Taggart and Scully
[2013] FCCA 1447
•4 October 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| TAGGART & SCULLY | [2013] FCCA 1447 |
| Catchwords: FAMILY LAW – Property settlement – husband alleging that at separation wife retained significant cash savings accumulated during cohabitation – non-disclosure of savings. |
| Legislation: Family Law Act 1975, ss.75(2), 79 |
| Stanford v Stanford [2012] HCA 52, (2012) 47 Fam LR 481, (2012) FLC 93-518 Watson & Ling [2013] FamCA 57 at [4], (2013) FLC 93-527 Weir & Weir (1992) 16 Fam LR 154, (1993) FLC 92-338 |
| Applicant: | MR TAGGART |
| Respondent: | MS SCULLY |
| File Number: | PAC 922 of 2010 |
| Judgment of: | Judge Halligan |
| Hearing dates: | 12, 23 April 2013, 23 September 2013 |
| Date of Last Submission: | 23 September 2013 |
| Delivered at: | Parramatta |
| Delivered on: | 4 October 2013 |
REPRESENTATION
| Solicitors for the Applicant: | Applicant Father In Person |
| Solicitors for the Respondent: | Respondent Mother In Person |
ORDERS
The husband's Initiating Application filed on 11 October 2012 is dismissed.
The wife's Response filed on 12 November 2012 is dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Taggart & Scully is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PARRAMATTA |
PAC 922 of 2010
| MR TAGGART |
Applicant
And
| MS SCULLY |
Respondent
REASONS FOR JUDGMENT
Introduction
These are property proceedings under the Family Law Act 1975, in which the applicant husband seeks orders requiring the respondent wife to pay him $70,000, while the wife seeks orders that the husband pay her $30,000. The husband asserts he is entitled to between 40% and 45% of the property of both parties, while the wife asserts she is entitled to between 60% and 70% of the parties’ total property.
The principal factual issue in this case is whether or not the wife retained significant savings accumulated during the parties’ marriage in her name at separation as the husband alleges.
Background
The husband is aged 49 (born (omitted) 1963), the wife 48 (born
(omitted) 1964). They married on (omitted) 1989. They did not cohabit before marriage. The marriage has been dissolved, the divorce order becoming final on 13 October 2011.
There is an issue as to the date of separation. The husband asserts the parties separated under the one roof on 29 March 2008. He left the parties’ matrimonial home on 27 March 2010, taking the children and the contents of the home, while the wife was on a holiday to (country omitted). At that time he surrendered the lease of the matrimonial home without advising the wife, with the result that when the wife returned from overseas on 31 March 2010, she had nowhere to live. The wife asserts the parties separated on 1 April 2010. Ultimately, I am not satisfied anything turns on this issue in the determination of these proceedings.
The parties have two children, X who is 22 (born (omitted) 1991), and Y who is 9 (born (omitted) 2004). The children live with the wife five nights a week and with the husband two nights a week. There are no parenting orders in place.
Both parties and X were born in (country omitted). The husband came to Australia on 16 February 2000. The wife and X arrived in Australia on 12 March 2000. The husband, wife and X became Australian citizens on 13 February 2003. Y was born in Australia.
Credit of witnesses
The husband and the wife were the only witnesses. Both conducted their cases without legal representation. Each had the assistance of a (omitted) interpreter during the hearing.
The husband contradicted himself or conceded evidence he previously gave was incorrect a number of times, including-
a)The husband denied he failed to pay his child support when due between 1 November 2010 and 13 January 2011, but when shown evidence from the Child Support Agency to contradict his evidence admitted he failed to pay the wife on time in November and December 2010 and January 2011.
b)At the commencement of his oral evidence, the husband said he had recently read over his affidavit and there was nothing in it he wished to change. In the course of his cross-examination, the husband admitted that statements in paragraphs [10], [23], [54], [60] and [77] on a variety of matters were wrong, including his assertion that the wife transferred $71,000 into the wife’s name on about 10 May 2007, saying that the correct figure was $51,000.
The wife's evidence as to her dealings with significant sums of savings built up during the parties’ cohabitation was inconsistent and on occasions evasive. I will deal with this evidence in detail later in these reasons, and for reasons there given, was not satisfied the wife was being truthful. I was satisfied that the wife was evasive and not truthful in the evidence she gave about this important issue, and that this significantly affects her credit as a witness.
