TILLER & TILLER
[2019] FCCA 705
•21 March 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| TILLER & TILLER | [2019] FCCA 705 |
| Catchwords: FAMILY LAW – Property settlement – application for leave to apply for settlement of property 18 years after divorce order final – leave granted. |
| Legislation: Family Law Act 1975 (Cth), ss.44(3), 44(6), 79(4), 75(2). |
| Cases cited: Stanford & Stanford [2012] HCA 52 Whitford & Whitford (1979) FLC 90-612 Althaus & Althaus (1982) FLC 91-233 |
| Applicant: | MS TILLER |
| Respondent: | MR TILLER |
| File Number: | ADC 3328 of 2013 |
| Judgment of: | Judge Mead |
| Hearing dates: | 24, 25 and 26 August 2016, 17 October 2016, 7 March 2017 and 12 April 2017 |
| Date of Last Submission: | 12 April 2017 |
| Delivered at: | Adelaide |
| Delivered on: | 21 March 2019 |
REPRESENTATION
| The Applicant appeared in person |
| Counsel for the Respondent: | Mr McGinn |
| Solicitors for the Respondent: | Andersons Solicitors |
UPON NOTING that upon being satisfied that procedural fairness has been afforded to the trustees of the Employer Superannuation Scheme in respect of a proposed superannuation split to the applicant from the entitlements of Mr Tiller Member Number … the court will make an order that in full and final settlement of any claim that either party may have of hereafter have against the other of them for settlement of property:
(A)There be an order for the superannuation split in terms of the notation above; and
(B)That otherwise each party retain all real estate, personalty of any description whatsoever and superannuation entitlements SAVE AND EXCEPT for the adjustments referred to herein.
ORDERS
That directions be adjourned to 16 May 2019 at 9:15am.
That within 7 days of the date of this order the respondent’s solicitors draw an order for settlement of property in terms of the notation hereto and immediately forward same to the trustees of the Employer Superannuation Scheme for the purpose of affording procedural fairness to the trustees of same in relation to the proposed superannuation split.
Liberty to either party to apply as to consequential orders.
IT IS NOTED that publication of this judgment under the pseudonym Tiller & Tiller is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT ADELAIDE |
ADC 3328 of 2013
| MS TILLER |
Applicant
And
| MR TILLER |
Respondent
REASONS FOR JUDGMENT
Introduction
On 11 September 2013 the applicant applied for leave to be granted to commence proceedings for settlement of property out of time[1]. She sought that by way of settlement of property there be such orders as are necessary to achieve a 70/30 division of the property of the relationship in favour of the applicant. She further sought an order that the respondent pay the applicant’s costs. At that time the applicant was represented by the Southern Community Justice Centre.
[1] Family Law Act 1975 (Cth) ss.44 (3) & 44(6)
In the applicant’s initial affidavit in support of her application she deposed to she and the respondent commencing living together in … 1981, marrying on … 1982 and separating on … 1993. She deposed to a divorce being granted in the Court of Petty Sessions in Perth Western Australia on 19 April 1995 with the divorce becoming final on 20 May 1995. Accordingly, the application for settlement of property was filed 18 and a half years after the divorce order between the parties became final.
The response filed 18 October 2013 sought that the application be dismissed and that the applicant pay the respondent’s costs.
At trial the applicant sought that a property owned by the respondent at Property A be transferred to her mortgage free or in the alternative the property be sold and she retain the sale proceeds. She was not clear in that submission as to whether she was seeking to retain the net or gross proceeds of sale.
In addition to the inexcusable delay in delivery of this judgment the matter had somewhat of a chequered history primarily arising as a result of concerns in relation to the mental health of the applicant.
At the time the trial commenced the applicant was aged 57 years and in receipt of a disability support pension. The respondent was aged 63 years and a professional.
It was common ground that the parties commenced cohabitation in … 1981, married on … 1982 and separated somewhere between … 1993. Accordingly, the period of cohabitation was approximately 12 years. At the time the parties separated they were residing in Western Australia. There was one child of the marriage born in 1987.
In 1988 they purchased a property at Property B, Western Australia. The property was purchased by the parties jointly at a cost of $92,500.00. Following upon separation the parties remained living in that property with their son but separated under the same roof until somewhere between … 1994 when the respondent vacated that property. The applicant remained living in the property between the time the respondent vacated same until early 1998. During that period of time the parties’ son resided with each of them on a week‑about basis.
The respondent resumed occupation of the former matrimonial home upon the applicant vacating same in or about … 1998. It was the respondent’s case that by in or about January 2000 the parties had reached agreement as to a distribution of their property, including a sum to be paid by the respondent to the applicant in consideration of her transferring her interest in the property to the respondent. It was his case that earlier, in about … 1997, the parties had agreed on a payment to the applicant on account of the respondent’s superannuation entitlements with the payment to be made as soon as he could access funds at about 60 years of age.
It was common ground that the parties maintained an amicable relationship in the main post separation with the applicant being invited and attending at the respondent’s 60th birthday celebrations in … 2012.
It was the respondent‘s case that the applicant did not dispute any aspects of their agreed property settlement between the time he said they reached agreement in January 2000 until the applicant commenced the proceedings before the court. It was his case that in January 2013 the parties meet to discuss the remaining payment of superannuation to the applicant and that shortly thereafter the applicant instructed solicitors and then instituted proceedings without permitting him the time necessary to finalise the distribution of agreed superannuation funds.
It was common ground that the applicant had suffered serious mental health challenges both during the period of the marriage and at all times post separation and that those difficulties continued as at the date of trial.
The applicant ceased working in or about … 1994 and thereafter did not work in paid employment. It was her case that her mental health difficulties prevented her from effectively negotiating issues of settlement of property with the respondent, that the respondent did not keep to the terms of the agreement reached between the parties in or about January 2000 and did not pay to her the sum of money she alleged the parties agreed. It was also her case that there had always been an agreement between the parties that upon the respondent reaching the age of 60 years and being able to access his superannuation he would pay to her an amount which she said as at … 1994 was agreed to be the sum of $34,000.00.
She submitted that the respondent should not be able to rely on the time limits imposed on parties by the Family Law Act 1975 (Cth) in relation to the institution of proceedings, by virtue of the agreement that the parties had that he would pay to her an amount from his superannuation entitlements once he had reached the age of 60 years. It was her case that the respondent had reneged on that agreement.
It was the respondent’s case that he had paid to the applicant all amounts that had been agreed by way of settlement of property, save as to payment to the applicant of the sum of $22,000.00 being the balance of her agreed share of his superannuation entitlements. It was his case that if the application was allowed to proceed he would suffer prejudice given that with the passage of time he had not retained all relevant documentation with respect to the settlement, and that he had been until January 2013 in constant contact and communication with the applicant who had never given him any notice that she intended to challenge the settlement or bring such a claim.
The respondent further claimed that the applicant had not given any notice to him of proceedings, that the matter had been significantly complicated by the delay in the bringing of the applicant’s application and that the applicant had failed to enter into any meaningful negotiations to try and resolve the matter prior to the commencement of the trial. It was his case that all of these issues added to and amounted to substantial costs he had incurred in relation to the application.
Although the respondent did not dispute that the applicant had long term mental health issues it was his case that they were not such that she could not have instituted proceedings if, if not within the time limit, within a reasonable time after the parties divorce.
The proceedings commenced before Judge Simpson in October 2013. Upon Judge Simpson’s retirement the matter came into my docket and was initially listed for trial on 25 May 2015. The matter was not reached at that time.
On 30 July 2015 an application in a case was filed by the applicant’s solicitors seeking that a litigation guardian be appointed to act on behalf of the applicant. That application was supported by an affidavit of the applicant’s solicitor annexing a report from the applicant’s psychologist Mr C in relation to the impact on the applicant of the proceedings and the possibility of appointment of a litigation guardian.
