Trevi & Trevi
[2018] FamCAFC 173
•6 September 2018
FAMILY COURT OF AUSTRALIA
| TREVI & TREVI | [2018] FamCAFC 173 |
| FAMILY LAW – APPEAL – PROPERTY – where final property orders were made eight and a half years after the parties separated – where the net property of the parties was substantial – where the trial judge concluded that contributions should be assessed as equal – where the wife received a 10 per cent adjustment pursuant to s 79(4)(e) – whether the trial judge erred in failing to addback amounts received by the wife pursuant to interim orders – where the trial judge erred in failing to addback an amount expended by the wife on legal fees – Chorn and Hopkins (2004) FLC 93-204 considered – where the trial judge confused two well-established approaches to dealing with the wife’s paid legal fees – Omacini and Omacini (2005) FLC 93-218 considered – whether the trial judge erred in the assessment of contributions – where the husband sought to agitate on appeal an argument not agitated below – whether the trial judge erred in failing to make a splitting order – where the trial judge considered it just and equitable to maximise the amount of cash the wife would receive – where the trial judge was well aware of the effect of making a splitting order – whether the trial judge erred in the assessment of s 79(4)(e) – appeal allowed in part. |
| Family Law Act 1975 (Cth) ss 75(2), 79, 117 Federal Proceedings (Costs) Act 1981 (Cth) |
| Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337; [1981] HCA 1 Doolan, P., “Now you see it, now you don’t: notional property and add-backs in family law”, Families, broken, blended, mended: conference handbook: 13th National Family Law Conference |
| APPELLANT: | Mr Trevi |
| RESPONDENT: | Ms Trevi |
| FILE NUMBER: | MLC | 8475 | of | 2014 |
| APPEAL NUMBER: | SOA | 38 | of | 2017 |
| DATE DELIVERED: | 6 September 2018 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | Melbourne |
| JUDGMENT OF: | Alstergren DCJ, Murphy & Kent JJ |
| HEARING DATE: | 5 March 2018 |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 18 May 2017 |
| LOWER COURT MNC: | [2017] FamCA 321 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Mr Richardson SC and Ms Smallwood |
| SOLICITOR FOR THE APPELLANT: | N Lawyers |
| COUNSEL FOR THE RESPONDENT: | Mr Bartfeld QC |
| SOLICITOR FOR THE RESPONDENT: | Kennedy Partners |
Orders
The appeal be allowed.
Order (1) of the Orders made by the Honourable Justice Thornton on 18 May 2017 be set aside.
In the event that, consistent with the Reasons for Judgment of the Full Court delivered contemporaneously with these orders, the parties reach agreement as to the cash sum payable to the wife in consequence of the said order being set aside, they shall within twenty-eight (28) days of the date of this order, file by email with the Appeals Registrar signed minutes of consent.
In the event that signed minutes of consent are filed in accordance with the preceding order, the Appeals Registrar shall forward the minutes to this Full Court so as to consider the making of orders by consent in Chambers giving effect to the parties’ agreement.
In the event that the parties do not reach agreement as contemplated by Order (3), the question of whether the sum of $437,628 paid by the wife in legal fees should be “added back”, and the question of the cash sum payable by the husband to the wife accordingly, shall be addressed by the parties each filing within 42 days of the date of these orders:
(a)the agreed facts and written submissions confined to five typed pages so as to permit this Full Court to re-exercise the discretion vested in the trial judge in respect of the said sum; or
(b)in the alternative, the proposed terms of the order for remitter.
Pursuant to the provisions of s 117(1) of the Family Law Act 1975 (Cth) each party shall bear their own costs of and incidental to the appeal.
The Court grants to the appellant a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by the appellant in relation to the appeal.
The Court grants to the respondent a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act 1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent in respect of the costs incurred by the respondent in relation to the appeal.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Trevi & Trevi has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT MELBOURNE |
Appeal Number: SOA 38 of 2017
File Number: MLC 8475 of 2014
| Mr Trevi |
Appellant
And
| Ms Trevi |
Respondent
REASONS FOR JUDGMENT
ALSTERGREN DCJ
I agree with the reasons for judgment of Murphy J and with the orders which his Honour proposes.
MURPHY J
In November 2015, Thornton J commenced a property trial which continued over 13 days spanning almost 12 months. On 18 May 2017, some eight and a half years after the parties separated, her Honour made orders for settlement of property. The husband appeals those orders.
The parties have three children. At separation, they were aged 15, 13 and nine years. By the time of trial, two were adults and the youngest child was aged 17 years. Although separating in September 2008, the parties continued to live in the former matrimonial home; the husband in a “summer house” separate from the main residence and the wife and children in the main residence.
About six years later in 2014 the property was sold, after the parties had commenced living in separate residences. Her Honour found that “the wife was financially supported and maintained by the husband from his earnings generated by his personal exertion” during that six years (at [6]).
The husband is a very successful lawyer. At the time of trial he was earning about $30,000 per week. After taking account of the expenditure he asserted, he was left with a surplus of about $3,700 per week. Both during the marriage and the post-separation period, the wife assumed the role predominately of homemaker and parent. At the time of trial, she was studying and hoped to return to work upon completion of her studies.
The net value of the parties’ interests in property and the amount of their superannuation interests as found by her Honour was $8,133,553. In addition, an unencumbered real property was agreed to be sold, but for the purposes of the proceedings its value was agreed at $1,400,000.
Her Honour concluded that the contributions of the parties should be assessed as equal and that the wife should receive an additional 10 per cent of the property and superannuation interests when account was taken of s 79(4)(e) of the Family Law Act 1975 (Cth) (“the Act”) (i.e. “the s 75(2) factors”). The effect of the resulting 20 per cent disparity in the ultimate result sees the wife receiving property and superannuation of $5,720,132 and the husband $3,813,421; a disparity of nearly $2 million ($1,906,711).
Those findings were reflected in orders which, in substance, saw each of the husband and wife retain property in their respective names or possession (which, in each case, included an unencumbered home valued in the region of $2.5 million) and their respective member benefit entitlements in superannuation funds. The husband was ordered to pay the wife a cash sum of approximately $1.9 million.
The asserted errors and outcome of the appeal
The husband’s appeal focusses upon his assertion that her Honour erred in failing to “addback” and credit against the entitlement of the wife amounts received by her pursuant to earlier interim orders (Ground 1).
Other errors are asserted in her Honour’s assessment of contributions (Ground 2) and the s 75(2) factors (Ground 3). Ground 4 asserts her Honour erred by failing to make a superannuation splitting order. All of those grounds assert within them a failure to provide adequate reasons. The husband also challenges her Honour’s refusal to order that the husband have his costs of an interim hearing on 13 February 2015 (Ground 5).
In my view, her Honour erred in failing to addback as against the wife the approximately $437,000 expended by her on legal fees. I consider, with respect, that her Honour failed to consider a well-established guideline emerging from Chorn and Hopkins,[1] later to be discussed, and the relevant considerations underpinning that guideline, with the result that her Honour’s discretion miscarried. I consider that no such error attends her Honour’s refusal to addback the other claimed sums.
[1] (2004) FLC 93-204 (“Chorn”).
Further, and in effect alternatively, I consider respectfully that her Honour confused two well-established approaches to dealing with the wife’s paid legal fees as a claimed addback. More specifically, while purporting to treat the same as a matter relevant to s 75(2)(o), her Honour in fact applied considerations relevant to the adding back of the sum. The discretions relevant to each are illuminated by differing considerations and her Honour failed to consider matters relevant to the exercise of the discretion inherent within s 75(2) and the place of sub-paragraph (o) within that section. It follows that I also consider that her Honour erred in the assessment of the relevant s 75(2) factors and that her Honour’s reasons were inadequate to explain her refusal to addback the wife’s paid legal fees.
I am, then, persuaded of error in respect of Grounds 1 and 3.
I am not persuaded of error in the assessment of contributions. Nor am I persuaded that her Honour erred by failing to make a superannuation splitting order. Consequently, I consider that Grounds 2 and 4 fail. I am also not persuaded of error in respect of Ground 5 and, in my view, it too should fail.
The following are my reasons for the conclusions just outlined.
The “addback” issue
Each party contended at trial that significant sums expended by the other should be notionally “added back” to the parties’ existing property interests, and credited against the entitlement of the other party to existing property.
The wife claimed $587,032 should be added back against the husband. The relevant sums comprising that total did not include any amount for legal fees paid by the husband (at [26]). The husband claimed against the wife addbacks of $913,772 (at [36]) which included $437,628 in paid legal fees.
Her Honour determined to addback none of the sums claimed by either party (at [216]). The husband contends that her Honour erred in that respect. There is no cross-appeal by the wife.
The Context for the sums claimed by the husband
On 12 December 2014, a consent order was made which provided each of the parties with significant sums of money. Expenditure by each of the parties from those sums formed part of the respective addback claims. Subsequently, a further consent order made on 15 December 2015 (when the trial was adjourned part‑heard for five months) saw the wife paid a further $250,000.
The amount of $913,772 sought to be added back by the husband comprises amounts of $843,772 and $250,000 paid to the wife pursuant to those interim consent orders less an amount of $180,000 which the husband conceded at trial should not be added back.
