current base salary (see paragraph 8 of his affidavit filed 26 October 2011) is $342,883. He is assessed for a performance based discretionary bonus and in March 2011 received a bonus after tax of approximately $95,787. He is supplied with a fully maintained company car and has the benefit of his employer applying considerable amounts of money towards the private school fees of the two children of the relationship who are attending private schools (such package capped at $36,000).
The children of the parties are D who was born in 1997, E who was born in 1999 and F who was born in 2002.
The elder children, namely D and E, are at present attending M School at North Sydney, a private school, which appears to be somewhat expensive. F is aged nine and will be attending her secondary schooling at M School when she is in year seven.
There was before me at trial a contested parenting application.
However the parties have put the children’s interests first and after receiving assistance from a Family Consultant, a Ms N, the matter is no longer in dispute before the Court and I complement the parties upon their coming to an agreement which obviously will benefit the children and which appears to be compliant with the children’s wishes.
The matters now left for my determination are the question of property settlement and a departure from a child support assessment.
Insofar as the property is concerned I am mindful that pursuant to the doctrine of Hickey & Hickey & Attorney-General for the Commonwealth of Australia (2003) FLC 93-143 (see paragraph 39), that the preferred approach for the determination of an application pursuant to the provision of s 79 involves four interrelated steps. Firstly, the Court should make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of hearing and consequently I will endeavour to do so.
I have been supplied in accordance with the Family Law Rules 2004 (Cth) with balance sheets by the parties but as a result of discussions and/or negotiations which have taken place between the Court and rulings made by myself, the balance sheets have been modified to a great extent. I will however be able to say this, that generally the property of the parties is contained in two real estate parcels, the first of which is the former matrimonial home situated at B Street, Suburb C in the State of New South Wales, purchased for $580,000 in September 1999 and subject to a first mortgage with
St George Bank. This property appears to have been purchased with the nett proceeds from the sale of a jointly owned apartment at Suburb O (approximately $100,000) the proceeds of sale of a portfolio of shares in the Husband’s name (some $22,000) and some savings.
Major renovations were carried out on the property in 2002/2003 of approximately $400,000. These renovations were funded substantially from borrowings and from savings to which both the Husband and the Wife contributed, including an inheritance of $70,000 received by the Wife. A line of credit was established with the Commonwealth Bank to finance the renovations in the sum of some $270,000. This line of credit in December 2003 was increased to about $420,000. The Commonwealth Bank line of credit and the mortgage were repaid in or about September 2005 by refinancing with the Suncorp Bank in the amounts of $590,000 and $368,000. Shortly prior, as I understand, to these facilities being available a sum of $39,000 was drawn down from the CBA line of credit to discharge monies owed on credit cards in the Wife’s sole name (paragraph 79 of Husband’s affidavit filed 26 October 2011) including a Diners Club credit card, a Westpac credit card and an Aussie credit card.
Notwithstanding that the Husband alleges that he was in some financial problems in 2010, he observed a property on eBay and considered that he could not live without it and he purchased this property situated at G Street in the H Town area for $325,000. This was funded by way of a loan of $32,000 from his father for stamp duty and legal costs, a loan of $45,000 from his brother Mr P and a mortgage of $260,000 in his sole name from Westpac (see paragraph 92(b) of the Husband’s affidavit filed 26 October 2011).
A boat was purchased in or about 2010 for $34,000, funded from bonus moneys he received that year. It appears that the engine of such boat has been damaged and it is now worth about $15,000 and is sitting at its moorings and has been there for a considerable period of time. There are other items of a personal nature as well as superannuation.
The parties, as I have referred to before, put before me balance sheets. I have taken it upon myself to prepare a balance sheet and incorporate the balance sheet in these, my reasons for judgment.

I have endeavoured to set out in that balance sheet the matters which are in agreement or the matters which are dispute. To generalise, what appears in dispute is the credit cards as to whether or not they should be taken into consideration as liabilities and the so called “waste” in relation to the motor boat.
The liabilities of the parties as set out are in relation to the mortgages on the former matrimonial home and the H Town property and after that are a considerable number of credit cards in the balance sheets of the Husband and the Wife.
