Tiernan and Tiernan and Anor

FAMILY COURT OF AUSTRALIA

TIERNAN & TIERNAN AND ANOR

[2010] FamCA 1121

FAMILY LAW – PROPERTY – Alteration of property interests – dispute as to date of separation as it relates to contributions – Application pursuant to s 106B – Issues of creditability – add-back of funds had prior to separation

Family Law Act 1975 (Cth)

Farnell and Farnell (1996) FLC 92-681
Norbis v Norbis (1986) 161 CLR 513

APPLICANT:

Ms Tiernan

RESPONDENT:

Mr Tiernan

THIRD PARTY:

B Tiernan

FILE NUMBER:

MLF

2364

2006

DATE DELIVERED:

10 December 2010

PLACE DELIVERED:

Melbourne

PLACE HEARD:

Melbourne

JUDGMENT OF:

Mushin J

HEARING DATE:

15, 16 & 17 February 2010 and 24, 25, 26, 27 & 28 May 2010

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Ms Stewart on 15 & 16 February 2010 until the lunch break, the applicant in person on 16 February 2010 from after the lunch break and otherwise in person

SOLICITOR FOR THE APPLICANT:

Morison Sawers on 15 & 16 February

COUNSEL FOR THE RESPONDENT:

Mr Sweeny on 15, 16 & 17 February 2010 and Mr Wilson on 24, 25, 26, 27 & 28 May 2010

SOLICITOR FOR THE RESPONDENT:

Mills Oakley

COUNSEL FOR THE SECOND RESPONDENT :

Mr Young with Ms Gordon

SOLICITOR FOR THE SECOND RESPONDENT:

Andrew Spilva Stewart & Co.

Orders

Within 90 days or such other time as may be agreed between the parties in writing, the husband pay to the wife the sum of $150,000.
Contemporaneously with the payment in accordance with paragraph 1 hereof, the wife transfer to the husband all her right title and interest in the property known as and situated at E in the State of Victoria at the husband’s expense.
Contemporaneously with the transfer in accordance with paragraph 2 hereof, the husband indemnify the wife and keep her indemnified against all liability past, present and future in respect of all outgoings of and relating to the said property including rates, taxes and like expenses.
Save as provided in these orders, all items of property forthwith vest in the party presently having possession thereof.
All applications be otherwise dismissed and removed from the list of cases awaiting hearing.
Liberty be reserved to either party to apply for any order consequent upon these orders.

IT IS CERTIFIED THAT

Pursuant to Rule 19.50 of the Family Law Rules 2004 this matter reasonably required the attendance of Counsel.

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF 2364 of 2006

MS TIERNAN

Applicant

And

MR TIERNAN

Respondent

And

B TIERNAN

Second Respondent

REASONS FOR JUDGMENT

introduction

These are competing applications for alteration of property interests arising out of the breakdown of the parties’ marriage. The parties married in 1966 and have four children by their marriage. They separated, on the assertion of the husband in approximately 1989 and on the assertion of the wife in 2004.
In addition to the proceedings between the husband and the wife, the wife has brought an application against one of their sons seeking that a transfer of a business between the husband and that son be set aside. The husband supports their son in opposing that application.
During their relationship the husband and the wife, later joined by at least one of the children, had the benefit of two primary sources of income. The first of those was a farm in the northern Victoria area and the second was several businesses styled H Business operating at various times in and around that area. Two of the primary areas of dispute between the parties are first, the potential income to be derived from the farm and secondly, the value and potential income to be attributed to the businesses.
Otherwise, the values of relevant property are virtually agreed but there is a further significant dispute as to what, if any, monies should be added back into the asset pool.

The parties and their children

The wife was born in 1948 and is presently aged 62 years. She described herself as a business owner and engaged in home duties. She lives in rented premises in the northern Victoria area and has not re-partnered.
The husband was born in 1944 and is presently aged 66 years. He described himself as a farmer. In recent years he has re-partnered with an Indonesian woman and spends up to half his time each year living with her in Bali.
The third party, one of the parties' sons, B Tiernan, was born in 1970 and is presently aged 40 years. He described himself as being a business owner and farmer. I will refer to him as "B Tiernan".
As well as the son referred to in the previous paragraph, the parties have three other children. They are twins, T and S, who were born in 1966 and are presently aged 44 years and CA, who was born in October 1977 and is presently aged 33 years. I will refer to the parties' daughter, CA, as "Ms CA".

The trial

This trial was heard over a period of eight days with an adjournment of three months between the third and fourth days. I granted the adjournment to the wife when counsel and instructing solicitor who had acted for her at the commencement of the trial ceased acting. The wife submitted that she hoped to be able to obtain financial support from her family to enable her to instruct lawyers to represent her. Unfortunately, she was unable to obtain that support and accordingly, on the resumption of the trial, she represented herself until it concluded.
Given the issues involved between the parties, the trial should not have taken as long as it did. A significant amount of Court time was taken up by the parties attempting to settle the matter which regrettably did not occur. The legal costs which have been expended on the trial and its preparation have been out of all proportion to the issues.

Credibility

As I remarked on several occasions during the trial, the hostility between the wife on the one hand and the husband and B tiernan on the other was in the extreme range. Despite her protestations of love for her son, the wife conducted herself in a manner which suggested a very high level of enmity towards him. I observed that enmity to be reciprocated in full measure. Two of the parties' other children supported the wife.
The degree of hostility described in the previous paragraph often adversely impacted on the evidence given by all three parties to these proceedings. One of many illustrations of that hostility commenced in the husband's affidavit of evidence in chief in which he alleged that the wife had been actively involved in various political activities including standing for public office. He alleged that one of those activities was as "a founding member and senior office holder" of a political organisation. …
In her affidavit in reply, the wife accepted that she had been occupied in political activity including having been an office holder of the political organisation in 2001. She asserted, and it was not denied, that both the husband and B Tiernan had also been members of the organisation.
The facts referred to in the previous two paragraphs were not asserted to be relevant to the issues which I must decide in these applications. In my view, those allegations, together with a number of other like matters, were sworn to by the parties in an effort to denigrate and smear. As I expressed during the trial, it was a disgrace that those and other matters were included in the affidavit material. They were not the subject of cross-examination and were not otherwise relied upon.
The matters referred to above lead me to the view, confirmed by my observations of the parties during the trial, that the parties have conducted this litigation with a viciousness which is seldom seen in proceedings of this type. That conduct has resulted in my having substantial doubts about the credibility of each of them.
However, I have a further serious doubt about the reliability of the evidence of each of the parties in these proceedings. I am far from convinced that the parties have made a full and frank disclosure of their respective financial circumstances to the Court. At approximately the commencement of the fourth day of this trial, I advised all three parties that I required them to show cause why, before proceeding further with the trial, I should not refer the papers to the Commissioner of Taxation of the Commonwealth of Australia. On the basis of submissions made in response to that requirement, I formed the view that there was insufficient material to warrant my further adjournment of the case for the purpose of referring the papers. However, throughout the trial and in the course of writing these reasons for judgement, I have maintained a significant doubt as to whether the parties have been honest with me in their disclosures.
There are two reasons for the doubt expressed in the previous paragraph. The first of those is the failure of the parties to produce all relevant books of account in respect of their financial activities. I will refer to the evidence of the single expert who valued the relevant businesses below. His evidence satisfied me that he was not confident that he was provided with all relevant material.
The second and more substantial reason for my doubt arises out of a statement made by the wife in response to a question which I asked of her while she was being cross-examined by counsel for the husband. I commented that on the evidence as I saw it, the business did not seem to earn very much money. The wife responded:
Oh - it earns very good money.
The wife was not challenged on that statement. On the contrary, it was allowed to go completely unremarked for the remainder of the proceedings. The parties' Financial Statements do not corroborate that evidence. The best evidence on the point is from the single expert to whom I will refer in due course. However, that evidence typified the manner in which I regard the parties as having conducted this litigation.
At the outset of this trial, counsel for the son voluntarily conceded that his client had not made a full and frank disclosure. Counsel was clearly insufficiently prepared through no fault of himself, his junior or his instructing solicitor. Various segments of further disclosure took place during the conduct of the trial but there was never a point at which it might have been said that a full disclosure had been made. No submission was made to that effect.
While there is insufficient evidence to make a finding on the balance of probabilities, I strongly suspect that they have not wanted me to hear the intricacies of their financial affairs which may well have caused them significant embarrassment. That issue has made my responsibility to do justice and equity between the parties more difficult than it need have been.