Her Honour found at [206] that the claimed $913,772 comprised:
·$437,628 paid by the wife in legal fees;
·approximately $180,873 paid for repairs and renovations to her home;
·$25,949 paid toward the purchase of a new car; and
·a bank balance of $215,228.
There remained an unexplained amount of $54,094. Her Honour reduced that unexplained amount to $26,654 by accepting $1,440 in living expenses above the conceded $180,000 and by excluding the nearly $26,000 used to purchase the motor vehicle, which her Honour noted was already contained in the balance sheet at a value of $40,000. It is properly conceded by Queen’s Counsel for the wife that her Honour erred in doing the latter. The consequence is that $52,654 remained as unexplained expenditure by the wife. In the circumstances of this case, including the amounts available to be spent and the amounts actually spent, set against the background of property proceedings not being in the nature of an audit, that amount is not material to the instant issues.
At the hearing of the appeal, it was properly conceded by Senior Counsel for the husband that the correct asserted addback figure should be reduced by the $215,228 referred to above because that sum comprised part of the parties’ interests in property at trial and to seek it as an addback was to double count it.[2]
[2] Appeal Transcript, 5 March 2018, p 4 ln 1–5.
The arguments on the appeal centre on her Honour refusing to addback the $437,628 in legal fees and the $180,873 in repairs and renovations to the wife’s home. The amount spent by the wife on legal fees was the primary focus of the arguments advanced at the hearing.
The $437,628 spent on legal fees by the wife compares with legal costs incurred by the husband of $142,587 comprised essentially of counsel’s fees. The husband is an equity partner at N Lawyers. His firm represented him and the preparation for trial and the attendant legal work was conducted in-house. Fees have been attributed to him within the firm and designated as payable. In a finding not challenged on appeal, her Honour found “there is no clear evidence that the husband will ever have to pay his legal fees” (at [424]).
Her Honour found that the husband’s costs were met from his income, which included income from investment properties and $30,000 met from interest on his investment of his share of the sale proceeds of the home (at [420]; [199]).
Guidelines for adding back to the property available at trial
(a) Dissipation of property and expenditure other than on legal fees
The Full Court held in Omacini and Omacini[3] that addbacks fall into “three clear categories”: where the parties have expended money on legal fees; where there has been a premature distribution of matrimonial assets; and “waste” or wanton, negligent, or reckless dissipation of assets.[4]
[3] (2005) FLC 93-218 (“Omacini”).
[4] Omacini at 79,617 [30], referencing in particular Kowaliw and Kowaliw (1981) FLC 91-092 (“Kowaliw”); Townsend and Townsend (1995) FLC 92-569 (“Townsend”).
However, the Full Court also made it clear that an addback does not necessarily occur whenever “a party has expended money realised from the disposition of assets that existed as at the date of separation”, the Full Court describing such a proposition as “unduly simplistic”.[5] An earlier Full Court made the same point, saying that adding back is “the exception rather than the rule”.[6]
[5] Omacini at 79,619 [39].
[6]Cerini & Cerini sub nom C & C [1998] FamCA 143 (“Cerini”) at [46].
The fundamental precept that addbacks are exceptional, reflected in the decisions just referred to, also mirrors what has been said in earlier decisions of the Full Court that, for example, “the Family Court must take the property of a party to the marriage as it finds it”[7] at trial. An important parallel proposition is that the parties do not “go into a state of suspended economic animation” after separation.[8] Thus, reasonably incurred expenditure does not usually come within accepted categories of addback.
[7] Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337 at 355. See also, Stanford v Stanford (2012) 247 CLR 108.
[8]Marker & Marker sub nom M & M [1998] FamCA 42 at [2.11].
Two fundamental premises emerge from Omacini and the authorities preceding it. First, “adding back” is a discretionary exercise. When the discretion is exercised in favour of adding back, it reflects a decision that, exceptionally, in the particular circumstances of a case, justice and equity requires it. The second premise is its corollary: in cases that are not “exceptional” justice and equity can be achieved, not by adding back, but by the exercise of a different discretion – usually by taking up the same as a relevant s 75(2) factor. Indeed, it has been said that the latter is “a course which is, perhaps, technically more correct” than adding back to the list of existing interests in property.[9]
[9] Line and Line (1997) FLC 92-729 at [4.72] as quoted in Chorn at 79,317 [38] (noting that, at [4.71], legal fees were said, in obiter, to be different and there is reference to the “notional property” approach). It has also been said that premature expenditure might be taken up in the assessment of contributions, for example by a party making a disproportionately greater indirect contributions to the existing property by reason of other property having been dissipated (see, Watson & Ling (2013) FLC 93-527 at 86,924 [33]).
(b) Expenditure on Legal Fees
To the considerations just discussed must be added the propositions emerging from authority that paid legal fees as a category of addback is imbued with considerations specific to that expenditure. The Full Court said in Chorn:
56.In summary, we consider that the above mentioned decisions of the Full Court establish that, while the treatment of funds used to pay legal costs remains ultimately a matter for the discretion of the trial Judge, in determining how to exercise that discretion, regard should be had to the source of the funds.
57.If the funds used existed at separation, and are such that both parties can be seen as having an interest in them (on account, for example, of contributions), then such funds should be added back as a notional asset of the party, who has had the benefit of them.
58.If funds used to pay legal fees have been generated by a party post‑separation from his or her own endeavours or received in his or her own right (for example, by way of gift or inheritance), they would generally not be added back as a notional asset; nor would any borrowing undertaken by a party post-separation to pay legal fees be taken into account as a liability in the calculation of the net property of the parties. Funds generated from assets or businesses to which the other party had made a significant contribution or has an actual legal entitlement may need to be looked at differently from other post‑separation income or acquisitions.
Those passages can be seen as an attempt to establish “guidelines”,[10] undertaken after a detailed examination of earlier authorities,[11] for the treatment of paid legal fees within s 79 proceedings. There can be little doubt that the statements made in that case have been applied by trial judges ever since.
[10] See, the comment to that effect in the earlier decision of Browne v Green (1999) FLC 92-873 at 86,360 [44].
[11] Chorn at [32] – [55] referencing: Farnell and Farnell (1996) FLC 92-681; Line and Line; A and A (unreported, 23 December 1997, Lindenmayer, Kay & Dessau JJ); Marker & Marker sub nom M & M [1998] FamCA 42; DJM v JLM (1998) FLC 92-816; C v C (1998) FLC 92-824; Ibrahim and Beavis [1999] FamCA 765; Gartner & Gartner [2000] FamCA 793; Clifford and Lodge [2000] FamCA 1666; Finlayson v Finlayson and Gillam (2002) FLC 93-121.
The word “guidelines” is used advisedly so as to distinguish the same from “binding principles of law”.[12] The distinction is important. Failure to follow a binding principle of law is an error of law. By contrast, the failure of a trial judge to follow a guideline:[13]
…does not of itself amount to error, for it may appear that the case is one in which it is inappropriate to invoke the guideline or that, notwithstanding the failure to apply it, the decision is the product of sound discretionary judgment. [However] [t]he failure to apply a legitimate guideline to a situation to which it is applicable may … throw a question mark over the trial judge’s decision and ease the appellant’s burden of showing that it is wrong…
[12] See, Norbis v Norbis (1986) 161 CLR 513 (“Norbis”) at 520 (Mason & Deane JJ); at 537-8 (Brennan J); Mallet v Mallet (1984) 156 CLR 605 at 608-9 (Gibbs CJ). See also, the discussion in Hoffman & Hoffman (2014) FLC 93-591 at [21]–[44].
[13] Norbis at 520 (Mason & Deane JJ).
The guidelines emerging from Chorn should be read together and read conformably with the Full Court authorities upon which they are based. That being so, the delineations there referred to — “the funds used existed at separation … such that both parties can be seen as having an interest in them”; or “funds used to pay legal fees have been generated by a party post-separation from his or her own endeavours” or received by a party “in his or her own right (for example, by way of gift or inheritance)” - cannot be seen as determinative of the exercise of discretion but, rather, as informing it.
Again, the matters just referred to have important ramifications in an appellate context. They may ease the appellant’s burden of showing that “although the nature of the error may not be discoverable … a substantial wrong has in fact occurred”,[14] or that the decision is “plainly wrong, [the] decision being no proper exercise of [the] judicial discretion”.[15] Equally, they may ease the burden of establishing that irrelevant considerations have been taken into account or that relevant considerations have not been taken into account.
[14] House v The King (1936) 55 CLR 499 at 505 (Dixon, Evatt and McTiernan JJ).
[15] Gronow v Gronow (1979) 144 CLR 513 at 519 (Stephen J).
Paid legal fees occupy a particular position in the consideration of addbacks by reason of s 117(1) of the Act; a matter not relevant to any other form of expenditure or dissipation of property the subject of an addback claim.
An order failing to addback legal costs is a pre-emptive decision about one party paying the other’s legal costs. The statutorily prescribed default position is that neither party pays all or some of the other party’s costs.[16]
[16] Family Law Act 1975 (Cth) s 117(1).
If, contrary to the demands of that section, there is to be a payment of costs, the award is dependent upon a finding of justifying circumstances which, in turn, is dependent upon (non-exhaustive) considerations all of which are informed by antecedent events - for example, whether one party has been “wholly unsuccessful” and “the conduct of the parties to the proceedings”.[17] An award of the costs of trial, if any, is in the usual run of events made after the respective entitlements of the parties to a settlement of property have been assessed and, importantly, any awarded costs are paid from the assessed entitlement to property received by the paying party.