At paragraph 81 of the Husband’s affidavit of 26 October 2011 he sets out what his credit cards were as at the date of separation and what they are at the present time. He has made little or no inroads into those credit cards; in fact he has gone backwards. This gentleman is a banker and I am quite surprised that he has put himself in the invidious position of owing some $60,000, upon which as he conceded in evidence, there is an interest liability of something like 20 per cent. He is paying an enormous amount per month off these credit cards, some $1600 per week (paragraph 100 (h) of Husband’s aforesaid affidavit) and one would sincerely hope that as a result of this judgment that he will pay them out and relieve himself of a considerable burden.
He points out at paragraph 83 of his affidavit filed 26 October 2011 that the American Express credit card, which is perhaps the only one that has decreased by a certain limited value, has been used for the family’s day to day expenses and he exhibits an end of year summary. These are, of course, years during which the parties were together. He has not, I believe, put before me any summary in relation to the use of the credit cards subsequent to separation, which was the 6 April 2009. In passing, a decree nisi was pronounced on the 3 June 2010. There was however a summary for the year January 2009 to December 2009.
These credit cards have been used for various expenses and have on occasions been used for the payment of F’s attendance at the Suburb C Public School. Notwithstanding that he receives a considerable amount of money from the bank and also some $36,000 by way of contribution towards the schooling expenses, he points out that in fact his expenses in relation to schooling is considerably more than that, approaching $48,000, and I refer to a document in which he particularises those outgoings (see inter alia paragraph 86 of his affidavit and those outgoings particularised at (a),(c), (d) and (e)).
In paragraph 90 the Husband refers to the fact that his father, Mr Spencer Senior, loaned the parties some $36,000 in order to pay out liabilities including credit cards, which was done. He alleges Mr Spencer Senior was still owed some $14,062 at the date of the affidavit, namely 26 October 2011. If that is correct, I assume that what he means is that as at 2006 there were no moneys owing on credit cards or if any of a little insubstantial amount. But as I have pointed out at the hearing, at the date of the swearing of his affidavit it appears that the parties are indebted to credit card establishments for approximately $60,000 for the Husband and $48,000 for the Wife.
The loan from the Husband’s father appears to have been paid out by the Husband’s bonus received in March 2011 (see paragraph 97(c) of the Husband’s aforesaid affidavit) and the Wife paid out hers.
As I have said, the credit cards are a bone of contention between the parties and I had initially considered that since the parties really had not adequately disclosed the use of such credit cards, it may have been better to leave the losses to lie where they fall. However, I must consider the Wife’s attitude towards this. Mr Q’s affidavit filed 16 December 2010 is of little help other than to show expenditure.
At paragraphs 20 to 22 of the Wife’s affidavit filed 7 November 2011, the Wife attempts to set out the details of her credit card indebtedness. She indicates that she had at the date of separation a Commonwealth Bank Mastercard debt of about $11,000. This has now been converted as I understand it to a Commonwealth Bank Platinum Mastercard, and the $11,000 has not been paid off.
The Wife sets out at paragraph 83 of her aforesaid affidavit the fact that she applies her income to meet childcare needs, medical bills, dental bills, physiotherapy bills, chiropractic bills, counselling bills, all extra curricular and coaching activities and part educational expenses. She says she meets personal and household expenses including her own private health insurance premium. She pays utilities in relation to the property in which she lives rent free and the maintenance of her own vehicle.
As far as I can ascertain, it appears as though the Wife’s indebtedness was as at separation in relation to her credit cards of some $11,000. There has been an enormous increase since then and I, whilst am unable to clearly find any allegation to suspect, have to assume that part and parcel to those matters to which she refers in paragraph 83 supra were funded by way of access to credit cards, which as everybody knows is an extremely expensive method of borrowing.
There is a considerable dispute in relation to the credit cards. The credit cards and their indebtedness are set out in both balance sheets prepared by the respective parties, but I must say that insofar as the Commonwealth Bank Platinum Mastercard which appears at item 14 on the Wife’s balance sheet and is item 13.6 on the Husband’s balance sheet, that the amount owing is not $11,000 anymore but $18,000 (see paragraphs 20 to 22 of the Wife’s affidavit filed 7 November 2011).
The credit cards appear to be in two sections. Items 13.1 to 13.5 of the Husband’s balance sheet are credit cards which he concedes are in his name and are used by him (see: compare items 13 and 14 in Wife’s balance sheet).