Relevant facts

The parties married in 1966. A Decree of Divorce was pronounced on 17 February 2007.
The date of the parties' separation has been a matter of great contention between them in these proceedings. It is common ground that in approximately 1989 the wife left the matrimonial home and moved to live in another country town in Victoria with the parties’ daughter Ms CA, at some distance away from the home. The husband swore that from that time until the parties' divorce, the parties lived separately and apart and their marriage -
… was effectively a sham and whilst I made the effort to be civil towards the wife and attended important family events … for all intents and purposes we were separated as a couple.
The wife conceded that there were "unhappy times" between herself and the husband, particularly from the time that she moved from the family home. However she swore that -
… although the marriage was unconventional it was a marriage.
The wife asserted that the actual separation between the parties did not take place until October 2004.
The factual dispute on this issue centres on the degree to which the parties maintained any, and if so what, financial relationship from the time that the wife moved away from the matrimonial home in 1989 until the time which she asserts as being the actual separation between the parties in October 2004.
In my view, it is not necessary to make a specific determination of the factual dispute with regard to the date of separation. In the first place, my findings referred to above with regard to the parties' credibility make it difficult to make such a determination. However, more importantly the actual issue is not the precise, or even the approximate date of the parties' separation, rather than a determination of the respective contributions of each of them, together with any other legislative requirement, during the disputed period. In that respect, the question of what, if any, money should be added back to the asset pool is at the heart of this dispute. No submission was made against my expression of that proposition during the trial. I will proceed accordingly.
At the commencement of the marriage neither party had any asset of significant value. The husband had been employed on his parents' family farm for many years. He had received very low wages in that employment, presumably because of the expectation that he would benefit from his father's estate in due course.
The wife was also in employment at the commencement of the parties' marriage but not in any respect relevant to these applications.
From the commencement of the marriage the parties lived on a rent free basis for approximately 5 1/2 years in a house provided by the husband's parents. In approximately 1971 the parents gave the parties $20,000 to purchase a home. The parties purchased a 100 acre property which they sold after 12 months. They moved to another property which they bought in northern Victoria and ultimately bought a farm property at E in approximately 1974 ("the farm"). That property was the matrimonial home and is the largest single asset relevant to these proceedings.
The husband's father died in 1973. He left a life interest in his substantial estate, consisting of 428 acres of land in northern Victoria, to the husband's mother and the residue to the husband and his two brothers in equal shares. The husband and his brothers subdivided 80 acres of the land into 80 separate blocks. One of the husband's brothers took primary responsibility for that venture.
The husband received approximately $400,000 from his father's estate which was paid to him in instalments over a number of years from the 1980s. He also retained four blocks of land and gave one block to each of the parties' children. Those gifts have been very beneficial to the children.
The benefits that flowed to the parties from the husband's inheritance included approximately $100,000 applied to the discharge of the mortgage encumbering the matrimonial home including the farm and approximately $50,000 applied to discharge various debts. The husband invested $150,000 in a superannuation fund.
In its early years, the farm does not appear to have yielded much income to the parties. That was apparently due to a very large downturn in beef cattle prices in 1975. Both parties supplemented the family income from other sources. The wife undertook some dressmaking from home and the husband also performed other work. The wife opened a shop which included a cafe. Both parties worked at local markets during weekends.
In approximately the early 1970s, the wife contracted Ménière's Syndrome, a disease of the inner ear which caused symptoms of dizziness and nausea, amongst others, on a regular basis. She continued suffering those symptoms for a period of 30 years. It appears that she continues to suffer those symptoms to some degree but there is no expert evidence to establish that proposition and its consequences, if any.
The parties continued to operate the farm and lived in the house together with their children. They both appear to have worked hard in their respective roles. The husband, together with at least one of their sons, was primarily responsible for work on the farm although I accept the wife's evidence that she also contributed in that regard and B Tiernan’s evidence that all four children worked on the farm from a very young age. I also accept the wife's evidence that at least until the time that she and Ms CA left the farm property the wife was the primary homemaker and parent for the family. While the husband undoubtedly made some contributions in those regards, they were relatively small given his farming responsibilities.
The parties' business interests outside the farm appear to have commenced in 1986. Because of their importance in these applications and particularly their relevance to the wife's application against B Tiernan, I will consider the facts relevant to those interests under a separate heading below. However, at this stage I note that at the time of the commencement of those business interests, the parties' endeavours became diversified and they reduced their involvement in the farm. In that regard the husband swore:
Once the proceeds of my inheritance began to come through in the late 1980s, and the farm had been paid off, this took a great deal of pressure off us and made it easier for the Wife and I to "go our separate ways", both in a financial and physical sense. …
The reduction in the parties' reliance on the farm and its income was referred to in the wife's affidavit of evidence in chief for the period following the discharge of the mortgage on the farm, referred to above, which she swore to having taken place in April 1990. The wife swore that for six years following the discharge of the mortgage on the farm in April 1990, "the farmlands were sometimes leased out."
The wife swore that in approximately 1990 her health problems referred to above -
… became more difficult to manage and after Christmas 1990 I returned to the farm to retire and get well.
She further swore that while she -
… was unwell the husband gave me $200 per week housekeeping for a few weeks in 1990.
41.I had no money myself in 1990 and I borrowed $2000 on MasterCard and returned to marketing on the weekends when I was well enough. I generally supported myself through my endeavours.
42.In the late 1990s the husband allowed his friend … to use the farm for cattle grazing. I believe there is still approximately $10,000 owing from [the friend] to the husband as a result of this arrangement.
43.From approximately 1995 I received $5,200 from the farm account until October of 2004. The payment was loosely called rent for my part of the property.
44.The husband always struggled with money management and was reluctant to spend money on household commitments. The money I earned through my endeavours was applied to my support and the benefit of the family.
From the time of the wife's move from the farm with Ms CA in 1989 until the parties' total separation in 2004 their relationship was, at best, strained. They appear to have maintained some aspects of what might be referred to as a traditional married life but clearly lived in different residences for at least a substantial proportion of that period. Amongst other things, they attended social occasions together at times. They were primarily involved in their respective business interests away from the farm. B Tiernan may have undertaken work on the farm including the purchase and sale of cattle which has been a controversial aspect of this matter but it is not necessary to make any finding on that.
From the wife's point of view, the marriage came to an end on 17 October 2004 when the husband told her "that he wanted his freedom." It is common ground that the marriage came to an end no later than that time.

H Business

The parties conducted several businesses under the name of "H Business" ("H Business") in different locations. H Business was the business vehicle by which the parties, occasionally together but also individually, earned income outside of their farming interests. It was the husband’s business which was the subject of the wife's comment in evidence quoted above with regard to earning "very good money". It is these businesses which have significantly contributed to my strong suspicions referred to above with regard to the parties' nondisclosure of all relevant facts.