[17] Family Law Act 1975 (Cth) s 117(2A), specifically sub-paragraphs (e) and (c), respectively.
As has been said, legitimate guidelines “guide the exercise of a discretion”; they do not replace it.[18] Guidelines, must “[preserve], so far as it is possible to do so, the capacity … to do justice according to the needs of the individual case”.[19] The decision to addback or not addback paid legal fees remains a matter of discretion. But, a finding that it is just and equitable to not addback an amount of legal fees so paid is a finding that it is just and equitable for the other party to contribute to the costs of the first party in that proportion as part of an overall assessment of the justice and equity governing their property division.
[18] Norbis at 537 (Brennan J); 519-520 (Mason & Deane JJ).
[19] Norbis at 520 (Mason & Deane JJ).
The considerations just referred to are plainly always important and central to the exercise of that discretion in respect of paid legal fees.
The passages from Chorn, quoted above, draw a distinction between legal costs met from property that would otherwise be available at trial and legal costs met from funds “generated by a party post-separation from his or her own endeavours or received in his or her own right (for example, by way of gift or inheritance)”. The proposition there advanced, that such expenditure “would generally not be added back”, also needs to be seen as a guideline informing the relevant discretion rather than determining it. A further distinction is suggested in Chorn between funds generated in that manner and “[f]unds generated from assets or businesses to which the other party had made a significant contribution or has an actual legal entitlement”.
The latter suggestion recognises the discretion inherent in the task and also, perhaps, that in the particular circumstances of a case, adding back sums generated post-separation in the different manners suggested might create injustice as much as it might cure it.[20]
[20] See, Doolan, P., “Now you see it, now you don’t: notional property and add-backs in family law”, Families, broken, blended, mended: conference handbook: 13th National Family Law Conference, p 255 at [2.3]ff. The paper itself provides examples of the potential injustice and inequity that can occur by a strict adherence to the “source of funds” distinction referred to in Chorn.
The impact in dollar terms of the refusal to addback
Before turning to consider whether discretionary error is established in respect of the refusal to addback the claimed sums in the instant case, I consider it important to record the impact in dollar terms of her Honour’s finding in respect of legal fees.
The value of the parties’ interests in property and superannuation as found by her Honour is $9,911,087. If the $437,628 in paid legal fees is added back, the total becomes $10,348,715. The wife’s 60 per cent entitlement equates to $6,209,229 which is reduced by the $437,628 paid in legal fees. Her entitlement becomes $5,771,601. The husband’s 40 per cent entitlement becomes $4,139,486.
The result is that the husband would receive about $175,000 more than his existing entitlement. Of course, that calculation assumes that the husband’s payment of legal fees from income is not treated in the same way as the wife’s legal fees and added back.
The Trial judge’s reasons with respect to addbacks
In Stanford v Stanford,[21] the High Court emphasised as fundamental that a consideration of whether it is just and equitable to make a property settlement order begins by “identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property”.[22]
[21] (2012) 247 CLR 108 (“Stanford”).
[22] Stanford at 120 [37] (emphasis in original) (French CJ, Hayne, Kiefel and Bell JJ).
The essence of a claim for addbacks is that the asserted sum/s should be added to the value of the existing property interests of the parties and, subsequent to the assessment of contributions, credited to the spending party as part of the value of their assessed entitlements. Doing so does not offend what was emphasised by the High Court. Adding back does not seek to create property interests that do not exist. Rather, doing so emphasises that satisfying the respective requirements of ss 79(2) and (4) of the Act to do justice and equity can require an “accounting” or “balance sheet” exercise for the purposes of s 79(2) and (4), so as to include the value of the dissipated property or expended sums within the total value of the parties’ existing interests in property, and to credit the value of same against the assessed entitlement of the dissipating or spending party.[23]
[23] See, eg, Bevan & Bevan (2013) FLC 93-545 at [79]; Vass & Vass (2015) 53 Fam LR 373 and pre‑Stanford statements to similar effect in Milankov & Milankov (2002) FLC 93-095.
Her Honour adopted that approach when addressing the issue of the parties’ existing interests in property. In doing so, her Honour rejected both parties’ claims that the respective asserted sums should be added back:
211. Since December 2014 the husband has had the benefit of the parties’ income from investment properties purchased during the marriage. On the husband’s evidence in his latest Statement of Financial Circumstances the income from the investment properties is approximately $239,824 per annum but this includes properties purchased after separation.
212.The benefit to the husband from this income has not been quantified and the income is obviously used to service mortgages and other expenses for the investment properties and the income received may have been different historically. However there was nevertheless some benefit to the husband
213.I have taken into account the balance in the bank accounts of both parties as part of the joint non-superannuation property of the parties.
214.It is impossible to carry out a dollar for dollar accounting reconciliation given the period of time since the various payments were made and there is no evidence of the benefit of the investment property income received by the husband. In these circumstances it is not appropriate to include a notional amount in the joint non-superannuation property pool for the balance of the payments received by the wife which is not accounted for in her bank accounts, and which in fact does not exist. For the same reasons, I am also not satisfied that this is a fact or circumstance which the justice of the case requires to be taken into account under s 75(2)(o) of the Act. Accordingly I do not propose to characterise the “adjustments” amounting to $913,772, sought by the husband as a part property settlement to the wife and I do not propose to include that amount in determining the non-superannuation assets of the parties.
215.I note that the wife has paid legal fees from the money she received from joint property and this is considered and referred to later in these reasons as a factor under s75 (2)(o) of the Act.
Among other matters later to be discussed by reference to other grounds of appeal, three matters relevant to the instant addback issue arise.
First, those passages constitute the totality of the reasons for refusing the asserted sums being added to the value of the parties’ property interests as part of her Honour considering that issue. Secondly, a distinction is drawn between the asserted addback for paid legal fees on the one hand and the balance of the respectively claimed expenditure on the other. Thirdly, her Honour expressly finds not only that the $437,628 in paid legal fees should not be added back but that the same should be considered by reference to s 75(2).
An error of approach evident in the Trial judge’s reasons
As the quoted passages of the reasons suggest would occur, her Honour returned to the issue of the wife’s paid legal fees. Much later in the reasons, under the heading “Assessment and quantification of s79(4)(d)-(g) factors” (at [393] – [407]), her Honour considered the paid legal fees under the specific heading, “Section 75(2)(o)) Paid legal fees” (at [408] – [421]).
However, despite that heading, and despite its inclusion within the broader discussion of the s 75(2) factors, the discussion of paid legal fees is not related to the place of paid legal fees within a broad assessment of the relevant s 75(2) matters at all but, rather, is entirely redolent of adding back the legal fees to the pool of assets.
Her Honour commences that discussion with reference to the decisions of the Full Court in Chorn and Calder & Calder[24] and what those decisions have to say about how the different sources for the payment of legal fees might impact upon the decision to addback, or not addback, to the pool of assets (at [408] – [421]). Her Honour referred to Chorn as “affirming that whether to take into account payment of legal fees is a matter of discretion” (at [414]) and quoted the Full Court saying that it is necessary to “consider when and how the funds used to pay the fees have been accumulated”.[25] Her Honour then quoted the well-known guidelines from that judgment which I have earlier set out.
[24] (2016) FLC 93-691 (“Calder”).
[25] Chorn at 79,320 [49].
That discussion does not admit of any matters relevant to the exercise of the s 75(2) discretion and relates entirely to a separate discretion, that of adding back the paid legal fees to the pool of assets. There then follows, under the heading “Conclusion about whether an ‘adjustment’ should be made for the legal fees paid”, three paragraphs in which, as the heading suggests, her Honour expresses her conclusions:
422.The source of the funds paid by the wife for her legal fees of $437,628.10 was the proceeds of sale of the [former matrimonial home].
423.The source of the husband’s legal fees, of which he has paid approximately $142,587, is his income and the income from the $812,172.62 which he received from the proceeds of sale of [the former matrimonial home]. The husband’s income also included the rent received from investment properties purchased by the parties during the marriage.
424.In both Calder & Calder and Chorn & Hopkins the Full Court affirmed that whether to take into account legal fees is a matter of discretion. This is an unusual circumstance where the wife was obliged to pay her legal fees of $437,628.10 whilst the husband, who is a solicitor, had the advantage of not being required to pay all of his legal fees other than approximately $142,587 which he has paid. Where there is no clear evidence that the husband will ever have to pay his legal fees, these are unusual facts which the justice of the case requires to be taken into account under s 75(2)(o) of the Act. In the unusual circumstances of this case and notwithstanding that the source of the funds paid by the wife for her legal fees was from joint property, I accept the submissions of counsel for the wife and do not propose to make any “adjustment” to the pool for the funds which the wife has spent to pay some of her legal costs.
(Emphasis added)
It can be accepted that, for better or for worse, the expression “adjustment” is used almost ubiquitously by trial judges so as to describe the superadding of the s 75(2) assessment to the assessed contributions. However, I am unable to read her Honour’s reference to “adjustment” as having that meaning.
In my respectful view, her Honour’s reasons evidence a confusion between two different approaches to the question of money expended on legal fees from property that would otherwise form part of the existing interests in property available for division between the parties.
