VASS & VASS

[2013] FCCA 1029

FEDERAL CIRCUIT COURT OF AUSTRALIA

VASS & VASS [2013] FCCA 1029

Catchwords:
FAMILY LAW – Property dispute – case complicated by very unclear circumstances of husband’s business interests – husband in partnership with friend of many years – business affairs almost impossible to unravel – in principle division 65/35 in favour of wife – further consideration of how to give effect to division of property required. 

Legislation: 

Family Law Act 1975 (Cth), s.79(2)
Evidence Act 1995, s.140

Stanford v Stanford [2012] HCA 52
Erdem v Ozsoy [2012] FMCAfam 1323
Jones v Dunkel (1959) 101 CLR 298

Applicant: MR VASS

Respondent: MS VASS

File Number: MLC 7299 of 2012

Judgment of: Judge Burchardt

Hearing dates: 28, 29, 31 May, 5 June and 31 July 2013

Date of Last Submission: 31 July 2013

Delivered at: Melbourne

Delivered on: 16 August 2013

REPRESENTATION

Counsel for the Applicant: Mr Mellas

Solicitors for the Applicant: Twigg Family Law

Counsel for the Respondent: Mr Atkinson

Solicitors for the Respondent: Berry Family Law

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

FEDERAL CIRCUIT COURT OF AUSTRALIA

AT MELBOURNE

MLC 7299 of 2012

MR VASS

Applicant

And

MS VASS

Respondent

REASONS FOR JUDGMENT

Introduction

1. The parties were able to resolve the parenting dispute about their two children, X born (omitted) 2002 and Y born (omitted) 2004, following some extensive negotiation at the start of the trial.  What remains to be determined is the property dispute. 

2. Leaving aside for the moment some unfortunately complex matters to do with the identification of the pool, the applicant husband seeks that there be a 60/40 split in the wife's favour and the wife seeks a 70/30 division.  For reasons which will become apparent, the actual mechanics of the division are complicated in any event and will require further consideration.  For the reasons that follow, I think that the wife should receive 65 per cent of the property pool. 

Agreed matters

1. The husband was born on (omitted) 1972 and is employed in two businesses with which it will be necessary to deal in detail.  The mother was born on (omitted) 1968.  She was formerly employed in relatively poorly-paid employment ($450 per week), but now works part-time ($230 per week).  With benefits and Child Support, her income is $681 per week, i.e. slightly over $35,000 p.a. 

2. The parties commenced to cohabit in 2000 and were married on

   
   

   (omitted) 2001.  They separated following an incident which was alleged by the wife to involve considerable violence on the part of the husband on 22 April 2012. 

3. Since separation the wife has continued to live in the former matrimonial home in Property W and the father lives with his parents.  Pursuant to the consent orders made on 29 May 2013, the children live with the wife and spend time with the husband for five nights per fortnight together with half of holidays and other special days. 

The first step: The identification of the parties' existing legal and equitable interests in property and whether there should be any order made to adjust those interests.

1. This is one of the very many cases in which both parties fully agree that it is appropriate for the Court to contemplate making an order pursuant to s.79(2) of the Family Law Act 1975 (Cth) (“the Act”) to adjust the parties' property interests. It is not necessary in these circumstances to say more than I agree with that mutual concession. It is not necessary to revisit the law as propounded by the High Court in Stanford v Stanford [2012] HCA 52. I would note that I agree with the observations of Walters FM, as his Honour then was, in Erdem v Ozsoy [2012] FMCAfam 1323 at [116]. In cases

   “… where the parties have separated and are no longer living in a marital relationship — the underlying assumptions that the parties had to the effect that the existing property ownership arrangements were functional (or perhaps irrelevant) and could be varied by agreement between them, no longer apply. That fact alone should ordinarily persuade the court that it is just and equitable to make orders altering the parties’ interests …”

Agreed matters in the property pool

1. Both parties now agree that the value of the former matrimonial home in Property W is $750,000.  For reasons which will become apparent, however, both parties agree that it should be sold.  It is the subject of a mortgage presently in the sum of $305,000, although the equivalent sum at the date of separation was $208,440. 

