Torren and Torren

[2009] FamCA 589

FAMILY COURT OF AUSTRALIA

TORREN & TORREN [2009] FamCA 589

FAMILY LAW – PROPERTY SETTLEMENT – Contributions

Family Law Act 1975 (Cth)

APPLICANT: Mr Torren

RESPONDENT: Ms Torren

FILE NUMBER: SYC 7025 of 2007

DATE DELIVERED: 2 July 2009

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Justice Fowler

HEARING DATE: 22 June 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Judge

COUNSEL FOR THE RESPONDENT: Mr Hodgson

Orders

1. The parties forthwith do all acts and things to place on the market for sale and sell the property situate at and known as L property in the State of New South Wales (hereinafter “the former matrimonial home”) by public auction on a date six weeks from the date of these Orders (unless otherwise agreed in writing between the parties as to the timing of sale) with a real estate agent as agreed or failing agreement as determined by the President of the NSW division of the Australian Property Institute, with the reserve price for sale at auction to be $1,850,000, with the proceeds of sale to be distributed in the following order and priority:

   (a)       in payment of all costs and expenses associated with sale

   (b)       in payment of all mortgages

   (c)       in payment of the sum of $213,920 to the wife and

   (d)       in payment of the balance then remaining to the parties in equal shares.

2. In the event that the former matrimonial home does not sell when first offered for sale by public auction, or subsequently at a price as agreed between the parties and a purchaser following the first public auction, then it shall again be listed for sale by public auction at six weekly intervals until sold, with the reserve price for sale at each subsequent auction to be 5% less than the reserve price of the previous public auction with the proceeds of sale on settlement to be distributed in accordance with Order 1 herein.

3. (a)      Within seven days of the date of these Orders, the wife shall prepare two lists of equal value of furniture and chattels in the former matrimonial home and submit those lists to the husband’s solicitor.

   (b)The husband shall then advise the wife’s solicitor within a further period of seven days as to which list of furniture and chattels he wishes to retain.

   (c)The wife shall within a further period of 14 days allow the husband or the husband’s agent access to the former matrimonial home to collect the furniture and chattels on the list nominated by the husband and the wife shall otherwise retain absolutely the furniture and chattels contained on the other list not nominated by the husband.

4. The husband shall forthwith take all steps and do all things necessary to sell his share portfolio.  The net proceeds of sale are to be applied to the repayment of the loan taken out with respect to the purchase of the shares.  Any balance then remaining is to be divided equally between the parties.

5. Each party shall retain absolutely and be declared solely entitled to their superannuation and like entitlements.

6. The husband shall within seven days of the date of receipt of the relevant documentation from the wife, sign all documents as may be necessary to transfer to the wife all of his right title and interest in the Golf motor vehicle being registration number … and the wife shall retain same absolutely.

7. The wife is declared to be the legal and beneficial owner of her Telstra shares.

8. The husband be and is hereby restrained for a period of five years from the date of these Orders from removing the wife as his nominated beneficiary of his Staff Travel Benefits Scheme.

9. Except as otherwise provided for herein, each party shall otherwise retain all savings, personal items and chattels, motor vehicles and all other property and financial resources in their respective possession.

10. In the event only of a party failing for a period of seven days to do all acts and things necessary to give validity and effect to these Orders then a Registrar or Deputy Registrar of the Family Court of Australia at Sydney is hereby empowered pursuant to Section 106A of the Family Law Act 1975 to do all acts and things necessary in the place and stead of the defaulting party to give validity and effect to these Orders.

11. The wife’s claim for spousal maintenance in Order 9 of the document entitled “Orders Sought by Wife” is dismissed.

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 7025  of 2007

MR TORREN

Applicant

And

MS TORREN

Respondent

REASONS FOR JUDGMENT

Introduction

1. The proceedings before the Court are ones in which the husband and the wife each seek orders for the alteration of interests in property and the wife seeks spousal maintenance and an order preventing the husband from not making available to her the benefits of a certain scheme for retired employees (of which the husband was one), to procure discounted travel.