That confusion might be expressed as her Honour undertaking what should occur at “stage one” rather than “stage three” of the often-cited “four-step process” involved in s 79 proceedings.[26] The failure to comply with the so-called four‑step process is not a legal requirement which results, of itself, in error.[27] However, error arises in my view because different discretions, informed by different considerations, are involved in the different approaches dealing with paid legal fees.
[26] See, eg, Omacini at [46].
[27] See, Norman & Norman [2010] FamCAFC 66 at [59] – [61].
The application of a discretion in deciding whether to follow a guideline in adding back the value of paid legal fees to the value of existing interests in property, involves a different discretionary task to the consideration of the same as but part of an overall assessment of all relevant s 75(2) factors. In a particular case, considerations relevant to the discretion to apply or not apply an established guideline may overlap with, or also be relevant to, considerations relevant to the s 75(2) discretionary task, but reasons must make clear that a separate discretion is being exercised and how identified matters are considered to be relevant to either or both.
I consider, respectfully, that her Honour fails to make that distinction. There is, in my view, an error of approach which has in turn led to discretionary error as I will now seek to explain.
Discretionary error in failing to addback legal fees
Ground 1 asserts in terms:
The trial judge was in error in failing to include in the balance sheet of net assets an amount of $913,722 paid to the [wife], pursuant to orders made on 12 December 2014 and 15 December 2015 or at least some of that amount and in doing so:
a)her Honour’s discretionary determination and hence the order was manifestly unjust;
b)her Honour errer [sic] by mistaking the facts in concluding that the [husband] received the benefit of income from investment property; and
c) her Honour errer [sic] in principle by failing to provide adequate reasons.
The written Revised Summary of Argument filed on behalf of the husband asserts:
14.The approach of the trial Judge to determining the legal costs issue was erroneous in that she approached the issue by comparing the situation of the two parties (regarding payment of costs), rather than applying the clear principles set out in Chorn v Hopkins to each of the parties separately.
(Emphasis added) (Footnotes omitted)
If it is thereby suggested that a failure to addback the legal fees is an error of principle (as distinct from the failure to follow a guideline), the submission must be rejected for the reasons already discussed. Similarly, I see no error of itself in the comparison of “the situation of the two parties” as a factor informing the relevant discretion. That is, the consideration is not of itself an irrelevant consideration; the comparison may be relevant to the exercise of a discretion founded in doing what is just and equitable in the circumstances of a particular case.
However, Senior Counsel for the husband’s oral submissions do not appear to go as far as what the terms of Ground 1 and the written Revised Summary of Argument suggest. Rather, they focus upon her Honour’s approach and what, separately, is contended to be her Honour taking account of irrelevant considerations.
Her Honour acknowledged, having quoted Calder, that “the purpose of adding back funds expended on legal costs is to ensure that one party does not pay the other party’s legal costs in the absence of an order [presumably, for costs]” (at [413]). Having recognised that purpose and the guideline emerging from Chorn (albeit not in those terms), the question which arises necessarily is what considerations informed her Honour’s discretion in refusing to apply that guideline?
I am unable to see where, having acknowledged this centrally important consideration, her Honour raises or analyses any considerations that point to the discretion being exercised in a manner contrary to a well-established guideline.
The matters referred to by her Honour at [214] quoted above are directed to the wife’s expenditure of funds otherwise than on legal fees and cannot in my view be seen as relevant to the question of the addback of legal fees — for example, there has, in fact, been a “dollar for dollar accounting” of the amounts expended on legal fees.
Queen’s Counsel for the wife accepted, properly as it respectfully seems to me, that the “sole matter” which her Honour took into account in refusing to addback was the “unusual” fact that the husband’s legal fees were (as her Honour found) absorbed in-house and his costs were effectively restricted to outlays, predominantly it seems, counsel’s fees.[28] The written submissions filed on behalf of the wife before this Court refer to the likelihood that the husband would not, on her Honour’s finding, need to pay any further legal fees,[29] and reiterates the finding as to “unusual circumstances”.
[28] Appeal Transcript, 5 March 2018, p 37 ln 19–24; Reasons at [410].
[29] Wife’s Summary of Argument filed 21 February 2018 at paragraphs 15 and 17.
I am unable to see how those matters impact upon the discretion in not following an established guideline or, more broadly, how they are relevant to the justice and equity of not adding back approximately $437,000 in legal fees.
Equally, I am unable to see where or how her Honour has considered the fact that not adding back has the effect of having the husband meeting 60 per cent of the wife’s (indemnity) costs in arriving at a decision that is just and equitable. The consideration is, in my view, highly relevant to that ultimate decision. Nor, in my view, has her Honour considered the dollar impact of failing to addback that sum and the consequential impact on the dollar value of the parties’ contributions assessed in percentage terms.
In my opinion, the matters just referred to lead to the conclusion that her Honour’s discretion has miscarried. So, too, those same matters lead to my conclusion that her Honour’s reasons were, with respect, inadequate in that respect.
The “sole matter” informing the decision to not addback emerges as the same sole matter in her Honour’s purported consideration of the wife’s paid legal fees as a relevant s 75(2) factor. Again, I am respectfully unable to see how that factor, notably expressed as a reason for not adding back the fees, is relevant to the s 75(2) analysis. Rather, that analysis revolves around a consideration of the fact that the wife would not have to meet that large sum from her entitlement emerging from the assessment of equality of contributions whereas the husband would, by contrast, be contributing one-half of the wife’s indemnity costs from his contributions entitlement, having paid such legal fees as he had from income.
In my view, her Honour’s confusion as to the approach to the wife’s paid legal fees led to her Honour taking into account irrelevant considerations in her s 75(2) assessment and, concomitantly, failing to take account of relevant considerations.
No discretionary error in failing to addback the remaining sums
The statement made by the Full Court in Cerini earlier quoted, pertains to the husband’s assertion that her Honour erred in failing to addback the remaining claimed sums. That statement occurs with a further statement by the Court that “[t]he parties are entitled to reasonably conduct their affairs post-separation in a manner that is consistent with properly getting on with their lives”.[30]
[30] Cerini at [46].
The wife here did not “distribute to [her]self an asset in which the [husband] had a legitimate interest”[31] such that treating the conduct as a matter to which regard should be had under s 75(2), rather than adding it back, is unjust. Nor did she embark upon “a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets”.[32] Nor can I see it asserted that she “acted recklessly, negligently or wantonly with matrimonial assets”.[33]
[31] Townsend at 81,654 [30].
[32] Kowaliw at 76,644.
[33] Kowaliw at 76,644.
Her Honour’s findings at [214] embrace those sentiments. The amounts spent on the wife’s home were, her Honour found, not capable of a dollar for dollar “accounting reconciliation”. Nor in light of the principles just referred to should they have been.
The husband argues that her Honour did not explain why this sum was treated any differently to the distribution which was used to purchase the wife’s home. I agree with the submissions of Queen’s Counsel for the wife that her Honour did not need to. If expenditure in respect of a home (which the earlier distribution was intended to provide) was to be seen as unreasonable for someone getting on with their post‑separation life, it would, in the absence of any other evidence, lie (or at least lie predominantly) in any difference between the purchase price of the home and its post-renovation and post-repair value. Her Honour noted that the husband had the opportunity to put evidence before the Court as to those values and chose not to do so.
As a consequence, I am unable to see any injustice or inequity in, unexceptionally, failing to addback any of that sum and nor am I persuaded of any discretionary error in failing to do so. I have already indicated that I regard the unexplained expenditure of approximately $50,000 in the same vein.
Her Honour’s reasons on the topic are, it should be conceded, brief (notwithstanding the overall length of the judgment). However, where adding back is the exceptional course, and her Honour had determined to not add the sums back, the totality of her Honour’s reasons seen in the circumstances of the case are adequate to explain her Honour’s conclusions.
Finally, it is contended that her Honour erred by mistaking a material fact, namely in effect according to the husband a benefit from investment income when any such income was negatively geared with the asserted effect that the husband had no such benefit.
I am not persuaded that the premise for the contention is made out. In my view, the assertion of material error of fact depends upon an interpretation of what her Honour found at [211] and [212] that is not reasonably open to the husband. Taken together, her Honour’s findings are that, although there is income in the amount found, the negative gearing strategy employed and the absence of evidence as to the relevant expenditure and taxation advantages resulting, made it impossible for the true benefit to the husband, if any, to be established. That finding, seen in that way, was in my view entirely open to her Honour.
In any event, the submission, and the materiality of any error of fact, if it be an error of fact, needs to be seen against the uncontroversial fact that whatever might be the form and sources of the husband’s income and whatever might be the form and sources of expenditure, the husband had, on his own case, a surplus of income over expenditure of approximately $3,700 per week.
Even if there be an error of fact as asserted, which I do not accept, I am unable to see how any such error is material to her Honour’s conclusions.
The Contributions Issue
Despite the terms of Ground 2, Senior Counsel for the husband informed the Court that we could “assume that [he had] narrowed and simplified the argument down from what was contemplated by the ground as drafted”.[34] At trial, the wife contended that contributions should be assessed as equal. The husband asserted they should be assessed at 60 per cent to him and 40 per cent to the wife. Before this Court, the husband’s Senior Counsel conceded that “we don’t have proper argument with her Honour up until looking at it from 2008 onwards”.[35] With respect, that concession seems to me to be appropriately made.
[34] Appeal Transcript, 5 March 2018, p 33 ln 8–9.