2. The husband's superannuation is worth $59,806 and the wife's superannuation $10,600. 

3. A shelf company owned by the husband called (omitted) Pty Ltd owns a storeroom at which are stored various chattels.  It is sufficient to note that both parties agree that each should have copies of any photographs contained therein.  I do not believe I have overlooked anything else in this storage unit but the parties will get an opportunity to make further submissions in any event.

The matters of disagreement at Court

Motor Vehicles

1. As is so often the way in property cases there are cars which are not the subject of any professional valuation.  There is a Holden (omitted) available to the wife which is a (omitted) model.  The husband's value is $10,000 and the wife's $5,000.  I strongly suspect that the wife's estimate is the more accurate valuation not least because the husband has been trying to sell it for $9,990 for many months with no offers at all.  This vehicle will have to be sold at whatever price the market will bear. 

2. (omitted) Pty Ltd is in the process of hire purchasing a Mazda which the wife presently drives.  It is asserted that its value is $35,000 and that there is about $44,000 owing on the hire purchase agreement, if I understand the matter correctly.  Once again this will have to be paid out following the sale of the matrimonial home. 

3. The wife presently drives a car leased (in the ultimate) through a company called (omitted) Pty Ltd (“(omitted) Pty Ltd”) of which more will be heard.  I presume it is implicit in the parties' positions that that vehicle will be returned to (omitted) Pty Ltd in some way. 

Boat

1. The parties bought a boat and trailer relatively recently in the wife's name.  It was agreed that it would be advertised for sale at not less than $25,000 but the husband has advertised it at $34,990.  Once again, it has not achieved any offers and must be sold for whatever the market will bear.

The value of the husband's businesses

1. This is where much of the battleground in the case was fought out.  The husband has a friend called Mr G (the surname is spelt in different ways in the materials) who he described as a mate for 20 years.  They are clearly close friends. 

2. In 2010, the husband bought 30 per cent of a business known as (omitted) Pty Ltd.  In fact this was done through the purchase of 3 of 10 shares in (omitted) Pty Ltd pursuant to a Share Sale Agreement dated 25 October 2010 (exhibit R11).  The shares were not bought by the husband personally but by (omitted) Pty Ltd (“(omitted) Pty Ltd”) as Trustee of the (omitted) Trust, an entity owned by the husband and wife jointly.  The purchase price was $90,000 of which $20,000 was paid in 2010 and two further payments of $35,000 were due on 15 July 2011 and 15 July 2012. 

3. Also, in late 2010 Mr G and the husband set up another company, (omitted) (“(omitted)”).  According to his first affidavit which dealt with property matters filed on 14 September 2012 (paragraph 8(b):

   “… My business partner, Mr G (sic) of (omitted) Pty Ltd, and I established (omitted) in December 2010.  The company has very minimal assets, and started off with one desk and a laptop.”

4. The value to be ascribed to the two businesses has been the subject of fertile disagreement between the parties.  They initially engaged one single expert witness to value the two businesses and engaged Mr L, (everyone referred to him as “Mr L” for convenience and I will do so too), to do so.  Unfortunately Mr L's first report was the subject of vigorous, even dismissive, disagreement by Mr Vass and Mr Vass' usual accountants.  They engaged Mr B to prepare a shadow report. 

5. In essence the main difference between the two experts, which has proved irreconcilable, is the weight to be given to management fees paid by the (business omitted).  On the same day as the Share Sale Agreement entered into on 25 October 2010, a further Shareholders Agreement was made in respect to (omitted) Pty Ltd.  The parties were (omitted) Pty Ltd itself, (omitted) Pty Ltd, (omitted) Pty Ltd as Trustee of (omitted) Trust and Mr Vass (exhibit R12).  The Shareholders Agreement recorded that the shareholders owned all the shares in the company (i.e., (omitted) Pty Ltd and (omitted) Pty Ltd).  By clause 2.1 effectively Mr G and Mr Vass were appointed as directors to the Board. 

6. At each meeting of the company and of the Board, Mr G had the power to outvote Mr Vass (clause 2.7).  By clause 2.15 it was foreshadowed that the parties might take over the operations of an entity called (omitted) Pty Ltd and that should this be the case (omitted) Pty Ltd would obtain 30 per cent of the said body, (subject to some qualifications that did not eventuate). 

