Stiller and Power

[2011] FMCAfam 996

FEDERAL MAGISTRATES COURT OF AUSTRALIA

STILLER & POWER [2011] FMCAfam 996

FAMILY LAW – Property – both parties 74 years of age, marrying in 1991 – issue of whether parties actually lived as Husband and Wife – Wife made the overwhelmingly greater financial contribution – whether to assess contributions on an “asset by asset” basis or a “global” basis – loan of $84,000 by the Wife to the Husband – Wife restrained from recovering debt – justice and equity done by each party retaining all real property in their possession, power or control.

Family Law Act 1975, ss.75(2), 79(4), 80, 81

Re NHC and RCH [2005] FamCA 864
Hickey and Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143
McMahon & McMahon (1995) FLC92-606
Norbis v Norbis (1986) 161 CLR 513; (1986) FLC 91‑712 at 75,178

Applicant: MR STILLER

Respondent: MS POWER

File Number: BRC 10496 of 2009

Judgment of: Baumann FM

Hearing dates: 2 & 3 February 2011

Date of Last Submission: 15 March 2011

Delivered at: Parramatta

Delivered on: 19 September 2011

REPRESENTATION

Counsel for the Applicant: Mr Tolton

Solicitors for the Applicant: Slipper Lawyers

Counsel for the Respondent: Mr Page QC

Solicitors for the Respondent: Thynne Mcartney

ORDERS

1. The Husband is entitled to retain full right and title to all real property, the boats “[A]” and “[Z]”; his motor vehicle, bank accounts, furniture and personalty in his ownership, possession, power and control at the date of this order to the exclusion of the Wife and he shall indemnify the Wife and save her harmless from any liability, claims or actions that could or do arise from his mortgage liability, his store and credit cards and any other personal debts.

2. The Wife is entitled to retain full right and title to all real properties, her interest in “[Ms Power] Pty Ltd”, her motor vehicle, bank accounts, furniture, jewellery and personalty in her ownership, possession, power and control at the date of this order to the exclusion of the Husband and she shall indemnify the Husband and save him harmless from any personal liability that she currently holds.

3. The Wife is permanently restrained from seeking to recover or claim repayment of the sum of $84,000 and the Invoice of $710.16 from the Husband, with the intent that the Husband is relieved of any obligation to repay the said sums or any interest thereon.

4. The Husband shall within seven (7) days, at his expense, sign and prepare all necessary documents capable of immediate registration, to remove or otherwise withdraw the caveats registered over the title of each of the following real properties owned by the Wife:-

   (a)Lot [omitted](the [L] property).

   (b)Lot [omitted] (the [C] property).

   (c)Lot [omitted](the [W] property).

5. Otherwise, all other applications are dismissed, save for applications for costs.

6. If either party seeks to make an application for costs, they shall within thirty (30) days file and serve written submissions in support of such application, and the other party shall file and serve written submissions in response.  Unless otherwise ordered, the applications for costs shall be dealt with on the papers in chambers.

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

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT BRISBANE

BRC 10496 of 2009

MR STILLER

Applicant

And

MS POWER

Respondent

REASONS FOR JUDGMENT

Introduction

1. When an intelligent and creative mature age couple decided in 1991 to marry, both with a reasonable level of unencumbered assets, it might have been anticipated that 20 years later they may have at least preserved and enhanced their financial position and had many happy and shared moments.

2. Alas, nothing could be further from the truth in this case. The marriage was an unusual somewhat ambivalent relationship which seemed more to exist on weekly social outings and dinners and regular luxury holidays.

3. There is an issue about whether the parties really lived very often as “man and wife”. There is an issue about how they may have supported each other financially.

4. What is not in real dispute is that the Husband’s net assets have shrunk to just about $315,000 whilst the Wife’s assets totally unencumbered, have swelled to just under $4,000,000.

5. As to what orders do justice and equity to both in this situation is a difficult question to resolve. Considering the Husband’s case is effectively that the Wife pay him $1.9 million whilst the Wife says he should not only receive nothing from her but in fact, repay her about $84,000, it will be immediately apparent that these two 74 year old litigants see the history completely differently.

6. The reasons which follow attempt to explain to both why the Court has decided as it has in this case.

Historical Context

1. Because of the significant disparity of approach urged upon the Court in final submissions, it is appropriate to set out in some detail the historical context. In so doing unless I otherwise set out, what follows as statements of fact should be construed as findings of fact.

2. The evidence before the Court consisted of, in the Husband’s case, his affidavits relied upon and set out in his Case Outline. In the Wife’s case, together with her affidavits, she relied upon affidavits of her son MR P; her friend MS R; a painter/decorator MR G; a builder MR M all of whom where the subject of cross examination. A further witness

   
   

   MR T, was unavailable due to ill health and as a result less weight can be given to his affidavit.