[35] Appeal Transcript, 5 March 2018, p 17 ln 22–23.
That concession manifests in a submission that: “I’m running his argument now only focusing from [separation in] 2008 so it would be a lesser disparity. At a high point I would put it at 55/45 presently on that argument”.[36] No such submission was made at trial.
[36] Appeal Transcript, 5 March 2018, p 17 ln 14–16.
The difficulty created for the husband by authorities such as Water Board v Moustakas[37] and Metwally v University of Wollongong,[38] is sought to be met by asserting that the submissions relate to a matter of law — or, perhaps more accurately, a conclusion as to a legal result — and are not caught by the principle that a party cannot advance on appeal a case not agitated below. I respectfully disagree. The argument on behalf of the husband is in my view a “new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had an opportunity to do so”.[39]
[37] (1988) 180 CLR 491.
[38] (1985) 60 ALR 68 (“Metwally”).
[39] Metwally at 71. See also, to similar effect: Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438; O'Brien v Komesaroff (1982) 150 CLR 310 at 319; Coulton v Holcombe (1986) 162 CLR 1; Whisprun Pty Ltd v Dixon (2003) 200 ALR 447 at [51].
In reality, the submission seeks to have this Court provide a second opinion as to a conclusion reached by her Honour based on an argument with a different emphasis, or an additional or different focus, than that which was run below. That is not a foundation for a finding of appealable error unless it can be concluded by this Court that her Honour’s assessment was “plainly wrong”.[40] In that respect, the submission must be that an exercise of a wide discretion with equality as its result is plainly wrong, but an assessment of 55 per cent / 45 per cent is not. Manifestly, without more, no such conclusion can be sustained.
[40] See, House v The King. See also, Sharman v Evans (1977) 138 CLR 563 and the authorities otherwise cited in Rodgers & Rodgers (No 2) (2016) FLC 93-712.
Further I consider that, in any event, the argument’s central contentions, based on the differing circumstances delineated by separation and the manner in which the parties’ differing contributions were made thereafter, ignores important contributions evident on her Honour’s findings which the wife continued to make after 2008 notwithstanding the parties’ separation, and indeed after December 2014 when the former matrimonial home was sold and “[w]hat was loosely referred to in the trial as ‘a financial separation’ of the parties occurred”.[41]
[41] Reasons at [71].
By 2008, the parties had co-habited for about 19 years. Their three children were then aged 15, 13 and nine years. The roles accorded to each other by the husband and wife during that 19 year period were, respectively, as a professional earning a very high income and as a homemaker and parent. During that 19 years of marriage, the husband became a partner in a law firm in 1997 and a full equity partner in 2004.
It is uncontroversial that the husband worked long hours to produce the very significant income which he earned, and that the wife’s contributions were made within that context. At trial, a number of competing assertions were made by each of the parties about details of their respective contributions within their respective roles which her Honour’s reasons traverse in significant detail. Importantly, it is now conceded, they should be seen as equal.
In the period between separation in 2008 and 2014, it is uncontroversial that the parties’ finances remained intermingled and that the husband supported the wife and children comprehensively, but broadly in the manner that had occurred prior to separation. Intermingling of the parties’ financial affairs occurred until the making of the first of the consent orders, previously referred to, in 2014. That is, the intermingling occurred for the vast majority of the eight and a half year period between separation and trial upon which Senior Counsel for the husband now places emphasis.
It is contended that, post-separation, the nature and degree of household services performed by the wife in her role as a homemaker were not provided to the husband and that he attended to them for himself. The husband left the summer house in June 2011. The three children of the marriage continued to reside with the wife, despite the separation of the parties, until early 2013 when the eldest child, then 19 years, commenced residing with the husband. In October 2014 - that is to say some six years after the parties had separated and over three years after the husband left the summer house - the parties’ second eldest child, then aged 21 years, commenced residing with the husband. At about that time the parties’ youngest child, then aged 15 years commenced living for approximately equal amounts of time with each of the husband and wife.
It can be seen, then, that not only did the wife’s role continue over approximately 25 years until the youngest child left the former matrimonial home and commenced living equally with his parents, but the wife carried out that role without the assistance which the husband himself said he provided during the marriage outside of his long working hours.
Separation almost inevitably brings about a change to the manner in which the roles that the parties have accorded to each other during the course of their relationship have manifested in contributions by each of them. Almost always, for example, the financial arrangements and support change and contributions in all forms that each of the parties make for and to each other also change. However, the fact that the roles of the parties change in their nature - including, in this case, in the manner just described - does not necessarily result in the contributions of one party being assessed as greater than the other.
Not only must contributions of all types be considered over the whole of the time up to trial, but also the post-separation period can see contributions of a type made during the marriage become more onerous. For example, homemaker and parent contributions made within a household comprising the marriage partners and children which are made by one party after separation may be more extensive.
I consider that the husband seeks to agitate impermissibly an argument not agitated below.
In any event, in respect of what appear to be the specific discretionary errors asserted, namely inadequate reasons or failure to take into account or properly assess the parties’ post-separation contributions, I consider that her Honour properly considered all aspects of the parties’ respective contributions over the whole of the period between cohabitation and trial. Even were the husband entitled to raise now the matters which he does, I am not persuaded of error.
The Superannuation Issue
It is convenient to deal with Ground 4 before Ground 3 as the issues relevant to same also impact upon arguments relating to the s 75(2) issue the subject of Ground 3.
Superannuation interests are to be treated as property for the purposes of s 79 proceedings.[42] However, while the interests remain subject to future vesting events, they are of a different nature and have different characteristics to interests in property. The latter might be preserved, but they might also be traded or capitalised; the former may not be traded or capitalised prior to a vesting event. As a result, effecting justice and equity in the making of appropriate s 79 orders can require an imbalance in the proportion of superannuation interests and property interests comprising one party’s s 79 entitlement when compared with the other.
[42] Family Law Act 1975 (Cth) s 90MS.
A failure to consider that relevant matter is said to be an error by her Honour and is the subject of Ground 4. That ground asserts specifically:
The trial Judge failed to make a splitting order of the superannuation interests in cicrumstances [sic] where:
a)her Honour failed to consider the effect of a splitting order, or the failure to make a splitting order, on the parties as a matter relevant to her determination of s 75(2) factors;
b) her Honour failed to give adequate reasons; and
c) it was manifestly unjust not to do so.
Senior Counsel for the husband points out that the findings as to the member benefit entitlements in the joint fund exceed the $444,829 said to be the aggregate of those benefit amounts. Her Honour’s figures are said to be referenced to Exhibit 11 in the trial. No clarification of the figures was provided during the appeal.
Senior Counsel for the husband contends that the effect of her Honour’s orders was that the husband needed to find approximately $250,000 more than if her Honour had made a splitting order consistent with the overall findings that the wife should receive 60 per cent of the assets and the husband 40 per cent. That finding has its converse, namely that the wife would have received about $1.67 million in cash rather than approximately $1.91 million.
It is said that, consequently, her Honour’s finding that the wife has a “need for money now” is “inexplicable”[43] because the wife is, in fact, receiving a substantial sum of money now, albeit approximately $250,000 more than she would have received had the splitting order been made.
[43] Husband’s Revised Summary of Argument filed 6 November 2017 at paragraph 55.
At [442] and [443] of the reasons, her Honour, uncontroversially for the purposes of this appeal, found that the respective superannuation interests of the parties consisted of $2,352 in the wife’s fund and $103,242 in the husband’s fund. Both parties had amounts in a joint fund. Exhibit 10 in the proceedings revealed that the wife’s benefit amount was $73,635 and the husband’s was $407,024.
The effect of her Honour’s order was to have the wife roll out her benefit in the joint fund so that her total superannuation entitlement became approximately $76,000 with a consequent result that the husband retain his superannuation interests in a total amount of $473,071 (at [456]).
The husband’s challenge has four elements:
·First it is said that “once there is an issue as to whether superannuation should be split or not, that needs to be resolved before [the court] resolve[s] section 75(2) conclusions”;[44]
·Secondly, it is said that the husband “would have been left to find $254,000-odd dollars less in terms of meeting the cash adjustment”;[45]
·Thirdly, the failure to consider that asserted relevant consideration is said to gain force by a matter not considered by her Honour, namely, the failure to take up the asserted addbacks, and in particular the wife’s paid legal fees, as part of her s 75(2) considerations; and
·Fourthly, it is said that the present value of the future capital sum owing to the husband was taken into account as part of the assets of the parties, in which, axiomatically, the wife shared, but its non-receipt until retirement was not taken up; that too bearing upon the cash that the husband would immediately need to find if no superannuation split was ordered.
[44] Appeal Transcript, 5 March 2018, p 31 ln 6–7.
[45] Appeal Transcript, 5 March 2018, p 31 ln 10–12.
There is no doubt that her Honour was aware of the difference in cash payment by the husband to the wife effected by a superannuation split and, conversely, the impact of failing to make any such splitting order:
450.The difference in approach to superannuation between the parties is about the mechanics of the orders to be made. On the wife’s proposal the husband will need to find more cash to make a payment to the wife rather than rolling over some of his benefit in the superannuation from the [Trevi] Family Superannuation Fund.