On 9 September 2015 an affidavit was filed by Mr D agreeing to assume the role of litigation guardian for the applicant in these proceedings in the event an order was made. An order for litigation guardian was made by Judge Young on 10 September 2015 appointing Mr D to that role.
On 24 September 2015 the matter was relisted for trial on 24 August 2016. Trial directions including the trial having priority were made by me on 18 February 2016 at which time the applicant remained represented by solicitors and through her litigation guardian.
On 24 August 2016 the order for litigation guardian made on 10 September 2015 was discharged on the application of the applicant which had been filed on 19 August 2016. The court noted on that occasion that Mr D who had been appointed litigation guardian had withdrawn his consent to act in that position in any event.
The applicant remained represented by counsel at the commencement of the hearing on 24 August 2016 but following upon the order discharging the litigation guardian the applicant’s solicitors and counsel also withdrew. Thereafter the applicant conducted the proceedings in person.
In her opening she advised the court that she was seeking orders granting her leave to apply for settlement of property out of time and that a property settlement be effected as between she and the respondent such that the parties current net assets be divided as to 60% in her favour and 40% in favour of the respondent if appropriate.
The matter proceeded on 24 and 25 August 2016 and at the end of that day was further adjourned to 26 August 2016.
On that occasion the applicant did not attend at court. The court ordered that the proceedings be adjourned part heard to 10:00am on 17 October 2016 noting that the matter would proceed on that day regardless of the attendance of the applicant.
The respondent’s solicitors were given liberty to file and serve a subpoena directed to the Suburb E Medical Centre in respect of the applicant and the respondent’s costs generally. The question as to the respondent’s costs of that day thrown away was reserved.
The hearing resumed on 17 October 2016 and both parties attended. The court noted on the order made that day that neither of the parties took issue with the values ascribed in each of their statement of financial circumstances to the various assets and liabilities of the parties as set out on page 12 of the respondent’s case outline document tendered to the court as exhibit “H5” save and except as to the current value of the Property A property and the current mortgage over the property.
The court further ordered on that day, after adjourning proceedings part heard to 7 March 2017, that the applicant file and serve one appraisal only from a licensed land agent for the property at Property A South Australia on or before 16 December 2016, in circumstances where there was a dispute between the parties as to the value of that asset.
On 7 March 2017 further evidence was adduced and on 12 April 2017 final addresses were given to the court by the respondent’s counsel and by the applicant in person.
Relevant legislation
The time limit within which to file an application for settlement of property granted to parties following upon a divorce is as specified in section 44(3) of the Family Law Act (supra).
That section is in the following terms:
Where, whether before or after the commencement of section 21 of the Family Law Amendment Act 1983:
a. A divorce order has taken effect; or
b. A decree of nullity of marriage has been made;
Proceedings of a kind referred to in paragraph (c), (caa), (ca) or (cb) of the definition of “matrimonial cause” in subsection 4 (1) (not being proceedings under section 78 or 79A or proceedings seeking the discharge, suspension, revival or variation of an order previously made in proceedings with respect to the maintenance of a party) shall not be instituted, except by leave of the court in which the proceedings are to be instituted or with the consent of both of the parties to the marriage, after the expiration of 12 months after-
a. In a case referred to in paragraph (a) – the date on which the divorce order took effect; or
b. in a case referred to in paragraph (b) – the date of the making of the decree.
The court may grant such leave at any time, even if the proceedings have already been instituted.
The Act further provides in section 44(4) as follows:
The court shall not grant leave under subsection (3) or (3A) unless it is satisfied:
a. That hardship would be caused to a party to the relevant marriage or a child if leave were not granted; or
b. In the case of proceedings in relation to the maintenance of a party to a marriage – that, at the end of the period within which the proceedings could have been instituted without the leave of the court, the circumstances of the applicant were such that the applicant would have been unable to support himself or herself without an income tested pension, allowance or benefit.
Hardship
It was submitted by counsel for the respondent that leave should not be granted to the applicant to prosecute her application for settlement of property in circumstances where the application was filed some 18 and a half years after the divorce order between the parties became final and, where notwithstanding that it was common ground that the applicant had suffered mental health difficulties for many years she did not adduce evidence that ought persuade the court that she had lacked capacity to conduct her affairs since the parties separated or lacked the capacity to take advice since the separation of the parties.
It was submitted that post separation the applicant had entered into various relationships and, for a considerable period of time had shared equally in the parenting of the parties’ son Mr F. It was common ground that the applicant had instructed solicitors in relation to sexual harassment claims between 1995 and 1997, pursued criminal injuries compensation claims during 2006 and 2007 and dealt with prosecuting authorities in 2012.
It was further common ground that the parties had together taken legal advice in relation to the division of the respondent’s superannuation entitlements in … 1994 and … 1997. It was further submitted that the respondent and applicant had remained on amicable terms until approximately December 2012, some 17 and a half years after the divorce order became final and further, that in January of 2013 the parties met to discuss payment to the applicant of an amount from his superannuation.
Following upon those discussions the respondent wrote to the Member Services Centre of his superannuation fund Employer Superannuation Scheme advising that the parties had taken advice as to payment to the applicant of an amount from his superannuation entitlements at such time as they became available to him. In that correspondence he stressed that the applicant was anxious to finalise the matter as soon as possible arising from her financial difficulties.
It was the respondent’s case that at the time the parties had discussion in January 2013 about the superannuation payment due to the applicant they were in agreement that such payment had not yet been made, was due, and there was no further discussion between them about any other outstanding claim by the applicant.
The applicant conceded in cross-examination that in her declaration accompanying her bankruptcy notice signed on … 2005 she had declared to the trustee in bankruptcy that there were no monies owed to her by anyone, and further that she had no interest in any property.
It was clear at the time of trial that at the very least the parties were in agreement that no monies had been paid to the applicant from the respondent’s superannuation entitlements, a position on which they had agreed shortly after separation.
At the time of trial the applicant was in receipt of a Disability Support Pension and had been so for almost 20 years. She was aged 57 years.
At the time of trial the respondent was aged 63 years and employed as a Professional, having been in fulltime employment since the time the parties separated.
In Whitford & Whitford (1979) FLC 90-612 at paragraphs 30 & 35 the Full Court of the Family Court of Australia commented on the following principles with respect to a determination of the concept of hardship, namely:
a. The loss of the right to institute proceedings is not the hardship to which this subsection refers, but the consequences of the loss of that right;
b. The hardship, if leave is not granted, implies that the applicant would probably succeed if the substantive application were heard on the merits;
c. If there is no probability of success, the court cannot be satisfied that hardship will be caused if leave were not granted;
d. If the probable result of the hearing on the merits is that hardship is not likely to be alleviated then the court cannot be satisfied that the applicant would suffer hardship if leave were not granted; and
e. The right or entitlement to be lost if leave is not granted should not be trifling or likely to be outweighed by the costs of the proceedings. However, it is not necessary to establish that the loss must be a substantial one.
The Full Court further concluded in that case that if the court was satisfied hardship would be caused if leave were not granted, then the court should as a second step consider the question of whether to exercise its discretion to grant leave or refuse such leave.
I find that notwithstanding the extreme delay on the part of the applicant in bringing her application for settlement of property, particularly in circumstances where:
a.the application was filed shortly after discussions between the parties as to payment of a further amount to her by way of a share of the respondent’s superannuation entitlements and
b.the respondent had attempted to arrange for payment of what he considered to be a previously agreed sum to the applicant and
c.the applicant had without any further notice to the respondent instituted the proceedings, that hardship would be imposed on the applicant if she were not granted an extension of time in which to bring property settlement proceedings.
It is not necessary for the court to determine whether the property settlement claim will succeed.
In Althaus &Althaus (1982) FLC 91-233 at paragraph 12 the court said:
“The exercise is to determine whether there is a reasonable claim to be heard. That is the essence of the inquiry into whether hardship will be suffered by denying…the right to litigate that claim.”