7. By Schedule 3 it was agreed that (omitted) Pty Ltd would employ Mr Vass on a salary of (after one year) $100,000 plus superannuation.

8. By clause 2 of Schedule 3 it was agreed that:

   “The Company shall enter into an agreement with the entity nominated by Mr G in relation to use of certain intellectual property and certain know how.  Such agreement shall require that the Company pay to the nominated entity a fee equal to 10% of Ordinary Revenue (plus GST) of the Company.  In this clause the expression "Ordinary Revenue" means all revenue of the Company except GST, fuel charges and vehicle damage reimbursement charges.”

9. Under Schedule 4 ‘Possible Business Plans’ it was noted that (omitted) Pty Ltd intended to establish a (omitted) site in Melbourne city by December 2012 and a (omitted) site at or nearby the Company's office at the (omitted) by December 2011 and that Clause 2 of Schedule 3 would apply to any such venture. 

10. It should be noted that pursuant to Schedule 4 of the Shareholders Agreement any future venture would involve a splitting of the directors' fees 50/50 rather than the effective 70/30 split in the car hire business.  In fact little has been said as to precisely how the agreed 50 per cent interest Mr Vass was derived. 

The difference between the two experts

1. There are only in substance two areas of significant dispute between Mr L and Mr B, the expert called by the husband. 

2. The first can be shortly stated and dealt with.  In various calculations made, Mr B allowed for $160,000 for salary for Mr Vass (or the notional manager of the two businesses) and Mr L provided for $140,000.  Mr B said that his figure was slightly higher because of superannuation to be factored in.  Mr L said his figure was an entirely appropriate one.  His answers were redolent with a familiarity born of long experience.  He said it would be easy to obtain the services of a manager of these two businesses at an all-in salary of $140,000 and I believe him. 

3. The (omitted) business pays, it is alleged by the husband (as does the (omitted) business), 10 per cent of its profit to Mr G's entity (omitted) Pty Ltd by way of management fees. 

4. Mr L was of the clear view that these management fees should not be accepted and constituted a form of, in effect, profit sharing between Mr G and Mr Vass. 

5. Mr B, the shadow valuer called by the husband, said that all these were genuine business expenses. 

6. I approach this aspect of the controversy bearing in mind the terms of s.140 of the Evidence Act 1995 (“the Evidence Act”). Stripped of any ambiguity, what Mr L was really saying was that the books had been cooked; that while moneys had been paid in the totals claimed by way of alleged management fees, these were not in fact management fees but were profit sharing. Although the matter has not been spelt out it would seem inevitable that there would be tax obligations avoided by such a mechanism. It is not a finding that the Court should rush to embrace.

7. Nonetheless, I should make it clear that I do in the main accept Mr L's position. 

The evidence of the experts – Mr B

1. Mr B was called on behalf of the husband.  He was contacted by (omitted), the accountants for the husband, who were unhappy to say the least with Mr L's valuation.  Mr A, the person at (omitted) who engaged Mr B, told Mr B of his concern about Mr L's approach to management fees in the (omitted) business. 

2. Mr B confirmed that he is a very experienced accountant whose work is predominately in the tax preparation and advice area together with auditing.  He has not worked for (omitted) since 2010 and had no work or involvement with that firm until he was contacted by

   
   

   Mr A. 

3. It was Mr B's position that if the management fees were commercial and backed by relevant documentation they should be taken into account.  He said he had seen a couple of BAS statements which as he put it "stacked up".  He said that the payments actually made were close to 10 per cent of profit and that any disparity might be explained by disputation as to what constituted a sale. 

4. Mr B's position was that there was no benefit to Mr Vass because moneys were paid out and indeed paid to (omitted) Pty Ltd in any event.  (omitted) Pty Ltd being a business in which Mr Vass has no interest or holding. 

5. Mr B's position was that a salary of $160,000 was more appropriate than the $140,000 suggested by Mr L.  The extra amount was essentially to cover superannuation at 9 per cent. 

6. I should say that I roundly reject the insinuation strongly advanced by counsel for the wife that Mr B was in fact closely involved with (omitted) and wholly partial and being dishonest about his denials to that effect.  Mr B struck me as being a palpably honest witness. 

