Summers & Glass
[2022] FedCFamC1F 229
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Summers & Glass [2022] FedCFamC1F 229
File number(s): PAC 4369 of 2018 Judgment of: SCHONELL J Date of judgment: 8 April 2022 Catchwords: FAMILY LAW – PROPERTY – Where the issue was division of assets – Where the applicant sought a contribution based assessment of 35% with 5% to be adjusted back to the respondent – Where the respondent sought to dismiss the applicant’s application – Where the applicant was incarcerated – Where the respondent became wholly responsible for financial and parenting matters after the applicant’s incarceration – Where the respondent’s evidence had to be treated with caution because of inconsistencies with prior affirmed evidence – Where the Court considered the contributions made by both parties and the factors relevant under s 90SF(3) of the Family Law Act 1975 (Cth) – Where a just and equitable outcome for division of the assets was found to be 12.5% to the applicant and 87.5% to the respondent. Legislation: Evidence Act1995 (Cth) s 128
Family Law Act 1975 (Cth) ss 90SF, 90SM
Cases cited: Dickons & Dickons (2012) 50 Fam LR 244; [2012] FamCAFC 154
Hickey & Hickey & Attorney-General for the Commonwealth of Australia (intervener) (2003) FLC 93-143; [2003] FamCA 395
Stanford v Stanford (2012) 247 CLR 108; [2012] HCA 52
Whisprun Pty Ltd v Dixon (2003) 200 ALR 447; [2003] HCA 48
Division: Division 1 First Instance Number of paragraphs: 73 Date of hearing: 23 – 24 March 2022 Place: Sydney Solicitor for the Applicant: Michael Vassili Barristers & Solicitors Solicitor for the Respondent: Bainbridge Legal ORDERS
PAC 4369 of 2018 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR SUMMERS
Applicant
AND: MS GLASS
Respondent
ORDER MADE BY:
SCHONELL J
DATE OF ORDER:
8 APRIL 2022
THE COURT ORDERS THAT:
1.Within ninety (90) days of the date of these orders, the respondent pay the applicant the sum of $137,857.37.
2.The applicant’s property application filed 12 August 2021 be otherwise dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Summers & Glass has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
SCHONELL J:
The hearing in this matter commenced initially with the parties in dispute about the parenting arrangements for their two children as well as what should be the financial adjustment of their property. The parties were able to resolve the parenting proceedings, and consent orders were made that provided for the respondent mother (“the respondent”) to have sole parental responsibility of their two children and limited orders for time with the applicant father (“the applicant”).
The parties were not able to reach an agreement about what the appropriate division of their assets should be and that aspect proceeded to a final hearing. The parties were well represented and conducted the proceedings professionally, efficiently and courteously. With the assistance of their lawyers, they were able to in large measure reach agreement about the pool of assets, with a couple of exceptions.
SHORT BACKGROUND
The parties were at issue about when they commenced cohabitation. The applicant contended that the parties commenced cohabitation in 2000 and the respondent contended that the parties commenced cohabitation in 2002. The parties agree that they finally separated in September 2015. The period of cohabitation was therefore either 13 or 15 years.
There are two children of the parties’ relationship, X born in 2004 and currently aged 17 years, and Y born in 2010 and currently aged 12 years.
The applicant was incarcerated in 2013 and was not ultimately released from prison until late 2017 after the parties had separated. The applicant’s incarceration had a devastating effect upon the family, leading to the respondent assuming all the parenting and financial responsibilities for the children.
The applicant has not seen the children other than on the occasions when the respondent or her sister brought the children to prison, which ceased sometime in early 2016.
A property at Suburb E was purchased in 2008 in the sole name of the respondent and was funded entirely by borrowings and the First Home Owner’s Grant. That property was sold in 2017 after the parties’ separation for $1,000,000. At the time of sale, there was a mortgage of approximately $263,000 on the property. The respondent, thereafter, purchased another property at Suburb E for $858,000, and the mortgage over the first property was carried over to the new Suburb E property.