I am satisfied that the applicant has a reasonable case in circumstances where even on the case of the respondent the applicant has not received the total amount of monies the parties agreed would be paid to her upon the respondent reaching the age where he was able to access funds from his superannuation entitlements.
The only real dispute between the parties was whether the amount they agreed on in or about … 1997 was $32,500.00 or $34,000.00. It was also common ground that regardless whether the agreed amount was $32,500.00 or $34,000.00, the respondent accessed the sum of $10,500.00 from his superannuation entitlements and paid that amount to the applicant on … 1997.
If leave were not granted to the applicant to proceed with her application for settlement of property it may be that the parties would be unable to resolve the issue privately as between themselves notwithstanding the history of this matter and in those circumstances I am satisfied that the applicant would suffer hardship by not being able to enforce by way of court order the payment of monies the parties were agreed were owed to her.
For those reasons I intend to grant such leave pursuant to s44(4) of the Family Law Act (supra).
Background
The applicant and the respondent commenced living together in a de facto relationship in or about … 1981. They had met whilst both working at the Employer and upon their marriage on … 1982 lived in Adelaide. The respondent remained employed at Employer and the applicant obtained employment at the Employer on her moving to Adelaide.
The parties moved to Melbourne in or about … 1983, where after some months of casual employment on the part of the applicant she obtained employment at the Employer. The respondent remained employed by the Employer.
In … 1984 the respondent was transferred back to Adelaide to work. After some seven months the applicant obtained a position at Employer. She worked in that employment between … 1985 and … 1985 during which time the respondent continued to work at the Employer.
On … 1985 the applicant was dismissed from fulltime employment at Employer as a result of becoming distressed at work. On her evidence this arose as a result of sexual harassment in the workplace.
After some temporary employment with the Employer following upon the termination of her fulltime employment the applicant obtained employment as a customer service officer at Employer in Adelaide from … 1985 until … 1987.
In early 1986 the applicant was diagnosed with anxiety and treated with medication. After finishing employment at Employer in … 1987 the applicant worked as a customer service officer on a temporary basis at the Employer for a period of some six weeks before obtaining employment at the Employer as a relief customer service officer in … 1987. The applicant continued in that employment from to … 1987 at which time she left the position in circumstances where she was pregnant with the parties’ child Mr F.
Mr F was born on … 1987, and sometime shortly thereafter it was the applicant’s evidence that she developed postnatal depression. The respondent’s evidence was that such a diagnosis had never been made by a medical professional.
In … 1988 whilst living in South Australia the parties purchased a house property as joint tenants at Property B Perth Western Australia. The property was purchased for the sum of $92,500.00, with some $52,500.00 being borrowed from Bank West. The property was purchased in anticipation of the respondent being transferred back to Western Australia from South Australia in a professional role at the Employer.
In … 1988 it was common ground that the respondent was directed by his employer to leave his position in Adelaide and go on long service leave. It was the applicant’s case that such a situation arose because of dissatisfaction with the respondent’s work performance. It was the respondent’s position that the situation arose as a result of him refusing a transfer in the Employer office in circumstances where the applicant refused to move to Town G and said she would only move to Western Australia with the respondent if the transfer was to Perth.
I am satisfied that nothing turns on the different reasons proffered for the common end result.
The applicant did not work outside of the home between the time of Mr F’s birth in … 1987 until … 1989.
By that time the parties had moved back to Western Australia (early … 1989) and the respondent had engaged the Employer to assist him in returning to work, resulting in protracted proceedings.
In … 1989 the respondent commenced receiving Workers Compensation payments through WorkCover Western Australia arising from him suffering from depression. His employment was terminated in … 1989. He continued to receive WorkCover payments thereafter and in … 1989 commenced an Unfair Dismissal action against the Employer. The respondent withdraw his action after two days in court on … 1989 due to lack of funds to pursue the claim. By this time he had incurred legal costs in the vicinity of $8000.00.
In … 1989 the applicant gained employment as a relief customer service officer at Employer, notwithstanding that by that time her mental health situation had deteriorated and she had commenced prescribed anti-depressant medication. She remained in that employment until … 1990 during which time the respondent continued to receive WorkCover payments.
It was the applicant’s evidence that the $8000.00 in legal fees was paid by her to the respondent’s solicitors, with the respondent’s evidence being that the payments were made from a combination of the applicant’s wages, his WorkCover payments and the parties’ savings.
I find nothing turns on that particular issue.
In … 1990 the applicant was admitted to hospital for approximately one week after suffering a further major depressive episode. After her discharge from hospital she continued to work at Employer from … 1990 until … 1991.
In … 1990 the respondent was redeployed into the Employer on his former salary. In … 1992 he obtained new employment as a professional with Employer, Perth.
On the respondent’s evidence his previous salary had consisted of pay of approximately $42,000.00 per annum plus use of a vehicle. His new employment as of … 1992 attracted a salary of $25,000.00 per annum.
Between … 1991 and late … 1992 the applicant was unable to work due to mental health issues. She obtained employment at Employer as a customer service officer between … 1992.
Between … 1993 and … 1993 the applicant was employed part-time as a customer service officer at Employer. Between … 1993 and … 1994 she continued in that position on a permanent fulltime basis.
The parties separated between … 1993 (respondent) and … 1993 (applicant).
On … 1991 the respondent had received a voluntary redundancy package from the Employer in the net sum of $37,742.75. It was the respondent’s evidence that the majority of those funds were paid into the parties’ mortgage account on the Property B property.
At the time the parties separated in 1993 they jointly owned the property at Property B, the contents of that home and a motor vehicle H.
At the time the parties commenced cohabitation the respondent had accumulated superannuation benefits with the Employer Superannuation Scheme following upon some nine years of service. It was the respondent’s evidence that he ceased contributing to the Employer Superannuation Scheme Fund in … 1992 when he ceased employment with the Employer. It was his evidence that he commenced a superannuation policy with Super Fund J in 1997, some four years post separation.
At the time of trial it was common ground that the respondent had superannuation interests with Employer Superannuation Scheme in the sum of $259,017.00 and with Super Fund J in the sum of $148,285.00. It was common ground at trial that the applicant had an interest in Super Fund K superannuation benefits in the sum of $278,864.00.
Following upon the parties’ separation in … 1993 the parties continued living separately and apart in the former matrimonial home at Property B until the respondent vacated the property and moved into rental accommodation.
The applicant remained living in the former matrimonial home between .. 1994 and … 1998 during which time the parties child Mr F lived with each of the parties on a week about basis.
In … 1998 the applicant relocated to Adelaide. The respondent resumed living in the former matrimonial home.
The applicant ceased employment in … 1994 and as at the date of trial had not resumed employment.
Between … 1994 and … 1998 the applicant paid the mortgage payments in respect of the former matrimonial home. Thereafter the respondent made the payments.
It was the respondent’s evidence that the parties agreed he would not pay child support during the period the applicant resided in the former matrimonial home in circumstances where he received a low income between $25,000.00 and $32,000.00 per annum, that he agreed with the applicant to maintain the front and rear yards of the former matrimonial home and where the parties shared equally in the care of Mr F.
As at … 1993 shortly after the parties’ separation the balance owing on the Bank West mortgage was approximately $22,000.00. There was no evidence as to the value of the property at that time.
By the time the parties separated in … 1993 the respondent had been continuing to contribute to his superannuation entitlements for a period of some 12 years and the applicant had also contributed to superannuation, such that the applicant had accumulated some $2000.00 in superannuation entitlements and the respondent some $76,000.00 in superannuation entitlements.
In or about … 1994 the parties sought legal advice from solicitors in relation to the applicant’s entitlement to the respondent’s superannuation entitlements.
In cross-examination the applicant conceded that the only difference in the amount that she understood the parties had agreed the respondent would pay her by way of her share of his superannuation entitlements was some $2000.00 in circumstances where she understood the agreed amount to be $34,000.00 and the respondent deposing to his understanding being $32,500.00.