I take the view that on balance the husband is a more reliable witness than the wife. The contradictions and admitted inaccuracies in his evidence in chief were generally in relation to matters of detail, and appeared to be misstatements rather than deliberate attempts to misrepresent the truth. I was concerned that the issues with the wife's evidence about her transfers of large sums of money to her brother in (country omitted) was of a very different, and much more serious, character.
The evidence
At marriage, neither party had any significant assets. Each had some personal possessions and the husband had an unspecified sum in cash savings that was not significant. On coming to Australia in 2000, the husband brought $US6,000. This was the extent of the parties’ property at that time.
At marriage, both parties had tertiary qualifications in (country omitted) and were in full time employment.
The husband has remained in full time employment throughout the parties’ marriage although it was some time after arriving in Australia before the husband obtained employment commensurate with his qualifications. In 2000 and 2001, the husband did additional weekend work.
The wife worked from marriage until about the time X was born. She then took two years maternity leave on 70% of her normal salary before returning to full time work. After moving to Australia, the wife was in full time casual employment from 2001 until November 2003. That employment was not commensurate with her qualifications in (country omitted). She did not return to remunerative employment until April 2010. She has been employed as a (omitted) since April 2010.
During the whole of the parties’ cohabitation, and until March 2010, the wife was primarily responsible for child care and household tasks. The husband assisted the wife to some extent, although the exact extent is in dispute. During cohabitation, the husband regularly collected used (omitted) from (omitted) to use for (omitted). He upgraded the home computer “continuously”. He also maintained the parties’ motor vehicles.
The parties lived in rented accommodation at all relevant times.
In 2000, the husband bought a motor vehicle in his name for $2,500 from cash savings. In 2007, he bought another motor vehicle for $14,000, using cash savings and the proceeds of sale of the first motor vehicle, which he sold for $600. The husband retains this vehicle. In 2009, the wife purchased a motor vehicle for $16,000 in her name using cash savings. The wife retains this vehicle.
The children returned to the wife's care shortly after the husband vacated the parties’ home in March 2010. From about mid 2010, the children lived with the wife five nights a week and with the husband two nights a week. The husband pays child support as assessed through the Child Support Agency. He was in arrears of child support between November 2010 and January 2011. There is no evidence of any current arrears. The current annual rate of child support payable by the husband is $8,667.
The husband entered into a contract to purchase a unit off the plan in June 2012. The purchase price is $515,000. He paid a deposit of $70,000. There is no evidence as to when the purchase may be completed.
From March 2008 to March 2010, when the husband said the parties were separated under the one roof, the husband saved about $80,000 in accounts in his sole name. He presently has savings of $78,239. Allowing for the $70,000 deposit on the unit, this suggests his ability to save has decreased since the parties ceased living in the same premises, despite the husband asserting that from March 2008 to March 2010 he met all the living expenses of the family, and since March 2010 he has only had to meet his own living expenses, the children’s expenses two nights a week, and child support.
The circumstances under which the parties ceased to live in the same premises, referred to earlier, resulted in the wife being homeless on her return to Australia. The husband initially retained all the contents of the parties’ home. He permitted the wife to collect a vacuum cleaner, a clothes stand that the wife discovered was broken when she attempted to use it, and clothing. The husband asserted the items he retained were of little value, but this relieved him of the necessity to acquire replacement items to set up a new household for himself. The wife had to purchase everything she needed for her new household for herself and the children, from cutlery and crockery to appliances, furniture and bedding.
The husband asserted that he believed the wife had possession of two suitcases containing personal documents and records of his. The basis of the husband's belief was not stated, and it is not readily apparent on the evidence how the wife could have taken possession of these items, as the husband retained possession of everything the parties owned when he vacated the parties’ home in March 2010, with the exception only of what the wife took with her in her luggage for her visit to (country omitted)
The husband's current income from his employment is $8,657 gross per month (or $103,884 per annum). The wife said she earns $726.85 per week (or $37,796 per annum) gross as a (omitted). She also works on some Saturdays and receives additional income, which she did not disclose. She was vague as to the frequency of weekend work, and hence as to the level of her average weekly income. I am satisfied it is somewhat higher than she disclosed in her financial statement.
The husband expressed the opinion that the wife does not fully exercise her earning capacity. He said the wife has tertiary (omitted) qualifications in (country omitted) that he asserted were recognised in Australia “as an equivalent Australian qualification”. He did not disclose the source of this knowledge, nor did he say what the equivalent Australian qualification was. He said that the wife had work experience in (country omitted) in the (omitted) industry, but did not work in that industry in Australia.