Insofar as the other credit cards and they are items 13.6 to 13.10 in the Husband’s balance sheet and at item 13 and 14 of the Wife’s balance sheet.
It appears that shortly prior to separation the parties had been using these credit cards particularly for household expenses and it appears if I may make a comment, “by robbing Peter to pay Paul”, on some occasions. It is alleged by the Husband that the Wife’s credit cards were very small as at the date of separation but that subsequent thereto she has used them and he should not be responsible for costs which are incurred by the Wife. The Wife says that these costs are incurred in relation to living expenses.
A quick addition of the Husband’s indebtedness to financial institutions other than banks appears to indicate that he is indebted to the extent of approximately $60,000. Insofar as the Wife is concerned it appears that she is indebted in a figure of something like $48,000.
Needless to say the payments on the amounts of these credit cards is a horrendous burden upon both the parties. It appears from paragraph 100 of the Husband’s aforesaid affidavit that he is paying something like $1,600 per week as and by way of credit card repayments. That being said it is something in excess of $83,000 per year.
It is submitted by the Husband that insofar as the credit cards are concerned the loss should lie where it falls.
There is evidence before me that one of the credit cards which is the Suncorp Bank credit card referred to in the parties’ balance sheets as owing as at this stage some $17,786, has been used and is being used for the provision of general services towards the family. I would consider that out of any of the credit cards I would be persuaded to take into consideration that as a liability. The others I feel the losses should lie where they fall, and that would mean something like $44,000 for the Husband and some $48,000 for the Wife owing by themselves. I therefore do not take into consideration anything other then the $17,786 credit card. Accordingly to my mathematics and with the assistance of the balance sheet to which I have referred, which has at this stage excluded all of the credit cards, there will be an addition insofar as the liabilities are concerned of some $17,786, making a total of the liabilities being $142,600.
The next question for me to determine according to the provisions of Hickey & Hickey & Attorney-General for the Commonwealth of Australia referred to hereinbefore, appear to me to be the contributions of the parties to the acquisition of the assets of the parties or either of them. It would generally necessarily require me to consider in depth the contributions made during cohabitation between the parties. There are however minor differences between the parties particularly upon moneys expended, for instance, by the Husband in relation to cosmetic improvement to his teeth. But, generally I am more than satisfied that during cohabitation the parties worked exceptionally hard together as a unit, the Wife during such times as she was not pregnant or recovering from pregnancy, that she worked and made contributions including inheritances as set out in paragraph 31 of her affidavit and as particularised at paragraph 41 hereof. Her contributions were not quite as much as the Husband, although I note that the Husband indicates that up until about 2005 his income was not as large as what it is now, I think a maximum of some $200,000. Notwithstanding that, contributions were made by the Wife including the inheritance (see paragraphs 66 to 67 of the Wife’s affidavit filed 7 November 2011), not only by way of financially but over and above by way of her contributions to the welfare of the children. Equally I am of the opinion that the Husband contributed financially as well as contributed to the welfare of the children. It appears to me, notwithstanding the submissions of Richards of Counsel, that it would be exceptionally difficult for me to consider that the contribution up until the date of separation was other than equal.
The complaints by the Wife appear to be directed basically to the fact that the Husband has subsequent to separation, out of his bonuses, which have been substantial, tended to benefit himself in relation to particularly two items of property, they being the motor cruiser which is now in a disabled state and as well the purchase of an H Town property in his own name. Naturally of course I am taking into consideration as assets of the parties, his interest in the boat and in the H Town property. May I say in passing that it has been alleged by the Wife that in fact I should discount the Husband because of waste in relation to the purchase of the boat. I do not consider this as any question of waste, it was a purchase made by him for some $34,000, admittedly it may not have been wise, but it was a boat that he had purchased for himself and the asset of course will be taken into consideration. There does not appear to be any suggestion on the part of the Wife, nor was it accepted by the Husband, that there was any casual attitude of him towards the maintenance of the boat. It appears that the boat blew up somewhere in the middle of Sydney Harbour. I do not consider that it is waste and I will take into consideration the present value of the item and have done so in the statement of assets and liabilities.