3. The Husband was born in 1937 and the Wife was born in the same year. In the mid 1980’s they were introduced but a more serious relationship did not commence until about 1988 and the parties decided to marry [in] 1991. The parties were then 53 years old (the Husband actually turning 54, some 9 days later) and 53 years respectively.

4. The parties did not cohabitate as man and wife or intermingle their assets in any substantial manner prior to the marriage – although they had accompanied each other to social functions and some holidays.

5. At the time of marriage the Husband was a [occupation omitted]. Prior to [that career] he had a career in “[omitted]” . He holds tertiary qualifications including a Bachelor of [omitted]; Bachelor of [omitted] and, is admitted as a [professional membership omitted].

6. The Wife is an [omitted] by profession and commenced her own business in 1968. She is a [professional memberships omitted]. Since 1983 the Wife operated a business on a site at [C] and in 1989 she changed from operating the business as a sale trader to operating through a corporate entity known as “[Ms Power] Pty Ltd”.

7. At the time of marriage, both of these high qualified mature aged people had assets which they owned. There is no doubt, on the evidence, what those assets were – although in the absence of probative evidence of values as at 1991, the only statements of value are those lay opinions of the parties. A more complete analysis of the assets follows in these reasons, however it is agreed that the parties’ interests were:

   a)Husband

   -House and land at Property R, [R] (unencumbered)

   -motor vehicle

   -superannuation

   -furniture and personal assets (including bank accounts)

   b)Wife

   -Home at Property L, [L]

   -Home unit at unit Property P, [P]

   -Home unit at Property U, [B].

   -Business premises at Property C, [C].

   -business known at “[Ms Power] Pty Ltd”

   -20’ Hood Yacht called “[N]”

   -Some shares, jewellery, furniture and personal effects

   -a bank account, which the Wife says and I accept, had a balance of approximately $70,000.

   -the Wife says, and I accept, that at the time of marriage she had two loans from the ANZ Bank being:-

   -$180,000 secured over the [C] Property

   -$110,000 secured over the [B] Unit.

8. At the time of the marriage, the Wife’s son, Mr P, from her previous marriage, was aged approximately eighteen. He lived at his Mother’s home at [L]. He spent three years at University (1990 – 1992) and he sets out, and I accept, the living arrangements during his University study period, were as he described them at paragraphs 6 to 12 of his affidavit filed 19 January 2011. I found Mr P to be an impressive witness and very believable. He made concessions where he should have and where the evidence he gives on various events differs from that of the Husband, I generally prefer Mr P’s evidence.

9. Prior to marriage, the Wife had her lawyer prepare an agreement which purported to set out the assets the parties owned at the time of marriage and sought to restrict, by contract, future rights to claims against the other party in respect of those named assets. Sensibly and properly, the parties through their Counsel both acknowledge the agreement has no formal effect. That so much time was, in those circumstances, devoted in the affidavits and cross examination to that agreement remains a curiosity to the Court – but that the purpose of doing so was to support ultimates submissions to credit. I deal with that issue, discretely below.

10. The Husband retired from his [occupation omitted] position in December 1993.  He was 56 years old. His retirement permitted him to access his superannuation benefits – of approximately $220,000 – which he then used to renovate and convert his property at Property R, [R] into flats.

11. I am satisfied, on all the evidence that from the time of marriage the Husband predominately lived at his [R] home whilst the Wife lived at her [L] property.

12. The parties, after the marriage, acquired a boat jointly and named her “[V]”. The Wife says, and I accept (see paragraphs 46-50 of her trial affidavit), that she paid for the initial purchase price of approximately $14,000 and further reimbursed the Husband for some works he performed on the boat. Remembering that by July 1993, the parties had been married for nearly two years, the tenor and necessity for the correspondence (and invoices) referred to and being Annexures “VP10” and “VP11” reveal they are really of a business nature and hardly normal communication between two loving adults sharing a joint passion and endeavour. In many ways the correspondence speaks volumes as to the nature of how these parties kept their finances very separate. I note, for example, that the Husband “charged”  the Wife items of 50 cents and $1.60 (a bulb). The invoices 1 & 2 were offset against an invoice apparently given to the Husband by the Wife for $702.45 for some goods her business provided to him. The Husband seemed anxious to confirm a discussion about the Wife allowing the Husband to “buy out” her interest in the boat, but it seems reimbursing her for payment to be by Christmas 1993 (when the Husband retired and accessed his superannuation). It is not clear whether the Husband did in fact repay the Wife – however the Wife says, and I accept, that in 2008 the Husband sold ‘[V]’ for about $35,000 and kept the proceeds. The Husband says merely that he disagreed with this assertion and that the proceeds of sale of ‘[V]’ “were spent on holidays”. I regard the Wife’s version of events as more believable.

