STREET & HODGES
[2014] FCCA 2485
•31 October 2014
FEDERAL CIRCUIT COURT OF AUSTRALIA
| STREET & HODGES | [2014] FCCA 2485 |
| Catchwords: FAMILY LAW – De facto property – whether the parties’ relationship was a de facto relationship at law from February 2003 or a date in 2005 – just and equitable settlement. |
| Legislation: Family Law Act 1975, ss.4AA(1), 79, 90SF and 90SM |
| Jonah & White (2012) FLC 93-522 Sinclair & Whittaker (2013) FamCAFC 129 Cadman & Hallett [2014] FamCAFC 142 Lynam & Director-General of Social Security (1983) 52 ALR 128 Moby & Schulter [2010] FamCA 748 Stanford & Stanford (2012) FLC 93-495 Bevan & Bevan [2013] FAMCAFC 116 |
| Applicant: | MR STREET |
| Respondent: | MS HODGES |
| File Number: | DGC 990 of 2013 |
| Judgment of: | Judge Small |
| Hearing date: | 14 July 2014 |
| Date of Last Submission: | 31 July 2014 |
| Delivered at: | Dandenong |
| Delivered on: | 31 October 2014 |
REPRESENTATION
| Counsel for the Applicant: | Mr Gates |
| Solicitors for the Applicant: | Hardys |
| Counsel for the Respondent: | Mr Williams |
| Solicitors for the Respondent: | McDonald Slater & Lay |
DECLARATION
Pursuant to section 90RD of the Family Law Act 1975 (Cth) the Court declares that the parties were in a de facto relationship between April 2005 and September 2012.
INTERIM ORDERS
The property situate at and known as Property W in the State of Victoria but more precisely identified in Certificate of Title Volume (omitted) Folio (omitted) (“the real property”) shall be placed on the market for sale within 45 days of the date of these Orders (“the sale”).
Should the parties be unable to agree on a real estate agent to conduct the sale within 14 days then they shall approach the President of the Real Estate Institute of Victoria and request him or her to appoint a real estate agent for that purpose.
Should the parties be unable to agree upon the terms of sale for the real property then the appointed real estate agent shall determine the terms of sale.
At the settlement of the sale, the proceeds of sale shall be applied as follows:
(a)First to pay all costs and commissions of the sale;
(b)Second to discharge any encumbrance affecting the real property, including any mortgage;
(c)Third to pay the following liabilities of the parties:
(i)The (omitted) Bank loan in the Applicant’s name up to the sum of $16,510;
(ii)The Respondent’s Centrelink debt up to the sum of $9,387; and
(iii)The Applicant’s tax liability up to the sum of $18,040.
(d)Fourth to pay any outstanding outgoings of the real property including rates and utilities;
(e)Fifth the balance to be divided as to 45% less $14,300 to the Applicant and 55% plus $14,300 to the Respondent.
The Applicant shall retain for his own use and benefit exclusive of the Respondent the items set out in Schedules A and C attached to these Orders, and the (omitted) Land Cruiser motor vehicle in his possession (“the Land Cruiser”).
The Respondent shall retain for her own use and benefit exclusive of the Applicant the items set out in Schedules B and D attached to these Orders.
The Applicant shall indemnify and keep indemnified the Respondent against any and all liabilities attached to the Land Cruiser.
The Applicant shall collect the ride-on lawnmower from the real property within seven days and return it to the (omitted) and the Respondent shall allow him access to the real property for that purpose.
The items set out in Schedule E attached to these Orders shall be sold and the proceeds divided as to 45% to the Applicant and 55% to the Respondent.
Should either party fail to do any thing or sign any document necessary for the operation of these Orders within 14 days of a request that he/she do so, then pursuant to s.106A of the Family Law Act 1975 (Cth) a Registrar of the Federal Circuit Court of Australia shall be forthwith appointed to do any such thing and sign any such document on his/her behalf as may be necessary to effect the operation of these Orders.
The Registrar shall give effect to paragraph 11 hereof upon receipt of an Affidavit sworn by the lawyer for the party seeking the Registrar’s intervention setting out the failure of the other party to comply with these Orders.
Within seven days of the date of these orders the lawyer for the Applicant shall provide procedural fairness to the Trustee of the Applicant's (omitted) Superannuation Fund (“the Trustee”) in relation to the proposed orders set out in Notation B hereto.
Within seven days of receiving a response from the Trustee the lawyer for the Applicant shall send a copy of that response to the Associate of Judge Small.
Unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:
(a)each party shall be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders;
(b)monies standing to the credit of the parties in any joint personal bank account shall be the divided 45% to the Applicant and 55% to the Respondent;
(c)insurance policies remain the sole property of the life insured named therein;
(d)each party shall be solely liable for and indemnify the others against any liability encumbering any item of property to which that party is entitled pursuant to these orders;
(e)any joint tenancy of the parties in any real or personal estate is hereby expressly severed; and
(f)each party forgoes any claim they may have to any inheritances to which the other party is entitled to either presently or in the future.
The proceedings are otherwise adjourned to a date to be fixed to allow for Orders 13 and 14 hereof to take their course.
AND THE COURT NOTES:
A.These orders are interim orders only because final orders will include a superannuation splitting order and upon the Court receiving confirmation of procedural fairness having been afforded to the Applicant’s superannuation Trustee, the orders in Notation B hereof will be made at a further mention of the matter.
B.The following are the orders proposed to be made upon receipt of the confirmation in Notation A:
In accordance with s.90MT of the Family Law Act 1975, whenever a splittable payment becomes payable in respect of the superannuation interest of the Applicant in the (omitted) Superannuation Fund (“the Fund”), the Respondent will be entitled to be paid an amount calculated in accordance with Part VI of the Family Law (Superannuation) Regulations 2001 using the base amount of $10,562.00 (ten thousand, five hundred and sixty two dollars) and there will be a corresponding reduction in the entitlement of the Applicant.
The trustee of the Fund must comply with the obligations imposed upon trustees of eligible superannuation plans under the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001.