451.However taking account of the disparity of income earning capacity between the parties which I have outlined and their respective ages I am satisfied that it is just and equitable for each party to retain the funds in their respective superannuation funds and for the wife’s benefit in the [Trevi] Family Superannuation Fund to be rolled over to a complying superannuation fund of her choice. This will result in the husband paying a greater cash payment to the wife, however I accept the submission made on behalf the wife that she needs the money now given the difficulties surrounding her income earning capacity rather than in the future when she becomes eligible for a superannuation payment.
Later, her Honour makes reference to the specific sum involved in examining the justice and equity of the orders that her Honour proposed making.
At [442], her Honour records that “[t]he closing submissions about superannuation became confused when the husband indicated a change in his proposal regarding the [joint] Superannuation Fund”. There can be little doubt that her Honour is correct in that conclusion.
I am not persuaded that her Honour’s finding at [451] to which Senior Counsel refers, should be read in the manner contended. It is true that her Honour’s conclusion is based, in part, on a conclusion that the wife “needs the money now” but seen in its proper context the finding is, in our view, plainly to the effect that her Honour considered it just and equitable to maximise the amount of cash the wife had “now”.
In particular, her Honour at [433] had made reference to evidence given by the husband that “if I need another million dollars I will just work for another year”. The husband said, in answer to a question pertaining to receipt of money by him pursuant to an early retirement scheme which he described as a “myth” that:[46]
…If I needed a million dollars today to repay some debt, as you postulated, I wouldn’t rely on the scheme which is so contingent. What I would do is work for another year and make a million dollars. I wouldn’t retire. That would be a reason not to retire.
[46] Transcript, 26 May 2016, p 269 ln 8–11.
Senior Counsel also contends that had her Honour considered the effect of not making a superannuation splitting order, that would result in the payment of the additional cash sum earlier referred to and would “correspondingly increase [the husband’s] need to liquidate assets”.[47] The necessity of the husband to liquidate assets was never part of his case at trial, the husband’s case was that any payment to the wife would be met from his cash resources plus borrowing. He alluded in evidence to using cash from the proceeds of the property ultimately agreed to be sold. Otherwise, he alluded in general terms to a possibility of asset sales without ever specifying the same or adducing evidence of sale costs and any taxation imposts.[48]
[47] Husband’s Revised Summary of Argument filed 6 November 2017 at paragraph 52.
[48] Transcript, 26 May 2016, p 294 ln 30 to p 296 ln 9.
At [447] to [449] of the reasons, her Honour quotes from the Amended Case Outline filed by the husband on 30 November 2015 in respect of superannuation and two passages from the oral submissions made on his behalf at the trial, the second occurring when her Honour asked for “further clarification about the orders sought by the husband”. Those passages should be repeated here:
447.In his Amended Case Outline filed 30 November 2015 the husband proposed at paragraph 10-11:
The orders sought by the Husband seek that the superannuation and non-superannuation assets be treated as a whole and that the Wife retain her existing entitlement irrespective of what proportion that is of the superannuation interests held by the parties but as part of her receipt of an appropriate proportion of the assets overall.
448.At the conclusion of the trial counsel for the husband clarified the husband’s proposal for the [Trevi] Family Superannuation Fund as follows:
And there is a slight difference. And the difference is this: with respect to the [Trevi] Family Superannuation Fund, we seek that there be a payment out to the wife of the husband’s interests sufficient to effect a 45 per cent division of that fund. So what the wife seeks is that she just gets a rollout of her entitlement. We say not simply a rollout of her entitlement. But she gets from that fund 45 per cent of it. And on that basis, there is – the net effect of it is that the amount of cash my client might have to pay the wife from other sources is reduced by the amount of the superannuation to which he is entitled in that fund being rolled out into a fund in her favour. The net effect – that’s the effect of the difference.
449.Counsel for the husband when asked for further clarification about the orders sought by the husband submitted :
… As we understand the wife’s orders, she simply seeks to have rolled out to her her [sic] existing entitlement, … which is $75,000. We seek to have paid to her an amount equal to 45 per cent of the entire value of the fund, inclusive of her entitlement; her entire entitlement being rolled out and the rest being effectively a splitting order. The practical effect of that is my client has to find by way of borrowings less money than he might otherwise have to find to pay the overall adjustment in the wife’s favour. Of course, what percentage of the fund it ultimately is is [sic] dependent on your Honour’s determination with respect to the percentage adjustment under section 79.
(Footnotes omitted)
It will be noted that contrary to the submissions advanced on his behalf before us, Senior Counsel on behalf of the husband advanced the proposition at trial that the money used to pay the wife her cash entitlement would be made “by way of borrowings” and that in the event that a splitting order to the effect of 45 per cent of the superannuation interests of the parties was made “the practical effect” would be that the husband would need to “find by way of borrowings less money than he might otherwise have to find to pay the overall adjustment in the wife’s favour”.[49]
[49] Transcript, 30 May 2016, p 366 ln 24–28.
Her Honour does not go on to quote in the reasons what followed from Queen’s Counsel for the wife at trial:[50]
[COUNSEL FOR THE WIFE]: …your Honour, can I simply ask your Honour to note that what is now proposed for the first time – we’ve only just received notice of the husband’s what I will call approach, which is different from what was in his response. The wife does not seek a splitting order. She doesn’t want a splitting order. She doesn’t want her money being tied up. She needs it now rather than next year’s time [sic], subject to the vagaries of the Superannuation Board. So she would seek that her entitlement be rolled out as opposed to the proposal for the husband.
[50] Transcript, 30 May 2016, p 367.
Senior Counsel for the husband seeks to make the point before us that the husband’s change of position with respect to a superannuation splitting order, coming at the very end of the trial, occurred because “it might be thought that, confronted with the continuing contentions of what he was going to have to meet as the trial proceeded – caused him to take a different view”.[51] However, it is said that it should have caused the wife no pause because in each of her amended application and her case outline document she had sought a splitting order in the proportion 65 per cent / 35 per cent; that is the same proportion as she contended by way of overall result.
[51] Appeal Transcript, 5 March 2018, p 30 ln 40–42.
Whatever may have been the confusion attending the position, and who did or did not seek orders and when, the task confronting the husband is to establish discretionary error in the manner contended for. In my opinion it cannot be said that her Honour “failed to consider the effect of a splitting order”. Reference to her Honour’s reasons shows that her Honour was well aware of the effect of making a splitting order, or not making a splitting order. Indeed, not only was her Honour aware of it in general terms, but her Honour made it clear she was aware that it would affect the cash payment made to the wife by the husband.
The asserted failure to take account of the making or non-making of a splitting order relevant to the s 75(2) consideration by her Honour must be seen in light of the arguments advanced by the husband in that respect at the trial. The submissions by Senior Counsel for the husband in closing submissions and quoted by her Honour at [448] and [449] of the reasons are important.
The Outline of Final Submissions provided to her Honour by Senior Counsel for the husband, under the heading “Factors under s.79(4)(d)-(g)”, did not seek to advance specific propositions relating to the justice and equity of any adjustment by reference to the splitting order that would or would not be made.
Insofar as they refer to the topic of superannuation at all, the submissions record:
44.Assuming that the [specified] property sells for only $1,125,000 the asset pool is $9,911,087. The Wife’s existing share of that pool is $3,530,524. 40% of the pool is $3,964,435. Therefore, in order to bring her to 40% of that pool there needs to be a further cash payment to her and/or transfer of superannuation interests in the order of $433,991.
First, the submission does not seek to limit or maximise the amount of the superannuation interests comprising the wife’s entitlement. Secondly, the submission refers to “transfer of” superannuation interests. The transfer of superannuation interests might be thought, in ordinary parlance, to refer to a rolling out of an interest, which can, of course, occur without a splitting order being made. The submission can readily be read in a manner that suggests the eschewing of a splitting order. Certainly, no splitting order is contended for in any amount or proportion which would seek to minimise the cash sum otherwise payable by the husband.
The passage from the transcript earlier quoted has Senior Counsel for the husband referring to 45 per cent of the joint superannuation fund. Thus the calculation urged upon this Court by Senior Counsel for the husband and earlier referred to, is slightly different to that resulting from the percentage contended at trial. Adopting the figures found by her Honour and earlier referred to (noting what would appear to be an error, pointed out by counsel but in respect of which we have no alternative figures), the calculation urged upon us by Senior Counsel for the husband on the appeal, the husband would have him needing to fund $119,827 less than that which her Honour ordered.[52]
[52] As asserted by the husband, the total amount in the joint fund equals $444,829 multiplied by 45 per cent equals $195,725 less super retained by wife of $75,897 equals $119,827.
When a global assessment of contributions is conducted as it was here, s 75(2), and in particular s 75(2)(b) and (n), make relevant what each party would receive pursuant to the mooted assessment of contributions. That consideration is informed centrally by any agreement the parties have reached as to who shall receive what property and/or the manner in which the parties have conducted their cases and joined issues accordingly.
It is important to understand that the parties had agreed upon a distribution of their non-superannuation property. Her Honour recorded and tabulated that agreement at [219] of the reasons. That, of itself, was an extremely important consideration pursuant to s 75(2)(b) and (n).
The case run by the husband did not seek to delineate or render in dollar terms any asserted injustice to him, by reason of the proportion in which the wife’s entitlement should otherwise comprise cash or superannuation interests. On the contrary, the husband’s evidence was that if he needed another million dollars he would simply work for another year. That being the case, the s 75(2) considerations relevant to the superannuation interests were overwhelmed, as her Honour found, by the current income earnt by each of the parties and their respective capacity to earn income.