DOCUMENTS RELIED UPON AND POSITION OF EACH PARTY
The applicant relied upon the following documents:
(1)Further Amended Initiating Application filed 12 August 2021;
(2)Affidavit of Applicant filed 1 September 2021;
(3)Affidavit of Applicant in reply filed 18 March 2022;
(4)Affidavit of Mr C filed 26 July 2019; and
(5)Financial Statement filed 18 March 2022.
The respondent relied upon the following documents:
(1)Amended Response to Initiating Application filed 9 September 2021;
(2)Affidavit of Respondent filed 1 September 2021;
(3)Affidavit of Ms B filed 30 July 2019;
(4)Affidavit of Ms A filed 30 July 2019;
(5)Affidavit of Mr K filed 1 September 2021; and
(6)Financial Statement filed 9 September 2021.
The applicant was cross-examined about both parenting and financial matters, with the parenting proceedings being settled by agreement on the second day of the hearing. He was at times during the course of his cross-examination, argumentative, discursive, and had to be asked to address his mind to the question he was asked on a number of occasions. There were inconsistencies between his oral and written evidence. He admitted in cross-examination that the respondent undertook 60% of the household activities, whilst in his affidavit he said that they were shared equally. It was suggested that he gave untruthful evidence in relation to the payment of monies to his brother. It was submitted that I should make a finding about his credit. I do not accept that submission. The foundation for this submission was that he was asked whether he paid monies to his brother, which he denied. It was said that this was inconsistent with prior affirmed evidence that said he paid monies to the lawyers for his brother for an appeal. There is a difference between the two propositions. I do not accept there was an inconsistency.
The applicant’s witness Mr C was not required for cross-examination and I accept his evidence.
As with the respondent, the applicant’s solicitor suggested that I should make findings as to credit in relation to the evidence of the respondent. Like the applicant, the respondent was discursive and had to be asked to address her attention to the question on a number of occasions. She was reluctant to make concessions as to the contributions of the applicant, and when finally directed to the issue, she begrudgingly made limited concessions. It was contended that she failed to properly disclose her superannuation entitlements and funds received by her from the proceeds of sale of the Suburb E property. I am inclined to the view that this was more oversight than deliberate.
I am less prepared to be so generous with her evidence about her affidavit affirmed in the District Court proceedings in City L. During cross-examination on this topic, the respondent was given a certificate pursuant to s 128 of the Evidence Act1995 (Cth). She said in cross-examination that it was not correct that the applicant was the only person who could care for the children when she was on evening and night work, which was inconsistent with her affirmed affidavit in the District Court proceedings. She did, however, concede that the applicant did on occasions look after the children, but that the majority of it was done by her mother and sister. When asked in cross-examination whether the contents of her affidavit in the District Court proceedings were true, she answered “not entirely”. No attempt was made in re-examination to determine what other parts were truthful and what were not. The Court is left with the impression that, as the concessions made by the respondent in that affidavit that were complimentary of the applicant or supportive of his contributions no longer aligned with the narrative that she now wished to present, the respondent was prepared to disavow her prior affirmed evidence. The Court is left in the invidious position that the respondent’s evidence must be treated with significant caution.
I will not make a general credit finding in relation to the parties and then accept or reject each party’s case on this basis. Rather, I will examine carefully the limited factual issues between the applicant and the respondent as are raised by each of them in their affidavits and in their cross-examination. I will approach the making of findings by looking to matters such as consistency of a particular version with undisputed facts, corroboration by other evidence that is independent and/or likely to be reliable, concessions made under cross-examination, and internal consistency with each party’s case.
The respondent’s partner Mr K was not required for cross-examination nor was her sister Ms A. I accept their evidence. The respondent’s mother was required for cross-examination but no real challenge was made to her evidence. I accept her evidence.
The applicant sought orders that the respondent pay him a sum of $340,000 by way of financial adjustment. The Case Outline on behalf of the applicant contended that this was determined by reference to a contribution-based assessment at 35%, with an adjustment under s 90SF(3) of 5% back to the respondent, leading to a 30% assessment overall.