The Applicant is hereby restrained by himself his servants and agents from making any binding death benefit nomination to the trustee of the Fund in favour of any person who is an eligible beneficiary within the meaning of Regulation 13 of the Family Law (Superannuation) Regulations 2001 which would have the effect of diminishing the value to the Respondent of the splitting order made in paragraph 8 hereof.
Paragraphs 1 and 2 of these Orders bind the trustee of the Fund when these paragraphs take effect from the operative time, being the fourth business day after the date these Orders are served upon the trustee.
The Applicant and the Respondent shall do all such things and execute all such documents as are necessary to facilitate the rollover by the trustee of the Fund of the Applicant’s entitlements pursuant to paragraph 1 of these Orders to another regulated superannuation fund, an approved deposit fund, or a retirement savings account or other such applicable fund or account at the sole nomination of the Respondent as soon as that is practicably possible after the operative time.
IT IS NOTED that publication of this judgment under the pseudonym Street & Hodges is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
SCHEDULE A
STREET & HODGES
DGC 990 of 2013
SCHEDULE OF FURNITURE, FURNISHINGS AND
CHATTELS TO BE RETAINED BY MR STREET
Master Bedroom:
Wooden bed (which was built by Mr Street).
Antique chair.
Ship steering wheel.
All (omitted) antiques.
Cannon.
TV Panasonic.
Chest (built by Mr Street).
Tapestry.
(omitted) hanging pictures.
Candelabra (built by Mr Street).
All antique furniture inherited by Mr Street from his grandmother .
Walk in robe:
Sky dive equipment
Toy helicopter.
Master Bedroom
Father's leather (omitted) jacket purchased in (country omitted) in (omitted). ·
The large wooden clothes peg.
His grandfather’s gold plated candlesticks.
Lounge:
Purple lounge.
The coffee table our client built.
The TV.
Cowbell.
Tapestry (x2).
Armour chest and head.
Waterford crystal (omitted).
Antique bugle.
Vase.
Oars.
His various CD's .
Dining:
Dining table and chairs (built by Mr Street).
Some of the children's books.
His grandmother’s small round antique table.
The wood heater tools.
The pottery pot.
(omitted) shield and weapons (built by Mr Street).
Jousting stick.
Masquerade mask.
(omitted) picture hanging.
His various books.
(omitted) clock.
Wrought iron (omitted) (built by Mr Street).
Wrought iron (omitted) (built by Mr Street).
Front entry:
(omitted) pictures.
Ceramic vase.
Swords.
Axes.
Street shield.
Black (omitted) box (built by Mr Street).
Toy room:
Large round antique table.
The 4 (omitted) prints.
Large coffee table (built by Mr Street).
(omitted) figurines – (omitted).
Other (omitted).
Kitchen:
(omitted) dinner set.
(omitted) cutlery.
Remaining mugs.
His grandmother's old (omitted) dish with lid.
Toaster.
Kettle.
(omitted) fridge .
(omitted) knives excluding the paring knife.
Microwave.
50% of wine and champagne glasses.
Chopping boards (built by Mr Street).
Study:
Filing cabinet.
Office chair.
GPS.
All (omitted) maps.
(omitted) flag.
Mask.
2 sets of binoculars.
Hallway:
Some towels.
Some bedding.
Some tea towels.
Laundry:
Dryer.
Second bathroom:
Some bath toys.
(omitted) mirror.
Spare bedroom:
Queen size mattress.
Radiator heater.
Candelabra our client built.
Outside/under house:
The large scales outside.
Wine barrels .
Square trampolines.
Business assets:
All items and assets owned by and belonging to the company, including but not
limited to:
The (omitted) fridge.
The generator.
Other Items:
Portable builders' toilet.
Rodeo ute number plate.
Outside bench and table.
All contents of all sheds including all tools and second hand materials save and except for the Mother's personal belongings - as verified in letter from mother’s solicitor dated 4th June 2014.
Two tarpaulins 9m x 6m.
All wall hangings and quilts made by Mr Street's mother.
SCHEDULE B
STREET & HODGES
DGC 990 of 2013
SCHEDULE OF FURNITURE, FURNISHINGS AND
CHATTELS TO BE RETAINED BY MS HODGES
Master Bedroom:
Queen size mattress.
Bedside table.
Bedside lamps.
Wooden chest.
(omitted) long side table.
Small wooden storage boxes.
Doona and bedding.
Christmas decorations.
Her (omitted) clock.
Walk in Robe:
Shoe rack
Xmas stand.
Fan.
Master Bathroom:
All Ms Hodges' personal items and children's personal items.
Lounge:
Small square side table.
Kids toy cupboard games .
DVD players.
Dining:
Kids’ books.
Old school desk.
Ms Hodges' books.
Piece of wood (varnished).
(omitted) (figurine).
(omitted) metal tubs (holds sticks).
Recipe books.
All her books.
Photo albums.
Front Entry:
Frogs.
Coat rack.
Toy Room:
Toys .
White fridge .
Ms Hodges' couch.
(omitted) painting.
(omitted) painting.
Desk for Y’s bedroom.
Kitchen:
Kitchen aid mixer.
(omitted) dinner set.
Glasses.
Kids’ mugs.
Mixing bowls.
Platters .
Coffee machine.
Miscellaneous cooking utensils.
All Tupperware including everything in large kitchen drawers.
Pantry items .
All electrical cookware .
(omitted) veg paring knife (GSF-24).
Vases.
50% wine / champagne glasses.
All bakeware.
Study:
2 x filing cabinets .
White board
Miscellaneous games.
(omitted) leather office chair.
Disc from video camera.
Stationery.
Electrical boxes.
Training manuals.
Laminator.
Paper.
Gift wrap/cards,
(omitted) DVD player .
Children’s boxes artwork.
Hallway:
Towels.
(omitted) bedding .
Kids’ bedding.
Steamer.
Laundry:
Washing machine.
Ms Hodges' tool box.
Cleaning products.
Mop.
Second Bathroom:
Bath toys.