The issues

1. The issues for trial were considerably reduced in a number of respects.  It seems clear that the property of the parties or either of them was agreed and set out in a tendered document, as set out hereunder and corrected for errors in addition.

2. It was further agreed that the parties’ contributions to the date of the hearing to the acquisition, conservation and improvement of the property of the parties or either of them and to the welfare of the family was on an overall consideration equal.

3. It was submitted by the wife that the division of the property of the parties or either of them should not reflect that equality of contribution but that taking into account the matters referred to in section 75(2) the parties should divide that property in the proportions of 55% to the wife and 45% to the husband.

4. Featuring significantly in the wife’s application was an alleged withdrawal by the husband from his superannuation account which was by the time of the hearing an allocated pension scheme.  The wife said that those withdrawals were amounts which should be taken into account under the provisions of Section 75(2)(o).  Further amounts derived by the husband from the sale of shares she said should also be taken into account.

5. The husband proposed a division of assets nearer to equality and which would provide to the wife the majority of the cash to become available.  A significant part of the assets which the husband was to receive was in the form of the value of his superannuation allocated pension scheme.  No splitting order was sought by either party.

6. The wife also sought an order for maintenance and on that application issues arose as to the earning capacity and needs of the wife and the capacity of the husband to pay.

Background Facts

1. The husband was born in July 1941 and is presently aged 67 years.

2. The wife was born in November 1951 and is presently aged 57 years.

3. The husband was in 1968 employed by a travel company and from which employment he retired in July 2003.

4. In August 1976 the parties married.  The wife during the course of the marriage worked as a self-employed teacher.  The wife, although having no formal qualifications, was not without talent in her field and was competent to teach the young in it.  She did also teach a few adults but noted that she did not present pupils for examinations and did not have those qualifications which would have her accepted into, for example, a school.

5. The wife also during the marriage let out a portion of the matrimonial home to boarders and derived income from that endeavour.  From 2002 the wife undertook work for an art company and worked teaching pupils as well.

6. The husband retired from work in July 2003.

7. The parties separated in November 2005.

Credit

The Husband

1. The husband gave evidence orally and by affidavit.  His financial statements of which there were three were unreliable and the information in them had to be supplemented as best the husband could orally.  It seems that the whole of his account with American Express Corporation was omitted and it was through this vehicle that he said that he had paid for many of his costs.

2. The husband became perplexed in dealing with the figures and although he was able to clear up a number of matters successfully in relation to the withdrawals made from his superannuation fund he was unable to remember how the money which was derived from the sale of shares was spent.  He was however certain that the amount was applied to the expenses of both he and the wife.

3. I accept that the husband tried to lay the facts out before the Court on the hearing but by then it was too late and he only partly succeeded.  This was unfortunate since had his endeavour been applied at an earlier time it might well be that there would be no unanswered questions.  As it stands, all the Court has is the general statement as to the application of the funds derived from the sale of the shares and no means other than that of verifying it.

4. In part I considered his evidence reliable.

The Wife

1. The wife gave evidence in a straight forward way.  She had I think unrealistic expectations but I found her a witness of whom it could not be said that she was unreliable in her recollection.

2. The first task facing the Court is to determine the net assets of the parties and in this case the task was done by the parties and apart from a small addition error (for which a correction has been made by me) the assets and liabilities of the parties are as follows:

Assets	($) (Agreed)
L property (former matrimonial home) (joint)	1,850,000
Share portfolio (h)	138,826
Toyota motor vehicle (h)	3,000
Telstra shares (w)	775
Golf motor vehicle (w)	7,500
Savings (w)	6,963
Savings (h)	206
Total	$2,007,270
Liabilities
Mortgage on former matrimonial home (joint)	17,272
Credit cards (h)	N/A
Credit cards (w)	N/A
Loan from husband’s employer for shares	3,732
Total	$21,004

Superannuation
B Super  (accumulation interest)  (h)	434,699
Australian Super  (accumulation interest)  (w)	6,858
Total	$441,557
Net Assets (including superannuation)	$2,427,823

1. The parties agree that their contributions were equal in terms of their contributions to the acquisition conservation and improvement of the property of the parties or either of them both financially and otherwise and to the welfare of the family.