The respondent’s solicitor contended that the contribution assessment overwhelming favoured the respondent as did the matters under s 90SF(3), and contended that there should be no adjustment in favour of the applicant.
The applicant contended that I should assess the parties’ contributions overall to one pool constituting the parties’ assets and superannuation entitlements. The respondent contended that I should adopt a two-pool approach in assessing contributions and the matters under s 90SF(3). Having said that, it was not expanded upon in submissions. I propose to approach the matter on the basis of a one-pool approach. In doing so, I recognise the significant financial contributions made by the respondent to her superannuation entitlements, which have not been matched by the contributions of the applicant in the period since his incarceration.
I am of the view, assessing the evidence overall, and considering the parties’ respective contributions and the matters under s 90SF(3), that an appropriate division of the parties’ net assets as to 12.5% to the applicant and 87.5% to the respondent represents a just and equitable outcome. Allowing for the property retained by the applicant, I accordingly will make orders that the applicant is to be paid a sum of $137,857.37. My reasons for reaching that conclusion are set out below.
APPROACH TO PROPERTY PROCEEDINGS
The approach to be adopted in a financial adjustment case under s 90SM is to follow the well-recognised four-step process (see Hickey & Hickey & Attorney-General for the Commonwealth of Australia (intervener) (2003) FLC 93-143). Following such an approach, the Court identifies and values the assets and liabilities at the date of hearing for the purposes of division. Secondly, the Court assesses the contributions of the parties within the meaning of s 90SM(4) of the Act and determines a contribution based entitlement. Thirdly, the Court identifies the relevant matters under s 90SF(3) and determines such adjustment as is necessary to the contribution based entitlement. Finally, the Court considers the effect of the findings and determines whether or not the order as proposed is in all the circumstances just and equitable.
An issue in the proceedings was whether there should be an adjustive order. Whilst no submission was made consistent with the ratio arising out of the High Court’s determination in Stanford v Stanford (2012) 247 CLR 108, I am of the view that it is just and equitable that an order be made adjusting the property interests of the parties. The parties are no longer living together and there is no longer the common use of their property. The assumptions and undertakings that governed the use of their property ended with separation.
POOL OF PROPERTY AVAILABLE FOR DISTRIBUTION
The parties, with the exception of a couple of liabilities, agreed as to what constituted the pool of assets, and I record below the legal interests of the parties. The applicant included a liability to V Finance of $4,966. There was no cross-examination on this and it appears in the applicant’s financial statement. I will include it in the pool of assets. The respondent included liabilities to the Australian Taxation Office and school fees. There is no evidence to support these liabilities in her affidavit or financial statement. I will ignore them. The net pool of assets is therefore $1,194,043.
Ownership Description Applicant Husband’s value Respondent Wife’s value ASSETS 1. H Westpac Choice Basic
BSB: … / Acc: …39$0 $0 2. H Commonwealth Bank Smart Access
BSB: …/ Acc: …93$100 $100 3. H Household Contents $1,500 $1,500 4. H Motor Vehicle 1
Registration: …$5,000 $5,000 5. H U Company ABN:… (Sole Trader) $0 $NK 6. W M Street, Suburb E $1,100,000 $1,100,000 7. W Commonwealth Bank
BSB: … / Acc: …19$1,608
$1,608 8. W Commonwealth Bank
BSB: … Acc: …24$21 $ 21 9. W Motor Vehicle 2
Registration: …$10,000 $10,000 10. W N Bank Offset Account
#...02$0 $0 11. W P Company - Interest in Business $NK $ Nil (closed) 12. W Household Contents $2,000 $ 2,000 13. W Shares – Q Company (56 shares) $3,528 $ 3,528 14. W Timeshare- Property O $NK $ Nil
Total $1,123,757 $ 1,123,757
ADDBACKS 15. $ $
Total $Nil $Nil
LIABILITIES 16. W N Bank Home Loan #...57 $220,000 $220,000 17. W CBA Mastercard #...83 $7,712 $ 7,712 18. W R Bank Loan $5,194 $5,194 19. H S Finance Loan $4,986 $4,986 20. H T Finance Loan $0 $0 21. H V Finance Loan $4,966 NK 22. W ATO debt $NK $ 9,730 23. W Outstanding school fees $NK $ E 4,900
Total $242,858 $ 252,522
SUPERANNUATION Member Name of Fund Type of Interest Applicants value Respondents value 24. H Super Fund 1 Savings $14,750 $ 14,750 25. W Super Fund 2 Accumulation $270,314 $ 270,314 26. W Super Fund 3 $28,080 $28,080
Total $ 313,144 $ 313,144
FINANCIAL RESOURCES Ownership Description Applicants value Respondents value $ $
Total $1,194,043 $1,184,379 ASSESSMENT OF CONTRIBUTION
Much of the evidence in the affidavits was of limited assistance and much of it amounted to criticisms of the other party’s behaviour or conduct, which was irrelevant. Its irrelevancy was highlighted by the absence of cross-examination on the assertions, or any submission by each of the parties’ representatives as to its relevance.