Spare Bedroom:
Wooden bed.
Heaters.
Outside/under house:
(omitted) trampoline.
Chest freezer.
Stable:
All horse gear/equipment.
Jumps/poles.
Other Items:
Video camera.
(omitted) digital camera.
Her horses and donkey.
PC.
Printers.
All (omitted) books.
(omitted) digital camera.
(omitted) vacuum and cordless.
Horse and horse saddle.
(omitted) trampoline.
Mother’s personal items in sheds.
ANNEXURE C
Items to be retained by the Father
(in addition to items detailed in Schedule A) (Annexure A)
(omitted business) P/L $21 000.00
Tractor $500.00
ANNEXURE D
Items to be retained by the Mother
(in addition to items detailed in Schedule B) (Annexure B)
Laptop $350.00
Caravan $9000.00
Sky Ski $900.00
Horse Float $6000.00
All (omitted) Tools $1638.00
Toyota Land Cruiser $16000.00
Ford Falcon $200.00
Sale Proceeds of Site Shed $9,500.00
Sale Proceed of the ski boat $11,300.00
Sale Proceeds of (omitted) Quad Bike $1,025.00
Sale Proceeds of (omitted) Quad Bike $800.00
Sale Proceeds of some Refrigerator Panels $300.00
Sale Proceeds of (omitted) Motorbike $1000.00
Sale Proceeds of (omitted) Boat motor $700.00
Sale Proceed of Scrap Metal $1200.00
(omitted) Tent $550.00
ANNEXURE D
Items to be sold
Refrigerator Panels
Fire Pump and trailer
Back half of (omitted) Carrier
Canoes
Rodeo Ute (number plates to be returned to the father within 7 days)
(omitted) Motor Vehicle
*To be sold by the mother via eBay and she to provide the father with documentary verification of sale and sale proceeds to be distributed in accordance with Court ordered percentage split.
ANNEXURE F
Agreed Joint Liabilities
Centrelink Debt $9387.00 (Mother)
at 2 April 2014
(omitted) Bank Loan $16,570.00 (Father)
Husband ATO Debt $18,040.00 (Father)
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT DANDENONG |
DGC 990 of 2013
| MR STREET |
Applicant
And
| MS HODGES |
Respondent
REASONS FOR JUDGMENT
Introduction
These are proceedings for de facto property settlement between Mr Street (“the Applicant” or “Mr Street”) and Ms Hodges (“the Respondent” or “Ms Hodges”) who were engaged in a relationship between late 2002 and September 2012.
They have two children, X born (omitted) 2006 and Y born (omitted) 2009, and during the proceedings they were able to come to agreement about their care arrangements with final parenting orders being made on the second day of trial.
The major matter which remains in dispute is whether the de facto relationship between them began as a matter of law in February 2003 when the Respondent brought her horses to the property of the Applicant and began spending overnight time with him, in April 2005 when the Respondent says she began to live with the Applicant full-time, or later in 2005 when, after a short breakdown in the relationship, the Applicant says the parties committed to a life together and started a family.
It is not disputed that the property at Property W (“the Property W property”), comprising 20 acres of semi-rural land, was owned by the Applicant unencumbered prior to the commencement of the relationship. The dispute is what the value of that property was as an initial contribution brought into the relationship by the Applicant.
The significance of the commencement date of the de facto relationship is that if the de facto relationship began in February 2003 then the value of the property, which then essentially had only a shed built on it, was $280,000 at that time, whereas if the de facto relationship began in 2005 then the value of the property, which by then had a partly constructed house on it as well as other improvements such as water tanks, was $480,000 at that time.[1] That is, the significance lies in the value of the Applicant’s initial contribution to the major asset of the relationship.
[1] These values are agreed between the parties and are the result of historical valuations carried out during the proceedings.
Thus, the issues to be decided in this case are:
A.Did the relationship between the parties become a de facto relationship at law in early 2003 or in 2005?
B.What are the property interests of the parties?
C.Is it just and equitable to make orders altering the parties’ property interests?
D.If so, what were the contributions of each party to their assets and liabilities before, during and after the relationship?
E.Should any adjustment to contributions entitlements be made on the basis of the factors set out in s.90SF(3) of the Family Law Act 1975 (“the Act”)?
F.What orders are appropriate to effect a just and equitable settlement between the parties?
Background
The parties met in 2002 and began an intimate relationship in about February 2003. They separated finally in September 2012. So much is agreed.
It is also agreed that they lived together as de facto partners between 2005 and the date of final separation although the date in 2005 when they moved in together permanently is in dispute. Ms Hodges says that date was in April; Mr Street says it was in November or December.
They have two children together as set out above and the children currently live with Ms Hodges in the Property W property. She has not repartnered.
Mr Street has repartnered although at the time of trial he was not living with his new partner.
It is agreed between the parties that the Property W property will be sold and the proceeds distributed by order of the court.
Mr Street works as a (occupation omitted) and Ms Hodges has her own fledgling business as a (omitted). Their respective earning capacities are also in dispute.
It is not in dispute that the Applicant owned the Property W property unencumbered prior to the parties meeting and that at that time the Respondent owned the property at (omitted) subject to a mortgage.
It is not disputed that from the commencement of the sexual relationship between the parties they spent overnight time at each other’s homes until they began living together full time in 2005.
Nor is it in dispute that between 2003 and 2005 a house and other improvements were built on the Property W property and that the parties and then their children lived there between 2005 and September 2012, when the Applicant left the property.
The dispute in this regard then, is whether the parties were in a de facto relationship at law between about February 2003 and either April or November/December 2005.
There are other matters in dispute, such as whether certain items are to be included in the pool of assets to be distributed, and whether it is appropriate for a superannuation splitting order to be made, and I will deal with each of those when dealing with each of the issues set out above.
Procedural History
On 19 April 2013 the Applicant filed an Initiating Application seeking parenting and property orders.
The Respondent filed a Response on 27 May 2013 in which she sought Orders for the children to live with her and spend time with their father and a division of the property.