There is no evidence to precisely describe the activities of the H businesses. At one stage in the evidence they were described as akin to "$2 shops". I infer from my life experience that no item of stock was of other than minimal value and most, if not all, sales were for cash.
The first H Business was opened by B Tiernan at Y in 1986. B Tiernan was 16 years of age at the time and apparently had the business acumen to self finance and conduct that business.
The wife swore that in approximately 1987 she and the husband established a H Business at M. The husband swore that the M H Business was initially set up by B Tiernan and the wife worked in it at first. By approximately Christmas 1990 the husband had taken over at least the primary, if not the sole, responsibility of running the M H Business. The wife swore that she maintained some bookkeeping role in that business until 1995. The husband appears to agree with that last proposition although he had previously deposed to the parties having maintained separate finances since the establishment of this business. The wife ceased all involvement with the M H Business no later than 1995.
In late 1991 the wife opened a H Business at P which she conducted on her own. The wife alleged that on 1 July 1996 the P H Business was transferred into a partnership of three equals shares held respectively by the wife, Ms CA and her husband, YA. It is not necessary to make a finding with regard to this transaction because of the finding which I will make on its sale and the treatment of those proceeds.
On 28 March 1994 the wife entered into a mortgage over the farm in the sum of approximately $220,000 to enable her to buy the freehold shop premises in P from which the P H Business was conducted. The wife deposed to having become the sole registered proprietor of the freehold. Neither Ms CA nor Mr YA was involved in the purchase nor did they later obtain an interest.

Wife's sale of P freehold

In September or October 2003 the wife appears to have entered into a heads of agreement to sell the P freehold. On 9 January 2004 she signed a contract of sale of the freehold for $825,000 plus GST of $82,500. Upon settlement of the sale on 1 March 2004 the wife received the gross sum of $910,765.29, which included the usual adjustments and the deposit of $80,000 already paid. Following the settlement, the P H Business was conducted from other premises in P.
The manner in which the wife dispersed the proceeds of the sale of the P freehold referred to in the previous paragraph is a major issue in these proceedings. It was submitted on behalf of the husband that at least part of the net proceeds should be added back into the asset pool as an asset of the wife. I turn to a consideration of that issue.
The parties are in dispute as to whether the wife involved the husband in any decision concerning the sale or disbursement of its proceeds. The husband swore that the wife did not consult him at any time. During cross-examination the wife was asked whether she had "used the funds as you saw fit." She responded: "That was right - but we had family discussions." Further on that issue, the wife swore in her affidavit of evidence in chief:
I chose to benefit members of our family. … I regularly discussed what I was doing with the husband. … at no time did he demur or indicate to me that I should not retain funds for my future.
The wife's case is that the parties separated in October 2004 which is shortly after the occurrence of these events. Despite the wife's protestations, at the time of these events the relationship between the parties was almost non-existent. My observations of the parties and the entirety of the evidence persuade me that it is highly improbable that the parties had any discussion with regard to this issue at that time or at all.
The deposit on the sale in the sum of $80,000 was received by the wife on 19 January 2004. At settlement, from the balance of $830,765.29 a number of outgoings were paid. They were the mortgage on the farm title in the sum of $216,827.70, legal fees of $330, water rates of $142.56 and Body Corporate fees of $24,983.56. However, that last sum was refunded to the wife on 16 April 2004. Accordingly, inclusive of the deposit, the wife received a net sum of $693,465.03 from the proceeds of sale. Those sums are corroborated by the Statement of Account and Adjustments of the sale of the freehold which is annexed to the husband's affidavit of evidence in chief.
Annexed to the wife’s affidavit of evidence in chief was a table, compiled by her, which she said showed amongst other things the total monies she received from the sale of the P freehold. That table has been reproduced and is incorporated below. In that table the wife volunteered that two further sums should be added to the net figure referred to in the previous paragraph. The first of those was an amount of $20,000 which she received from the husband, apparently being money which he had received from Ms CA. The reason for this payment is unclear. However, as the evidence is from the wife and is potentially against her interests, I accept it
The second amount was $35,000 received from B Tiernan by the wife being an apparent debt owed by his Family Trust. Of that sum, $7,500 was paid in cash. Again, the debt of $35,000 has not been proven in any strict sense but because the evidence was from the wife, at trial all parties proceeded on the basis that it was accurate.
Accordingly, by virtue of the previous two paragraphs, the sum of $55,000 must be added to the sum of $693,465.03 referred to above resulting in the wife having received from the sale and related matters the net sum of $748,465.03. All parties relied on that last figure as the starting point of my consideration of the major issue of the wife's disbursement of funds and the question of whether any of those monies should be notionally added back to the pool of relevant assets. I will refer to that figure as "the base amount".
Counsel for the husband conceded that a further three amounts should be deducted from the base amount. They are:
·$128,379 paid to Cameron Secured Investment Ltd on 29 April 2004 to discharge the mortgage secured against the title to the farm;
·$82,500 being liability for GST paid on 22 June 2004; and
·$54,495 for the purchase of the motor vehicle the wife paid on 8 June 2004.
Those figures total $265,374 which, when deducted from the base amount, derives a total of $483,091.03. That was ultimately rounded down during the trial to $482,500 for reasons which are of no consequence for present purposes. I will refer to that last figure as "the net amount".
The wife's affidavit of evidence in chief annexed the following table, referred to above, detailing distribution of the net amount as follows:

INCOME & DISTRIBUTION FROM SALE OF PROPERTY
Shop Sale price	$825,000.00	RECEIVED
Plus G.S.T	$ 82,500.00
Plus adjustments	$ 3,265.29
09/01/2004	-Less Deposit	$ 80,000.00 =	$830,765.29	Banked	$80,000.00
Paid Mortgage	$216,827.70
16/04/2004	Body Corporate	$ 24,983.56	Refunded	$24,983.56
Camerons	$ 330.00
Water	$ 142.56
04/03/2004	Cheque	$588,481.47 =	$830,765.29	Banked	$588,481.47
Balance of [husband’s[ money from [CA]		$20,000.00 Cash*
07/07/2004	[B Tiernan] repaid Family Trust Loan $35,000		$27,500.00 $ 7,500.00 Cash
You will aid them in TOTAL MONEY RECEIVED $748,465.03
PAID OUT
29/04/2004	Camerons – Settlement of farm mortgage	$127,806.32
Camerons – Fees	$ 247.50
Mary Stewart – Fees	$ 325.65 =	$128,379.47
10/08/2004	Investment Loan to [CL] – Cheque	$ 35,000.00
16/03/2004	[T & F Tiernan] (Half was [husband’s] money)*	Old Farm Debt	$ 25,000.00
07/04/2004	[S & J Tiernan] (Half was [husband’s] money)*	Old Farm Debt	$ 15,000.00
29/04/2004	[H Business Y] – Stock	Consignment	$ 25,000.00
25/03/2004	[B Tiernan] Family Trust Loan	Repaid	$ 35,000.00
24/04/2004	[DA] – Cheque	Gift	$ 35,000.00
14/01/2004	[CA & YA] – shed for farming business (from $60,000 withdrawn in cash)	Gift	$ 20,000.00
14/01/2004	[B Tiernan] Family Trust – Bank Chq (from $60,000 withdrawn in cash)	Gift	$ 20,000.00
09/06/2004	VW Van	$ 54,495.00
22/06/2004	G.S.T	$ 82,500.00
TRANSFERRED TO BUSINESS TO COVER COMMITMENTS FOLLOWING SALE OF PROPERTY
14/01/2004	(from $60,000 withdrawn in cash)	$ 20,000.00
23/01/2004	Cashed Cheque	$ 5,000.00
23/03/2004	Cheque	$100,000.00
08/04/2004	Cashed Cheque	$ 5,000.00
20/04/2004	Cashed Cheque	$ 5,000.00
23/04/2004	Cheque	$ 25,000.00
07/06/2004	Cashed Cheque	$ 5,000.00
11/06/2004	Cashed Cheque	$ 5,000.00
11/06/2004	Cheque	$ 50,000.00 =	$220,000.00
[WIFE] – PERSONAL CASHED CHEQUES
23/03/2004	$ 5,000.00
16/04/2004	$ 5,000.00
21/04/2004	$ 5,000.00
28/04/2004	$ 5,000.00
25/05/2004	$ 5,000.00
02/06/2004	$ 5,000.00
07/06/2004	$ 5,000.00
17/06/2004	$ 5,000.00
21/06/2004	$ 5,000.00
27/07/2004	$ 5,000.00 =	$ 47,000.00
07/01/2004	Mary Stewart – Fees Cash	$ 144.65
01/03/2004	Mary Stewart – Fees Cash	$ 2,271.00
10/08/2004	VW Van Insurance Cheque	$ 425.21
[wife] Cash	$ 3,249.70
TOTAL PAID OUT FROM MONEY RECEIVED $748,465.03