The applicant conceded in cross-examination that she thought that payment would be made to her when the respondent could access superannuation funds which they understood would be when he was about 60 years of age.
On … 1994 the sum of $10,000.00 was drawn down from available mortgage funds. It was the respondent’s evidence that this withdrawal was made at the applicant’s request with all of those funds provided to her to discharge debts.
In addition to that increase to the mortgage the respondent deposed to further withdrawals by the parties from the mortgage facility between 1995 and 1999 totalling some $22,000.00 in respect of which each of the parties received about $11,000.00.
On … 1999 the respondent and applicant refinanced the former matrimonial home, borrowing the total sum of $100,000.00. By then the amount owing with respect to the Bank West mortgage was $54,034.72 and that mortgage was discharged in its entirety.
Further payments were made from the funds borrowed by the parties from National Australia Bank as follows:
a.Payment of the applicant’s Myer card in the sum of $12,032.00;
b.Payment to the applicant in the sum of $13,239.78;
c.Payment to the respondent’s Amex card in the sum of $2105.00;
d.Payment to the respondent in the sum of $18,050.00;
e.Fees in connection with the refinancing in the sum of $438.50.
The distribution of the funds referred to above was set out in correspondence from the National Australia Bank to the parties dated … 1999 and annexed to the affidavit of the respondent filed 22 May 2015 in “T-18”.
These matters were conceded by the applicant in cross-examination.
The effect of the distribution of the monies obtained upon the refinancing was that the applicant received funds of some $25,491.00 and the respondent funds in the sum of $20,374.00.
By January of 2000 the respondent had reduced the mortgage balance from $100,000.00 to $98,000.00.
It was common ground that the parties had discussions about the respondent purchasing the applicant’s interests in the former matrimonial home in the early part of 2000 but the parties were in dispute as to the amount it was agreed that the respondent would pay to the applicant.
It was the respondent’s position that the parties had agreed that the applicant would receive $26,000.00, being one half of the available equity in the property taking into account its agreed value less anticipated costs of sale and deducting from that amount of $150,000.00 the outstanding mortgage in the sum of $98,000.00. That resulted in equity of $52,000.00 with one half share of that amount being $26,000.00.
It was the applicant’s position that the respondent had agreed to pay her $75,000.00, being one half of the agreed value of the former matrimonial home without taking into account the outstanding mortgage of $98,000.00.
These issues were deposed to by the applicant in her affidavit filed 13 May 2015 in paragraphs 63 to 70.
The effect of the applicant’s evidence was that the only funds that she actually received from the respondent were in an amount of $3170.00.
Annexure “T-20” to the respondent’s affidavit filed 22 May 2015 contained a schedule setting out various payments made by the respondent on behalf of the applicant and, on his case, at her request between … 1994 and 11 January 2001 totalling $26,098.00.
The applicant conceded in cross-examination that to her recollection at least the majority of those payments had been made as stated by the respondent. She further conceded that she understood that those were payments made to be taken into account in calculating what was owed to her by way of her half share of the former matrimonial home.
Page 100 of the respondent’s affidavit filed 22 May 2015 was a copy of an email from the applicant to the respondent dated 11 January 2001. The applicant conceded in cross-examination that the contents of the email accurately reflected the applicant’s belief as to the parties’ financial arrangements at the time of the email. In that email the applicant said to the respondent “…so what is left from the house money $655? will need to be B. Payed into my mastercard immediately or preferably physically deposited by cash at any National Bank is where the mastercard was issued from in the next day or two…”.
There is no doubt that the funds paid by the respondent on behalf of the applicant totalling the $26,000.00 that he alleged to be the applicant’s half share of the net value of the former matrimonial home as at 2000 included slightly in excess of $10,000.00 paid to the applicant before the agreement in early 2000. The majority of that amount was the $10,000.00 the parties jointly withdrew from the mortgage account on … and provided to the applicant.
The applicant conceded that by the time the parties reached agreement as to a division of the value of the former matrimonial home, having previously reached agreement in relation to a division of the respondent’s superannuation, she had considerable experience in relation to the conduct of litigation and was aware, as a result of attending with the respondent to get advice in relation to family law issues, of the existence of the Family Court and the ability of parties to seek orders from the court if agreement could not be reached.
She agreed she also had knowledge of that system as a result of her relationship with Mr L who, at the time of that relationship, was going through his own proceedings in the Family Court.
She agreed that neither party had pursued their discussions further through a solicitor as they were both anxious to avoid legal fees. This was particularly so in light of the $8,000.00 in legal fees that had been incurred by the respondent during the period of the marriage in relation to his employment issues.
The applicant further conceded that in addition to her experience of the respondent’s litigation with WorkCover she had also pursued her own HREOC claim in relation to Employer which had been ongoing for some time. She agreed that throughout the period of time that she instructed her solicitor Ms Crisp in relation to the compensation claim, between approximately 1999 and 2005, there was no suggestion of her being unable to instruct her solicitors or any suggestion of being in need of a litigation guardian, notwithstanding significant mental health issues at the time.
It was the position of the respondent at trial that by May 2001 the parties had finalised putting into effect the agreement in relation to property settlement save and except as to the payment of the outstanding sum of $22,000.00 in relation to the respondent’s superannuation entitlements.
It was the respondent’s case that following upon what he understood to be the finalisation of the parties’ financial affairs save and except for the superannuation payment that he and the applicant maintained a mutual friendship with regular contact. That situation was not seriously challenged by the applicant in either her evidence-in-chief or in cross‑examination.
It was certainly common ground that at no time until early 2013 did the applicant give any indication to the respondent that she intended pursuing any claim for settlement of property.
I am satisfied that the applicant had no intention of making a claim for settlement of property until shortly prior to the issuing of the proceedings.
From at least mid-2001 to the time of trial the applicant and the respondent managed their financial affairs separately although from time to time the respondent provided the applicant with some financial assistance.
Relevant law
In this case as in any other case involving an application for settlement of property the court must be satisfied, upon an identification of the existing legal and equitable interests of parties in the property available for distribution, that it is just and equitable to make any order for settlement of property involving an alteration of those interests[2].
[2] Stanford & Stanford [2012] HCA 52
I am satisfied that this is a case where it is just and equitable to make an order for settlement of property where, even on the case of the respondent, the agreement that he says was reached between the parties in or about 1994 as to a payment to the applicant of a sum of money by way of her agreed interest in his superannuation entitlements has not yet been effected. The only dispute between the parties with regard to that issue was whether the amount agreed in 1994 was $32,500.00 or $34,000.00.
I must therefore take into account the provisions of s79(4) of the Family Law Act (supra) in so far as they are relevant to the circumstances of this case, the parties’ evidence with regard to those issues and make the necessary findings.
It is also of course necessary to make findings as to the relevant asset pool to be taken into account.
Asset Pool
The parties separated in … 1993.
They lived separately and apart in the former matrimonial home at Property B in Western Australia until … 1994.
The parties had discussions about the applicant’s entitlements to a percentage of the respondent’s superannuation between approximately … 1994.
The applicant’s evidence was that she and the respondent agreed at a meeting with a Perth solicitor in or about … 1994 that the respondent would pay to her the sum of $34,000.00 from his superannuation entitlement when he could access it. The applicant deposed in paragraph 50 of her affidavit filed 13 May 2015 to her understanding that that represented 50% of the respondent’s then interest in superannuation. Even on her figure of $34,000.00 that was clearly not the case. She deposed to understanding at the time that family law legislation did not provide for any splitting of parties superannuation.
It was the respondent’s evidence that he was unaware of how the solicitor calculated a division of $32,500.00 to the applicant.
It was common ground that the respondent had joined the predecessor to the Employer Superannuation Scheme in or about 1971 and had been contributing to that and subsequently to the Employer Superannuation Scheme Fund prior to the parties commencing cohabitation in 1981.