On 29 May 2013 the matter became before Judge O’Sullivan in the Duty List. At that hearing the parties came to an agreement and Interim parenting Orders were made by consent such that the children live with their mother and spend time with their father. An Order was made for a Family Report and the proceedings were adjourned to 3 September 2013 for further hearing in the Duty List.
On 13 August 2013 the Family Report was completed by Family Consultant Mr M and released by the Court on 18 August 2013.
On 3 September 2013 the matter returned before Judge O’Sullivan in the Duty List. At this hearing His Honour ordered the parties to a Conciliation Conference with a Registrar on 16 December 2013 and set the proceedings down for a Final Hearing on 20 March 2014 along with directions as to the filing of material before trial.
The Applicant filed an Amended Application on 23 September 2013 and the Respondent filed an Amended Response on 7 October 2013.
On 31 January 2014 the matter returned to Court and no orders were made.
On 30 March 2014 the matter was to be heard for Final Hearing before Judge O’Sullivan although the matter did not proceed on that day and was adjourned for Final Hearing on 14 July 2014.
On 3 June 2014 a Mention Hearing took place with the parties appearing by telephone and no orders were made.
On 14 July 2014 the matter came before me for Final Hearing and ran for two days.
Before trial, the parties had agreed that each would retain certain items of property and those were set out in several Schedules handed up to the court. The parties agreed that those items were not to be considered as part of these proceedings.
Final parenting Orders were made by consent on the second day of trial.
The parties were the only witnesses at trial and my decision was reserved.
At the end of the trial, with both parties being in agreement that the Property W property will need to be sold in order to effect a just and equitable settlement between them, I agreed that if counsel prepared a minute of orders to that effect I would be prepared to make those orders in chambers so that the parties would not have to wait an inordinately long time before obtaining those orders.
No proposed consent orders have been received and therefore there is currently no order for the sale of the property.
Issues, Evidence and the Law
A.Did the relationship between the parties become a de facto relationship at law in early 2003 or in 2005?
It is perhaps relevant to say at this point that it is of course quite possible for a person to believe that he/she is not in a de facto relationship when in fact he/she is as a matter of law. Similarly, it is possible for a person to believe that he/she is in a de facto relationship when he/she is not.
The law relating to de facto relationships is found in Part VIIIAB of the Act.
Section 4AA(1) states that:
a person is in a de facto relationship with another person if:
(a) The persons are not legally married to each other; and
(b) The persons are not related by family; and
(c) Having regard to all the circumstances of their relationship, they have a relationship as a couple living together on a genuine domestic basis.
The factors to be considered when assessing “all the circumstances of their relationship” are set out in s.4AA(2). They are:
(a)The duration of the relationship;
(b)The nature and extent of their common residence;
(c)Whether a sexual relationship exists;
(d)The degree of financial dependence or interdependence, and any arrangements for financial support, between them;
(e)The ownership, use and acquisition of their property;
(f)The degree of mutual commitment to a shared life;
(g)Whether or not the relationship is or was registered under a prescribed law of a State or Territory as a prescribed kind of relationship;
(h)The care and support of children;
(i)The reputation and public aspects of the relationship.
Sections 4AA(3) and (4) state that it is not necessary for the court to make any particular finding in relation to any circumstance in order to decide whether a de facto relationship has existed and that the court may take into account any matter it deems appropriate in that exercise.
There is no dispute that there was a de facto relationship between these parties. The issue here is very discrete: did these parties begin to live together such that their relationship can be characterised as a de facto relationship in February 2003 or in 2005?
The Evidence
(a)The duration of the relationship
The parties were in a relationship from late December 2002 to the date of separation in September 2012, a period of almost ten years, a significant duration on anyone’s terms.
(b)The nature and extent of their common residence
The Applicant’s evidence can be summarised as follows:
· The parties were only “boyfriend and girlfriend” who had a sexually intimate relationship from February 2003 until they decided to live together in November 2005.
· Between 2003 and about November 2005 the Respondent spent overnights at the Applicant’s home, and he at hers, on perhaps two or three nights per week at times, but that they lived separately and “far apart” (about 50 kilometres) between those dates.
· It was only after a short breakdown in the relationship between about August and November 2005 that the parties decided to live together full-time and to start a family, and in his view that is when the de facto relationship began.
· It was only after the parties decided to live together that the respondent decided to sell her property in (omitted), indicating, he says, that she was living there until then.
When cross-examined at trial, Mr Street conceded that the relationship was exclusive from February 2003, but was adamant that he did not consider the relationship to have taken on a “genuine domestic basis” character until after the parties moved into the Property W property on completion of the house in late 2005.
He said:
We did not live in the shed together as a de facto couple. She refused to. She said the only way we would live together is that we would move into the house, and that was after the three-month break when we had discussions with each other.
He further specifically denied that Ms Hodges and he had spent “at least three to four nights a week through 2003, 2004 and up to April 2005” together.
He conceded that the Respondent had bought food and supplies while staying at his home between February 2003 and November 2005 but said: “If I was at her place I would spend money. If she was at my place she would spend money…. We were boyfriend and girlfriend and that’s what you do.”
Under cross-examination in relation to the Respondent’s superannuation entitlements at what she says was the date of cohabitation, the Applicant made clear that he did not know what the Respondent had done with a redundancy payment she received in early 2003 and that he was unaware of the details of her financial situation at that time. The inference taken was that the parties did not share financial resources at that time.
His evidence was that the Respondent’s horses were kept at (omitted) in early 2003 and that while a fence was built around the house being constructed on the Property W property, he could not remember when it had been built. He denied that it was built to accommodate the Respondent’s horses. He could not remember exactly when the horses were brought to live at the property but said that the fence was built so that he could “get some cows as well”. He could neither agree nor disagree that it was in March or April 2003, but he specifically denied that Ms Hodges had helped him to construct the fence, saying his friend Mr T and he had built it.