13. The Husband says that “during the course of our relationship we purchased a property at [P] referred to as [P]”. The Husband’s statement seeks to give a “gloss” to a pre marital purchase by the Wife in 1989. Whilst the Husband acknowledged he did “not provide any monies for the purchase” but attended to some minor maintenance, the Wife gives fulsome details of the unit purchase for $320,000 (paragraph 29(b)); and its sale for $430,000 in 2006. The Wife says, and I accept the net proceeds of sale were contributed to her superannuation.

14. In 1997, the Wife purchased the property at Propery W, [W] for $195,000 with finance. She used her savings to pay a deposit and has rented the home out as an investment. The Husband does not claim any direct financial contribution to that purchase.

15. Also in 1997, the Wife sold her [B] Unit and purchased a Unit at “[E]” in [B] for $311,000. The Husband does not claim he made any direct financial contribution to that purchase.

16. In 2002, the Wife inherited $200,000 from her Mother’s estate. The Wife says that she used about $14,000 to pay for a trip to Alaska for the couple and put the rest into her superannuation. The Husband agreed with that statement, adding that he paid “many of the out of pocket expenses of this trip”. This contribution by the Wife of the major share of travel expenses was, I am satisfied the usual approach to joint holidays, as the Wife claims, for example:- (referring to the extensive details set out at paragraph 124 of the Wife’s Affidavit:-

    -    the 6 week holiday in England, Wales and Scotland in September 1994;

    -    the 10 day trip to China in May 1998;

    -    the trip to London and Spain in August 1999. The Husband’s claim for reimbursement of expenses (see annexure “VNP34” dated 2 July 2000 again speaks volumes and, in my view supports the Wife’s claim about how they separated finances and how careful (she says “frugal”) the Husband was with his money.

    -    The cruise to Alaska in 2002

    -    The 2003 cruise around South America

    -    The cruise on the Queen Mary 2 in February 2007

    -    And the cruise on the Queen Elizabeth 2 in January 2009.

17. The Husband’s response to these statements by the Wife is imprecise and does not, in my view, cause me any concerns in accepting the accuracy of the Wife’s very clear and, at times, collaborated assertions. He says merely:-

    “124.Disagree. All of my contributions get no mention. I paid totally for a one month car tour of the British Isles. On our honeymoon, I brought the Respondent many thousands of dollars worth of jewellery and ornaments as well as mementos (sic) which are at our [L] property today. On all our trips, I bought souvenirs for our [L] property and presents for [Ms Power] as well as sharing expenses. I have been on to budget and then live without counting the cost. I had no idea the Respondent was so very different in this respect, counting the coast of everything (and not its value) and ignoring contributions of other including my friends and relations. As an example, we dined in New York at my brother-in-law’s expense prior to boarding the Queen Elizabeth 2. How much this amounted to I have no idea.”

18. Clearly if he actually contributed to the New York dinner, he would know how much it cost. This is a man who as early as 1993 was claiming expenses for boat maintenance of less than 2 dollars. The Wife was very particular and has kept her records for a long time. In fact I regard both parties are extremely particular about money matters. If the Husband was able to give clear details he would have done so. I infer, in the absence of doing so, he has merely made general observations – which I find to often be exaggerations.

19. The Husband’s boat “[Z]” was purchased by him with his funds. The Wife claims no contribution to its acquisition or maintenance. The Husband says the Wife was “kept fully informed, shown pictures of “[Z]” but declined to accompany me to Sydney either to inspect or to buy”. The fact that the Wife may have spent some time on the vessel and gave the Husband some advice on “colour schemes”, does not amount to converting the endeavour to a joint activity or purchase.

20. The evidence of the Husband is that the Wife was a willing participant in his purchase of an expensive ocean going yacht to be built in the United Kingdom called “[A]”. More than any other event since the marriage in 1991, the purchase and financing of this vessel shapes both the available pools of assets and the ultimate decision. It is discussed separately below.

21. Within the midst of the finance issues relating to the “[A]”, the Husband on 1 July 2009 wrote a letter to the Wife as follows in part, namely:-

    “After some years of progressive deterioration (sic) in our 17 year old marriage I realised that the marriage had broken down irretrievably when you sent your invoice and claim for the sum of $4,710.16 for interior furnishings on ‘[A]’ on 25 June last and received on 1 July. This is now appropriate to sort out our financial affairs and in 12 months divorce”.

22. The Wife, whilst apparently accepting the marriage (as it was) was over, took some legal advice as to her position should the Husband’s then highly geared financial situation (through his borrowings for the ‘[A]’) cause him to lose his home/property at [R]. Of course, the Court does not seek to explore what advice the Wife (or for that matter the Husband) was receiving at the time, however the circumstances surrounding the Wife offering to pay the husband $84,000 on 20 July 2009 are disputed. The Wife says she did so, from her funds, on a “promise” the Husband gave to repay her from the sale proceeds of “[Z]”. The Husband (in his affidavit filed 17 January 2011) agrees that was the case.