The wife said that she sacrificed her career to care for the family and support the husband in his career. She said she cannot return to the type of (omitted) work she did in (country omitted). She said remaining at home to care for the family has meant she has lost the chance to study English, and her English is not good. She said her income is much less than the husband's, her job security is much poorer than the husband's, and her prospects of gaining employment if she loses her job are much poorer than the husband's if he lost his job. She also said she has to provide accommodation for the children and her rent is higher than the husband's, although I note the husband has the children two nights a week and hence both parents need to provide accommodation for the children.
I note that at no time since coming to Australia has the wife worked in the type of professional employment she had in (country omitted), whereas the husband has over time returned to the type of professional employment he had in (country omitted) and has progressed in that career in Australia. I also note, having heard the parties attempt to communicate verbally in English during the hearing despite both requesting and being provided with (omitted) interpreters, that the husband's spoken English if far better than the wife's.
I am not satisfied on the evidence that the wife’s qualifications obtained in (country omitted) are recognised in Australia, and hence I am not satisfied that the wife is underutilising her earning capacity.
The applicable law
Property settlement proceedings fall to be determined by reference to s.79. The court may make such order as it thinks appropriate (s.79(1)), but must not make an order unless satisfied it is just and equitable to do so (s.79(2)). In deciding whether to make an order, and if so what order, the court must have regard to those of the considerations in s.79(4), including s.75(2), the provisions of which are incorporated into s.79(4) by reference, as may be relevant in a particular case.
The High Court has emphasised the importance of the injunction in s.79(2) that the court shall not make any property settlement order unless it is satisfied in all the circumstances of the particular case that it is just and equitable to do so, noting that s.79(2) and s.79(4) must not be conflated (Stanford v Stanford, [2012] HCA 52 at [35], (2012) 47 Fam LR 481, (2012) FLC ¶93-518). While stating that “just and equitable” is a qualitative description not admitting of an exhaustive definition, the High Court in Stanford stated there were three fundamental propositions in relation to s.79(2) that must not be obscured, viz-
a)It is necessary to begin any consideration whether it is just and equitable to make a property settlement order by identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in property (at [37]).
b)Despite the breadth of the power to make a property settlement order conferred by s.79, it is nonetheless a power that rests upon the law, and the discretion the power confers must be exercised in accordance with legal principles, including the principles the Act itself lays down. Whether it is just and equitable to make an order is not to be answered by an assumption that the parties’ rights to or interests in marital property are or should be different to those that exist. The question is whether the parties’ existing property interests should be altered (at [38]-[39]).
c)Whether making a property settlement order is just and equitable is not to be answered by commencing with an assumption that either party has the right to have the parties’ property divided between them, or has the right to an interest in marital property fixed by reference to the matters set out in s.79(4). To proceed otherwise is to conflate ss.79(2) and 79(4) (at [40]).
However, the just and equitable requirement may be readily satisfied where the parties no longer live in a marital relationship (Stanford at [42]), or semble, for a property settlement application under Part VIIIAB, where the parties no longer live in a de facto relationship (Watson & Ling, [2013] FamCA 57 at [4], (2013) FLC ¶93-527).
In Hickey & Hickey; A-G for Commonwealth (Intervener), [2003] FamCA 395, (2003) 30 Fam LR 355, (2003) FLC ¶93-143, the Full Court explained the preferred approach in determining property settlement proceedings under s 79, as follows (FamCA at [39]; FLC at 78,386; Fam LR at 370):
“39. The case law reveals that there is a preferred approach to the determination of an application brought pursuant to the provisions of s.79. That approach involves four inter-related steps. Firstly, the Court should make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing. Secondly, the Court should identify and assess the contributions of the parties within the meaning of ss.79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties. Thirdly, the Court should identify and assess the relevant matters referred to in ss.79(4)(d), (e), (f) and (g), (“the other factors”) including, because of s.79(4)(e), the matters referred to in s.75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established at step two. Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case: Lee Steere and Lee Steere (1985) FLC ¶91-626; Ferraro and Ferraro (1993) FLC ¶92-335; Davut and Raif (1994) FLC ¶92-503; Prpic and Prpic (1995) FLC ¶92-574; Clauson and Clauson (1995) FLC ¶92-595; Townsend and Townsend (1995) FLC ¶92-569; Biltoft and Biltoft (1995) FLC ¶92-614; McLay and McLay (1996) FLC ¶92-667; JEJ and DDF (2001) FLC ¶93-075 and Phillips and Phillips (2002) FLC ¶93-104.”