In later evidence, he was adamant that the Respondent’s horses had moved to the Property W property permanently with the respondent in late 2005, although he did concede that they had “come backwards and forwards a few times” before that date. It was his evidence that he had built a horse float for the respondent to transport the horses, possibly in 2003, and that the Respondent had paid for the materials for the float, which had been used to transport her horses between their usual home and the property.
He gave evidence that when he was living in the shed on the Property W property he had washed his own clothes, the parties had shared the cooking when Ms Hodges was there, and each would do some cleaning. He also stated clearly that Ms Hodges was not living at the property during the week and that she did not keep any of her personal items at the shed, rather bringing them (and specifically clothes and toiletries) with her each time she visited.
While there were several occasions when the Applicant could not recall details of events in 2003 or 2004, it was his clear evidence that the parties were not living together at that time and he could not be shaken in that belief.
The Respondent’s evidence as found in her Affidavit material is not particularly persuasive of her case, and I made a comment at the commencement of the trial that I thought she might have an uphill battle to convince me of the existence of a de facto relationship before 2005.
Indeed, in her Affidavit sworn 27 May 2013, the Respondent says the following:
60. While the house was still being completed I continued to live in my property in (omitted) and would spend three or four nights a week staying in the shed at the Property W property. Every spare moment Mr Street and I had was spent working on the Property W property.
61. Between late 2004, early 2005 (sic), Mr Street purchased a motor bike and Nissan (omitted).
62. Shortly thereafter, in April 2005, the house was complete and Mr Street and I moved in.
63. My property at (omitted) was then put on the market for sale and sold in February 2006.
In her Affidavit sworn 17 February 2014 the Respondent says the following at paragraph 1:
I am the Respondent Wife in these proceedings and have lived with the applicant Mr Street (Mr Street) since April 2005. We commenced a relationship in 2002 and lived together for various periods between 2003 and 2005. On some occasions for approximately 3 months at a time.
On the face of those statements, it would appear that the parties lived separately, while spending some considerable time together, between 2003 and 2005.
However, the Respondent’s counsel tendered several bundles of documents, which he said, would “demonstrate conclusively the nature of the relationship” and show that the parties were living together from February 2003.
The first was in the form of telephone records which, the Respondent says, show that telephone calls were made from the Applicant’s mobile telephone to the landline installed in the shed on the Applicant’s property during the day on weekdays and weekend days between 22 August 2003 and 21 June 2005. The number to which those calls were made is (omitted). The Applicant concedes that that is the number of the landline connected to the shed on his property at that time.
It is the Respondent’s sworn evidence that she answered those calls, as she was living or at least staying at the property for more than half the time from February 2003. She says that those calls show that she was at the property at various times while the Applicant was absent, and at times when he was interstate, and she had no reason to have been there at those times if she were not living there. The times of the calls show that they were answered on days during the week and on weekends.
Under cross-examination at trial, the Applicant conceded that while he said the calls might have been answered by his father or by “anyone”, he could neither confirm nor dispute that the Respondent had been at the property on the days specified.
In the absence of any evidence to the contrary, I find on balance that it was the Respondent who answered the calls specified in the tendered material. She had received a redundancy from her employment early in 2003 and it was her evidence that she spent several months not working at that time, during which she lived at the Property W property during the week.
Upon reviewing the tendered material, I calculate there to have been about 32 such calls originating from the Applicant’s mobile phone to the landline at the Property W property in the two year and ten month period.
Evidence of 32 calls in two years and ten months is not, on its own, proof that the Respondent was living at the Property W property at that time.
The second piece of evidence tendered by the Respondent was a bundle of credit card statements in the name of the Respondent showing EFTPOS purchases in the Property W area between 1 February 2003 and 6 March 2005.
Those statements show regular and multiple purchases of groceries, take-away food and household supplies over the period, and the Applicant does not deny that the Respondent often bought food and supplies for the parties when she visited his home, as did he. Again, the evidence is not conclusive of cohabitation on its own but it can be added to the evidence of the telephone calls as pointing to an inference that the Respondent stayed at the Property W property on regular and frequent occasions over the relevant period.
The Respondent’s oral evidence in relation to the telephone records and bank statements was that in early 2003 she was not working having received a redundancy payment from (employer omitted), and she was staying at the Property W property for at least three or four nights a week and sometimes full time for periods of weeks at a time.
Her evidence was that she answered multiple telephone calls from the applicant who was out and about working while she was in the shed at the property. She says her reason for being there was that she was living there.
She further stated that while she lived in the shed on the property with the applicant she did all the cooking, clothes washing and much of cleaning. It was her evidence that she did most of the shopping and it was set out in submissions by her counsel that I should take the telephone records and the bank records as evidence that she was living at the Property W property from early in 2003.
The third pieced of evidence tendered is in the form of a series of photographs of works being carried out on the building and landscaping of the house on the Property W property. The Applicant conceded under cross-examination that they were correct interpretations of the state of construction on the property on the dates marked on them.
One set of those photographs is dated March 2002 and it shows a partially completed dwelling from the exterior and several interior rooms, also incomplete.
The remainder of the photographs are dated between 10 April 2005 and 12 September 2009 and have little evidentiary value in the context of this particular dispute.
I do not accept that the photographs tendered support the Respondent’s claim to have been living with the Applicant since February 2003.
Under cross-examination, the Respondent conceded that the utilities at the property were not in her name at that time although she said that she had “on occasion” paid for them. She did not make contributions to the outgoings on the property. She further conceded that the parties had no joint bank accounts at that time and that they did not pool their finances.
It was her evidence that she had brought her horses to the Property W property about three months after the parties met and that they had stayed there until August 2005, when the relationship broke down for about three months. She then found agistment for them in (omitted) before bringing them back to the Property W property in late 2005, when the parties reconciled.
She was adamant that she had stayed at the Property W property regularly and frequently from February 2003 until April 2005, when she moved her possessions from her house in (omitted) and the parties moved into the house on the property.
She says that when the parties separated in August 2005, she removed her belongings from the property and moved back to her (omitted) home. When they reconciled three months later, she again moved her belongings to the Property W property. It was her evidence that she moved her belongings in her horse float.