23. The Wife says (at paragraph 74) that on 20 July 2009 (after handing over the funds which were then transferred to the United Kingdom), they had a meal during which the Husband “promised me that in return for lending him the money, he would agree to enter into a binding financial agreement in the same terms as our financial agreement.” The Husband says he made no statements as alleged by the Wife – save that he did promise to enter into a binding financial agreement but not in the terms of the original “deficient document”. Nothing turns on why no agreement was entered into however I am satisfied that the payment of $84,000 was meant to be a “loan” to the husband by the Wife. It is acknowledged as much by the Husband at item 53 of the Husband’s financial statement filed 17 November 2009.

24. The Husband commenced proceedings in this court in November 2009 and the trial proceeded on 2 and 3 February 2011. The Court expresses its regret for failing to deliver these reasons earlier.

25. Written submissions were delayed because the parties, at the conclusion of the evidence had agreed to put a “joint question” to the Wife’s bankers, ANZ Bank Limited. No further evidence from the Bank was received. The written submissions closed with the Wife’s submissions in reply being filed on 15 March 2010.

The Financial Agreement

1. The parties agree that they discussed a “pre-nuptial agreement” however the Husband disagrees that he agreed to sign one. He said he told the Wife such agreements “had questionable value”. At that time he was entirely correct, but the Wife did arrange for a solicitor to prepare a document. Two copies are Exhibit 5 (signed carbon copy) and Exhibit 6 (signed photocopy). Although the signed documents are the same, and purport to set out the assets of the parties at the time, and an agreement that neither party will make any claim against the “assets of the other party as set out herein or acquired by the other party in substitution or in addition to the assets set out herein” (clause 1(d)) or against their estates (Clause a(e)), the signing of the documents is a matter of controversy.

2. The Husband claims “I signed the agreement on the cake table at our wedding breakfast. I did not date it at that time or ever”. I do not accept this evidence. I accept that, as the Wife states:

   a)she gave the agreement she had her solicitor prepare, to the Husband before the date of marriage;

   b)The agreement was signed by the Husband some nearly two years later “in the kitchen of my showroom at [C]”.

   c)At the time the Husband signed the agreement it had been signed by the Wife on or about 11 June 1993. The Wife says the Husband signed the agreement on 30 July 1993.

3. Apart from finding the Wife a more accurate and precise historian, the Wife’s version is also collaborated in part by Mr P who says “at no time did I observe [Mr Stiller] being presented with a document to sign at any time on the day of the wedding”. Another guest at the Wedding Ms R said likewise.

4. Clearly the evidence of Mr T could not be tested – and should therefore be treated with caution. Mr T said he had known the Wife for forty years and had been a Justice of the Peace for over 25 years. He would have either lunch or morning tea with the Wife and her staff on a Friday. He was at the wedding and said no signing of a document as alleged by the Husband. Mr T swears he witnessed the Husband’s signature on the agreement on 30 July 1993.

1. The documents suggest, by the dates beside the signatures, that:-

   a)The Wife signed the documents on 11 June 1993 and it was witnessed by Mr T on that day. The signatures on the “Carbon Copy” appear to be original signatures for the Wife and her witness that day. The 11 June 1993 was a Friday.

   b)The Husband’s signature does not have a date proximate to it. The signature of the witness Mr S appears to be an original on both copies of the document. The date proximate to Mr T’s signature is 30 July 1993 – although it is differently described in each document. Also the initial “J.P” appear in the carbon copy but not the photocopy. The 30^th of July 1993 was a Friday.

2. Although the agreement does not have the effect of preventing any claims being made, the Husband’s insistence that he was forced to sign the Agreement at the wedding, which I do not accept, damages his credit considerably.

The [A]

1. Based on findings already made about credit, I make the following findings about the purchase and financing of the yacht “[A]”, namely:-

   a)In March 2008 the Husband signed a contract to buy a yacht in the United Kingdom that was to be “built to order”. A contract solely in the Husband’s name is annexure “VMP13”. The agreement to purchase is dated 17 March 2008. The purchase price was £385,927.

   b)I do not accept the Husband’s evidence that:

   “Just prior to separation the Respondent and I decided to purchase a yacht to sail around various parts of the world during our retirement”

   The Wife, in cross-examination made it clear that whilst she enjoyed cruising on the Queen Mary and Queen Elizabeth 2, she did not enjoy yachting and had no interest whatsoever in cruising the world in a smaller boat, as alleged. I believe her.

   c)The estimated delivery date for the boat was April 2009. The Husband gave the Wife a brochure on the boat. I accept it may have been at the Wife’s [business]. However there is no evidence that satisfied me, this was a joint endeavour. I accept the Wife expressed alarm and concern to the Husband about how he was able to afford the yacht. The Wife was not involved with any initial financial borrowings.