The applicant acquired modest superannuation entitlements during the period of the marriage. They totalled some $2,000.00 at around the time of separation.
The respondent’s superannuation entitlements increased during the period of the marriage, although it is unclear as to the value of those entitlements at the time the parties commenced cohabitation in 1981. They totalled some $76,000.00 at around the time of separation.
The parties purchased the former matrimonial home in … 1998.
The property was at Property B Perth Western Australia and it was purchased for $92,500.00, of which $52,500.00 was borrowed from Bank West by way of mortgage. The parties contributed approximately $40,000.00 from their joint savings towards the purchase price of the property.
At the time of separation in 1993 the parties owed approximately $22,000.00 to Bank West with respect to that mortgage.
There was no evidence as to the value of the property at the time of separation.
Upon the respondent vacating the former matrimonial home in or about … 1994 the applicant had retained the motor vehicle H. The parties also effected a division of household contents and effects. The motor vehicle H was later sold and the proceeds divided equally.
To the best of my ability on the evidence available to the court, the parties assets at the time of separation consisted of the following:
House property at Property B Perth Western Australia
value not known
Furniture and effects
value not known
Motor vehicle H
estimate $5,000.00
Respondent’s Employer Superannuation Scheme superannuation entitlements
estimate $76,000.00
Applicant’s Super Fund M superannuation entitlements
estimate $2,000.00
It was common ground that in early 2000 the parties discussed a division of their non-superannuation assets. It was common ground that the respondent approached the applicant with a proposal to purchase her share in the former matrimonial home.
It was the evidence of the applicant that the respondent would pay her the sum of $75,000.00 to which she agreed. It was the evidence of the respondent that he would pay to the applicant one half of the equity in the home.
The property was appraised at that time at a value of $154,950.00 (annexure “T-17” to the applicant’s affidavit filed 22 May 2015), with a mortgage of $98,000.00. It was the respondent’s evidence that the parties agreed the anticipated sale costs of the property would be $5,000.00. It was his evidence that on that basis the parties agreed the equity in the former matrimonial home at that time was $52,000.00, a position conceded by the applicant in cross-examination.
I have referred earlier herein to the advances drawn against the mortgage facility by the parties on … 1994 and in various amounts between 1995 and 1999 resulting in the parties refinancing the former matrimonial home with a borrowing of $100,000.00 from National Australia Bank on … 1999. By that stage the payout to Bank West in respect of the existing mortgage was $54,034.72.
I have also previously referred to the balance of the funds being distributed to the parties as to $25,491.00 to the applicant and $20,374.00 to the respondent. The funds paid to or on behalf of or for the benefit of the applicant were in addition to the $10,000.00 made available to her on … 1994 by way of the parties mutually agreeing to drawn down from available mortgage funds.
I accept the evidence of the respondent over that of the applicant with respect to the financial affairs of the parties at the time of and post separation.
I find that the respondent kept detailed financial records and had a much clearer and better recollection of those financial issues primarily because of the records he did keep than did the applicant.
Overall I found the applicant to give her evidence both in-chief and in cross-examination in a generally honest fashion. I found no suggestion that she was incapable of conducting the litigation as a self‑represented litigant notwithstanding what were clearly many years of mental health issues. Even on occasions when she did take issue with the evidence of the respondent it was in the main confined to issues of allegedly not remembering exactly what payments had been made on her behalf or evidence of what money she had received rather than seriously challenging the evidence of the respondent.
At the time the property was transferred into the sole name of the respondent in 2000 I am satisfied that the available equity was $52,000.00, in circumstances of the property being appraised at a value of $154,950.00 with a mortgage of $98,000.00.
I do not consider it appropriate to take into account in fixing that value the anticipated costs of sale at that time in circumstances where the property was to be retained by the respondent.
Between the time the respondent vacated the former matrimonial home initially in or about … 1994 until the property was transferred into his sole name in 2000 the parties by and large paid the mortgage payments during their various periods of occupation with the respondent assuming occupation of the property in or about … 1998 at which time the applicant moved to Adelaide.
At the time the parties drew down the sum of $10,000.00 on … 1994 from the house mortgage to provide the applicant with funds to cover outstanding debts the applicant was primarily responsible for the payment of the mortgage. She was residing in the former matrimonial home at that time with Mr L who during the period of his relationship with the applicant paid, according to the respondent, the sum of $50.00 per week to the respondent on account of “rent” as well as contributing to household expenses with the applicant.
The parties each then benefitted to the extent of approximately $11,000.00 by way of further drawdowns on the mortgage between 1995 and 1999. It was those drawdowns that took the mortgage balance from $22,000.00 approximately at the time of separation to $54,034.72 at the time the parties refinanced the Bank West mortgage with a loan from National Australia Bank on … 1999.
Other than with respect to the issue of superannuation there is simply no evidence available to the court upon which I could base a finding as to the totality of the assets that were available for distribution between the parties as at separation in 1993, in circumstances where the value of the house property was unknown.
Likewise, there is no evidence available to the court as to the value of each of the parties’ superannuation entitlements as at … 2000 when the parties agreed that the former matrimonial home be transferred into the sole name of the respondent and effected such transfer.
At that time the applicant had paid the majority of the mortgage payments for the period … 1994 to … 1998 which mortgage payments would have increased during that period of time because of the “drawdowns”. The respondent had paid the Bank West mortgage at the higher rate between … 1998 and … 1999 and then the higher National Australia Bank mortgage payments between … 1999 when the parties refinanced to the extent of $100,000.00 and … 2000 when the property was transferred into the sole name of the respondent.
On … 1997 the respondent drew down the sum of $21,539.53 from his entitlements with the Employer Superannuation Scheme, $10,500.00 of which were paid to or on behalf of the applicant.
Although the applicant gave evidence that she understood those funds came from a drawdown of the Bank West mortgage she did not seriously dispute that payment to her and the manner of payment and I accept the respondent’s evidence that those funds came from his Employer Superannuation Scheme.
In circumstances where as I have said previously the applicant did not seriously or credibly contest the accuracy of the respondent’s evidence in relation to the parties’ financial affairs.
I find that by the time the former matrimonial home was transferred to the respondent in … 2000 the parties had each received funds from the mortgage drawdowns as follows:
a.As to the applicant:
i)$10,000.00 in … 1994;
ii)$11,000.00 between 1995 and … 1999;
iii)$25,491.00 from the National Australia Bank refinance
TOTAL: $46,491.00
b.As to the respondent:
i)$11,000.00 between 1995 and 1999;
ii)$20,374.00 from National Australia Bank refinance
TOTAL: $31,374.00.
The equity in the former matrimonial home at the time of the transfer of the property to the respondent was $56,950.00 taking into account the appraised value at the time less the mortgage of $98,000.00.
Although I accept that the applicant received non-superannuation funds from the various mortgage drawdowns between … 1994 and the house transfer in … 2000 to the extent of approximately $15,000.00 more than did the respondent, I am satisfied that where she paid the mortgage for the majority of the time, where there was a period of approximately four years that the respondent did not pay child support and where for almost all of that time period the applicant was in receipt of a Disability Support Pension, it would be appropriate to find that the non-superannuation assets available for distribution between the parties as at … 2000, some seven years after separation is $56,950.00.
I find that that is the appropriate time to calculate, for the purposes of these reasons, the non-superannuation asset pool in circumstances where although the parties had been separated for some seven years and divorced for some five years, their finances to a great degree had remained intertwined.
I find that at separation the parties’ superannuation entitlements totalled $78,000.00, being $2,000.00 on the part of the applicant and $76,000.00 on the part of the respondent.
Subsequent to the transfer of the former matrimonial home to the respondent, the respondent sold that property in … 2002 for $184,950.00. The respondent’s evidence was that the net proceeds of that sale were approximately $57,000.00 and in circumstances where I find his evidence as to finances reliable I accept that evidence.