She agreed that she had not sought to sell her (omitted) property until after the parties had reconciled in late 2005 and that it was sold in February 2006. It was her evidence that she had had “boarders” living in the (omitted) property while she had been living at the Property W property but under cross-examination said that that had been for about a year in perhaps 2000, some years before the relationship between the parties began.
I inferred from that evidence that the Respondent had been living alone in the (omitted) property at the beginning of 2003. She said that during the 2003 to 2005 period she had returned to the (omitted) property to collect mail and water the garden, although in other evidence she said that she had stayed at the Applicant’s property three or four nights a week during those years, which would indicate that she spent the remaining three or four nights at her own property.
While it is true that parties keeping separate properties after the date of cohabitation is not unusual, the fact that the Respondent sold her (omitted) property only after the date on which she says the parties moved in together on a full time basis means that an inference as to the status of the relationship in her mind before the date can be drawn from that fact.
She conceded that when she had received her redundancy payment in early 2003 she had not applied it to the Property W property in any way, saying that she had spent that money on a car and in contributions to her superannuation fund.
The Respondent further conceded that she had not sought a property settlement at the time of the separation between August and November 2005 but rejected the implication that that was because she had not been living with the Applicant for long enough at that time to have been entitled to such a settlement.
Her evidence was that she had spent literally almost every weekend between early 2003 and April 2005 at the Property W property assisting the Applicant in preparing it for habitation. She says that she helped to build the fences, drove a tractor to bring trees down, helped to make paths and generally worked extremely hard to assist in the improvement of the property, as well as performing homemaker tasks such as cooking, washing clothes, cleaning, and chopping firewood.
However, I note that no evidence was adduced as to whether she had placed her name on the Electoral Roll at the Property W property before 2005, or as to whether she had received mail at that property from 2003 to 2005.
When all the above evidence is taken into account, I find that it is more probable than not that the parties did not live together on a full time basis between February 2003 and April 2005, but that they spent considerable time together, predominantly at the Property W property, during that period.
(c) Whether a sexual relationship exists
It is common ground between the parties that a sexual relationship existed between them from about February 2003 until the time of separation and that they have two children together.
It was the Respondent’s evidence that between February 2003 and some time in 2005 the relationship was exclusive and that the break in the relationship between August and November of that year came after she discovered that Mr Street was having an affair.
The Applicant says that it was Ms Hodges who was having an affair in 2005 but he acknowledges that the relationship was exclusive before that time.
(d) The degree of financial dependence or interdependence, and any arrangements for financial support, between them
The evidence of both parties is that there was no “pooling” of resources between 2003 and 2005, although both say that they each paid for food and household supplies for the other’s home during that time.
(e) The ownership, use and acquisition of their property
The Applicant says that during the relevant period, the Property W property belonged solely to him, and that while the Respondent stayed there sometimes, she contributed little to its maintenance or improvement.
The Respondent says that she stayed at the property often, and sometimes full time for weeks at a time, and that she was a diligent partner with the Applicant in preparing the property for full time habitation.
(f) The degree of mutual commitment to a shared life
The Applicant says there was no commitment to a shared life before late 2005 after the parties had had a break in the relationship. Until then, he says, they were “boyfriend and girlfriend”. It was his evidence that he at least was not committed to the relationship in any serious way until late 2005.
The Respondent says that she experienced the relationship as serious and committed from early 2003 and that she was devastated when she discovered that Mr Street was having an affair in 2005.
On that evidence, it cannot be said that there was a “mutual commitment to a shared life” between 2003 and 2005.
(g) Whether or not the relationship is or was registered under a prescribed law of a State or Territory as a prescribed kind of relationship
There is no evidence before the court of the relationship ever having been registered under Victorian law.
(h) The care and support of children
At the relevant time the parties had not yet had children.
(i)The reputation and public aspects of the relationship
The Applicant does not deny that the parties might have been seen as a couple between 2003 and 2005. He simply says that the perception would have been of a “boyfriend and girlfriend” and not of a de facto relationship.
The Respondent says that the parties socialised together and that she spent monthly dinners with the Applicant’s family. She says that they attended a (omitted) club together and that they were definitely seen as a couple. She conceded that they did not go out together very much but said that was because they spent almost all their spare time working at the Property W property during that period.
I note that no third parties gave evidence in support of either position. In those circumstances I have only been sworn evidence of the parties in relation to that issue and as that evidence conflicts it is difficult to make a finding about it.
The Law
The authorities indicate that the court should approach the issue of whether a de facto relationship exists or has existed on a holistic basis and should not rely on any one of the factors set out in s.4AA.
The essential test, as stated by the Full Court in Jonah v White[2] and approved by several subsequent Full Courts[3], is whether the court is able to find that the parties are or were “a couple living together on a genuine domestic basis”.
[2] Jonah v White (2012) FLC 93-522 at 32
[3] Eg Sinclair v Whittaker (2013) FamCAFC 129; Cadman v Hallett [2014] FamCAFC 142
In Sinclair & Whittaker the Full Court referred with approval to a passage from the judgment of Fitzgerald J in Lynam v Director-General of Social Security (1983) 52 ALR 128, where he said, at page 131:
… each element of a relationship that draws its colour and its significance from the other elements, some of which may point in one direction and some in the other. What must be looked at is the composite picture. Any attempt to isolate individual factors and to attribute to them relative degrees of materiality or importance involves a denial of common experience and will almost inevitably be productive of error. The endless scope for differences in human attitude and activities means that there will be an almost infinite variety of combinations of circumstances which may fall for consideration. In any particular case, it will be a question of fact and degree…..whether a relationship between two unrelated persons of the opposite sex meets the statutory test.
In Moby v Schulter [2010] FamCA 748, Mushin J, in confirming the “overall” approach, made clear that the test is an objective one, not a subjective one.
Overall, taking all the above factors into account, and looking at the “composite picture”, I cannot find that the parties were “living together on a genuine domestic basis” between February 2003 and April 2005, and that therefore they were in a relationship that satisfies the provisions of s.4AA of the Act at that time.