   d)The Husband, owning an unencumbered property at Property R, arranged finance through the National Australia Bank. The Husband secured a loan of $1.4 million. It seems clear that this loan, arranged before the global financial crisis, relied upon the Husband’s [R] property having a market value greater than was reasonable – however that was the commercial bargain and risks undertaken by the Husband and the Bank.

   e)The Wife says, and I accept, the Husband told her the loan was going to be “a perpetual loan where he would borrow sufficient to include interest payments and that the loan and interest would eventually be paid by his estate”. The Wife said she wanted nothing to do with it.

   f)By March 2009, it seems clear the construction costs and accumulated borrowings and interest were reaching a level that the Husband decided he must try and refinance. At that time, the Husband asserted in a loan application that his [R] property was worth $3.9 million. At the hearing the property had an agreed value of $1.3 million.

   g)Whilst I would accept that the Husband probably mentioned to the Wife his increasing debt and concerns, at no time did the Wife offer to expose her assets to the Husband’s debts, by becoming a co-borrower.

   h)The Husband’s loan with the NAB was due to expire in November 2009.  At early 2009 the Husband’s only income was rental income from his property. It is clear he was investigating refinancing on a “lo-doc” basis namely, as I understand it, primarily on a basis that the security offered was sufficient to cover the debt adequately without significant reliance or investigation into the borrower’s income. The Husband, on or about 23 March 2009 made enquiries with a finance broker called “Commercial Finance Connections”. Annexure “VMP16” is a copy of the Broker’s “understanding” of the Husband’s finance requirements. As the letter indicates, 2 conditions seemed to be that the husband’s property be valued at $2.92 million and, relevantly:-

   “The involvement of a ‘co-borrower’ (with a beneficial interest in the finance proposal i.e de facto) who has held an ABN for in excess of 2 years and who makes a declaration to the lender that they have sufficient income to meet interest under the Facility…..”

   i)It is hardly surprising when the Wife (a very prudent and conservative businesswoman in my assessment), was confronted by the Husband and a representative of the broker (Mr B), that she refused to sign the document. The Wife says that Mr B and the Husband “tried to coerce me into signing a contract for a refinance proposal”.  The Husband denies that strongly. Mr B was not called by the Husband to give any evidence. It is a reasonable inference to draw that Mr B would not have given evidence helpful to the Husband about that meeting. In the circumstances, the Husband saying he left the meeting “utterly bewildered and disoriented” and “dumfounded and speechless” is really astonishing. I am satisfied he had no expectation that the Wife would expose herself to a borrowing she had not otherwise been involved with. The Wife, consistent with the history, refused to sign the form. It is likely that the Husband was under extreme pressure and embarrassed. The meeting took place on 26 March 2009. It was a Friday.

   j)At paragraphs 29 to 37 of the affidavit of Mr P, he details discussions with the Husband and his Mother.

   k)That was not the end of the matter. I am satisfied the Husband approach Mr P in May 2009 and asked him if he would guarantee “a loan for $80,000 to fund the final payment of his yacht”. Mr P refused.

   l)Clearly without the final payment being made, the Husband was not able to take delivery of the yacht. At around the same time as Mr P refused to guarantee a loan, the Husband, again approached the Wife. At paragraphs 61 to 66 the Wife gives evidence of the events leading up to her decision to lend the Husband the sum of $84,000. I accept the Wife’s evidence is true.

2. The Husband ultimately took delivery of the boat, which at the time of trial, was still in the United Kingdom. The Husband has now spent some months in European waters sailing the boat. The boat has been subject of an independent valuation by a qualified yacht surveyor, consultant and broker Mr P. His report dated 20 December 2010 opines the current market value to be £433,692. This represents “81% of the price paid by the owner in 2009. It also represents 70% of the cost of buying a Southerly 49 of similar specification for delivery for the 2011 season”.

3. In short, the Husband in my view, unilaterally decided to buy an expensive overseas built yacht. He borrowed heavily on his unencumbered property to do so. Because of his lack of income, the borrowings swelled with accumulated interest. The boat cost more than originally contracted, and is now worth less than he paid for it. It is the Husband’s passion to be an ocean going sailor. It never was shared in a meaningful way by the Wife. This expensive exercise is something for which the Wife should bear no responsibility.

Principles

1. Shortly stated, but more concisely and elaborately described in the Full Court decision in Hickey and Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143, in a property settlement case, the court must adopt a well-known four-step process, essentially:

   a)to identify the pool of assets and liabilities generally, and usually at the time of hearing;

   b)to assess the relative contributions of both the financial, non-financial, direct and indirect nature as specified by s.79(4);

   c)to consider the factors as are relevant contained in s.75(2) of the Act; and

   d)finally, consider the ultimate analysis to determine whether the order the Court proposes to make it just and equitable to both parties.