There are a number of matters which require comment in the above list. They are as follows:
a)On 25 March 2004 the wife loaned the sum of $35,000 to B Tiernan’s Family Trust. On 7 July 2004 B Tiernan appears to have repaid "Family Trust Loan $35,000". This second $35,000 is the sum referred to above as being included by the wife in the total monies she received from the sale. The evidence on this matter is quite unsatisfactory and incomplete. The wife was unable to adduce sufficient evidence or make adequate submissions to clarify this and many other aspects of accounting evidence during the trial. In addition, despite the fact that this sum does not obviously come out of the settlement adjustments, the wife was not cross examined on it.
That second $35,000 referred to as repayment from B Tiernan of Family Trust Loan on 7 July 2004 may well be the same sum as what is referred to as being “repaid” on 25 March 2004. In the wife’s trial affidavit she deposes to having loaned B Tiernan the sum of $35,000 for a short time as bridging finance. However it appears this was sworn in the context of the wife recommencing to trade in or about 2006. In the circumstances, I have decided to give the wife the benefit of the doubt, despite the unsatisfactory nature of the evidence. Accordingly, the sum of $35,000 will be subtracted from the net amount.
b)Otherwise, the upper part of the table down to the total receipts being the base amount appears to be uncontroversial.
c)The next part of the table headed "PAID OUT" is uncontroversial insofar as it details the sum of $128,379.47, the purchase of the wife's motor vehicle and the payment of the GST. These sums were conceded on behalf of the husband and have already been deducted from the base amount. However, I must also take as uncontroversial:
i) the “gift” to the “B Tiernan Family Trust” of $20,000 “(from $60,000 withdrawn in cash)” on 14 January 2004. That sum does not appear to have been challenged during the cross-examination of the wife; and
ii) The “Investment Loan to CL” on 10 August 2004. On the wife’s evidence this loan has since been repaid to her, possibly with interest.
Arising out of my findings in the previous paragraph, the further sum of $55,000 (being the total of the sums of $35,000 and $20,000) must be deducted from the net amount which results in the revised net amount of $427,500 (“the revised net amount”).
Save for those matters, that portion of the table is highly controversial. Despite many warnings given to the wife by me during the trial that she would need to prove her claims, she failed to corroborate any such claim, either by way of documentation or oral evidence by any other witness. While there is evidence to substantiate the actual movement of money in some circumstances, the failure of corroboration relates to:
a)the nature of the liability for the two entries of "Old Farm Debt";
b)the two “gifts”, one to each of CA and YA (from monies withdrawn in cash) and YA’s mother DA;
The table then indicates the transfer of $220,000 for the purpose of the business. Those items are detailed in the further table below.
The wife's "Personal Cash Cheques" totalling $50,000, shown in the table as totalling $47,000, together with the fourth succeeding items, have also not been established to any requisite standard.
The transfer of the sum of $220,000 to the business referred to above was particularised by the wife in the following table annexed to her affidavit of evidence in chief:

$220,000 TRANSFERRED TO BUSINESS ACCOUNT
COSTS TO SET UP SHOP
Till	$ 1,444
Measure scales	$ 511
Rent	$ 16,114
Alarm System	$ 2,023
Locksmith	$ 1,081
Electricial	$ 1,013
Legal	$ 1,3072
Lights	$ 730
=	$ 24,288
PAYMENT OF OLD ACCOUNTS
Origin	$ 6,212
Superannuation Staff	$ 6,580
Repayment of business loan – [R & F Tiernan]	$ 25,000
Repayment of business loan – [JW] & Interest	$ 52,000
Tax	$ 24,648
Air Conditioner maintenance	$ 205
Telephone	$ 1,004
Accountant	$ 452
Workcover	$ 596
Plumber	$ 258
Security	$ 416
=	$117,371
STOCK PURCHASED PRIOR TO SALE OF PROPERTY
Paid for in January February March 2004	$ 57,051
Paid fro in April May June 2004	$ 6,075
=	$ 63,126
BENEFITS TO [THE WIFE]	$ 2,555
Copier	$ 5,070
Filing cabinets	$ 975
Binder	$ 1,009
Printer	$ 345
DVD Burner	$ 165
Divider Screen	$ 490
Office Chairs	$ 237
Trolley cart	$ 346
Folding Tables – cream	$ 1,080
Adobe photo shop	$ 3,563
Computer	=	$ 15,735
$220,620.00

Subject to the discussion and findings above, as with the earlier table none of the items in the table in the previous paragraph has been proven by the wife. A forensic accountant, Mr M, was appointed as a single expert to report on the P H Business. Annexed to his report dated 36 August 2009 is a partial balance sheet, the information for which was derived from financial statements of the P H Business for the year ending 30 June 2004. I refer to that balance sheet as being "partial" because some of the required information was not provided to Mr M. Against the heading "Proprietors' Funds", the capital sum of $3,430 is shown for each of the wife and CA and the negative sum of $6,860 is shown for YA. There is no other evidence to establish the whereabouts of the funds asserted by the wife in the above table. Accordingly, I am unable to find that the wife has substantiated those payments. It will be necessary for me to consider the consequences of the wife's lack of proof of the matters in both tables in my consideration of the asset pool relevant to these applications. I will do that below.