The submissions framed in respect of superannuation on behalf of the husband at trial implicitly recognise that fact. That being so, her Honour considered separately the parties’ superannuation interests subsequent to a consideration of s 75(2) so as to inform the orders which her Honour considered “appropriate” pursuant to s 79.
I am not persuaded of any error.
The Section 75(2) Issue
Ground 3 is in these terms:
The trial Judge was in error in finding that the [wife] should receive a further ten per cent of the net assets having regard to the matters in section 79(4)(d)-(g) of the Act in that her Honour:
a)made significant errors of principle comprising failure to consider the effect of contribution findings on the respective positions of the parties before considering other factors; failure to determine whether to make and the consequences of a superannuation splitting order before assessing the other factors; and, treating the partnership capital account as a financial resource when it had already been taken into account as property;
b)made significant errors of fact as to the [husband’s] future financial circumstances;
c) failed to evaluate the evidence touching upon the [husband’s] future financial circumstances;
d)failed to resolve or give adequate reasons addressing the issue she identified at Reasons [399];
e) failed to take into account relevant facts comprising the likely sale of property by the [husband] and economic consequences thereof to facilitate compliance with the orders proposed and the [husband’s] ongoing financial commitments to the children of the parties; and
f) the decision on the facts before her Honour was manifestly unjust.
It is convenient to address each of those specific matters in turn.
The Effect of the contributions findings and the “likely sale of property”
In oral submissions before this Court, Senior Counsel for the husband argued that “one of the core matters” which “underpins error in her Honour’s approach to assessing” the relevant s 75(2) factors[53] is a principle emphasised in Willis & Willis:[54]
… in our opinion there was an error in the trial judge’s treatment of the section 75(2) factors. Her Honour failed to consider the effect of the findings as to contribution on the respective positions of the parties, before proceeding to determine whether any adjustment was warranted pursuant to section 75(2). The effect of the 30 per cent differential established on the basis of contribution was approximately $220,000. This required consideration pursuant to section 75(2) but was not addressed by her Honour. The appeal must therefore be allowed in respect of the finding that the wife receive an adjustment of 15% on account of section 75(2) factors.
[53] Appeal Transcript, 5 March 2018, p 17 ln 42–43.
[54] [2007] FamCA 819 at [50]; counsel also referring specifically to Marsh & Marsh (2014) FLC 93-576 at [128].
Sub-paragraphs (b) and (n) of s 75(2) in particular “recognise a symbiosis between the s 79(4)(a), (b) and (c) assessments and the s 79(4)(e) assessment” and “[i]n the vast majority of cases this is an important consideration”.[55]
[55] Hurst & Hurst (2018) FLC 93-851 at [57].
The Revised Summary of Argument filed on behalf of the husband before this Court, seeks to make a case asserting ramifications for the husband in respect of the sum necessary to be paid by him consequent upon her Honour’s orders. It should immediately be noted that the sum awarded by her Honour was less than that for which the wife contended at trial. Consequently, her Honour’s orders necessitated the husband raising and paying to the wife a sum less than that which he must have contemplated as possible by reference to the wife’s case.
The husband’s Revised Summary of Argument also advances a case postulating both the means of raising the necessary cash payment and what are said to be the consequences of doing so. The argument refers to borrowings by the husband and associated borrowing costs, assumed interest rates and the like. To similar effect, the sale of assets is postulated with consequential taxation imposts. It is said in respect of the latter that:[56]
Although (as noted by the trial Judge) no evidence of tax consequences was introduced in the case, the Court could take judicial notice of the fact that a substantial capital gains tax would apply in relation to [a specified investment property]…
[56] Husband’s Revised Summary of Argument filed 6 November 2017 at paragraph 38.
The case agitated by the husband at trial has earlier been referred to. Again, he did not seek to adduce evidence or make submissions in respect of properties that might need to be sold; relevant selling costs; and/or capital gains tax. Equally, the husband chose not to adduce evidence at trial that contemplated the consequences of the result contended for by the wife or any alternative order save of the type and magnitude for which he contended. He chose not to adduce evidence of any amount that might need to be borrowed; its source; any interest rate and repayments and any borrowing costs and nor did he adduce evidence of any property that might need to be sold with any of the associated costs and taxation ramifications if any.
In my view, Senior Counsel for the husband again seeks to agitate a “new argument which, whether deliberately or by inadvertence, [trial counsel] failed to put during the hearing when he had an opportunity to do so”.[57]
[57]Metwally at 71.
Respectfully, it may have been preferable for her Honour to specifically make clear that the ramifications of the mooted contributions assessment was being considered by reference to s 75(2)(b) and (n). Her Honour’s reasons do not make reference to this relevant consideration in terms. However, it should be repeated that her Honour was presented with an agreed distribution of assets and liabilities which her Honour tabulated at [219]. As a consequence of that agreed distribution it was, on any view, necessary for the husband to contemplate a case agitated by the wife that would see him paying to the wife a significant additional sum in cash. However, the manner in which the case was conducted and in particular, the agreed distribution of assets, gave that question a different focus.
When seen in that light, I consider her Honour gave the mooted contributions assessment and those relevant sub-paragraphs of s 75(2) the consideration which the issues joined between the parties required.
Superannuation splitting order
For the reasons earlier given, I am not persuaded that her Honour “made significant errors of principle” in “fail[ing] to determine whether to make and the consequences of a superannuation splitting order before assessing the other factors”.
The Partnership Capital Account
As can be seen, sub-paragraph (a) of Ground 3 asserts that her Honour “treat[ed] the partnership capital account as a financial resource when it had already been taken into account as property”.
That contention should be rejected. Her Honour, with respect correctly and contrary to suggestions otherwise, distinguished between the return of the husband’s capital account upon retirement (the present-value calculation of which was included as an asset to be divided between the parties) and the “Early Retirement Scheme” (“ERS”).
The husband contended that any amount receivable pursuant to the latter scheme was so hedged by contingencies that his entitlement was a “myth”.[58] Be that as it may, her Honour noted that there was “no evidence” about it “other than the concession in the evidence of the husband that it exists” (at [432]). Her Honour could not, and did not, attribute any value to it. A fair reading of the reasons reveal that her Honour accorded it no weight.
[58] Transcript, 26 May 2016, p 302 ln 14.
Her Honour’s references to the husband’s capital account, albeit under the heading “Financial resources”, commence with the expression “[u]nrelated to the early retirement scheme”. Contrary to the contention on behalf of the husband, her Honour was plainly aware of the difference between it and the ERS.
I read all of the matters contained under the heading “Financial resources” in her Honour’s reasons as no more than her Honour recording, as but a part of the overall s 75(2) assessment, a number of matters rendered uncertain because of the inability to predict the future with all of its contingencies. Her Honour refers to the ERS; the fact that the capital account is to be received in the future upon retirement; and the fact that, given the husband’s age and plans, his current extraordinarily high income will come to an end at a future time. The husband’s evidence was that he planned or hoped to work for another seven years and would be earning a substantial income for four or five years (the difference pertaining to the “points” within the partnership by which income was calculated, reducing as he aged).
Future financial circumstances
The arguments relating to “errors of fact” in respect of future financial circumstances and the asserted “failure to evaluate” same appears to have a number of components.
It is contended that while her Honour found that the husband’s “present income could not be assumed for any longer than four or five years”, her Honour “has given no indication of the weight that she attached to this matter and it must be assumed that she gave it little or no weight”.[59]
[59] Husband’s Revised Summary of Argument filed 6 November 2017 at paragraph 35.
I am not persuaded that the assumption there referred to follows from the premises upon which it is based. Further, in my view the submission, which is effectively one as to weight, is not reasonably open on her Honour’s findings. At [403] of the reasons her Honour found:
I accept the submission on behalf of the husband that it cannot be assumed that he will still be earning at his current level in seven years’ time. Having regard to his highly demanding position and competitive work environment, I accept the argument that a prospective assessment on the assumption of future earnings at this level can be no greater than four to five more years. As stated earlier I cannot draw any conclusions as to the value of any early retirement scheme and there is insufficient evidence about the scheme.
It is said that her Honour “ignored entirely the evidence of the [husband’s] partnership statistics”.[60] It is not necessary for her Honour to refer to every piece of evidence or argument in the context of the exercise of a broad discretion.
[60] Husband’s Revised Summary of Argument filed 6 November 2017 at paragraph 39.
The challenge, in substance, relates solely to the attribution of weight. The caveats upon appellate intervention founded on weight challenges are well established by principle and need not be repeated.
The submission assumes that her Honour ought to have given greater weight to statistics such as “the average age of partner exit” over direct evidence of the husband as to his intentions. Her Honour simply accepted the evidence of the husband as to his intentions having taken into account all of the factors to which Senior Counsel for the husband refers including the highly demanding nature of the husband’s job, his age, the fact that his continued earnings are performance related and the like. Her Honour preferred the husband’s direct evidence over statistical averaging. I can see no error.
The central material error of fact asserted by Senior Counsel for the husband on appeal, would appear to be that her Honour took account of rental income received by the husband through his investment properties which, it is asserted, is erroneous because the properties are negatively geared and “all of that income was consumed”.[61] I have earlier made reference to what I consider to be erroneous premises upon which that contention is based.