2. Although the statement of principal is clear, in this case it is urged by the Husband that I adopt a global assessment of contributions, consistent with the preferred approach identified by the High Court in Norbis v Norbis (1986) 161 CLR 513; (1986) FLC 91‑712 at 75,178. The submissions of the Husband’s Counsel refer me to a number of authorities. However, in my view, and consistent with the approach contended for by the Wife, it is appropriate in this case to separate the respective interest of the parties held at trial and to assess contributions under s.79 on an “asset by asset” basis.

3. The guiding authority which remains good law after more than 15 years, is McMahon & McMahon (1995) FLC92-606. Although it is often stated that a marriage of short duration might more likely compel moving from a global assessment, each case must be dealt with on its own facts.

4. The Wife said at paragraph 20 of her affidavit that: -

   “20.[Mr Stiller] and I agreed that we would never mix our finances or our assets. Neither of us had any detailed knowledge of the others bank account balances. Neither of us had any influence or control over how the other person has dealt with their assets and finances”.

5. The Husband disagreed with that statement however, the history demonstrates that even if they didn’t agree (and certainly the financial agreement reflects such an understanding), they did conduct themselves in such a manner as the findings already made clearly show.

6. The circumstances of this case, in summary, which persuade me that an asset by asset approach is preferable to a global approach include:-

   a)Although a long marriage these parties at best lived together for only most weekends and holidays. Despite being retired from 1993, the husband did not take up occupation in the Wife’s home permanently at a time that the Wife continued to operate her business in Brisbane, and live at [L].

   b)The pernickety manner in which both parties delivered invoices to each other for works and goods.

   c)The lack of accumulation of any substantial joint property. I ignore, in that description, the Husband’s claim of purchasing jewellery, souvenirs etc. No value for these good is revealed and more likely they have little more than sentimental or momento value.

   d)The Husband does not claim to have made any significant direct financial contribution to the Wife’s assets. He may have been on occasions, a confidant in respect of the Wife’s business decisions but nothing more other than minor repairs or maintenance or, at times, advice. There is nothing to reveal the Wife took such advice. The Husband himself acknowledged the Wife generally did her things her way.

   e)The only possible “joint asset” during the entirety of this long relationship was the boat “[V]”, which has been dealt with above. That “joint” ownership lasted for a short period and I am satisfied the Husband did much better out of the deal than the Wife.

   f)There is no evidence of “pooling” income. They lived separate lives; maintained separate bank accounts; and made financial decisions solely. They might have shared some of the expenses (like regular dining, social activities, shows etc) but this is more compatible with a relationship between occasional companions than devoted partners. The tenor of correspondence produced to the Court so reveals.

POOLS

1. I find that at the hearing, I should estimate the separate pools – that of the husband and that of the Wife – as below.

Husband

Assets
Property R, [R]	$1,300,000
The vessel “[A]”	677,562
The boat “[Z]”	10,000
Furniture	5,000
Car	4,000
$1,996,562
Liabilities
NAB mortgage	$1,508,500
Loan form Wife	84,000
Husband’s ANZ Visa	38,542
Other credit cards	50,000	$1,681,042
Net Assets	$   315,520

Wife

Assets
Property L, [L]	$575,000
Property C, [C]	1,300,000
Propery W, [W]	550,000
Property B, [B]	765,000
Business – [Ms Power] Pty Ltd	Nil
Bank Accounts
[W] property account	10,207
[C] property account	4,411
[B] property account	10,397
Savings account	67,772
Cheque account	59,924
ANZ V2 account (proceeds of superannuation)	475,339
Furniture	15,000
Loan to Husband	84,000
Total	$3,910,050

1. I note that the Wife had converted all her remaining superannuation to cash – representing the funds in the ANZ V2 account.

2. To further explain the pools as found, I say that:-

   a)I have adopted the Husband’s estimate of value of his car as a statement against interest.  The Wife says, and I accept, the car she drives (a SAAB) is owned by her company; is leased; and the lease payout exceeds its value. I therefore ignore it.

   b)The Wife says she has a remaining ANZ V2 account of $475,339.  There is no doubt se had contributed much more than that sum to superannuation.  The Wife’s evidence is about $186,000 from an inheritance and the proceeds of sale of the [P] unit (sold in 2006 for $430,000) were contributed to superannuation.  Income would have been earnt on the investments in the fund.  The Wife’s says she has spent $196,000 on legal expenses.  I am comfortable in inferring the Wife has accessed her superannuation from time to time as needed to pay her legal expenses.

   c)Because of the source from which the Wife paid her legal expenses – being an asset not contributed to in any real sense by the Husband – I would not add back these funds.  This approach is consistent with the discretionary guidelines identified in Re NHC and RCH [2005] FamCA 864. Similarly, the Husband’s costs of $3,000 should not be added back.