I have, however, read all of the evidence relied upon in the proceedings including the Exhibits but do not propose to repeat all of it in these reasons. As the High Court reminds in Whisprun Pty Ltd v Dixon (2003) 200 ALR 447:
62. … A judge’s reasons are not required to mention every fact or argument relied on by the losing party as relevant to an issue. Judgments of trial judges would soon become longer than they already are if a judge’s failure to mention such facts and arguments would be evidence that he or she had not property considered the losing party’s case.
The assessment in a property case calls for the exercise of a discretion and a holistic value judgment of the respective contributions of the parties. The Court is required to consider all of the contributions of the parties as the Full Court in Dickons & Dickons (2012) 50 Fam LR 244 makes plain:
24.…the task of assessing contributions is holistic and but part of a yet further holistic determination of what orders, if any, represent justice and equity in the particular circumstances of this particular relationship. So much is clear from the terms of s 79 itself and, in particular, s 79(2). The essential task is to assess the nature, form and extent of the contributions of all types made by each of the parties within the context of an analysis of their particular relationship.
25.Doing so is also consistent with the demands of authority that the ultimate assessment of contributions should be made without “giving overzealous attention to the ascertainment of the parties’ contributions” (Norbis v Norbis (1986) 161 CLR 513 at 524 ; 65 ALR 12 at 18 ; 10 Fam LR 819 at 825 ; [1986] HCA 17) and the well-established recognition in the authorities (acknowledged specifically by her Honour in this case) that the process required of the court by s 79 is the exercise of a wide discretion, not the performance of a mathematical or accounting exercise.
26.The necessarily imprecise “wide discretion” inherent in what is required by the section is made no more precise or coherent by attributing percentage figures to arbitrary time frames or categorisations of contributions within the relationship. Indeed, we consider that doing so is contrary to the holistic analysis required by the section and, in the usual course of events, should be avoided.
Guided by such Full Court determination, I propose to assess the parties’ contributions.
As stated earlier, there is an issue about the date of commencement of cohabitation, with the applicant contending the parties commenced cohabitation in 2000 and the respondent contending that the parties commenced cohabitation in 2002. I am persuaded that the applicant’s evidence is more reliable on this topic.
The respondent contended the following in her affidavit of 1 September 2021:
4. [Mr Summers] and I commenced a relationship in or about 2001. Eventually in or about 2002, we started living together.
The respondent swore an affidavit in the District Court proceedings in 2013. In that affidavit, she said:
3.[Mr Summers] and I met in 1999. We have been in a relationship for thirteen years…
The two propositions stand inconsistent. The contention that they had been in a relationship for 13 years by 2013 would put the commencement of the relationship somewhere in the year 2000. The version in her affidavit in the District Court accords with the applicant’s evidence in the District Court as well as the applicant’s evidence at trial. For the reasons stated earlier as to the concerns I have with the respondent’s evidence, I prefer the applicant’s evidence to that of the respondent and find that the parties commenced cohabitation in or about 2000.