I have briefly touched upon the Wife’s complaints in relation to her contribution to the children, but may I point out that the Husband’s contribution subsequent to separation, include the following:
·some $36,000 which comes from his bank towards the education of the children;
·the payment of the mortgage instalments on the former matrimonial home; and
·that the Husband says are other outgoings over and above the $36,000 in relation to the children’s welfare being some $48,000, and I am assuming that these outgoings will continue to include those expenses referred to by the Wife at items 17.1-17.6 of her Response filed 2 March 2011.
The Husband is at present living in rented accommodation with his new partner who is now unemployed.
The Wife does not earn anywhere near as much as the Husband but it must be pointed out that subsequent to separation she has been living rent free in a house which is worth some $1.6 million. However, she does say that she has been paying maintenance expenses in relation to the house for which she is solely responsible and naturally of course, living expenses and expenses other than school expenses for the children.
I must say quite clearly that the s 75(2) factors must be in favour of the Wife. Naturally of course it is now a question for me to determine how much.
In particular I refer to a list of assets and liabilities which I have extracted from the various materials. Also the other assets of the parties other than those to which I have hereinbefore referred to appear basically to consist, over which there is no dispute, is superannuation in favour of the Husband of Colonial First State Rollover Superannuation of $194,982 and the Wife’s superannuation comprising of some four funds, totally approximately $164,008.
The balance sheets of which I have hereinbefore referred to include assets, liabilities and other financial resources but in particular I am referring to assets. Virtually all of the asset values have been agreed, save for one and that is the Wife’s interest in her father’s estate. Subsequent to separation the Wife became entitled together with her two sisters to equal shares in her father’s estate which was approximately $600,000 nett (See paragraphs 31-38 of the Wife’s affidavit filed 7 November 2011).
31. My late father’s estate consists of the following:
(a)Bank accounts which at the 4 November 2011 have a value of about $24,210; (the value of the NAB account is yet to be confirmed)
(b)An amount refundable from the [R Region] Retirement Trust of $271,391.25;
(c)A share portfolio worth $496,355 at the date the Grant of Probate was granted;
(d)War medals worth $600.
The Wife goes on to depose at paragraph 33 that the total known liabilities of her father’s estate is approximately $213,500. On my calculations, such values deposed to by the Wife at paragraph 31 come to a total $792,556.25, minus liabilities leaving $579,056.25 for division between the three remaining relatives (paragraph 32 of the Wife’s affidavit).
On the face of it, the Wife’s entitlement to such share would be some $200,000 or as particularised in the Husband’s balance sheet, some $199,000. The problem with this estimate of her interest in the shares is that there is a block upon her using such amount since the amount really is comprised of the value of the shares which are held by the estate and there is a direction by the testator that the income from the aforesaid shares should be used towards the grandmother, ie. the Wife’s mother’s maintenance during her life; in other words the Wife’s mother has a life interest on the aforesaid shares. It has been put forward by the Husband that this amount of money is available to the Wife. I will be discounting that considerably since she is not entitled to use it as it stands at present. There are many other ways of being able to avoid, one would have thought, the incidence of the condition imposed upon her entitlement to the estate. The Wife’s mother, at this stage, has all of her capacities and consequently it could not be suggested that she was in any way at a disadvantage if an alternate arrangement were made whereby the Wife could have access to the whole sum, but I will take it into account as a substantial matter under s 75(2) that she does have available to her in one form or another an amount approaching $200,000.
A problem insofar as the amount which the Husband had borrowed for his legal fees has now, I understand, been agreed at an amount of $114,138, and an amount of $108,314 used by the Wife by way of payment of legal fees (see item 21 of the Husband’s balance sheet; item 21 of the Wife’s Balance Sheet fees).
Taking into consideration those matters to which I have referred insofar as property is concerned, including the superannuation funds available to the parties, and the inheritances and termination packages paid to the Wife during the course of the marriage, it appears to me that the property of the parties is $1,987,146 not including the inheritance from the Wife’s late father’s estate. In relation to that inheritance, the value of which is in dispute, I will prefer for the purposes of property settlement to consider the value provided by the Wife ($36,000) as part of the inheritance which I understand she is able to access (see paragraph 31 of the Wife’s aforesaid affidavit). I will consider the sum of approximately $200,000 in relation to s 75(2).