Transfer of M H Business to B Tiernan

It is common ground that from 1990 the husband had the primary conduct and control of the M H Business. The husband and B Tiernan alleged that on 31 March 2006 the husband transferred the old M H Business to B Tiernan for a consideration of $120,000 on a "walk in/walk out" basis ("the transaction"). The husband swore that he had sold that business to his son because he was getting too old to run it. The evidence persuades me that the husband's newly formed relationship with his partner in Bali was also a contributing factor to his decision to sell.
The wife sought an order that the transaction be set aside and the M H Business be vested in her absolutely. It is an important part of the wife's claim in this regard that she receive the business in specie to provide her with a future income. Alternatively, she sought property in the stock and fittings of the M H Business to enable her to use it for the establishment of another similar business.
The wife challenged the transaction, particularly on the basis that it involved no valuable consideration and that it defeated her claim in these proceedings. The husband and B Tiernan conceded that no money changed hands as part of the transaction but rather, B Tiernan forgave certain debts owed to him by the husband, together with further sums owed to him by both the husband and the wife, as the consideration for the transaction.
I turn to a determination of the consideration claimed to have been exchanged in the transaction. In his affidavit of evidence in chief, the husband swore that the sale price was set off against monies owed by him to B Tiernan for stock of the business. During the trial, B Tiernan produced a bundle of documents containing a copy of a handwritten list of stock provided by him or a corporate entity associated with him to the M H Business. The total value of the stock was alleged to be $61,291.79. However, as with the unsatisfactory nature of the evidence of the wife with respect to receipts and expenditure, the documents were not independently verified and were essentially assertions by way of opinion by B Tiernan as to their having been provided and the values contained in them. Accordingly, arising out of my findings against him, I find that they have not been proven to an appropriate standard.
The husband, the wife and B Tiernan swore that all four children of the parties' marriage, including B Tiernan, had worked on the family farm from a very young age. B Tiernan swore that he had been taken out of school by the husband at 13 years of age so that he could work on the farm on a full-time basis. Prior to leaving school, he had significant absences to enable him to work on the farm. He swore that he had completed approximately half of grade 5 and a quarter of grade 6.
The evidence referred to in the previous paragraph is relevant to another part of the consideration alleged to have been given for the transaction. B Tiernan, supported by the husband, asserted that between July 1979 and June 1981 he had, on six separate occasions, loaned money to his parents totalling $6,600. The loans were made when B Tiernan was aged between 9 and 11 years. Each of the loans was evidenced in writing, typed in identical language and expressed to be -
… at an interest rate of 10% per annum, calculated and added to outstanding Principle (sic) annually.
Each loan was to be repaid in full on or before 1 July 1995.
B Tiernan alleged that none of the loans had been repaid and that each of them was outstanding as at the date of the transaction being 31 March 2006. A rough calculation of the interest as at that date suggests that the sum of approximately $22,800 would have been outstanding, including principal and interest.
Both the husband and B Tiernan asserted that the transaction took place in order to draw a line under the liabilities owed to B Tiernan, including for inputs into the farm. However, both conceded that there has never been any record of B Tiernan’s inputs into the farm, although in cross examination the husband did offer that the figure might be approximately $30,000. He provided no basis for this estimation. It is unclear as to whether there might have been other potential offsets.

The wife submitted that B had been repaid in other ways. In particular, he had a block of land originally valued at $60,000 from the estate of the husband's father. While there is no valuation, it was asserted that that land would now be worth approximately $250,000. There was no challenge to that proposition.
B Tiernan swore that the M H Business had been merged in another like business at a nearby town and had been transferred to another legal entity. He asserted that the stock was now of minimal value and there was effectively no asset which could be the subject of an order to set aside the transaction or which might be transferred to the wife. Therefore, the open offer made on behalf of B Tiernan towards the end of the trial that the wife could have the remaining stock is meaningless in any real sense.
There is evidence by the independent expert, Mr M, with regard to the question of valuable consideration having been given for the transaction. On 6 March 2009 Mr M published his report with regard to the value of the M H Business at 30 June 2006. His valuation was completed on the basis of a capitalisation of earnings. A later revision of his opinion stated that the basis of evaluation was "rule of thumb". The report considered the M H Business on the basis of evaluation of the closing stock as at the date of sale in the sum of $226,500. On that basis, Mr M formed the opinion that the consideration for the sale of $120,000 -
… may be less than the value of assets that is (sic) transferred - say between $180,000 and $226,500.
Mr M revisited his valuation in the later revision referred to above. His subsequent opinion was that the business was valued as at the date of the transaction in the sum of $158,250.
In cross examination, Mr M expressed the opinion that he had probably not been shown all of the stock of the M H Business. He accepted that there was no goodwill of the business because the stock figure was too high to allow for that. He referred to his valuation of the stock as a "guesstimate". Mr M expressed the opinion that the M H Business would not have been making a lot of money after allowing for income to the husband. He noted that this was a cash business and that it did not generally pick up debtors and creditors. He rejected the proposition that he had understated the stock.
Cross-examination of Mr M by or on behalf of all three parties resulted in some doubt being cast on the opinions expressed by him in his written reports. Mr M agreed with the wife's proposition that there appeared to have been a trend in the M H Business of the cost of stock having been approximately 45% of total sales. In the year up to the point of the transaction that figure had risen to 60%. In response to a question from counsel for the husband, Mr M expressed the view that it was "not unreasonable" that a hypothetical purchaser might only pay $120,000 for the business.
Mr M did not agree with counsel for the husband that a valuation basis of future maintainable earnings resulted in the best option for a purchaser being to realise the stock rather than continue to operate the business as a going concern.
Mr M’s uncertainty is understandable in the circumstances. Both the husband and B Tiernan conceded that there was no accounting and no reckoning or stock-take. On the basis of that concession together with the entirety of the relevant evidence on this issue, I conclude that neither the husband nor B Tiernan has made a full and frank disclosure of all relevant matters with regard to the transaction.
Accordingly, I express significant misgivings with respect to the integrity of the transaction. In the first place, the evidence of both the husband and B Tiernan with regard to the transaction is quite unreliable. Their evidence depends on my acceptance of their credibility which I am unable to do. Secondly, I cannot accept that the consideration which they assert was part of the transaction constituted valuable consideration in any sense of the meaning of that term. To the extent that the husband and B Tiernan had relied on consideration in the sum of $120,000, I find that it is inadequate. Thirdly, at least part of the debts alleged to have been “ruled off” were debts owed by the wife. Accordingly, the husband and B Tiernan were asserting that they had forgiven debts of the wife well after the husband’s best view of the date of the separation. I do not accept that as being any consideration as between them.
I find that the evidence of both the husband and B Tiernan is quite unsatisfactory on this matter. The evidence of Mr M is incomplete through no fault on his part but consistent and credible. I accept Mr M’s opinion of the value of the M H Business as being $158,250 at the relevant time. His acceptance of the proposition that a purchaser might have paid only $120,000 does not reflect his actual acceptance of value.
On 3 July 2009 orders were made by consent restraining B Tiernan from "selling or otherwise disposing of" the M H Business. The same orders required him to make frank disclosure of all relevant documents. He swore that he had closed the M H Business in approximately late 2009 because of difficulties with the local council and Worksafe. He alleged that the only value of the M H Business was in its stock. B Tiernan has not established any of those assertions.
On the basis of all of the evidence I conclude that the husband decided that for personal reasons, probably including the commencement of his relationship with his partner in Bali, he could not, or did not wish, to continue to conduct the M H Business. I do not doubt that B Tiernan was well able to conduct that business which was obviously of sufficient value to him to warrant his taking it over. In doing so, neither he nor the husband gave the slightest consideration to the possibility of the wife benefiting from at least the stock.
However, the evidence has not persuaded me that there is anything of any real value which might be considered as a present asset relevant to these proceedings. There is no evidence to suggest that there is other than a minimal amount of stock and some fixtures and fittings. Accordingly, while I will dismiss the wife's application to set aside the transaction, I will consider a further aspect of this issue in my determination of the relevant assets forming the pool of assets in these applications.

The asset pool

As with most aspects of this matter, formulating the relevant assets and their values is far from straightforward. That largely arises from the unsatisfactory way in which the case was prepared and presented. The lack of disclosure by all parties including my continuing suspicions with regard to the financial circumstances of all parties at various stages of their relationship is at the heart of my concerns.
I will consider the asset pool in two fundamental categories being those on which the parties agree and those on which they disagree. In doing so, it is unnecessary for me to have regard to the dispute about the date of separation and any significance it may have on the inclusion or exclusion of any asset and liability. That is a later consideration in the exercise of discretion to which I will turn in due course.
The asset pool must consist of those assets and liabilities in existence at the date of the trial at their values as at that date. It must include any notional asset together with any add-back which I consider is just and equitable. The issue of add-backs is fundamental in these applications.