At the commencement of cohabitation neither party had any assets of value.
For the first eight years of the parties’ relationship they lived in rented premises, acquiring the property at Suburb E in 2008.
During the course of the relationship each of the parties were employed, the respondent as a health professional and the applicant in various occupations as a tradesperson, and working in retail in his own business and with Employer J.
It appears that the parties reached an agreement in or about 2006 that the applicant would concentrate on conducting his Business G. Thereafter, it would appear that the applicant worked principally in his Business G but also attempted to establish Business F.
One of the issues in the proceedings was the extent of the applicant’s financial contribution to the living expenses of the parties during the course of the relationship and up until 2013 when he was incarcerated. The applicant gave evidence that he contributed no less than approximately $400 per week to the living expenses of the parties and on other occasions greater sums of money but, acknowledged that most of the expenses were paid by the respondent from her income and in part from the funds that he provided.
He gave evidence that he purchased the majority of the household items such as a fridge, TV, oven and stove. He also gave evidence of the provision of funds from his Business G and that he also won a significant sum of money.
The respondent in her affidavit denied the applicant’s contentions. She said that she did not receive weekly cash payments from the applicant during the course of the relationship, and that he did not reimburse her for household outgoings and the children’s expenses that she paid. She contended that the applicant had both a gambling and an alcohol problem, and that he had to borrow money from her to meet various debts.
The parties are clearly at issue about the extent of the applicant’s financial contributions. I do not accept that the applicant’s financial contributions were as limited as suggested by the respondent nor that they were as expansive as he now asserts.
Exhibit 7 in the proceedings is an affidavit of the applicant affirmed in 2013 as part of the criminal proceedings before the City L District Court. In that affidavit, the applicant identifies what his financial position was in 2011, identifying that his earnings were sporadic. He indicates that he was able to supplement his Business G income by doing some casual work, earning about $150 per day working one or two days each week. He identifies that the respondent’s earnings were between $1,000 and $1,500 each week, that the respondent looked after the parties’ financial affairs and he says “I knew that we were only just making ends meet” (Exhibit 7, paragraph 26). He gives evidence that the parties did not have any savings or assets with equity in them. He says “[w]hatever money we earned was spent meeting our expenses” (Exhibit 7, paragraph 27). He concedes that he had an alcohol problem and was drinking at least five nights per week but that it reduced over time.
The respondent in her affidavit affirmed in the same proceedings in relation to financial matters said the parties “were only just managing to keep their heads above water financially”, and that she observed that the applicant was drinking heavily (respondent’s affidavit affirmed in the District Court in 2013, paragraphs 14 and 15). She made no reference to a gambling problem or him having to borrow money to meet debts. That the applicant’s income has always fluctuated and she gives evidence, “whatever money came into our household would be almost immediately spent on bills and living expenses. We did not have any savings at all” (respondent’s affidavit affirmed in 2013, paragraph 24). She also said “I have always found Mr Summers to be a loyal, honest, hardworking and loving family man” (respondent’s affidavit affirmed in 2013, paragraph 26).
She further states “[m]y salary is the only reliable income we receive that permits us to meet our mortgage and loan repayments”, and “I am only just meeting the mortgage payments at present. If we lose the income from my job, as well as Mr Summers’ limited earnings from the Business F and Business G, we will lose our car and our house. This obviously would be devastating for our family” (respondent’s affidavit affirmed in the District Court in 2013, paragraphs 38 and 39).
On the basis of the above evidence, I do not accept the respondent’s evidence in her trial affidavit as to the limited and almost non-existent financial contributions that she sought to paint of the applicant’s contributions. Likewise, the evidence of the applicant does not align with what he said to the District Court. I accept the evidence given by both the applicant and respondent in their affidavits in the District Court in 2013 to be more reliable. That evidence paints a clear picture that the parties’ financial circumstances were extremely tight, and that they were living upon the income of the respondent to meet the mortgage and loan repayments but, nevertheless the applicant’s income was necessary to meet the household expenses of the parties. I accept that the applicant made a significant contribution to the extent of his ability to do so from his Business G income and the other forms of employment that he undertook during the course of the parties’ relationship.