7. Having said that, however, some of his answers were not in my view responsive and it was clear from what he said and the way that he said it that he was to an extent partial.  He was after all engaged precisely to challenge a given aspect of Mr L's report.  I note that he does not annex to his report before the Court his letter of instructions (unlike Mr L). 

8. It is clear that Mr A expressed to Mr B in the strongest terms his disapprobation of Mr L's report.  It is more probable than otherwise that he did so in terms not inconsistent with exhibit LV-3 to the wife's affidavit filed 13 May 2013.  When you come into an investigation on such a basis it requires a considerable effort of will to remain wholly impartial and while I make no stringent criticism of Mr B who, as I say, was clearly an honest witness, I think to an extent his mind may have been influenced by an unwitting partiality. 

Mr L

1. Mr L has an impressive Curriculum Vitae.  He is a chartered accountant and has been a partner with a major accounting firm.  He was also to an extent slightly combative in his approach to giving evidence and indeed his evidence was not so much led as denoted and controlled by him. 

2. Mr L had accepted the 10 per cent management fees in the (omitted) business but was not in the ultimate prepared to accept them at all in the (omitted) business. 

3. In the end I should make it clear that despite some aspect of Mr L's evidence being wide off the mark in the main, I prefer his conclusions for reasons to which I will come shortly.  Mr L was, however, in my view wide off the mark in his complaints about the explanations for the particular style of some of the documents sent to him, including the Shareholders Agreement.  The explanations proffered by the husband to counsel were in my view convincing. 

4. The reasons I accept Mr L's evidence are as follows:

   a)First of all Mr L is an expert in forensic valuations and he was not challenged in his assertions as to his qualifications in this regard.  Mr B, while clearly a competent accountant, did not profess the same expertise.

   b)To the extent that it is of any moment Mr L's Curriculum Vitae is somewhat more impressive.  He is a chartered accountant and Mr B is not.

   c)Mr L's evidence was that there was a rule of thumb in licensee arrangements (and there was no challenge to his categorisation of the (omitted) business in this regard) of a cap of 25 per cent of gross profit paid to the licensor.  This evidence was also not successfully challenged.  Mr L's evidence was that the 10 per cent of all profit charged by the asserted arrangements was excessive.

   d)In regard to (c) I point out that Mr L said (p-112) that the management fees charged struck as being high from the start.  He said that this was normally an indicator of distribution of profits rather than a charge for value and that indeed there was no mention of invoices supporting the management fees when the matter was first brought to his attention. 

   e)

   The provision of a 70 per cent shareholding, in addition to a 10 per cent licensing fee, was grossly excessive (“ridiculous” –

   
   

   p-117). 

   f)Mr L was saying right from the start to (omitted) that the management fees overall were excessive and approximately double what he would have expected to see. 

   g)Mr L's evidence was that a licensor already received payment for any management fees in the 50 per cent ownership that was granted.

   h)Mr L said it was never the case that a licensor takes equity in the licensee's business in any event.

   i)The amounts actually paid were substantially wide of 10 per cent in any event.  Exhibits R8 and R9 in my view are consistent with Mr L's characterisation. 

5. Mr L had other criticisms to make of the documents provided by way of sales receipts/tax invoices (exhibit R10).  While it is clear that moneys were paid to meet these invoices I note that none of these invoices actually detail what was provided.  These amounts do, as Mr L suggests, give rise to serious questions as to what was being bought. 

6. Mr L was of the view that the fact that the invoices did not match the statements suggested that this was a methodology for distributing profit (p-117).  He also pointed to the fact that the charges for the posited employees put to him in cross-examination to have been required as being far too high for businesses of this sort. 

7. Finally, I note that Mr L's evidence accords with common sense.  The position adopted by Mr B and the husband is that the management fees charged to both the (omitted) and the (omitted) businesses were to offset such matters as accounts administration, advertising, website maintenance and the like.  Mr L's position was that the proposition that you would need substantial such support in a (omitted) business, particularly in relation to such matters as accounts, was extremely debatable.  In my view, this criticism makes common sense. 

8. In all the circumstances, in my view, the evidence of Mr L should be accepted and his methodology adopted. 

9. I likewise accept, as I have already indicated, Mr L's evidence that $140,000 would be a fair and reasonable package to provide to the manager of the businesses. 