The respondent then purchased a property at Property N Western Australia. The property cost $118,000.00 with a mortgage of $74,000.00.
The respondent’s mother died in 2005 and he subsequently received an inheritance of $50,000.00. Approximately half of that money was expended on a motor vehicle purchase in … 2006.
The respondent did well financially out of the property in … Western Australia, selling that some five years after its purchase for $339,000.00 resulting in net sale proceeds available to him of $270,000.00.
The respondent then moved from Western Australia to South Australia, with his evidence being that he did so at the request of the parties’ child Mr F who was approximately 20 years old at that time.
Upon the respondent’s arrival in South Australia he purchased a property at Property O at a cost of $235,000.00 plus costs with that property being sold in … 2008 for $262,000.00 with net proceeds of $253,770.00.
The property owned by the respondent at the time of trial namely Property A was purchased by him in … 2008 for $352,000.00 plus costs and stamp duty, with a mortgage of $115,000.00 obtained from ING Direct.
The applicant lodged a caveat over the Property A property on 3 June 2013.
The caveat was removed upon the application of the respondent in or about August 2013.
The applicant did not acquire any property of significance post separation.
In or about … 1991 the applicant instituted proceedings against Employer in the Equal Opportunity Commission of Western Australia in relation to alleged sexual harassment whilst working at Employer. Her application was ultimately dismissed on … 1997 after several days of hearing earlier in 1997 in respect of which the respondent was one of the applicant’s witnesses.
It was during 1997 that the respondent withdraw the sum of $21,539.00 from his superannuation entitlements, of which $10,500 was provided to the applicant by way of payments requested by her in the sum of $4,000.00 to her bank account, $3,700.00 in respect of Bank West mortgage arrears incurred during the applicant’s occupation of the property, $1,500.00 to reduce the applicant’s store account at … Store and $1,300.00 to reduce the applicant’s Myer store account.
This evidence was not disputed by the applicant although she was unable to accurately remember the payments that had been made to her or on her behalf and her evidence was that she understood these monies to come from a drawdown on the mortgage.
For the reasons that I have already given I accept the respondent’s evidence in relation to these issues.
On 20 April 2005 the applicant was declared bankrupt upon her own application. The creditors disclosed in her statement of affairs totalled $30,228.00. The creditors included ANZ Banking Group, National Australia Bank, the applicant’s treating clinical psychologist and the applicant’s solicitors who acted for her with respect to a Criminal Injuries Compensation claim against her previous partner Mr L.
In 2007 the applicant received the sum of $34,000.00 by way of a Criminal Injury Compensation claim in relation to Mr L which payment was excluded from her bankruptcy. She deposed to using those funds for everyday living expense and to purchase a reliable motor vehicle. The applicant conceded in cross-examination that at the time she completed her statement of affairs in relation to the bankruptcy she declared that she had no interest in any property and that no monies were owed to her.
Shortly after separation the applicant commenced receiving a Permanent Incapacity Pension from Super Fund K with those payments continuing to the date of trial. She deposed to receiving $1,851.83 per month in her affidavit sworn 13 May 2015.
It was common ground that at the date of trial the parties assets and liabilities were as follows:
Applicant:
Assets:
Bank West cash
$50.00
ANZ cash
$74.00
Motor Vehicle P
$2,700.00
Household contents
$5,000.00
TOTAL
$7,824.00
Liabilities:
Ambulance Centrelink loan and telephone bills
$2,024.00
TOTAL NET NON-SUPERANNUATION ASSETS
$5,800.00
Superannuation entitlements:
Super Fund K
$278,864.00
Respondent:
Assets:
Property A
$420,000.00
Westpac Account
$495.00
Westpac Account
$52.00
Motor Vehicle Q
$5,000.00
Household Contents
$4,400.00
TOTAL
$429,947.00
Liabilities:
Property A home loan
$98,417.00
Personal loan
$12,664.00
Westpac Visa card
$1,500.00
TOTAL
$112,581.00
TOTAL NET NON-SUPERANNUATION ASSETS
$317,366.00
Superannuation entitlements:
Employer
$259,017.00
Super Fund J
$148,285.00
TOTAL
$407,302.00
Contribution
Neither party had any significant assets at the commencement of cohabitation in 1981.
The respondent had superannuation benefits towards which he had been contributing by that time for approximately ten years. He had during that period been working as a public servant on a modest wage.
The applicant may have had some very minimal superannuation entitlements herself at that time.
The parties lived in rented accommodation in Western Australia, Victoria and South Australia until approximately … 1998 at which time the respondent was required to go on long service leave by his then employer the Employer.
The parties had purchased the former matrimonial home in Western Australia at Property B Perth in … 1988.
In circumstances where in all instances I prefer the evidence of the respondent over that of the applicant with respect to the parties financial affairs, I find that the parties jointly contributed some $40,000.00 towards that purchase with the balance of the purchase price being borrowed from Bank West.
From the time the parties commenced cohabitation in 1981 until … 1988 the respondent was employed on a fulltime basis. During that same period of time the applicant was regularly employed sometimes on a part-time and sometimes on a fulltime basis until shortly before the birth of the parties’ son Mr F in … 1987.
The applicant was engaged in fulltime home duties between … 1987 and … 1989. During that period of time the respondent embarked on an Unfair Dismissal claim against his previous employer which ultimately was unsuccessful and resulted in the parties facing a legal bill of $8000.00.
The respondent was in receipt of WorkCover from the time his employment was terminated in … 1989 until … 1990 when he was redeployed into the Employer on his former salary.
Between … 1989 and … 1990 the applicant, was employed as a customer service officer at Employer and further employed in the same capacity from … 1990 until … 1991.
During the course of the marriage the applicant’s mental health had continued to deteriorate, particularly after the birth of Mr F. The applicant was unable to work outside of the home between … 1991 and … 1992.
Throughout most of the period particularly after the birth of Mr F the applicant took prescribed medication to assist with her mental health challenges and on occasions became unwell to the extent of being admitted to hospital.
The applicant resumed employment as a customer service officer at Employer between … 1992 and from … 1993 until the time of separation was employed at the same Employer on a part-time basis as customer service officer.
In … 1992 after working on a fulltime basis at the Employer since April 1990 the respondent obtained new employment as a professional with Employer, Perth on a salary of $25,000.00 per annum. This was significantly less than the salary he earned working for the Employer which was something slightly in excess of $40,000.00 per year.
At the time of separation the respondent remained in his employment with Employer.
I find that overall the parties’ contribution to the acquisition, conservation and preservation of their non-superannuation and superannuation assets during the period of cohabitation and marriage should be assessed as equal save and except that the respondent made a greater contribution to the acquisition of superannuation entitlements taking into account his fulltime employment prior to Mr F’s birth and his nine years of contribution to same prior to the commencement of cohabitation. The respondent earned greater income during the relationship and made a greater direct financial contribution than did the respondent.
I am satisfied however that the respondent worked as much as she was able during that entire period and that the respondent’s moves in his employment had an impact on the applicant’s ability to maintain stable fulltime employment as did her mental health difficulties on occasions. I find that she contributed her income towards the parties’ joint endeavours as well as taking on the primary role of caregiver for the parties’ son Mr F from the time of his birth until early 1989.
I am satisfied that the respondent also made a contribution by way of homemaking and parenting and that the parties worked together to acquire their assets.
The respondent contributed to superannuation for some nine years prior to the parties commencing cohabitation and continued to contribute to superannuation for the 12 years of cohabitation and marriage.
The total amount of superannuation that he acquired by the time of separation was $76,000.00. There was no evidence as to the value of his superannuation at the time of commencement of cohabitation but I am satisfied that taking into account the length of the parties relationship and the total period over which he acquired those superannuation entitlements that it would be appropriate to assess contributions as to 45% to the applicant and 55% to the respondent.