Where the pool of divisible assets and resources includes superannuation interests, the Full Court in C & C, [2005] FamCA 429, (2005) 33 Fam LR 414, (2005) FLC ¶93-220, considered the approach that should be taken. The majority said (at [58] and [65]-[68]):
58. Thus, we consider that because of the obligation under s 79(2) to make a just and equitable order, then in order to ensure such a result the Court should wherever there is a superannuation interest apply the provisions of s 79(4)(a) to (g) (which will include the matters contained in s 75(2)) to that superannuation interest whether or not a splitting order is sought.
65. In summary, then, the trial Judge has a discretion as to how superannuation interests will be treated in a particular case. If superannuation is not included in the list of property but rather made the subject of a separate pool, it will be necessary where a splitting order is sought, or extremely prudent where no such splitting order is sought (in order to ensure that justice and equity is achieved) to:
(a) value the superannuation interest (according to the Regulations if an order under Part VIIIB is sought or according to the Regulations or otherwise if no order is sought);
(b) consider and make findings about the types of contributions referred to in s 79(4)(a), (b) and (c) which have been made by the parties to the superannuation interests on either a global approach or an asset by asset approach depending on the circumstances;
(c) consider the other factors in s 79(4) being the matters in s 79(4)(d), (e), (f) and (g); and
(d) ensure that pursuant to s 79(2) the orders in relation to the parties’ property, and any order under Part VIIIB in relation to superannuation interests are just and equitable.
66. In the context of a consideration of the matters referred to in sub-paragraphs (b) and (c) of the last paragraph, the following matters may well be relevant: the relationship between years of fund membership and cohabitation; actual contributions made by the fund member at the commencement of the cohabitation (if applicable), at separation and at the date of hearing; preserved and non-preserved resignation entitlements at those times; and any factors peculiar to the fund or to the spouse’s present and/or future entitlements under the fund.
67. If this approach is adopted, whereby superannuation interests are dealt with separately from property as defined in s 4(1), but are subject to the considerations in s 79(4), then not only will any contributions, both direct and indirect, by either party to such superannuation interests be more likely to be given proper recognition, but the real nature of the superannuation interests in question can also be taken into account, both in consideration of the s 75(2) matters and in the final assessment of whether the ultimate order is just and equitable.
68. When we refer to “the real nature” of the relevant superannuation interest, we are referring to the fact that notwithstanding that its value according to the Regulations may well be calculated to be a very significant amount, that superannuation interest may be no more than a present or future periodic sum, or perhaps a future lump sum, the value of which at date of receipt is unknown.”
The pool of divisible assets, liabilities and resources
As previously mentioned, a significant issue in this case is whether the wife retained significant cash savings, accumulated during cohabitation, at separation. If the husband satisfies the court it is more likely than not that the wife retains cash funds accumulated during cohabitation, albeit undisclosed by her, the court may make a finding that the wife has these funds when determining the parties’ present interests in property.
Cash savings
The husband asserted that at 6 September 2002, the parties had accumulated savings of $92,755. At 14 June 2004, the husband said this had grown to $151,015, spread across four different Term Deposits with two separate banks, as follows-
a)$25,713 in (omitted) Bank account (omitted);
b)$29,975 in (omitted) Bank account (omitted);
c)$62,154 in (omitted) Bank account (omitted); and
d)$33,172 in (omitted) Bank account (omitted).
The total of these four amounts is in fact $151,014, not $151,015.
The husband said that as each of these term deposits thereafter matured, the money was reinvested in term deposits in the wife's sole name, to minimise the tax payable on the interest.
The wife did not challenge any of this evidence, and I accept it.
The husband said that on 10 May 2007, he transferred $71,000 into the wife's name. He conceded in cross-examination that this statement was incorrect, and said that the amount he transferred into the wife's name was $51,000. I accept that the sum transferred to the wife was $51,000, the figure put to the husband by the wife in cross-examination.
He said that on 4 February 2008, he transferred $43,000 into the wife's name. The wife did not challenge this evidence, and I accept it.