[61] Husband’s Revised Summary of Argument filed 6 November 2017 at paragraph 40.
The Revised Summary of Argument on behalf of the husband in respect of this issue (at paragraph 37) appears to frame the asserted error somewhat differently, namely a failure “to consider the effect that her order would have on the earnings of the [husband]”. That, again, makes assumptions that were not the subject of either evidence or submissions in the proceedings before her Honour. I reject it as an assertion of error.
It is also contended at paragraph 39 that her Honour failed to have regard to the wife’s “potential passive income from her property settlement”. At [438] her Honour found:
I also find on the joint expert evidence of the chartered accountants, which was accepted by the parties, that if the wife received an amount of $1.5 million and invested that sum, that she would be likely to receive a return on that investment of between $50,250 which equates to 3.35% per annum and $141,873 which equates to 9.5% per annum. [Footnote: Transcript of proceedings, 26 May 2017, pp 306-307]
Senior Counsel for the husband constructs an argument based on assuming “the mid-point of the expected return on capital at 6.425 per cent”. It is thereafter contended that her Honour ought to have considered an investment by the wife of an amount derived from an equal assessment of contributions. Doing so, it is said, would give the wife a “capital base” of $4.766 million which would produce an annual income of $306,265. The submission then goes on, “[e]ven assuming the [wife’s] decision to commit $2,616,400 for a home was reasonable, she could expect passive income of $138,162 per annum”.[62]
[62] Husband’s Revised Summary of Argument filed 6 November 2017 at paragraph 43.
The first thing that should be said about such a submission is that it was not a submission put before her Honour.
That important issue aside, a number of assumptions are contained within the submission, not the least of which is that, there being no spousal maintenance order and a finding that the wife cannot expect to earn significant income into the future, no allowance is made for the use of any capital that might be used to purchase any relevant necessities, nor to any income that might be used for self‑support. In that respect, a significant s 75(2) factor in the circumstances of this case is “a standard of living that is reasonable in all the circumstances” (s 75(2)(g)).
Finally, in respect of financial circumstances, it is submitted that her Honour erred by taking into account funds the husband had in bank accounts or that her Honour failed to consider that the parties shared the care of their youngest child.
Again, each of those matters involve challenges to the attribution of weight. Further, and in any event, I am not persuaded, as is asserted, that those matters were included by her Honour in her summary of relevant financial circumstances which her Honour took into account. Her Honour was making a number of observations consistent with the respective positions of the parties. There is no element of “double counting” as is asserted.
The Issue at [399] of the reasons
Paragraph [399] of the reasons is as follows:
Counsel for the wife at the conclusion of the trial submitted that an adjustment of 15 percent should be made in favour of the wife for s 75(2) factors. In the event that the “adjustments” [to the pool of assets] sought by the wife were not accepted he submitted that the Court should allow a further 5 percent adjustment pursuant to s 75(2)(o) of the Act in favour of the wife to allow for the fact that the husband has had the advantage of all of the income, including rental income from investment properties post December 2014. He argued that in circumstances where the husband “seeks to bring into account monies received by way of capital by the wife; ignores his own purchase and on costs and overlook the drop in value of the [Suburb I] property and the shortfall in the net value of the [Suburb I] and [Suburb Q] properties whilst seeking to visit against the wife the detriment of his overdraft and his taxation liabilities since separation, it is just and equitable for the court to make a greater adjustment for s 75 factors, to reflect these matters.” [Footnote: Wife’s written closing submissions, par 79]
The particular paragraph is, as it seems to me, an acknowledgment by her Honour that matters have been raised by the wife which militate against her expenditure resulting in a consequent s 75(2) weighting against her.
The husband’s contention before this Court appears to be that error should be found by reason of her Honour not having considered matters raised by the wife in submissions in the event, as in fact eventuated, that her Honour did not addback the sums for which she contended. No such matters raised by the husband in submissions at the trial are referenced. I am not persuaded of any error.
The Failure to addback
It will be clear from what I have earlier said that I consider her Honour erred in the treatment of the wife’s paid legal fees. A consequence of my view that her Honour erred subsequently in the manner in which those legal fees were considered as a factor relevant to the s 75(2) discretion is that her Honour in fact ignored the expenditure as a relevant s 75(2) factor.
It was, of course, open to her Honour to find, that for reasons set out, the addbacks claimed by the husband against the wife did not have relevance to any s 75(2) assessment or that, if they did have relevance, were balanced by either the addbacks claimed by her as against the husband or other matters such as those addressed in the submission referred to in [399] of the reasons. However, it was not, in my view, open to her Honour to ignore those sums in circumstances where both parties agitated a case that they should be considered as part of the s 75(2) assessment.
In my view, that is the effect of what her Honour did and in doing so, her Honour failed to take account of relevant considerations with the consequence that the discretion miscarried. If her Honour intended to take account of those matters, in my view, her reasons are not, with respect, adequate to explain how she did so.
The costs issue
On 13 February 2015 orders were made by which the wife was required to withdraw caveats she had lodged against properties registered in the husband’s name. Subsequent to those orders being made, the husband made an application for the wife to pay the costs of that hearing. That application for costs was heard at a further interim hearing on 27 May 2015 which also concerned the wife’s interim application for periodic spousal maintenance. An order that day reserved the husband’s costs to the trial.
Her Honour’s trial reasons conclude with a finding that those reserved costs should not be payable by the wife to the husband.
The submissions on behalf of the husband recognise explicitly the usual position with respect to proceedings under the Act prescribed by s 117(1) and also recognise the principle that costs are “peculiarly a matter … within the discretion of the trial judge and it is only in the rarest of cases that the Full Court should interfere”.[63]
[63] Harris and Harris (1991) FLC 92-254 at 78,711.
The submissions also recognise that her Honour specifically took into account that the wife had been wholly unsuccessful in the proceedings seeking to maintain her caveats. However, it is contended that her Honour:[64]
…failed to take into account important matters as to the conduct of the [wife] which not only resulted in her being wholly unsuccessful … but constituted conduct that necessitated the proceeding.
At no time did the [wife] have a caveatable interest in the property. She chose to adopt, illegitimately, a procedure … She was requested to remove the caveat yet refused to do so…
[64] Husband’s Revised Summary of Argument filed 6 November 2017 at paragraphs 55 – 56.
Her Honour found at [521]:
…The wife was unsuccessful in the interim hearing on 13 February 2015. However having heard all of the evidence in the trial and the circumstances of the husband having purchased the [Suburb I] property unilaterally, together with the fact that the husband’s financial position is far superior to that of the wife, I am not of the opinion that there are circumstances here which justify an order for costs of the interim hearing on 13 February 2015 other than the usual order that each party bear his or her own costs.
The husband’s Senior Counsel asserts that the finding as to disparity in the financial position of the parties takes no account of the property settlement orders. I am not persuaded that argument has any force in the context of an application for the costs of an interim hearing given the comparative financial positions of the parties subsequent to the property orders made. Furthermore, while not referred to in the context of the issue of reserved costs, her Honour had earlier made a finding that, despite a debit being raised against the husband for his firm’s representation of him in the property proceedings, it was not likely to be pursued. The husband’s total legal costs of those proceedings consisted of outlays, principally counsel’s fees.
I am unable to see any error in the exercise of her Honour’s discretion.
Conclusion
In my opinion, the husband has established appealable error as outlined at the commencement of these reasons. The appeal should be allowed and Order (1) of the orders made by her Honour set aside.
Senior Counsel for the husband suggested that, depending on the nature of the error found, if any, the highly experienced counsel representing the parties might be afforded the opportunity of saving each of the parties the time and expense of a rehearing.
That course, always indicated if common sense is to prevail, might be thought to be particularly attractive in this case given that the parties separated ten years ago. I would make orders that avail the parties of the opportunity to reach agreement, failing which the parties would be required to file written submissions including the agreed facts pertaining at the date of the hearing of the appeal upon which this Court might re-exercise or, alternatively, the terms of the order for remitter.
Costs Of The Appeal
The husband has succeeded in respect of one aspect of the appeal but it cannot, in my view, be said that the wife has been “wholly unsuccessful”. The husband’s financial circumstances are superior to those of the wife. However, the sum he will need to pay to the wife will remain significant irrespective of any agreement or order in respect of the addback of legal fees. No issues of conduct in respect of the appeal are agitated.
Her Honour found that the husband was unlikely to pay legal fees associated with the trial in respect of fees raised “in house” against him. He did however apparently incur substantial outlays. We have no evidence upon which any such conclusion could be reached in respect of the appeal, but implicit in the submissions, as it seems to me, is that the husband would incur, at least, counsel’s fees in respect of the appeal.
I am not persuaded that the circumstances justify departure from the position prescribed in s 117(1) of the Act. I would order that each party pay their own costs of and incidental to the appeal.
In that event, each of the parties seek certificates pursuant to the Federal Proceedings (Costs) Act 1981 (Cth). The error identified by me is one of law. I consider it appropriate that certificates should issue to each of the parties.
KENT J
I agree with the reasons for judgment of Murphy J and with the orders which his Honour proposes.
I certify that the preceding one hundred and seventy-seven (177) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Alstergren DCJ, Murphy and Kent JJ) delivered on 6 September 2018.
Associate:
Date: 6 September 2018
112
20
2