It was clearly the expectation of the parties at the time they had discussions in 1994 with some legal assistance in relation to a sharing of the superannuation entitlements that the intention of the parties was that they should be shared such that there be a slight weighting in favour of the respondent.
Post separation both parties made contribution towards the mortgage payments in respect of the former matrimonial home during their various periods of occupation, both then together but separately under the same roof and individually.
Both parties benefitted from various drawdowns in respect of the mortgage account and then ultimately the refinancing of the mortgage over the former matrimonial home up to the time of transfer of the property to the respondent in March 2000.
In the particular circumstances of this unusual case the only clear picture of the parties respective financial circumstances that I have is that which existed at the time of trial.
In those circumstances I also have to consider the question of post separation contribution.
The applicant moved to Adelaide to live in 1998.
Between then and January 2000 the parties child Mr F remained living with the respondent in Western Australia but from January 2000 he went into the fulltime care of the applicant in Adelaide. At that stage Mr F was 12 years of age.
The applicant did not pay child support to the respondent between 1998 and January 2000. The respondent had not paid child support to the applicant during the period Mr F lived with her from … 1994 to … 1998.
In late 2000 the respondent commenced paying child support to the applicant as assessed by the child support agency and he continued to do so until Mr F attained the age of 18 years in … 2005, save for a period of approximately six weeks during the time when Mr F resided with him in Western Australia.
Post separation both parties contributed to the mortgage payments during their various periods of occupation of that property until the property was transferred into the sole name of the respondent in March 2000 whereupon he took sole responsibility for the payment of the mortgage payments.
Between separation and the transfer of the home into the sole name of the respondent in March 2000 both parties benefitted from various drawdowns on initially the Bank West mortgage and then through the refinance with National Australia Bank.
In … 1997 the respondent withdrew $21,539.53 from his Employer which monies were distributed as to $10,500.00 to or on behalf of the applicant and the balance of $11,039.00 being retained by the respondent.
Effectively that withdrawal was divided equally.
Following upon the transfer of the former matrimonial home to the respondent in March 2000 the parties maintained an amicable relationship but their financial relationship effectively finalised.
It was the case of the respondent that by shortly after 11 January 2001 he had paid to or on behalf of the respondent between 1994 and early 2001 the total amount of $26,000.00 that he understood the parties had agreed was the applicant’s half share of the equity in the former matrimonial home.
I am satisfied that his belief was shared by the applicant and have previously referred herein to the email from the applicant to the respondent dated 11 January 2001 effectively conceding that some $655.00 was still owing to her from the “house money”.
Post March 2000 the applicant continued to receive her Disability Support Pension from her Super Fund K entitlements and the respondent remained in employment save for a few short months in or about 2007.
The applicant made no contribution to the mortgage payments in respect of the former matrimonial home after the transfer of same to the sole name of the respondent, at which time I am satisfied the equity that he retained, taking into account the approximately $26,000.00 of payments made to the applicant between 1994 and early 2001 was effectively $30,590.00.
I accept the evidence of the respondent that following upon the sale of the former matrimonial home he purchased a unit at a time when real estate prices in Perth were in a phase of rapid increase. Within a period of five years the property had increased in value by $222,000.00.
In 2005 the applicant declared bankruptcy. I accept her evidence that she has for many years struggled to make “ends meet”. She deposed in paragraph 113 of her affidavit sworn 13 May 2015 to needing to make a hardship application to access $6,000.00 of her superannuation entitlements in 2011.
She further deposed to having attended the Salvation Army community support services to get immediate emergency assistance with food vouchers and food parcels and to having participated in financial counselling through that agency.
There is no doubt that the applicant’s psychiatric difficulties that she has experienced over many years have contributed to her difficulties with respect to her financial situation.
I am satisfied that neither party effectively made any financial contribution to the acquisition, preservation or conservation of any assets of the other of them post approximately March 2000 but I am mindful that the respondent retained at least $22,000.00 of the amount the parties agreed was owing to the applicant from his superannuation entitlement as at the date of separation. These funds remained in his Employer superannuation fund and contributed to the increase in the value of that fund to the date of trial.
s75(2) factors
At the time of trial the applicant was aged 57 years and the respondent 63 years.
The applicant had not by that time engaged in paid employment since approximately … 1994. She is not likely to do so for the rest of her life.
She suffers significant mental health conditions which have effectively prevented her from engaging in employment and have resulted in her receiving a Disability Support Pension since approximately … 1994.
The respondent at the time of trial was in good health and remained in appropriate gainful employment. He was however at the time of trial close to retirement age.
As at 2 August 2016 the respondent’s annual income was a little under $70,000.00.
The applicant agreed in cross-examination that there was no evidence before the court to suggest that she would not continue to receive the disablement benefit through her Super Fund K Scheme until she reached the age of 65 years. She said however that the issue of payment was reviewed from time to time and was due for review later in 2017.
In paragraph 103 of the applicant’s trial affidavit filed 13 May 2015 she deposed to being in receipt of a part Disability Support Pension from Centrelink and a Permanent Incapacity Pension from Super Fund K totalling $1,851.83 per month.
Her statement of financial circumstances filed at the same time deposed to average weekly income of $711.00 per week which equates to $3,081.00 per month.
The applicant had very modest property including some cash, a motor vehicle and household contents totalling $5,800.00 but a superannuation entitlement in the sum of $278,864.00.
The respondent at the time of trial owned real estate, had modest savings, a modest motor vehicle and household contents totalling $429,947.00 by way of non-superannuation assets but with liabilities of $112,581.00 leaving net non-superannuation assets held by him in the sum of $317,366.00.
He had superannuation entitlements with Employer and Super Fund J in the total sum of $407,302.00.
Both parties lived modestly and only had responsibility to support themselves.
As at the swearing of the applicant’s financial statement on 13 May 2015 she was in receipt of a Centrelink Disability Support Pension in the sum of $220.00 per week and also received $64.00 per week by way of rent assistance. She received the sum of $427.00 per week by way of her pension from her superannuation entitlements.
The applicant was living in rental accommodation which she had done at all times since … 1998. Her rental commitment at the time of filing her financial statement on 14 May 2015 was $370.00 per week.
There was no evidence to suggest that the standard of living in the circumstances of the applicant was other than reasonable.
The respondent paid mortgage payments of $300.00 per week with $62.00 per week by way of rates and unit levies and at the time of trial lived in the property he owned at Property A which for the purposes of trial had an agreed value of $420,000.00.
I am satisfied that the applicant continued to contribute to the respondent’s Employer superannuation entitlements following upon separation and continued to do so to the date of trial in circumstances where there had been no payment made to her of at least $22,000.00 of what was an agreed either $32,500.00 or $34,000.00 as long ago as 1994.
The respondent ceased contributing to the Employer superannuation in … 1992.
That predated the parties separation by approximately 12 months and on the respondent’s evidence he did not commence contributing to his second superannuation fund namely Super Fund J until 1997, some four years post separation.
It was common ground that in 1994 the respondent’s superannuation entitlements with the Employer superannuation totalled $76,000.00 and the applicant’s superannuation with Super Fund K totalled some $2,000.00.
Accordingly, the growth in the respondent’s Employer superannuation entitlement from $76,000.00 to $259,017.00 occurred in the period between … 1992 and the time of trial without any contribution by either party. That was a period of some 24 to 25 years.
The applicant made no contribution to the respondent’s Super Fund J entitlements.
The applicant’s Super Fund K entitlements were not contributed to by the applicant after … 1994. Accordingly, they had grown from approximately $2,000.00 at that time to $278,864.00 at the time of trial, a period of some 22 years. The respondent likewise made no contribution to what is effectively all of the applicant’s superannuation entitlements.
The other matter that the court has to take into account pursuant to the terms of s75 of the Family Law Act (supra) is the very significant delay on the part of the applicant in making her application for settlement of property.