The husband said that he believed that at 4 February 2008, the wife held cash savings in her sole name totalling approximately $265,015. This evidence cannot stand in light of his concession that his statement he transferred $71,000 to the wife in 2007 is incorrect. Using the lesser figure of $51,000, the total sums I am satisfied were placed in the wife's sole name is $245,014.
The husband said he believed that the wife had savings much greater than the sum of the four term deposits and the two sums he said he transferred to her, because of interest earned on the term deposits and because he suggested she saved money from her income since 2004 to date. He gave no basis for his belief that the wife saved money from her income since 2004 to date, and I therefore am not satisfied the wife saved money from her income. There is no evidence as to any interest that may have accumulated on any of the term deposits, or what happened to it, and I therefore cannot quantify it.
The wife admitted in cross-examination having transferred money to bank accounts in (country omitted). She said she could not recall anything about these transfers, such as how many times she transferred money or how much she transferred. She said the foreign transfers occurred more than three years ago. When the sum of $205,000 was put to her as the amount she transferred, she said she was not quite sure. When challenged further as to her recollection of the amount transferred, she said it could have been less than $200,000 or a little more than that. She appeared most reluctant to give direct answers to questions as to how much she had transferred.
She said she had not disclosed the money transferred overseas in her financial statement, as she no longer had it.
Her evidence as to what became of this money was most unsatisfactory, her explanations changing as the probing of what became of the money progressed and became more specific.
She said she saw a doctor in (country omitted) for an undisclosed reason, and paid him approximately $70,000 or $80,000. She provided the doctor’s name. When asked what became of the balance of the moneys, she said she paid living expenses in (country omitted), including food and accommodation, she hired a translator to translate divorce documents the husband gave her as she was leaving Australia, and she was introduced to a psychologist and a (omitted) specialist. When asked what she spent on each of these, she said-
a)She had no idea how much she spent on food and accommodation.
b)She could not remember if she paid anything to the psychologist.
c)She paid maybe $100 or $200 to the translator for translating the divorce documents and apart from that could not remember if she paid or gave anything to the translator, but added that sometimes the translator paid when they went out and she later refunded the money.
d)She paid the (omitted) specialist $A100,000.
The wife said the translator arranged everything for her and helped her a lot, and she did what the translator advised. How the translator came to perform such a role, which seems totally unconnected to translating divorce papers, was never explained by the wife beyond saying the translator was a friend and he took her to dinner as he had a car. She later said the translator arranged accommodation for her with a friend for which she paid, but she did not pay the person who provided the accommodation, but rather paid the translator, although she could not remember how much she paid him. This contradicted her earlier evidence that she could not remember if she paid the translator more than $100 or $200.
In relation to the $A100,000 allegedly paid to the (omitted) specialist, the wife said the specialist helped her with her (omitted), and for each item she paid $A20,000 or $A30,000, and he promised that if it did not work after one year, he would repay the money. The wife said the (omitted) advice only partly worked. She said she had been unable to contact the (omitted) specialist since.
The wife said she did not stay in a hotel while in (country omitted). When it was put to her that she therefore would not have had any accommodation costs, she said she did, but could not remember how they arose. She then said the translator arranged a place for her to stay with a friend of his, and she had taken the translator to dinner, bought the translator some presents, and had given the translator some money, in both Australian and (country omitted) currency, for the accommodation. Why she did not do this for the person providing the accommodation, rather than for the translator, was not explained. She professed not to remember how much she gave the translator.
The wife admitted staying for some of the time she spent in (country omitted) with her brother. She did not pay him for accommodation. She said some of the time she stayed with family, and some of the time she stayed with the translator. When challenged about now saying she stayed with the translator, the wife said the translator stayed with a friend and sometimes she stayed there, which is the home of the translator’s friend she previously referred to as having stayed at. I found this explanation quite unsatisfactory in light of her evidence up to that point. The wife's evidence gave the impression of being concocted as the cross-examination progressed.
The wife could not remember how long she stayed with her brother or how long she stayed elsewhere.
The wife said that before she left (country omitted), she had spent all the money she had transferred there. She also said she owed a debt to the translator because ultimately she did not have enough money and the translator paid some bills for her. She said the translator paid some money to the (omitted) specialist in addition to the $A100,000 she paid, but she could not remember how much. When challenged about her ability to remember if she paid the (omitted) specialist $A100,000 but her inability to remember how much remained outstanding and paid by the interpreter, she then said that $A100,000 was the total amount paid to the (omitted) specialist. She said she did not owe any money in (country omitted) now.