I find, on balance, that the de facto relationship between them began when Ms Hodges moved her belongings to the Property W property in April 2005.
B.What are the property interests of the parties?
I have stated that the parties provided several Schedules to the Court containing items which they agreed would be distributed pursuant to those Schedules and which were not to be considered as part of the pool of assets to be divided in these proceedings. I have therefore not considered them.
However, apart from those matters, there is a dispute about what should happen or has happened to some items of property in this case.
The first is whether a ride-on mower currently located at the Property W property and used by the Respondent is owned by the parties and is therefore available for distribution between them, or whether it is owned by (omitted) and should be returned to that business.
The Applicant says the latter, the Respondent the former.
The Respondent tendered a manual for the mower which she says shows that it belongs to the parties. I do not see that as strong evidence. It is quite possible and even probable that an owner might provide a manual to someone to whom he or she lends an item on an extended basis.
The only third party evidence in relation to the mower is in the form of a letter on (omitted) letterhead dated 29 August 2013. The letter states as follows:
Attention: Mr Street
We hereby confirm that Mr Street has had on loan from (omitted) a ride on lawn mower for some time.
As we are now approaching summer we request that we will now require this returned as discussed early next week in full working condition.
The letter is signed by a “Mr B” whose position is unstated.
There is no other evidence to support either party’s contention, including any proof of purchase by the parties or any further demands from (omitted) for the return of the mower after 29 August 2013.
I find on balance that it is more probable than not that the mower belongs to (omitted) and I will make an order for its return.
The second matter still in dispute concerns the whereabouts of a leather (omitted) jacket belonging to Mr Street. He contends that Ms Hodges has it in her possession as it was in the house at the Property W property when he left in September 2012.
Ms Hodges says that she put all Mr Street’s clothes in a box after separation and that he collected the box. She says that the jacket is not in her possession and she does not know where it is.
The jacket is of sentimental value to the Applicant and he wants it back.
However, on the evidence before me I cannot make a finding about its whereabouts one way or the other, although it is difficult to find a motive for Mr Street seeking its return if it is in his possession.
The current property interests of the parties can therefore be described as follows:
Assets
The Property W property which is registered in the sole name of the Applicant which is agreed to be worth $850,000 and is unencumbered
A (omitted) Toyota Land Cruiser registered in the Applicant’s name and worth $53,000
The assets are therefore worth $903,000
Superannuation entitlements
Applicant $116,037.46
Respondent $173,509.24
Total superannuation entitlements are therefore $289,546.70
Liabilities: Applicant
(omitted) Bank personal loan $16,510
(omitted) Toyota Land Cruiser loan $27,000
Applicant’s total liabilities $43,510
Liabilities: Respondent
Centrelink $9,387.55
(omitted) Visa Card $8,000
Respondent’s total liabilities $17,387.55
Total liabilities are therefore worth ($60,897.55)
The net pool remaining for distribution between the parties is therefore $842,102.45 ($903,000 less $60,897.55).
In addition to the above assets, and to those retained via the Schedules provided by the parties, the Respondent acknowledges that she sold various jointly owned items after separation and retained the sale proceeds, those items being worth either $24,625 on her calculations, or $25,525 on the Applicant’s calculations. For the purposes of this exercise, and no evidence having been called at trial as to the precise value of the items sold, I will value them at $25,075, which is the mid-point between the parties’ estimates.
There is a dispute between the parties as to whether that sum ought to be characterised as an interim property settlement or as spousal maintenance.
The Respondent’s evidence is that in circumstances where the Applicant was paying her no spousal maintenance and was disputing his child support assessment, and she was attempting to establish herself in a new business, she was forced to sell the items in order to support herself.
The fact that there was no spousal maintenance being paid was not disputed at trial and in the circumstances set out in paragraphs 165 to 212 hereof, I find that the Respondent was entitled to maintenance from the Applicant after separation. I therefore characterise the $25,075 retained by her as maintenance for the period from the date of separation to the date of trial at a rate of about $263 per week. It therefore does not form part of the property pool to be distributed.
C.Is it just and equitable to make orders altering the parties’ property interests?
Section 90SM(3) of the Act states that the court must not make an order under this section (that is, an order for property settlement between de facto partners) unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
Section 90SM(3) is identical in its terms to s.79(2) of the Act, which applies to married couples.
In relation to that section, in Stanford v Stanford[4], the High Court made clear that this decision must be made before any consideration of the matters set out in s.90SM(4) is undertaken.
[4] Stanford v Stanford (2012) FLC 93-495
In Stanford the High Court further said, at paragraph 42:
In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and the wife.
In Bevan & Bevan the Full Court said that the circumstances described in the above passage of the Stanford judgment “encapsulate the vast majority of cases”[5] . While the parties to the current proceedings were not married, the principles set out in Stanford and Bevan apply equally to de facto relationships.
[5] Bevan & Bevan [2013]FAMCAFC 116 paragraph 70
In this case, the parties were in a de facto relationship for seven years. They have two children who have not yet attained the age of 18 years.
As set out above, the parties have interests in property both severally and jointly.
It is clear that there cannot be common use of that property now that the relationship is over, and in particular, it is agreed between the parties that the Property W property will have to be sold.
In these circumstances, where the parties have separated and no longer have common use of the property, I find that it is just and equitable in all the circumstances for the court to make orders altering their property interests.
D. If so, what were the contributions of each party to their assets and liabilities before, during and after the relationship?
The matters to be taken into account when deciding what orders ought to be made in a de facto property settlement are set out in s.90SM(4) of the Act, which I set out here in full:
Section 90SM (4) In considering what order (if any) should be made under this section in property settlement proceedings, the court must take into account:
(a) the financial contribution made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:
(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
(ii) otherwise in relation to any of that last-mentioned property;
whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them; and
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:
(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
(ii) otherwise in relation to any of that last-mentioned property;
whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them; and
(c) the contribution made by a party to the de facto relationship to the welfare of the family constituted by the parties to the de facto relationship and any children of the de facto relationship, including any contribution made in the capacity of homemaker or parent; and
(d) the effect of any proposed order upon the earning capacity of either party to the de facto relationship; and
(e) the matters referred to in subsection 90SF(3) so far as they are relevant; and
(f) any other order made under thisAct affecting a party to the de facto relationship or a child of the de facto relationship; and
(g) any child support under the Child Support (Assessment) Act 1989 that a party to the de facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the de facto relationship.