In 2008, the respondent purchased a property at Suburb E. The property was purchased in her sole name funded entirely by borrowings and a First Home Owner’s Grant. This is a significant contribution by the respondent. It was, however, as conceded by her in cross-examination, a joint purchase in that they regarded it as their home and one of the factors influencing its purchase was the capacity to house Business G.
In relation to this property, I accept the evidence of the applicant in large measure because it was not the subject of challenge, that following the purchase of the property he made financial contributions of between $5,000 and $6,000, by having the electricity and water connected as well as paying between $1,500 and $2,000 for the installation of Colourbond gates as well as paying for a plumber to fix pipes.
The parties were also at issue about the extent of the applicant’s contributions in his role as a homemaker and parent. The respondent sought to paint the applicant as an almost absent parent and that his contributions to the household domestic activities were again almost non-existent.
Again, I prefer the evidence given by the respondent to the District Court in 2013. The respondent gave evidence that the applicant was heavily involved in the children’s upbringing and was involved in recreational activities with the children. She gave evidence that on the days that her mother was unable to assist in care of the children, that the applicant would leave his business to collect the children from school and day care. The respondent gave evidence in that affidavit “Mr Summers is the only person who can care for the children when I am on evenings and night work” and “[t]he reality is that if Mr Summers is not available to help me care for the children I will be forced to quit my job” (respondent’s affidavit affirmed 30 January 2013, paragraphs 36 and 37).
The applicant makes a concession that the respondent was the primary carer of the child X between 2004 and 2006. Thereafter, the evidence would appear to be that X attended day care and/or pre-school on a full-time basis until school started. Likewise, in relation to the child Y, she was cared for by the respondent until she attended day care and/or pre-school.
I find the applicant did make a significant contribution as a parent to the children. In doing so, I acknowledge that the respondent also made a significant contribution and accept the support provided by her mother and sister in helping care for the children.
I accept that both parties made a contribution as a homemaker, and accept the applicant’s evidence that the respondent made a greater contribution in that respect.
The circumstances of the applicant’s arrest in 2011 and subsequent incarceration in 2013 were devastating for the family. As much was admitted by both the applicant and the respondent in their affidavits to the District Court in 2013.
In 2013, the applicant was incarcerated. For at least the first two years of the applicant’s incarceration, the respondent would bring the children to visit him at W Prison. The applicant conceded that it was a two-hour drive there and a two-hour drive back, and the respondent would bring the children to spend a few hours with him. Then when the applicant was in Z Prison, again the respondent would bring the children on an hour’s drive there and an hour’s drive back, and stay for approximately two hours.
It is undoubtedly clear that in the period subsequent to his incarceration, the applicant’s contributions as a parent and homemaker completely ceased. I find that the respondent’s contributions on the other hand were enormous. Not only did she assume almost the entirety of the financial responsibility for the children but also then had to re-organise her life and, with the assistance of her mother and family, assumed the totality of the parenting contributions in relation to the children. I also acknowledge her significant contribution and effort in ensuring in the first two years following incarceration, that the children maintained a relationship with their father. It was a significant contribution on her part involving extensive travel to take the children to visit their father in both W and Z Prisons.
The applicant’s financial contributions following incarceration were greater than as contended for by the respondent, but were nevertheless modest. I accept the evidence of Mr C and the applicant that approximately $24,000 was provided to the respondent from the sale of Business G assets owned by the applicant. Of course, this just represented the provision to the respondent of some of the joint property of the parties. I also accept the evidence of the applicant that he paid $2,430 for rates on the D Street, Suburb E property. I also accept the evidence that the respondent provided the applicant with funds while he was incarcerated, which the applicant conceded totalled approximately $5,700.
The parties were at issue about the extent of funds provided to meet the legal fees of the applicant following his arrest.