When asked if she saw any other doctors in (country omitted) other than the one to whom she said she paid $70,000 to $80,000 and the psychologist, the wife said she also saw a doctor for her “sleeping problems”. She could not remember how much she paid to either the psychologist or the doctor seen for her sleeping problems.
The wife said she transferred the money to (country omitted) because she wanted to see some doctors there. She saw them when she travelled there in early March 2010, returning to Australia at the end of March 2010. She transferred the money to the account of her younger brother.
Bank records ((omitted)) show the wife transferred the following funds to (country omitted) on the dates indicated-
a)7 August 2009, $9,832.
b)6 January 2010, $89,032.
c)15 January 2010, $38,032.
d)1 April 2010, $68,832.
Thus, the total transferred was $A205,728. The last transfer occurred after the wife returned to Australia.
When presented with documentary evidence from the bank of the last of the above transfers, the wife maintained that she could not recall it, but accepted that if it was recorded by the bank, it must be correct. She professed not to be able to recall whether she transferred this money to her brother’s bank account in (country omitted). I am not satisfied the wife was being candid in this evidence, in light of her earlier evidence that the money she transferred to (country omitted) was transferred to her younger brother’s bank account. I note that the bank record ((omitted)) shows all four transfers were to her brother, Mr S.
When taken to the bank record ((omitted)) recording four transfers to her brother in (country omitted) totalling over $205,000 between August 2009 and April 2010, the wife remained reluctant to unequivocally agree that this is what she did despite acknowledging that the bank record was correct.
In the circumstances, I am not satisfied the wife’s evidence about what she did with the money she transferred to her brother in (country omitted) was truthful. A significant part of that money ($68,832) was in fact transferred to her brother’s account in (country omitted) after she returned to Australia, and so could not have been spent by her while she was in (country omitted). What the wife transferred to (country omitted) before travelling there is less than she said she spent while there. I am satisfied that the wife concocted her evidence as to the expenditure of these funds, and am satisfied it is more likely than not that she retains control of those funds, either in (country omitted) or in an undisclosed bank account in Australia.
I am satisfied that the wife's cash assets are $205,728 more than she disclosed in her financial statement.
I am not satisfied on the evidence it is more likely than not that the wife retains a greater sum of savings, as the husband submitted. While I am satisfied that in early 2008 the wife retained cash in the sum of $245,014 in her sole name, I note that she subsequently bought a car from savings, and on return from (country omitted) in 2010 she was left with virtually nothing by the husband, and had to re-establish a household for herself and the children.
The husband cross-examined the wife about other transactions on her bank accounts since returning to Australia. There was no suggestion these funds were transferred overseas. The wife disclosed present savings totalling $39,971, a sum greater than any of the sums involved in these transfers. I am not satisfied the wife has any further undisclosed savings.
Husband's property purchase
On 28 June 2012, the husband exchanged contracts for the purchase of a unit at (omitted) off the plan. The purchase price is $515,000. He has paid a $70,000 deposit from his cash savings. In the absence of any valuation of the husband's interest in this unit, I will treat it as worth the amount of the deposit, $70,000.
The parties assets, liabilities and resources
I therefore find that the parties’ assets and liabilities are-
| Item | Description | Title | Amount |
| 1 | Husband's (bank omitted) account (omitted) | Husband | 35,419.00 |
| 2 | Husband's (bank omitted) account (omitted) | Husband | 42,820.00 |
| 3 | Husband's Toyota motor vehicle | Husband | 6,650.00 |
| 4 | Husband's household contents | Husband | 600.00 |
| 5 | Deposit on "off the plan" property | Husband | 70,000.00 |
| 6 | Husband's unpaid tax for 2011/2012 | Husband | -2,450.00 |
| 7 | Husband's Visa card | Husband | -2,120.00 |
| 8 | Unpaid solicitors fees on property purchase | Husband | -680.00 |
| 9 | Wife's (bank omitted) account (omitted) | Wife | 18,062.00 |
| 10 | Wife's second (bank omitted) a/c (number not stated) | Wife | 21,909.00 |
| 11 | Wife's Toyota motor vehicle | Wife | 7,000.00 |
| 12 | Wife's household contents | Wife | 2,000.00 |
| 13 | Wife's Mastercard | Wife | -816.00 |
| 14 | Wife's undisclosed savings | Wife | 205,728.00 |
| Total | 404,122.00 |
I find that the parties’ resources comprise their respective superannuation accounts, namely-
| Item | Description | Title | Amount |
| 1 | (omitted) Super | Husband | 72,651.00 |
| 2 | (omitted) Super | Wife | 13,563.00 |
| Total | 86,214.00 |
The assessment of contributions
I am satisfied that overall the parties’ contributions to their property should be assessed as equal. The husband has been the primary bread winner, and has received a higher income than the wife while the parties have been in Australia, and when the wife was on maternity leave in (country omitted). On the other hand, the wife has been the primary homemaker and parent. While the husband has accumulated savings since separation, whichever date is taken as the date of separation, the wife has since April 2010 make a significantly greater contribution as homemaker and parent, having the care of the dependent child five days a week.