Insofar as the final property is concerned, of course I have to take into consideration many things in relation to s 75(2) factors. I take into consideration the fact that notwithstanding the Husband has contact with the children, the Mother will have the primary responsibility for their care and welfare, that she is receiving something like $300 per week for each child but her evidence is before me that that he does not indemnify her in relation to the costs. Her income is considerably less than the Husband. She will, as a result of this order, as I have said, have little or no debts, but she will have to maintain herself and the children. She will no longer have a rent free home but will either have to rent and/or purchase a property in the area which she so desires.
I also note that it is suggested by the Husband that the Wife is in a relationship with one Mr S, which the Husband asserts is a de facto relationship. I am satisfied on the evidence of the Wife that she is not in a de facto relationship with Mr S, however, I am more than satisfied that there is a close, loving and warm relationship between the parties and that he does contribute towards the maintenance of herself and I expect to the children.
An attempt was made to show that in fact the Wife has more money per year than what she indicates by way of income as against outgoings. I am satisfied that if there is any moneys coming from Mr S I am not particularly able to quantify this, but this is a matter which I have taken into consideration in the final distribution of the property between the Husband and the Wife.
On the other hand the Husband has a secure job although he has mentioned that it may be that the bank will no longer practice in Australia, but I am not satisfied on the evidence before me that that is the case. He is with his present partner who at present is unemployed but has the capacity of earning something like $75,000 per year. He is paying the child support and also considerable moneys in relation to the children’s education.
Taking those matters into consideration and basically on the disparate nature of the income between the parties, I feel that property settlement should be divided 60/40, in other words there should be a loading of 10 per cent in favour of the Wife.
What then does this equivocate to? I herein incorporate the balance sheet to which I have previously referred, combining those balance sheets handed up by the parties at trial.

ASSETS	Ownership	Wife	Husband
1	B Street, Suburb C ("FMH")	Joint	1,600,000	1,600,000
2	G Street, H Town	Husband	325,000	325,000
3	Car	Wife	5,000	5,000
4	Boat	Husband	15,000	15,000
5	Furniture & effects
5.1	Furniture & effects, husband's residence	Husband	15,500	15,500
5.2	Furniture & effects at FMH	Wife/joint	17,500	17,500
5.3	Furniture & effects, at the H Town Property	Husband	2,000	2,000
6	Jewellery	Wife	2,000	2,000
7	Bank Accounts
7.1	St George Freedom account …	Husband	284	284
7.2	Westpac choice account numbered …	Husband	22	22
7.3	NAB Cheque account numbered …	Husband	173	173
7.4	CBA Streamline account …	Wife	74	74
8	Shares
8.1	T Pty Ltd shares (622)	Husband	236	236
8.2	U Pty Ltd shares (36)	Husband	947	947
8.3	V Pty Ltd shares (11)	Wife	10	10
9	Other
9.1	Bond monies	Husband	3,400	3,400
9.2	Wife's Interest in Father's Estate	Wife	36,000	199,000
TOTAL	2,023,146	2,186,146
TOTAL (not including inheritance)	1,987,146	1,987,146
LIABILITIES	Wife	Husband
10	Home Loan account, B Street, Suburb C	Joint	893,300	893,300
11	Home loan account, G Street, H Town	Husband	260,000	260,000
12	Personal Loans
12.1	Remaining amount of Husband's loans from father in 2006 and to acquire H Town property	Husband	14,062	14,062
12.2	Personal Loan from husband's brother, Mr P (utilised to purchase the H Town property)	Husband	45,000	45,000
12.3	Westpac Flexi Loan - legal fees	Husband	12,415	12,415
12.4	NAB Personal Loan - legal fees	Husband	50,559	50,559
12.5	Loan from wife's mother for legal fees	Wife	68,314	68,314
12.6	Loan from wife's sister Ms W for legal fees	Wife	40,000	40,000
12.7	Loan from Mr P for Legal Fees	Husband	21,164	21,164
13	Credit Cards
13.1	Suncorp Metway Visa card	Husband	17,786	17,786
TOTAL (excluding all credit card debt except joint $17,786 debt)	1,422,600	1,422,600
ADDBACKS	Wife	Husband
20	Paid legal fees(items 12.3, 12.4 and 12.7 plus bonus received and paid to legal fees)	Husband	114,138	114,138
21	Paid legal fees(items 12.5 and 12.6)	Wife	108,314	108,314
TOTAL (excluding mortgage arrears and boat purchase)	222,452	222,452
SUPERANNUATION	Wife	Husband
23	Colonial First State Rollover Superannuation	Husband	194,982	194,982
25	Australian Super member no.	Wife	30,884	30,884
26	Super X	Wife	10,451	10,451
27	AMP Superannuation Member No. ......	Wife	3,684	3,684
28	Colonial First State Personal Superannuation	Wife	118,989	118,989
TOTAL	358,990	358,990
TOTALS	Wife	Husband
Assets	2,023,146	2,186,146
Less Liabilities	1,422,600	1,422,600
Nett assets	600,546	763,546
Plus addbacks	222,452	222,452
Plus superannuation	358,990	358,990
TOTAL	1,181,988	1,344,988

As I have mentioned, I have chosen to favour the “Assets” value provided by the Wife, including the sum of $36,000 by way of inheritance. The parties had between them a number of personal loans, used, as I have mentioned, to finance legal proceedings and these have been added back accordingly.