Agreed assets

The following table sets out those assets on which the husband and the wife agree or on which no contrary submission was made:

Jointly owned farm property (including water rights)	$404,000
Husband's interest in bull	$500
Husband’s Hi-Ace van	$1,000
Husband's leasehold interest in property in Bali	$100,000
Balance of husband's superannuation fund	$80,000
Wife’s business	$10,120
Debt owed to husband by TS	$10,000
Debt owed to husband by KE	$10,000
TOTAL	$615,620

Disagreed assets

One of the difficulties in determining the identity and value of assets which are not agreed between the husband and the wife is that they have not been strictly proven, particularly as to value. The following table lists those assets together with their values as I find them to be. I detail the basis of those findings immediately below the table.

Husband's 1990 Honda	$3000
Husbands 1994 Land Rover	$2500
Miscellaneous farm equipment	$10,000
Wife's net proceeds of the sale of business	$80,000
Wife's net proceeds of the sale of P freehold	$427,500
Husband's proceeds of sale of M H Business	$158,250
Husband's prepaid legal costs	$61,730
Wife's prepaid legal costs	$51,830
TOTAL	$794,810

I now make the necessary findings as to my reasons for including the various assets and their values in the table in the previous paragraph.
Neither party has adduced any admissible evidence to prove the values of either of the husband's motor vehicles or the miscellaneous farm equipment. However, both parties asserted values in documents tendered in support of their final addresses. In respect of each of those three assets, I have considered the option of excluding them on the basis that they have not been appropriately proven. However, I have determined that that would not be just and equitable in the circumstances and accordingly, have included them at the husband's asserted lower figures on the basis that they constitute admissions against interest.
The wife agreed that she received the net sum of $80,000 from the sale of her one-third interest in the P business to CA and YA. However, she has not included it in her list of assets. In my view, it must be included as a relevant asset at that value, particularly because she received it after the latest date on which the parties separated. No submission was made to the contrary.
The sum of $427,500 for the sale of the P freehold by the wife is included in the table set out above. The wife argued that it should be discounted at least in part because of the expenditure detailed in her tables replicated at paragraphs 56 and 62 above. While some of the expenditure of the gross proceeds of sale of the freehold was conceded on behalf of the husband and/or B Tiernan as I have found above, it was submitted that the wife had not proven any of the further expenditure of the net amount, now the revised net amount, detailed at the commencement of this paragraph. In my view, that submission is correct. Particularly because the wife represented herself in the latter part of this trial, I warned her on a number of occasions that unless she substantiated those expenditures in an appropriate way, she ran a significant risk of my finding against her on that issue. She did not even attempt to substantiate any of those items despite the fact that in my view, evidence would have been reasonably available for her to call had she chosen to do so. The wife did not give me any explanation for her failure to call that evidence.
The wife was not cross-examined on the issue of whether she had retained those monies or had otherwise disposed of them. In the circumstances, I have formed the view that that question is of no practical significance. On her own admission, the wife has received the monies and has not appropriately accounted for them. I am therefore unable to find that the wife did make the payments alleged by her. I find against the wife on this issue.
I have given consideration to discounting the capital monies received by the wife on the sale of the P freehold because she might reasonably have needed funds for living expenses. However, on the basis of her evidence with regard to the earning capacity of the M H Business quoted above, which I did not regard as being restricted to that business alone, I infer that the wife has received adequate income for living expenses from her current business which, on her evidence, I understand to be effectively a smaller scale version of the H Business.
I now turn to the issue of the husband's sale of M H Business to B Tiernan. There is a further consideration arising out of my findings that there is no significant asset which might be either transferred to the wife or be brought back into the relevant pool of assets and that the transaction lacked integrity. That is the question of whether any, and if so what, sum should be included as a notional asset. Mr M’s evidence has persuaded me that the husband disposed of a valuable asset to B Tiernan which would have otherwise been relevant as between the husband and the wife in these proceedings. Mr M ultimately valued that asset in the sum of $158,250 and I have accordingly included that sum in the list of assets.
I have included the two items of prepaid legal costs in accordance with the ratio in Farnell and Farnell (1996) FLC ¶92-681.

Omitted assets and liabilities

The wife submitted that certain assets of the husband should be added back into the pool on a notional basis. In each case I have declined to do so and now give reasons for that.
During this trial considerable time was spent on the issue of transactions involving the purchase and sale of cattle. A significant proportion of the evidence involved a consideration of a centralised registration system known as Property Identification Code (“PIC”). The wife asserted that cattle sales and purchases had taken place which had resulted in a profit of a little in excess of $100,000 between the 2004/2005 financial year and the 2005/2006 financial year.
During the relevant period there appears to have been significant volumes of transactions. Part of the issue was whether those transactions were the husband's or B Tiernan’s. That issue entailed a consideration of the PIC registration system. A factual issue which was important to a resolution of the question was whether the PIC registration system attached to the individual or the property. It was asserted by the husband that he had permitted B Tiernan to agist cattle on the farm from where he was able to trade in those cattle in his own name using the farm's PIC number. Unsurprisingly, B Tiernan corroborated the husband's evidence in that regard.
The wife asserted that any transaction was actually that of the husband rather than the parties' son and the evidence of both the husband and B Tiernan could not be trusted.
While I have considerable difficulty with the credibility of both the husband and B Tiernan, the wife has the burden of proof of this point. No attempt was made by any party to call expert evidence on the issue and no explanation was given as to why such evidence was not called. While I am suspicious of the denials of both the husband and B Tiernan, I find that the wife has not satisfied me to the appropriate standard and accordingly must fail in her submission that a notional asset should be included against the husband to account for the cattle transactions.
The wife submitted that the estate of the husband's late father referred to above had a present residual value which should be included in the asset pool. In the first place, the wife has not established that proposition. Secondly, even if there were such a present residual value the entitlement to such an asset would be discretionary and could not be regarded as anything more than a resource in the husband's hands. Accordingly, the wife must fail on that submission.
Likewise, the wife has not established that there should be any add-back of the sum of $70,000 in respect of distributions from the superannuation fund.
The husband alleged that he owed the sum of $19,000 to DN. He has not established that to the requisite standard and I reject it.
The wife submitted that certain travel expenses claimed by the husband in his tax returns were not genuine and that they should be included in the asset pool as add backs. Those amounts were $31,652 for the 2004/2005 taxation year and $24,534 for the 2005/2006 taxation year, a total of $56,186. The wife cross-examined the husband on those amounts and he was unable to give a plausible explanation for the claims. Given the husband's employment which was essentially as the owner of the M H Business at those times, I find it difficult to understand the basis for their magnitude. However, he claimed them on his taxation returns for those years and those claims have been accepted by the Commissioner of Taxation. Accordingly, although I am suspicious of the claims, on the basis of that acceptance I have formed the view that I cannot take a different approach to them.

Net assets

I now turn to a summary of the net assets available for distribution in these proceedings. In doing so, I divide them into the categories of joint assets, assets of the husband and assets of the wife.