There was initially $40,000 provided by way of surety. This was obtained by borrowings of $25,000 from two friends of the applicant, and the provision by the respondent of $15,000 in part by way of a $10,000 personal loan and $5,000 by drawing on the home loan and credit cards. The $40,000 surety was reimbursed to the respondent. I accept the evidence of the applicant that he met the repayment of the $25,000 loans obtained to provide part of the surety.
There was also an argument about how much was provided by way of legal fees. The respondent’s evidence was that she paid $100,000 by way of legal fees, but her solicitor accepted during the course of submissions that she was only able to establish in her affidavit, evidence of a payment of approximately $80,000 by way of legal fees.
The respondent in cross-examination accepted that there was receipted evidence of payments to two different firms of solicitors of $18,800 in the case of one solicitor and $16,500 in the case of another solicitor. The parties were apart in relation to whether or not the respondent paid a further $25,000 by way of cash to a solicitor. The respondent pointed in her affidavit to various withdrawals of monies in bank accounts. She was challenged by the applicant’s solicitor that these monies were not paid. Notwithstanding her unreliability on other matters, I accept her evidence but note as well that she received back the surety of $40,000.
I do not place any weight on the argument advanced by the applicant in relation to the payment of legal fees that the respondent insisted on obtaining private legal representation in circumstances where the applicant contended that he could obtain legal aid. I fail to see the relevance of the submission. There was no evidence that the applicant would have been granted legal aid. Irrespective of whether or not he could or could not have, the reality was that private representation was obtained at a time when the parties regarded themselves as in a relationship. At the end of the day, it is not necessary for me to resolve this issue other than to note that the incurring of the legal fees was entirely as a consequence of the criminal conduct of the applicant.
In 2017, the respondent sold the property at Suburb E for $1,000,000 and purchased another property at Suburb E for $858,000. The mortgage for the original Suburb E property was carried over to the new Suburb E property. From the proceeds of sale, the respondent retained $81,404. That money was applied towards meeting various expenses of the respondent and the children. She gave evidence that she used it to pay for household furnishings, new furniture for the children, a computer, and that it otherwise met expenses for herself and the children. The applicant through his solicitor sought to contend that there was some attempt to not disclose this sum of money. At the end of the day, the issue of disclosure matters little in circumstances where there was no issue that the funds were received by the respondent and it was not challenged as to how she spent the monies. No submission was put that the respondent had other undisclosed funds.
In the period post-separation, as I indicated, the respondent has undertaken all of the contributions in relation to the children. The applicant, despite having the financial capacity, certainly in the years following his release from prison, has made no financial contribution to the children. Whilst in his affidavit he contended “I have full intentions of contributing to the children’s lives both financially and non-financially” (applicant’s affidavit filed 1 September 2021, paragraph 201), actions speak louder than words. Exhibit 3 in the proceedings is correspondence from the respondent’s solicitors to the applicant’s solicitors asking for the applicant to make a financial contribution to the costs of the children. No such financial contribution was made. It reflects poorly upon the applicant’s assertions in his affidavit.
I recognise also in the assessment of contribution that a large part of the agreed pool of assets is represented by the respondent’s superannuation entitlements. They are currently measured at almost $300,000. I note that Exhibit 5 in the proceedings are statements in relation to the respondent’s superannuation entitlements. I note that those statements identified that as at 30 June 2013, the respondent’s superannuation had a value of approximately $77,441 and as at 30 June 2015, it had a value of approximately $116,407. That demonstrates that the increase in superannuation held by the respondent is a result in part of her contributions in the period post- separation of the parties.
Assessing the parties’ contributions in a holistic way during cohabitation and subsequently, I am of the view that an assessment at 35% as contended for by the applicant fails to properly have regard to the enormous contributions made by the respondent in the nine-year period since the applicant’s incarceration, both in relation to the care of the children but also financially and, in particular to reduce the loan on the home by about $40,000 but also her significant contributions to superannuation. Likewise, however, an assessment at zero, as contended for by the respondent, fails to properly recognise the applicant’s contributions during the first 13 years of the parties’ relationship. In my view, a proper assessment of the applicant’s contributions leads to an assessment at 12.5%.