It appears then that the Wife would be entitled to an amount of 60 per cent of the total property, being $1,181,988. This percentage equates to $709,192.8. How then is the Wife to be paid this amount? Firstly I must consider what the Wife already has in her possession.
Accordingly the evidence herein and with reference to the above table, the Wife has in her possession the car ($5,000), furniture and effects of former matrimonial home ($17,500), her jewellery ($2,000), bank accounts ($74), shares ($10) and the value of her share in the estate of her late father ($36,000). Adding to this sum the value of the Wife’s various superannuation funds, I find the Wife is already in possession of $224,592.
How do we then find the remaining $484,601? It would appear to me that the way of doing it is that in fact the house should be sold and that out of the nett proceeds of the house that money be paid. Or, it could be that the Husband pay out the amount as referred to immediately hereinbefore.
I have indicated hereinbefore that I expect the Wife to receive an amount of $484,601 as and by way of property settlement. My concern however is that one of the asset valuations to which the parties have agreed to is the house, and that is $1,600,000. It appears the house will have to be sold, but my concern is that if the house is sold for more than $1,600,000 the Wife will be at a disadvantage. But, if the house is sold for less than $1,600,000 the Husband will be at a disadvantage since I may be transferring it to him. In those circumstances, I would be ordering that upon the house being sold at a figure different to $1,600,000 that the amount of $484,601 be varied rateably in accordance with the percent difference.
I may say in passing that I have considered the initiating application and the Wife’s response and I am of the view that the method which I have adopted is preferable in all the circumstances in giving a more accurate and equitable estimate of the respective parties’ entitlements.

Child Support Departure Order

Since I am of the view that this matter should be determined in this Court it now behoves me to consider the provisions of s 117 of the Child Support (Assessment) Act 1989 (Cth) which are extensive but however I wish to refer basically to the fact that the Court may make a departure order:
Court may make departure order
(1)Where:
(a)      application is made to a court having jurisdiction under this Act for an order under this Division in relation to a child in the special circumstances of the case; and
(b)      the court is satisfied:
(i)       that one or more of the grounds for departure mentioned in subsection (2) exists or exist; and
(ii)      that it would be:
(A)just and equitable as regards the child, the carer entitled to child support and the liable parent; and
(B)otherwise proper;
to make a particular order under this Division;
the court may make the order.
The grounds for departure are set out in s 117(2). I need not, in my opinion, set out the whole of s 117(2) but refer to a provision of that subsection which concerns me in this matter.
It appears to me that the relevant subsection is that as contained in s 117(2)(c) which is as follows:
…
(c)that, in the special circumstances the case, application in relation to a child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child:
(i)because of the income, earning capacity, property and financial resources of the child; or
(ia)because of the income, property and financial sources of either parent; or
(ib)because of the earning capacity of either parent; or
(ii)because of any payments, and any transfer or settlement of property, made or to be made (whether under this Act, the Family Law Act 1975 or otherwise) by the liable parent for the child, to the carer entitled to child support or to any other person for the benefit of the child.
I have set out this subsection in full but consider that the apposite parts of such subsection are s 117(2)(c), (ia), (ib) and (ii). I will take each of them seriatim.
In relation to s 117(2)(c)(ia), I refer to my considerations of the income, property and financial resources of both parents in relation to the property settlement application before me, which has in fact in my opinion enabled this matter to be determined by this Court.