Conclusion based on contribution

1. On the basis of those contributions I find an equality of division would be appropriate.

Section 75(2) considerations

1. The Court must determine whether the division referred to above should be varied by reason of any of the relevant matters arising for consideration under Section 75(2).

2. The wife asserted that the parties are both in good health.

3. The husband denied this and produces reports from his medical consultants not verified on affidavit which he says support this.  The documents were tendered before the court without demur.  It appears that he has been diagnosed with bladder cancer for which he has been treated.  He has been observed by his medical advisors as having gall stones and abnormal liver function tests and an ulcer.  It was recommended in May 2008 that he undergo further testing and monitoring with a view to a cholecystectomy subject to further testing to exclude other more significant problems.

4. The doctors were not called to give evidence and no evidence was offered in relation to the effect of the illnesses/conditions described on the husband’s present or future functioning.

5. It is accepted however that the husband is deaf and is obliged to wear bi-lateral hearing aids to hear.

6. The property of the parties is as set out in their balance sheet.  The husband has a financial resource in the form of his former employer’s discount travel programme.  He has been able to make that resource available to the wife.  Presently the wife seeks to have that benefit continued in her favour on an open-ended basis.  The husband offers to have it continue for a period of five years.

7. The husband now derives income solely from the amount he receives from his superannuation allocated pension scheme and will in due course on his receipt of cash from the liquidation of the parties’ assets potentially receive income from the return on any monies he invests from those proceeds.

8. The husband has given evidence of his seeking employment on his retirement.  He procured a certificate in the Responsible Service of Alcohol.  He has sought and procured some part time work since his retirement in the service industry but found that he is not quick enough to successfully fulfil the role.  He has also done some handyman work but is not presently working in that capacity.  His earnings from those employments he described as “pin money” and I accept his evidence in this regard and find that it is unlikely that he will earn anything of significance from this form of employment.

9. The major income the husband derives is from his superannuation allocated pension fund and the capital base, which has had major and significant reversals of fortune (after a short period of significant profits) in the developing and current global financial crises.  His income is drawn as an allocated pension and the drawings are reducing the capital somewhat at present.

10. The husband has since separation travelled overseas regularly.  He has stayed he says with friends and significantly with a lady in Hawaii.  He avers that the relationship is not sexual but one of friendship and that he has as a quid pro quo for his board and lodging done some handyman work and bought some food.  He has, he says, in other places and at other times acted as an escort in return for accommodation and keep.  He denied any other permanent liaison at this time and I accept his evidence.  He remarked that the chief attraction of Hawaii is the ability to play a round of golf for the sum of $7 which is likely given his passion for golf and his asserted platonic relationship with the lady.

11. The wife has a capacity to earn income as a teacher and in the arts company.  From her past history she also has talents at the management of boarders.  She has sought it appears no other employment.  She informed the Court that the employment at the arts company is seasonal and low paid but that she loves it.  Her current rate of return from the job she deposes to be in the order of $22 per hour or $88 per four hour shift.  She is able to earn up to $60 per hour from her teaching.

12. In relation to the wife’s earning capacity she said:

    a)It is difficult to find boarders in a small home and she will not be able to acquire a home of the same somewhat grander proportions of her present home with the money available for purchase.

    b)Her work at the arts company is seasonal and it has attendant travel costs associated with it although she seeks to share her parking expenses with acquaintances who are either involved in the company or otherwise work there. She gave evidence that she undertakes the work notwithstanding the low return because she loves it.  I can understand that with her background and interest she probably does get a deal of pleasure from her association with the art company.  She is not to be criticised for having the ability to do what she likes and get paid for it.  Having said that her return per hour as a teacher is significantly higher.