   d)The Husband seeks to include as an asset, a payment to the Wife’s son Mr P totalling $92,000 – which was paid over a period of time by the Wife, to her only child.  I accept the evidence of the Wife and Mr P that the repayment of these funds has been forgiven, as much as remains unpaid. Certainly some of the funds for a car were repaid (see Exhibit 7).  I do not accept the evidence of the Husband that a large cash sum, approximately $42,000, was paid to the son by the Wife, as he claims.  The story is, I accept, as detailed by Mr P in his evidence is that he did receive some cash from his Mother in the region of $3,000 - $10,000.

   e)The Wife has some shares in a company called “[omitted]” or similar of minimal value.  The evidence is insufficient to make a finding about this holding save that in a total pool of the Wife’s assets exceeding $3.7 million, it is an insignificant holding.

Contributions

1. Section 79(4) of the Family Law Act 1975, at subsections (a) and (b) requires the Court to take into account financial and non-financial contributions made “by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them…”

2. On the facts as found by me, I am satisfied that the Husband and Wife made no relevant direct financial contribution to the acquisition of any of the property of the other party.  They hold assets now which they either had at cohabitation or were substituted for or sourced from assets at cohabitation.  The Wife and husband retained total control of their income and, although contributing (although not equally) to holidays and social occasions jointly enjoyed, almost without exception any task or expense involving property of the other party resulted in an “invoice” or claim and was usually paid or otherwise offset.

3. Although the Husband claims support of the Wife’s son Mr P – it seems clear on the evidence any support by way of contribution of accommodation on the Gold Coast was limited; offset in part by payments made by Mr P and a benefit to Mr P as an adult – not a child.

4. In circumstances where it has been the Wife’s case form the outset that the Husband made no contribution to her assets at all, it was to be expected that the Husband would seek to establish the extent of his non-financial contributions.  As a result of the findings already made, the highest and only relevant contribution he says he made, falls within the category of a direct or indirect contribution (other than financial) to the acquisition, conservation or improvement of the Wife’s property.  The Wife does not claim she made any significant non-financial contributions to the Husband’s assets.

5. On the evidence I assess the claims of contribution made by the Husband as follows:-

   a)I prefer the evidence of the Wife and her witness Mr M (builder) to that of the Husband, where the Husband claims the Wife “sought my assistance in receiving and appraising the civil engineer design” for work on the [C] property.  The Husband is a qualified [omitted], not a structural engineer.

   b)Rather than the parties spending alternate weekends at the Husband’s home as he claim, I accept the Wife’s evidence that she spent only a few weekends at the Husband’s home.  The evidence points to the Husband travelling usually on a Friday to Brisbane; expecting the Wife to collect him and then the couple going out for dinner and staying at the Wife’s home and, occasionally her unit at [B], before he then returned to the Gold Coast.

   c)The Husband claims (as paragraph 23) that he used his car “as a builder’s van for the next 73 weekends without a break to finish off extension work to [L] begun by the Wife”.  I do not accept this generalised evidence.  He may have done the odd job or maintenance on [L] but this claim by the Husband is an exaggeration.  The evidence of the Wife, her son Mr P, Mr M (as paragraphs 8 and 9) and Mr G all are to be preferred to the evidence of the Husband.  On this basis, I make the findings I do above.

   d)The Husband says from 1993 (after he retired) he would come up by train on a Friday and “would help” the Wife in her business in [C].  The Wife overly minimised the Husband’s contribution by saying he did nothing at all.  This was seized upon by the Husband who, in the final analysis, was able to demonstrate some modest work in bookkeeping, banking and wage calculation. I say modest, because the Husband would ask the Court to accept, as is contended for in paragraph 15 of the written submissions, that:-

   “15.It is submitted that the Husband made substantial contributions to the acquisition, conservation or improvement of the property of the parties….  The Husband argues that he not only actively assisted in the conservation and improvement of all the properties, but by his unpaid assistance in the business, he allowed the Wife to produce an income that would also assist in the acquisition and retention of property.”

6. I don’t accept this assertion completely.

7. The Husband’s non-financial contributions were not significant but extremely modest.  Although it is not necessary to find a “nexus” between a particular contribution and an asset being conserved or acquired to give value to the contribution, in my view the Wife’s business has, it is agreed, no value and the income from it is modest – probably less than $400 per week net. Clearly the Wife’s primary source of income is rentals.  Having no debt enables the full benefit of this passive rental income to be enjoyed.  Sadly, for the Husband, his debts and the way they are structured, extinguishes most of the benefits of his income.  I also make the observation that unlike the Husband who retired in 1993 (aged 56), the Wife has continued to work in her business as an [omitted].  That overwhelming contribution to the business places the Husband’s occasional forays into bookwork into a true perspective.