I do not intend to reiterate all those matters to which I have hereinbefore referred in relation to the property, but do say in passing, that one of the matters that I have to concern myself with in coming to that decision in relation to property is the expenses which the Wife may have in relation to the children and whether this sounds under the provisions of the relevant sections of the Act.
It is quite clear as a result of my determination that the parties will, should they accept financial management advice, put themselves in a position where, to me, it would appear that neither of them will have any substantial debts other than the Husband for the property at H Town and the Wife for her rental provisions or payment in the event she chooses to purchase a property.
Consequently overall it appears to me that the prime matter to consider is the disparate income of the parties.
The Husband in his position at present is earning a package of approximately of $500,000 per year.
The Wife is in receipt of regular income to which I have hereinbefore referred however clearly there is a disparity between their incomes. This of course takes into consideration s 117(2)(c)(ib) as well.
Am I persuaded as a result of this disparity to be able to say that it is such that the provisions of s 117 have been totally overcome?
Each ground of s 117 also requires me to consider the “special circumstances” of the case. What then are the special circumstances of this case, which I have to find so that it complies with the requirements of (c) referred to hereinbefore?
The term was considered in Gyselman & Gyselman (1992) FLC 92-279 and I also refer to the decision of Sheahan and Sheahan (1993) FLC 92-375 where the Full Court required the court to determine whether the relevant facts constitute special circumstances, which, if not taken into account, would result in injustice or undue hardship. It is my belief that the disparate income between the parties is such that the Wife would suffer undue hardship should the order not be departed from, and accordingly special circumstances are present from the facts of this case justifying a departure order to minimise the disparity.
In my opinion having overcome, if I may say, the hurdle of s 117, it appears to me as though I have to consider this basically as a child maintenance case in that being satisfied of the income, property and financial resources of the respective parties taking into consideration as I have the disparate income.
What should I order? The Husband in these circumstances as being sought by the Wife against him, to pay in effect, for the maintenance of his children. I have as I have said taken into consideration the fact that he expends a considerable amount of money, I would have thought all together of about $50,000 per year by way of educational and incidental expenses thereto, and having regard to the $80,000 in the manner of repayments on credit cards.
I note that in the Wife’s Form 17 filed on the 7 November 2011 (Financial Statement) she sets out what she considers to be the reasonable expenses of the three children.
According to my maths it would appear that her gross claim for the children amounts to approximately $2,000 per week. This would be extrapolated out to be something like $104,000 per year maintenance of the children, other than for the schooling expenses to which I have referred and to those amounts which are paid by the Husband in excess of $50,000. She is claiming an amount of $300 per child, which is about $900 per week but she says that that amount is a proper amount which I should order that the Husband by way of child support do pay.
I also note in Wife’s affidavit of the 7 November 2011 at paragraph 128 she says she has:
…
significantly high child care costs in relation to the children, in order to earn the income I do.
I note that in her financial statement she alleges that it costs by way of babysitting, which I believe is the subheading, an amount of about $450 per week. This I believe appears to be excessive and the children are now getting of an age, especially the eldest ones, where one would have thought that they could look after themselves to a great extent.
In consideration of the fact that the Husband’s income is, as set out in the evidence and as referred to in my reasons for judgment, some $500,000, and I also emphasise that if as a banker he recognises his credit cards and the enormous amount of money that he is paying per week, it would just become very close to what the Wife is seeking by way of child support payment. That is, $1,000 per week and taking that into consideration, it is quite clear that notwithstanding the Husband is struggling, even at present he is able to pay that amount per week and consequently insofar as his capacity to pay the $300 for each child, I am more than satisfied that he has that capacity.
It is just and equitable that he should pay this amount? It appears to me that if the Wife’s claim is correct, that is that she is expending $2,000 exclusive of those amounts to which I have referred, which are paid by the Husband, it would appear to me to be just and equitable that that nett figure, ie, less the schooling expenses referred to hereinbefore, should be shared equally between the parties. Consequently I am satisfied that the Husband can pay that amount and should, subject to my finding that in the special circumstances of the case.

I certify that the preceding seventy-nine (79) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Bell delivered on 9 December 2011.

Associate:

Date: 9 December 2011

[2011] FamCA 932

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