    c)Her capacity to teach and earn a living from it really only derives from the teaching of the young in an area where the fees can be afforded.  Teaching she says has to occur in her home or another fixed place.  I am satisfied that her net income would be less if she were obliged to travel to the homes of her pupils.  She described herself as having a good reputation as a teacher and I accept that.  She lacks however formal qualification.  She goes on to say that she has not generally advertised and that her students are as a result of references by the parents of other students.  She says that she could again undertake this work upon a move but that it would take some time to restore her income.  She could continue with her work at the arts company during the season.  I accept that the wife could increase her income somewhat in due course but I do not think that it will be likely to reach the amount of $56,950 per annum which, it is submitted by the husband, is a short term prospect.

    d)The wife will in the same way as the husband and given her age be able to invest in superannuation.  Having regard to her age she is able to forward invest the sum of $450,000 in such a fund.  That amount is close to the amount the husband has invested in such a fund.  She is of course not limited to that form of investment and could invest in other income producing forms.  It may be that investment in such a fund however might have additional taxation advantages to her.

    e)The wife has received voluntary payments pending the hearing of this matter from the husband in the sum of $300 per week and has since separation resided in the matrimonial home, with the husband paying most of the significant outgoings.  The wife received and did not account for some income from boarders although the evidence did not suggest that it was overly significant.  The wife made some contributions to the maintenance of the home and particularly its swimming pool.  It is noted that during that period she has maintained savings of about $6,000 and spent $11,000 in assisting her son to settle into New York.  The husband’s consent was neither sought nor given to that payment.

    f)In addition, the wife has since separation undertaken discretionary expenditure and expenditure on the home and its attendant swimming pool which may not be needed in her new residence.

13. Neither party has the care or control of a child of the marriage who has not attained the age of 18 years.

14. I am satisfied that the order I propose to make will enable each party to this relationship to support himself or herself having regard to their reasonable needs.

15. Neither of these parties has the present legal responsibility to support any other person.

16. The husband has an entitlement under his pension scheme and the wife will have an entitlement under her superannuation scheme. There is no evidence that either of them have any current entitlement otherwise to any pension allowance or benefit of the nature referred to in Section 75(2)(f) of the Family Law Act 1975 (“the Act”).

17. I find that the order that I propose to make will afford each of these parties the opportunity to enjoy a standard of living which in all the circumstances of this case are reasonable.

18. No evidence was given by the wife of the steps she would need to take to get formal qualification as a teacher nor did she evince any desire to do so.  She said that her computer skills were limited to sending emails but conceded she could undergo a course to improve them.  She appeared personable and to have good communication skills.  I find on the evidence that the wife has not optimised her earning capacity.

19. I do not think that the husband can do anything to improve his ability to earn and I find it unlikely that he will earn significantly from personal exertion.

20. The orders that I will make will enable the declared creditors to be paid their outstanding debts.  This is particularly so in relation to the shares held and the sale of which I propose to order, coupled with an order that the sum outstanding in relation to the loan procured to buy them in part be discharged.

21. The parties to the marriage have contributed equally to the income earning capacity of each of them in various ways during the marriage.  The husband was assisted in following his career by the contributions made by the wife in caring for the home and the children and the wife was assisted by reason of the husband’s income to pursue her interests in her field and which enabled her to earn income thereby and develop her reputation as a teacher.

1. The cohabitation of the parties from the date of marriage was for a period of 29 years.  There is no evidence of its effect on the income earning capacity of each of the husband and the wife save to the extent that the joint efforts of the parties enabled each of them to maximise their earning capacity.  Had the wife not had children arguably she might have had, had she desired to do so, the opportunity of gaining higher qualification as a teacher, but there is no evidence of any desire on her part to do so.

2. The wife is cohabiting with her daughter at the present time on a temporary basis.  She has had in the past some others living with her as boarders.  She has not re-partnered.  The husband has resided with his friend in Hawaii on a platonic basis in the circumstances earlier described and I find that he has not re-partnered.

3. In considering the relative means and needs of the parties I have taken into account the effect of the orders I will make and the capacity of each of the parties to earn income and provide themselves with accommodation as a result of those orders.  I have also taken into account the flexibility because of the nature of the orders afforded to the wife in making her future choices as to residence and investment.