I have no evidence as to the accumulation of the parties’ respective superannuation entitlements, and I therefore assess their contribution based entitlements to the superannuation resources in the same way as to their property, as being equal.
The assessment of non-contributions considerations
I am satisfied that because of the wife's lower income earning capacity, which I am satisfied has been adversely affected by her assuming the primary child care responsibility since the parties came to Australia, enabling the husband to pursue his professional career in Australia, and because of the wife's greater responsibility for care of the dependent child, having the child’s care during weekdays while the husband has her on weekends, there should be an adjustment in the parties’ contribution based entitlements to both their net property and their resources in her favour.
In determining the level of that adjustment, I take into account the fact that I am not satisfied the wife has made full and frank disclosure of her financial circumstances. I am not satisfied the wife accurately disclosed the level of her income, as she failed to disclose her overtime work on Saturdays.
In relation to the wife's undisclosed cash savings in excess of $205,000, I am unable to determine what became of the interest the wife could have earned on that sum. I am conscious of the comments of the Full Court of the Family Court of Australia in Weir & Weir, (1992) 16 Fam LR 154 at 160, (1993) FLC ¶92-338 at 79,594-
“Where there is clear evidence of non-disclosure as there was here, the court should not be unduly cautious about making findings in favour of the other party.”
I am therefore satisfied that an adjustment to the wife's contribution based entitlement to both the parties’ net property and superannuation resources in the order of 10% is warranted , but subject to the fact that some doubt must remain as to whether the sum of $205,728 fully reflects the present full value of the savings I am satisfied the wife has retained and failed to disclose because of interest that could have been earned on that sum.
Is it just and equitable to make an order, and if so, what order?
The parties are separated and there is no prospect of them reconciling. As the High Court put it in Stanford, (above, at [42]) “any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s.79(4).”
An adjustment in the wife's favour of 10%, giving her an entitlement to 60% of the net assets, would mean she should receive a net amount of $242,273 from the net property pool where the wife has net property worth $253,883, necessitating a payment by the wife to the husband of $11,410. She should receive $51,728 from the superannuation where she has superannuation worth $13,563 necessitating an adjustment for a difference in superannuation worth $38,165 but the court has not been asked by either party to make a superannuation splitting order.
Both parties are in their late 40’s, and it is likely to be in excess of 15 years before their superannuation interests will vest. Any adjustment to the parties’ interests in present property to give effect to a necessary adjustment in superannuation interests that are unlikely to vest in either party for many years requires that there be a discounting of the value of superannuation for which the adjustment to interests in present property is made.
Taking into account the need to discount the figure to be adjusted against present property for the wife's interest in the superannuation pool, and the uncertainty as to the true value of undisclosed savings retained by the wife, and the fact that without an adjustment for the superannuation, the wife would need to pay money to the husband to achieve a proper division of the property pool, I am satisfied a just and equitable order in the particular circumstances of this case is to leave each party with the property and resources they presently have, and to refuse to order any adjustment in favour of either party.
In other words, I am not satisfied either party has demonstrated sufficient reason to make an order for a payment to them from the other party, and both the husband's application and the wife's response should be dismissed.
I certify that the preceding seventy-five (75) paragraphs are a true copy of the reasons for judgment of Judge Halligan
Date: 4 October 2013
Key Legal Topics
Areas of Law
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Family Law
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Civil Procedure
Legal Concepts
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Jurisdiction
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Procedural Fairness
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Abuse of Process
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