At the date of cohabitation, which I have found to be April 2005, the Applicant owned the Property W property unencumbered and it was worth $480,000.
He also owned a Nissan (omitted) motor vehicle worth $30,000, a tractor he says was worth $12,000, two four-wheeled motor bikes and one two-wheeled motor bike, and tools and equipment which he used in his business as a (occupation omitted).
At that time he owed his parents the sum of about $28,000.
The Respondent owned a property in (omitted) whose worth at the time is unknown but from whose sale in February 2006 she realised the net sum of $72,559.
She also owned a Ford Falcon (omitted), a horse float, a ski boat, a campervan and a (omitted) motor vehicle, and had savings of about $30,000.
However, before the date of cohabitation (as I have now found it), the Respondent claims non-financial contributions to the Property W property. She says that between the beginning of the parties’ relationship in December 2002 and the date of cohabitation full time in April 2005, she made substantial contributions to the Property W property by way of assisting the Applicant with work around the property and by way of homemaker contributions.
It is my view however, that the Act does not provide for pre-de facto relationship homemaker contributions to be considered when looking at contributions to property. The Act clearly states that such contributions are made “by or on behalf of a party to the de facto relationship” and I have found that no de facto relationship existed at law before April 2005.
At trial, Ms Hodges said the following answer to the question “Can you set out between 2003 and 2005 the type of frequency that you were at the farm and what role that you performed on the farm?”:
Yes. Every weekend from Friday to Monday mornings. When I say “every weekend”, maybe not one or two weekends in the whole three years. Also there would be nights through the week that I would be there as well. There were periods when I was working, months, when I took – wasn’t working at (employer omitted), for three months, that I stayed at the shed permanently and I would go back to my house in (omitted) to collect mail and the lawns. My horses: I brought those to the property within three months of meeting Mr Street, as soon as we put – the fencing was the first thing that we did – the outside of the fencing and then put in front fencing at the front of the property, so it only had three sides to begin with. We also did a massive amount of clearing. The property is bush paddock and the paddock had – was almost inundated with tea tree, and with all the bush we moved and burned and cleared pretty much the 20 acres. We put in new extra water tanks. There was already water tanks at the shed but we also put in more at the shed as well as water tanks at the house. We cleared out a track around the edge of the perimeter of the property, which was both by foot as well as using the tractor. I did the majority of the tractor driving so as Mr Street could chain trees on the back of the tractor, and also when we would put the trailer on the back of the trailer (sic) so as I could back it up to where it needed it.
She said further that she had done all the cooking, cleaning and clothes washing and the majority of the food shopping during that period. She said that the Applicant would come with her to do the food shopping “on the odd occasion”. It was her evidence that on the nights that she did not cook the parties would go to the local pub for dinner.
She gave further evidence that the parties sourced the wood for the heating of the shed and that while the Applicant cut the trees down it was she who performed the task of physically splitting the kindling wood.
As I have said, while that evidence might be relevant to the issue of whether the de facto relationship began in 2003 or 2005, I do not see its significance in terms of pre-de facto relationship contributions to the property as they might more properly be characterised as contributions to the “welfare of the family”.
In addition, the Respondent said that she had provided some administrative services to the Applicant’s business from 2003 in the form of data entry services. She did not perform book-keeping services.
I note that the detail of the Respondent’s evidence as to contributions was given in chief at trial and was not contained in the Respondent’s affidavit material filed before trial. Counsel for the Applicant objected to the admission of that evidence the ground that it had been readily available to the Respondent before trial and had not been put to the Applicant so that he could respond to it.
Family Law is not an ambush jurisdiction. The reason parties are required to file affidavits of evidence-in-chief is so that their opponents can make reply to those issues at trial or ask questions about them in cross-examination.
Ms Hodges’ evidence about her presence at and her contributions to the Property W property before 2005 was known to be a major issue in dispute in this matter well before trial.
In those circumstances, while I admitted the evidence at trial, I do not give it the weight that I would have given it if it had been contained in the same detail in her affidavit material.
In any event the Applicant denies those contributions, or at very least, minimises them considerably. He says clearly that the fencing was constructed by him and his friend Mr T and that the parties shared household tasks on the two or three nights a week when Ms Hodges stayed at the property. He was particularly adamant that he had washed his own clothes at that time.
The photographs produced by the Respondent and discussed in a different context in paragraphs 66 to 69 hereof show only that the house on the property was constructed in the main by 2005 and that considerable landscaping and finishing work was conducted after that. There is nothing in those photographs to say that the Respondent performed any of the work herself as she does not appear in them. However I note that the Applicant acknowledges that the Respondent contributed to the development, improvement and maintenance of the Property W property from the time they began to live together.
It has often been said that when two parties are in fierce disagreement about facts, the truth probably lies somewhere between their two positions.
I find that it is probable that Ms Hodges assisted Mr Street in physical work done on the Property W property between 2003 and 2005, to a greater extent after 2005. I find that while the pre-April 2005 contributions were significant, and will be taken into account, they were not as substantial as the Respondent claims and that it was Mr Street who carried out most of the work.
In those circumstances I will make only interim property orders at this time, until such time as the Trustee has been afforded procedural fairness, when I shall make final orders for that superannuation split.
I certify that the preceding two hundred and twenty four (224) paragraphs are a true copy of the reasons for judgment of Judge Small
Date: 30 October 2014
Key Legal Topics
Areas of Law
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Family Law
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Property Law
Legal Concepts
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Contract Formation
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Reliance
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Intention
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Offer and Acceptance
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