4. I am asked to consider pursuant to the provisions of Section 75(2)(o) various matters raised by the wife, namely:

   a)The fact that the husband is in receipt of an allocated pension which provides him with a regular income which significantly exceeds that of the wife and that the husband has the capacity to access lump sums from his superannuation fund.  I have taken into the pool of assets to be divided the superannuation fund.  Having received the benefit of that fund in capital form I do not think that it is appropriate to adjust the division of property further.  The wife will have the capacity to similarly provide for herself and, if personal exertion income is not presently available, to make income producing investments which will yield presently available income.  The income of the husband is an income created in part by the drawing down of capital from the allocated pension fund.  The wife can procure for herself cash in lump sums from the proceeds of sale of the property.  I reject the submission that the husband’s capacity to access lump sums from his superannuation is a matter requiring adjustment under this section.

   b)It is asserted that at the present time the husband has a greater earning capacity than the wife.  Given what I have earlier found I reject the submission.  It is asserted that the husband has made a deliberate decision not to engage in employment.  I reject that submission.

   c)The receipt by the husband of certain monies from the sale of shares and withdrawal from his pension fund the detailed expenditure of which was not fully itemised.  Save for a number of items of expenditure that the husband could point to, including the payment of tax, the renovation of a kitchen and the payment out of the residual of the wife’s car lease, the only evidence of expenditure was that of the husband.  He said that although he could not give further detail, the monies were applied to the expenses of himself and the household of the wife.  I consider that whilst the evidence was unsatisfactory as to detail that the overall theme of it as to the use of the funds was probable.  I note the husband readily conceded that he had spent monies on a cruise but I also note that the wife conceded that she had paid monies from her savings to the benefit of the son without the husband’s agreement.

   d)I find that there is not a sufficient basis for the adjustment of the entitlements of the parties based on the application of Section 75(2)(o).

Conclusion on section 75(2)

1. Having regard to all the matters raised for consideration under Section 75(2) I reject the submission that an adjustment of the division of assets determined on a contribution basis is merited by such a consideration and accordingly no such adjustment will be made.

Overall division of assets

1. The above determination will see the wife receive approximately 50% of the parties’ net assets and the husband receive approximately 50%.

Just and equitable

1. The division of assets would see the wife receive an amount sufficient to enable her to rehouse herself and if she wishes to procure an income.  The husband will be likewise served and after a marriage of 29 years each of the parties will be placed in the same position upon a sale of the home.

2. In all the circumstances of this case I consider that the result is both just and equitable between the parties.

The wife’s maintenance claim

1. On the evidence before me I do not think that the wife on the sale of the home has made out a case for the payment of maintenance.  She will have something in the order of $1,250,000 at her disposal.  With that money she will be able to adequately rehouse and support herself until such time she is, in accordance with her evidence, able to re-establish her income.  In the meantime, having regard to her expenses, I find that she is able to support herself until the sale of the property.

2. The wife’s claim for maintenance is accordingly dismissed.

The wife’s claim for injunctive relief

1. The wife points to the benefits which accrue to the husband in discount travel, which he can and has made available to her for her use in the period of cohabitation.

2. The wife seeks the continued provision of that benefit for so long as it can be made available to her as a former spouse.

3. Whilst the benefit accrued as a result of the husband’s employment during the marriage it is important that I take into account the directions of Section 81 as to finality of interspousal obligation, and I think that in all the circumstances the husband’s proposal is not unreasonable.

4. Were the husband to re-partner he would want to have the opportunity of making that benefit available to his new partner and I do not think he should be deprived of that opportunity for longer than the period he is prepared to offer.

Orders which should be made

1. I was asked to consider the transfer of the shares to the husband in specie and to adjust an amount of cash in favour of the wife.  I decline to do so having regard to the fact that the share market is volatile and that such a proposal might cause injustice to either of the parties.  I accordingly propose to make the orders set forth above.

I certify that the preceding fifty-eight (58) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Fowler.

Associate: 

Date:  2 July 2009