Joint asset
Farm including water rights	$404,000
Husband's assets
Interest in bull	$500
Leasehold interest in property in Bali	$100,000
Balance of superannuation fund	$80,000
Debt from TS	$10,000
Debt from KE	$10,000
Husband’s Hi-Ace van	$1,000
1990 Honda	$3000
1994 Land Rover	$2500
Miscellaneous farm equipment	$10,000
Proceeds of sale of M H Business	$158,250
Prepaid legal costs	$61,730
Total husband's assets	$436,980
Wife's assets
Net proceeds of sale of business	$80,000
Net proceeds of sale of P freehold	$427,500
Wife’s business	$10,120
Prepaid legal costs	$51,830
Total wife's assets	$569,450

Accordingly, I find the net assets available for distribution in these proceedings are as follows:

Joint assets	$404,000
Husband's assets	$436,980
Wife's assets	$569,450
Total net assets	$1,410,430

The parties' proposals

The husband's proposal

Counsel for the husband submitted that I should take an asset by asset approach rather than a global approach. Further, my consideration of questions of contribution should be divided into several distinct periods of time being first, his contributions from his parents, including his father's estate, at the commencement of the parties' relationship, secondly, the period from the commencement of the parties' relationship until their separation in accordance with his version of that date and thirdly contributions following the separation.
It was submitted that the assets brought in to the parties' relationship by the husband from his parents, including his father's estate, should be recognized by an additional adjustment of contribution in his favour of approximately 10%. It was also submitted that there was no future factor warranting any further adjustment in favour of either party.
However, counsel proposed orders which incorporated a practical resolution of the matter from the husband's point of view. The precise calculations are contained in the written submissions in support of his final address dated 28 May 2010. Essentially, it was submitted that each party should retain the assets presently in his or her position as listed above on the basis that the farm was in the possession of the husband, and the husband should pay the wife an additional sum of a little less than $100,000. However, the calculations include an "allowance for error" of a little more than $50,000 resulting in a proposed payment by the husband to the wife of $150,000 in addition to each party retaining the assets presently in their possession.
It is important to note that the husband's proposal is arguably influenced by my findings with regard to the asset pool. The essential differences between the husband's proposal and my findings are contained within the add backs for prepaid legal expenses and the husband's notional asset of $158,250 being the sale price of the M H Business to B Tiernan, my rejection of the husband’s alleged debt to DN and the revised net amount retained by the wife from the sale of the P freehold. As a result, the husband's net asset pool amounted to $1,164,500, being approximately $245,900 less than my findings.

The wife's proposal

The wife was unable to make any submission to me with regard to an apportionment of contributions and future factors as required by the legislation discussed below. That inability stems from her self representation and, understandably, her lack of knowledge of the legislative requirements relevant to my consideration of these applications.
However, the wife was able to make a practical proposal for resolution of these applications in a similar structure, but with a very different result, to that of the husband. The essence of her proposal was that she receive a distribution of the parties' assets such as would enable her to earn an income. The wife's ultimate goal was to retain the farm from which she asserted she would be able to earn an income.
In the alternative to the proposal set out in the previous paragraph, the wife sought the transfer to her of the M H Business together with all stock, fixtures and fittings. To achieve that alternative she sought the setting aside of the transaction between the husband and B Tiernan as discussed above. I have already decided against the wife on the setting aside of that transaction.

B Tiernan’s proposal

The only order sought by B Tiernan was the dismissal of the wife's application against him referred to in the previous paragraph. Because I have determined that application in his favour, his involvement in these proceedings has been brought to an end.

Discussion

I am empowered to make such order as I consider appropriate altering the property interests of the parties to the marriage. However, I must not make any such order unless it is just and equitable to do so. In considering whether it is just and equitable to make an order, I must take into account the various matters in subsection 79(4) of the Family Law Act 1975 ("the Act"). I turn to a consideration of those matters.

Contributions

The first three paragraphs of the subsection referred to above concern matters of contribution. Those contributions include direct and indirect financial and non-financial contributions by on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them. They also include contributions made by a party to the marriage as a homemaker and/or parent. In considering the question of contributions, I accept the submission by counsel for the husband that it is convenient to consider contributions in relation to different periods of the parties' relationship.

Commencement of marriage

The first of those periods is the parties' respective contributions at the commencement of their relationship. It is common ground that neither party owned any asset of significant value.

Marriage to 1989

This period ends at the time which is asserted by the husband to be the parties' separation. I will consider that issue under the next heading. During this period, the parties lived rent-free with the husband's parents for 5 1/2 years. They then received a gift of $20,000 to enable them to purchase their first home. They ultimately used the capital initially derived from the gift to purchase the farm.
The husband's father died in 1973 leaving an estate of significant value. I have made detailed findings with regard to the benefits received by the parties and their children from that estate. They are substantial. In my view, the parties would have had great difficulty in purchasing and probably retaining the farm were it not for the contributions by the husband's parents. Further, each of the children of the marriage benefited significantly from their grandfather's estate.
With the exception of the matters discussed in the previous two paragraphs, during this period both parties made substantial contributions in accordance with the legislation. Generally, the parties maintained a traditional division of roles. The husband was by far the primary breadwinner, working very hard and long hours on the farm with substantial input from one or more of the children. In that regard B Tiernan made a particularly significant contribution but not in any way which, in my view, might be seen to benefit one party over the other. However, each of the parties made some contributions in other ways. The wife participated in farm activities to an extent which is unclear on the evidence. Likewise, the husband assisted the wife as a homemaker and parent but only to a very limited extent.
Accordingly, I conclude with regard to this period of the parties' relationship that save for the initial contribution by the husband's parents and the benefits to the parties and their children from the estate of the husband's father, the parties contributed equally in accordance with the legislation.

1989 to 2004

As previously found, the wife asserted that the parties separated in October 2004 rather than in 1989 as asserted by the husband. I have already noted that the question of the date of the actual separation of the parties is insignificant compared with the nature of their contributions and other matters relevant to the legislation. It is common ground that between 1989 and 2004 the wife spent at least a considerable time living away from the farm. The proportion of times during which she did live at the farm has been a matter of considerable contention between the parties. The state of the evidence, and in particular the parties' credibility, do not enable me to make clear findings on that issue. My impression from the entirety of the evidence leads me to the inference that each party is exaggerating his or her particular version of these facts.
I accept the wife's evidence that during this period she spent some time at the farm although the evidence does not permit me to find that time to the extent that she swore. Likewise, I do not accept the husband's evidence that the wife spent minimal time at the farm during this period.
With regard to contributions, I find that the husband performed very significantly more of the farm work than did the wife. I am also satisfied that to the extent that the farm yielded income, the wife did not receive any of those proceeds. Accordingly, the wife was required to meet her own financial needs and for that purpose, she conducted the H Business at P as described above. My lack of confidence in the credibility of both parties leads me to the finding that it is not possible to determine the relative incomes of the parties from their respective sources. Accordingly, I see no reason to differentiate between the parties as to their financial positions during this period.
In my view, the inclusion of the capital profits from the sale of the P freehold is not impacted upon by the precise date of the parties' separation. The wife has had the sole benefit of those capital profits and it would be unjust to the husband not to include them as an asset for the purpose of these proceedings.
Also during this period, the parties' daughter, CA, lived with the wife and accordingly, the wife contributed as homemaker and parent to her. CA turned 18 in 1995 and accordingly, the wife's contribution in that regard did not continue throughout the relevant period but could not be regarded as having necessarily come to an end in that latter year. The evidence does not permit me to make a specific finding on that issue.
The parties' other three children turned 18 years of age before the commencement of this period. The evidence does not permit me to make a specific finding as to any contribution by the husband to home making and parenting of any of the children from 1989 onwards.