8. Assessing all these factors within the matrix of a long unusually ambivalent marriage, I find that the Husband’s contributions to the assets of the Wife are far exceeded by the Wife’s – such that the Husbands minimal contributions are almost irrelevant.  Although the Wife, through her submissions (at paragraph 26) contends she made “considerable tangible and intangible contributions” to the Husband’s property, frankly although marginally greater, they are also almost irrelevant.

1. The nature of the weekends being spent socialising and going out to dinner, does not create a significant homemaker contribution but to the extent I am satisfied the couple, when together (other than on holidays) were usually at the Wife’s home, it follows in my view, her contribution was greater.

Section 75(2) factors

1. By reason of s.79(4)(e) of the Act, the court must consider the factors, as are relevant in s.75(2).

2. Both of these parties are in their early 70’s and although each complain of health conditions, no uncommonly felt through the process of ageing, neither party produced any medical evidence at all to establish they are not otherwise in reasonable health for their age.

3. The Wife clearly is in a significantly superior financial position to the Husband, but less it be regarded as the Court being unsympathetic to the current plight the Husband is in, it must be recorded that the comparative positions stem from:-

   a)The Wife’s superior initial financial positions;

   b)Poor decision making by the Husband in that:-

   -retiring at age 56, he failed to maintain an adequate flow of income.  His qualifications may have allowed him to seek out positions in the [omitted] industry.  There is no evidence he sought to do so;

   -the decision to purchase “[A]” was simply beyond his means unless he was prepared to sell the [R] property;

   -the financing options created an accumulating debt with no significant option to increase his income beyond the maximum rentals achieved after using his superannuation to improve his property.

   -although he could not be blamed for not seeing the global financial crisis, he seems to have almost naively accepted his property and only asset could not reduce in his estimations of value.

4. The ultimate result is, I accept, for a man of his age, a financial tragedy.  He has real estate and a boat which have depreciated in value.  His loan is in arrears; accumulating with compound interest; and he is confronting proceedings in the Supreme Court with National Australia Bank, who seeks possession of the property.

5. It would, in my view, be an impermissible exercise of judicial discretion and a form of social engineering in this case to make some adjustment from the Wife’s pool of assets to the Husband merely because they went through the Act of marriage in 1991.

6. I agree with the Wife’s submissions that there should be no adjustment for the s.75(2) factors.

Just and equitable order

1. The Husband seeks an order that he essentially receive 50% of the net combined pool.  Essentially on the pools as found by me, this would require the Wife to pay the Husband funds totalling $1,797,265, calculated as follows:-

Husband’s net assets	$315,520
Wife’s net assets	$3,910,050
Total pool:	$4,225,570
Half of pool =	$2,112,785
Less Husband’s net assets	315,520
Balance payable by the Wife	$1,797,265

1. On the evidence and the findings as made by me, that proposition is fanciful and not even remotely equitable to the Wife.

2. The Wife’s Case Outline sought, as a primary order, that the Husband’s property applications be dismissed; that all caveats be removed; and that within 30 days, the Husband to pay the Wife the sum of $84,000 and the sum of $710.16.  I should indicate that I do not regard it as equitable to make an order in respect of the claim for expenses incurred by the Husband from the Wife, of $710.16.

3. In considering an order that does justice and equity to both in this matter, in reality the issue reduces in my view, to whether the Husband should be required to repay the Wife the sum of $84,000 loaned to him.

4. In the absence of:-

   a)a sale of the boat “[A]”;

   b)a significant improvement in the value of the [R] property such as will enable it to meet the entirety of the secured mortgagee’s interest under its security;

   it is hard to see what assets are likely to exist in Australia to permit any recovery of the sum of $84,000 (with or without interest).

5. It was clearly a matter considered by Senior Counsel Mr Page QC in his final submissions where he says at paragraph 33, in part that:-

   “…It is submitted that the Court does not have power to make an order that the Husband pay that sum [$84,000] to the Wife as such is not within the compass of s80 of the Act.  It can however alter the interests of the Wife in that debt by transferring the debt to the Husband, in other words, forgiving the debt…”

6. The issue about the Court’s power to order the Husband to repay the debt of $84,000 was not the subject of argument before me. In those circumstances, I am not prepared to necessarily accept the submissions as to the powers under s.80 (for example s.80(k)).

7. On the totality of the evidence however, I am on balance satisfied that to give effect to the duty the Court has, under s.81, to end financial relations between these parties, orders where the parties retain all those assets currently in the possession, power and control of each party at the time of trial and extinguishing the prospect of the Wife recovering the funds she paid to her Husband of $84,000, does justice and equity to both.

8. The orders which appear at the commencement of these reasons does so.

I certify that the preceding seventy-three (73) paragraphs are a true copy of the reasons for judgment of Baumann FM

Date:  19 September 2011