I am satisfied that at all times post separation the applicant had the knowledge, capacity and at times easily obtainable legal advice that would have facilitated her filing an application for settlement of property within the appropriate time or certainly at a much earlier time if she had at any time considered that she and the respondent had not effectively informally resolved those issues.
I am satisfied that for the reasons to which I have already referred the applicant struggled financially at all times post separation and that her difficulties in that regard were compounded by her ongoing significant mental health problems.
Nevertheless, the court must be careful to afford justice and equity as between the parties in circumstances where from the respondent’s point of view he considered the matter to be concluded other than obtaining information from the superannuation fund as to an appropriate amount to pay to the applicant. He sought this information by letter to the Member Services Centre at Employer dated 6 February 2013.
In that correspondence he asked the service centre to “…calculate, based on the history of my fund activity from 1995 to 2012, for a sum which Ms Tiller is rightfully due…”.
Conclusion
I have already determined that the applicant should be given leave to proceed with her application for settlement of property on the grounds of hardship, based on her loss of right to litigate this matter and potential hardship that would arise for her if that right was lost.
I am satisfied that, based on the evidence of the respondent to which I have referred herein, that at the time the former matrimonial home was transferred to the sole name of the respondent in March 2000 the applicant had already received from him or shortly thereafter received in full a sum the parties agreed which I find to be approximately $26,000.00.
I do not accept the evidence of the applicant that the agreed amount was $75,000.00. Such amount did not take into account the liability of the mortgage against the value of the property in early 2000.
I am not satisfied that there is any basis on which any further adjustment should be made in favour of the applicant on account of the non‑superannuation assets held by the respondent at the time of trial.
I find that the parties clearly agreed the method upon which the payment of the agreed sum would be based, namely a reconciling of various agreed amounts paid to the applicant by the respondent between 1994 and early 2001. I find that the email to the respondent from the applicant to which I have previously referred herein dated 11 January 2001 was clear acknowledgment by the applicant that the respondent had paid to her what the parties had agreed was due. I find that the amount that was so paid was a just and equitable resolution of the division of the parties’ non-superannuation assets as at March 2000.
The amount the parties agreed the respondent would ultimately pay to the applicant from his superannuation entitlements when he could access them at approximately age 60 was, I find, $32,500.00.
I prefer the evidence of the respondent over that of the applicant in relation to fixing the amount in circumstances where overall the respondent was a more accurate historian of the parties financial affairs and in particular his evidence as to a calculation of that amount by the solicitor jointly consulted by the parties and his lack of understanding of why that amount was recommended as the appropriate division.
The parties total superannuation entitlements as at the time of those discussions in 1994 was approximately $78,000.00.
An equal division would have resulted in each party retaining superannuation entitlements to the value of $39,000.00. At that time the applicant had $2,000.00. A payment of $37,000.00 would have been due to the applicant if, as she alleged, the parties were agreed on an equal division.
The amount of $32,500.00 represented approximately 42% of the total superannuation pool of $78,000.00. The applicant’s superannuation entitlements of $2,000.00 at that time, added to that sum would have resulted in an overall division of superannuation entitlements as to 44.5% to the applicant and 55.5% to the respondent.
The respondent commenced contributions to his Super Fund J fund in or about 1997, a fund to which the applicant made no contribution whatsoever and which commenced some four years post separation.
By the time of trial the respondent’s Employer Superannuation Board entitlements had increased to $259,017.00. He had not contributed to that fund since 1992.
The applicant’s Super Fund K entitlements had increased to $278,864.00.
Those amounts total $537,881.00.
I accept the evidence of the respondent, which was not seriously challenged by the applicant, that in 1997 he drew down the sum of $21,539.53 from the Employer Superannuation Scheme. The applicant retained the sum of $10,500.00 with him retaining the sum of $11,039.00.
This was effectively an equal division of the respondent’s superannuation drawdown from the superannuation fund to which he had ceased to contribute in 1992.
The payment of $10,500.00 to the applicant was effectively one third of the amount that the respondent had agreed to pay to the applicant.
The withdrawal at that time however meant that the principal amount remaining in the superannuation fund was reduced by $21,539.00. The evidence adduced by the respondent in “T-14” to his affidavit filed 22 May 2015 confirms that at the time of withdrawal of those funds on … 1997 the amount preserved in the fund was $101,175.81. The reduction in the preserved amount at that time would have resulted over the years in reduced earnings.
I am satisfied that justice and equity would be achieved in this matter if there was a split in favour of the applicant from the respondent’s entitlement in the Employer fund of an amount equal to two thirds of 45% to take into account the amount of one third of that agreed percentage paid to the applicant in 1997.
That would require a split of approximately 30% to the applicant from that fund taking into account its agreed value at the date of trial, being $259,017.00 and 30% being $77,705.00.
I find however that that amount should be reduced on account of the significant increase in the applicant’s Super Fund K in respect of which she made very limited contributions post separation such that it had a value of approximately $2,000.00 in or about … 1994 and by the time of trial had increased in value to $278,864.00.
The applicant’s fund earnings therefore from 1994 to the date of trial were significantly greater than the respondent’s Employer fund earnings for the same time period. The applicant’s had increased by some $276,864.00 but the respondent’s Employer fund only increased by $183,017.00.
The parties were generally agreed as to an approximate 44.5/55.5 percent sharing of their superannuation entitlements as at approximately … 1994.
The respondent had significantly greater superannuation entitlements at that time. The applicant’s entitlements were almost negligible.
The applicant received an amount equal to approximately 15% of the 44.5% agreed from the respondent’s superannuation fund in 1997.
The respondent did not contribute to his Employer superannuation fund after 1992.
A proportionate increase in both parties’ funds over the years would support a split to the applicant of 30% of the respondent’s Employer superannuation entitlements affording justice and equity as between the parties.
I am not satisfied however that such a result would be just and equitable in that it would result in overall the applicant retaining a greater amount of superannuation than the respondent notwithstanding that his second Super Fund J which had a value at trial of $148,285.00 was all acquired by him significantly post separation.
Taking all of those matters into account I find that a payment of $40,000.00 to the applicant from the respondent’s Employer superannuation entitlements would effect justice and equity as between the parties. This represents approximately 15.5% of the respondent’s Employer superannuation entitlements.
Such a division would result in the applicant’s superannuation entitlements increasing in value to $318,864.00 and the respondent’s Employer superannuation entitlements reducing to $219,017.00. He would retain total superannuation entitlements in the sum of $367,302.00.
Had the applicant received the additional sum of approximately $22,000.00 in 1994 and it had been invested to the date of trial it may well have increased to an amount greater than $40,000.00.
However the applicant did receive the sum of $10,500.00 in 1997, many years before it was agreed that payment would be made to her. She therefore had the benefit of the value of that payment in terms of its true value in 1997 and was able to discharge various debts.
It is not possible in a matter such as this to do other than make an order for a payment of an arbitrary amount from the respondent’s superannuation entitlements. The time elapsed and factors that have occurred since the divorce became final has made any accurate assessment almost impossible.
Taking all of the particular issues of this matter into account in an effort to effect a just and equitable resolution of the parties property settlement issues reflective of the contributions of each of them post separation and their particular circumstances at the time of trial, I find the superannuation split to the applicant results in a just and equitable outcome.
I note in particular that the respondent is unlikely to have a significant number of years in the future in the workforce taking into account his age.
It is of course not possible to make final orders at the time of the delivery of these reasons in circumstances where procedural fairness will not have been afforded to the respondent’s superannuation fund.
In those circumstances I intend to make an order adjourning the matter for some eight weeks noting the terms of the order that I intend to make.
I certify that the preceding two hundred and eighty-two (282) paragraphs are a true copy of the reasons for judgment of Judge Mead
Date: 21 March 2019
Key Legal Topics
Areas of Law
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Family Law
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Civil Procedure
Legal Concepts
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Procedural Fairness
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Remedies
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Jurisdiction
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