2004 to the present

It is common ground that the parties' marriage broke down no later than October 2004 and they have lived separately and apart since that time. The wife has lived at P and has conducted a business there. The evidence does not permit me to make any finding with respect to the level of income which she has derived from that business but as I have already found, the income was adequate to meet her living requirements.
Initially, the husband lived and worked on the farm. The evidence suggests that the income derived from the farm has been relatively insignificant.
It appears that B Tiernan has also performed considerable work on the farm. To the extent that B Tiernan has claimed that he has not been compensated for that work, there is some evidence to suggest that he has conducted some sales and purchases of cattle and presumably has derived profit from that. Again, the evidence does not permit me to make a specific finding on that issue.
The husband has repartnered with an Indonesian woman who lives in Bali and spends approximately half his time there with her. He has acquired an interest in a property in Bali which is included in the list of assets above. The wife has not satisfied me that he has any other asset in Bali or that he derives any significant income from that property.
While counsel for the husband submitted that I should approach the issue of contributions on an asset by asset basis, I am entitled to take either an asset by asset approach or a global approach as I deem appropriate in the circumstances of the case (see Norbis v Norbis (1986) 161 CLR 513). This is a long marriage with only two closely interrelated aspects of contributions as differentiating factors between the parties. In my view, it is appropriate to take a global approach in the circumstances.
Ultimately, I accept the submission by the husband's counsel that the only aspects of contribution in accordance with the legislation which may be regarded as reason to depart from what would otherwise be equality of contribution is the initial contribution on behalf of the husband by his parents of the sum of $20,000 to enable the parties to purchase their first property, together with the very substantial benefits derived from the estate of the husband's father. In my view, but for those contributions the parties' assets would now be no more than minimal. That is a factor which must be given significant weight and to that extent I find that a further allowance of 10% over equality should be made in favour of the husband resulting in a finding of total contributions of 60% by the husband and 40% by the wife.

Future factors

I am required by subsection 79(4)(e) of the Act to have regard to the various matters in subsection 75(2) to the extent that they are relevant. The husband is four years older than the wife which, in my view, is not significant in the context of this matter. Each of them appears to be resourceful although possibly the wife more so than the husband. My observation of the parties suggests that the wife is more prepared than is the husband to conduct a business of the style of H Business. It is her evidence that she has been running a like business, albeit on a significantly reduced scale, since in or about 2006. However, in my view if the husband were to decide to open such a business on his own account, he would be as capable as the wife of conducting it.
Both parties have some health difficulties although it is not suggested by the wife that her particular problems limit her ability to conduct a business of the type referred to above. For example, her primary proposal in these proceedings is that she retain the farm from which she asserted she could earn an income.
Likewise, there is no evidence to suggest that any aspect of the husband's health would limit his earning capacity in the context of his age.
The parties' financial circumstances are set out in their respective Financial Statements. The husband's statement asserts a weekly income of $290 and weekly expenditure of $807. He asserts a credit card liability estimated at a little over $9,000 together with unbilled legal fees and the alleged debt of $19,000 which I have not accepted. That debt does not account for the excess of expenditure over income of more than $500 per week. The husband swore that he received income of approximately $400 per month from his property in Bali. That income also does not account for the deficit. That is a further reason for my concerns with regard to whether the husband has made a full and frank disclosure.
Likewise, the wife's disclosure appears to be similarly questionable. She disclosed weekly income of approximately $200 and weekly expenditure of $799. Her oral evidence suggested that the income figure may have been reduced but there is no adequate evidence to support that proposition. The wife's liabilities include a debt to friends of a little more than $54,000 together with two credit card debts totalling nearly $28,000. Her expenditure includes repayments on the credit cards. The wife's Financial Statement was sworn in November 2009. The wife did not claim any of the debts referred to in this paragraph as relevant liabilities in the proceedings.
The wife satisfied me that she is confident of her ability to earn income as long as she is able to have the conduct of an appropriate business. That finding arises out of the way in which she put her proposals for resolution of this matter to me. In her first alternative, she sought the transfer to her of the M H Business as a going concern. In accordance with her evidence as to the earning capacity of such a business quoted above, she was confident that it would yield her what I infer to be at least a reasonable income. The wife's second alternative was to receive the farm as a going concern from which she also believed she could receive income. Her confidence did not appear to be adversely affected by her health.
The evidence suggests that the parties have lived a comparatively basic lifestyle. They have not had lavish possessions although they have had significant holidays at times. I am satisfied that as a result of the orders which I will make in these proceedings, the parties will be able to live at a similar standard of living to that which they have had in the past. Further, that standard of living will not be significantly different as between them.
The husband's disposal of the M H Business to B Tiernan is also relevant at this point. The transaction took place at about the time that the husband commenced his relationship in Bali. On the evidence of both the husband and B Tiernan as found above, the husband did not receive any tangible consideration for that transaction to replace that business with actual capital. After he disposed of the business, the husband worked in it as an employee of B Tiernan. I infer that he is sufficiently confident of his financial circumstances to enable him to live at what he regards as being an adequate standard. Likewise, despite her protestations to the contrary, the wife will in my view be able to live at an equally reasonable standard in all the circumstances.
While issues of health, age, apparent earning capacity and standard of living are at least very similar, the nature of the parties' assets and their potential distribution are significantly different. In my view, that has an important bearing on the parties' respective earning capacities. I have determined that it is appropriate to make a further adjustment in favour of the wife of 10% in respect of the future factors. I will amplify that proposition in my consideration of justice and equity below.

Other legislative requirements

There was no submission that any other legislative requirement contained in section 79(4) of the Act is relevant to my consideration of this matter. I agree with that position.

Justice and equity

The final step required in my consideration of this matter is a determination of what is just and equitable as between the parties. In that consideration, I must effectively step back from the detail and consider the overall result in that context.
In accordance with my above determination of equality arising out of issues of contribution and future factors, if the husband were to retain the farm he would be required to pay the sum of $135,765 to the wife on the basis that she retain her present assets in the sum of $569,450. That would result in the wife receiving half of the assets being $705,215. In particular, the husband would be able to pay the bulk of that sum from the balance of his superannuation funds amounting to $80,000. By adding a further $55,765 to those funds, he would be in a position to retain the farm which is an income earning asset. In his final address, counsel for the husband submitted that the husband would be able to retain the farm if he had to pay the wife no more than $230,000.
The husband also has a little income from his property in Bali. While he swore that it was now no longer possible to earn anything other than a minimal income from the farm, the reality is that he would have an asset, which in accordance with the parties' agreement as to value, has a present value of $404,000.
The husband's asset position is different to that of the wife in that he would retain the potentially income earning farm together with its equipment while the wife's assets consist almost entirely of add backs of previously owned capital which do not have any present income earning capacity. If the wife receives a cash sum of $150,000 from the husband, she will have sufficient capital to purchase stock for a business at least similar to the P H Business.
As previously noted, the husband proposed that in addition to her present assets, the wife receive the sum of $150,000, albeit that it was asserted on his behalf that that was in excess of what should be regarded as being just and equitable to both parties. The reality is that the husband represented that he has the capacity to pay the wife that sum. That payment does not depend on any particular finding with regard to the asset pool. Notwithstanding my findings with regard to that pool, the husband has retained the capacity to make such a payment. There is no reason not to order the husband to pay the wife the sum of $150,000 in these circumstances, albeit that I have found the net assets to be of greater value than that asserted on behalf of the husband.

Conclusion

I conclude that the wife be required to transfer all her rights, title and interest in the farm to the husband. Contemporaneously with that transfer the husband will be required to pay the wife the sum of $150,000. Otherwise, each party will retain title as against the other party of all items of property in his or her possession.
In accordance with the husband's proposal, I am satisfied that the payment of that sum will enable the husband to retain the farm. I am also satisfied that there is no realistic prospect of the wife receiving the farm in her own name to the exclusion of the husband.

I certify that the preceding one hundred and fifty one (151) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Mushin

Associate:

Date: 10 December 2010

[2010] FamCA 1121

10 December 2010

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