SECTION 90SF(3)
Section 90SF(3) of the Act provides:
(3) The matters to be so taken into account are:
(a)the age and state of health of each of the parties to the de facto relationship (the subject de facto relationship); and
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the de facto relationship who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support:
(i)himself or herself; and
(ii)a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (4), the eligibility of either party for a pension, allowance or benefit under:
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii)any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g)a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(i)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and
(j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the de facto relationship and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party’s role as a parent; and
(m)if either party is cohabiting with another person—the financial circumstances relating to the cohabitation; and
(n)the terms of any order made or proposed to be made under section 90SM in relation to:
(i)the property of the parties; or
(ii)vested bankruptcy property in relation to a bankrupt party; and
(o)the terms of any order or declaration made, or proposed to be made, under this Part in relation to:
(i)a party to the subject de facto relationship (in relation to another de facto relationship); or
(ii)a person who is a party to another de facto relationship with a party to the subject de facto relationship; or
(iii)the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv)vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(p)the terms of any order or declaration made, or proposed to be made, under Part VIII in relation to:
(i)a party to the subject de facto relationship; or
(ii)a person who is a party to a marriage with a party to the subject de facto relationship; or
(iii)the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv)vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(q)any child support under the Child Support (Assessment) Act 1989 that a party to the subject de facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the subject de facto relationship; and
(r)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(s)the terms of any Part VIIIAB financial agreement that is binding on either or both of the parties to the subject de facto relationship; and
(t)the terms of any financial agreement that is binding on a party to the subject de facto relationship.
In relation to the matters under s 90SF(3), the applicant contended there should be a 5% adjustment to the respondent. The respondent’s case was that there should be no adjustment in circumstances where she contended that there should be no property settlement order.
Notwithstanding their submissions, the relevant matters under s 90SF(3) seem to me to include the disparity as to income available to each of the parties. In that respect, I note from the applicant’s Financial Statement that his income would appear to be $1,776 gross per week, whilst the respondent’s income would appear to be $2,300 gross per week. The respondent clearly earns more than the applicant.
Otherwise, I note that the respondent will have the entire care of the child X until he turns 18 at the end of this year, and all of the care of Y who is only in Year 7 at school. I also note, given the conduct of the applicant to date in relation to financial support of the children, that the entirety of the future financial costs of supporting the children is more likely than not to fall upon the respondent.
I take into account that the respondent has re-partnered and clearly has the benefit of the financial contributions of her partner to the support of herself. I note his unchallenged evidence that he has made a significant financial contribution to the support of the children. I also note the respondent has a child of her new relationship.
I note that the superannuation entitlements of the respondent dwarf those of the applicant.
I also note that each party has outstanding legal fees, which are not included in the pool of assets as referred to above. I note that the applicant may still have a liability for legal fees given my findings, assuming that he applies all of the amount ordered in payment of legal fees.
I note that as a consequence of my findings, there is an imbalance of contribution in favour of the respondent. This might otherwise call for an adjustment under s 90SF(3) but in the circumstances of this case, taking into account the ongoing parenting obligations of the respondent and the likelihood that she will receive no significant financial contribution from the applicant to their support, I find that no adjustment under s 90SF(3) is warranted.
Accordingly, the parties’ assets as identified earlier in these reasons will be divided in the proportions as to 87.5% to the respondent and 12.5% to the applicant.
To give effect to this, the applicant will receive a sum of money taking into account the assets that he has of $137,857.37. The respondent asked for time to pay in the order of 60-90 days. In view of my finding as to her obligations to support the children, I will order the respondent to pay the said sum to the applicant within 90 days of the date of the making of these orders.
I am satisfied that these findings and the adjusting orders represent a just and equitable division of the parties’ interests in property.
I certify that the preceding seventy-three (73) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Schonell. Associate:
Dated: 8 April 2022
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