10. Finally, I should emphasise that Mr L did not adopt the four times multiplier adopted by Mr B in relation to the (omitted) business.  He felt that four would be excessive.  I note that his figure is closer to the 2.5 suggested at an earlier stage by (omitted).  Mr L said he felt that a multiplier of four would be too high for a business of this sort and that concession in my view stands to his credit. 

11. I also accept Mr L's methodology as revised in the witness box to reflect the very substantial increase in turnover of both businesses in the most recent half year.  It follows that Mr L's methodology and the values he ascribes to Mr Vass' share should be accepted.

Add-backs

1. Although in theory this might go to questions of contribution (and indeed in one sense does so) it is appropriate to deal with certain add-backs at this point.

2. Immediately following separation the husband started readjusting the parties' finances to his own benefit.

3. The wife sought to do so but was unsuccessful.

4. On 25 and 26 April 2012 the wife sought to remove $5,000 from the parties' accounts.  The husband blocked these payments immediately.  Thereafter he very rapidly withdrew on 3, 5 and 6 May 2012 a total of $15,000.  He also withdrew $25,000 on 13 June 2012 and a further $15,000 on the same date which was paid to the wife's solicitors for legal costs. 

5. On 7 June 2012 he had also taken out $50,000 in effect which he provided to his parents to repay an alleged loan and a further $25,000 to the (omitted) Bank. 

6. He applied $5,000 of the sums withdrawn to his MasterCard which at that time had a wholly trivial amount on it, which he conceded himself was not the subject to any immediate need. 

7. It is quite apparent, even accepting the husband's assertion that he spent $15,000 likewise on his own legal fees, that the husband took active steps to ensure that the wife had very little money available to her. 

8. I accept that the husband continued to pay the mortgage and associated household expenses together paying the wife $300 a week until December 2012.  Nonetheless the pattern that emerges from the evidence is all too clear.  He set out to ensure that there was as little available to the wife as possible. 

9. In my view the $25,000 payment taken out, as the husband put it, just to pay for things as they went, cannot be sustained.  It was not needed for immediate expenses (see next paragraph).  It should be added-back. 

10. This then leaves the tranche of $15,000 taken out between 3 and 6 May 2012.  I am prepared to give the husband the benefit of the doubt in this regard and accept that this was to meet immediate needs. 

11. It should be noted that what the husband did with the moneys he took out inter alia was to discharge all his outstanding credit card debts of approximately $22,000.  He was clearing the field to suit himself. 

12. The $50,000 loan alleged to the husband's parents requires some further examination.  It is clear from the evidence as a whole that in approximately 2008 the husband's father retired and accessed his superannuation.  He gave $50,000 to the husband and wife which they applied to their mortgage.  This did not of course pay the mortgage out.  There was never any loan documentation and at no point did the husband, who maintained it was a loan, give details of any oral agreement said to constitute a loan agreement. 

13. At some point subsequently it appears that some $25,000 was paid to the husband's parents it would appear possibly to assist them in purchasing a property.  It seems clear this was repaid (see p-104). 

14. I have seen both the husband and wife give evidence. The wife was an excellent witness who gave her answers with conviction and in a very responsive way.  The husband I regret to say was much less impressive.  His answers were often evasive and unresponsive and to the extent that there is substantial dispute between them I prefer the evidence of the wife. 

15. As I find the $50,000 advanced to the parties was not anything in the nature of a loan. It did not attract interest and there was no term as to its repayment.  The husband confirmed his parents would never sue him for it. 

16. Although the husband said "I would never do the wrong thing by my parents" what actually happened was that once he separated he wanted to get money to assist his and his family's position and he therefore unilaterally repaid them $50,000.  The entirety of that sum should be added-back in.  If he feels he still owes his parents money he will be at liberty to repay them following the conclusion of these proceedings.

The $70,000 loaned to (omitted) Pty Ltd and also allegedly owed by the parties to (omitted) Pty Ltd

1. When parties conduct their affairs in a fashion designed to minimise their taxation obligations through relatively complicated and sophisticated company and trust structures, the task for the Court in trying to unravel it becomes extremely difficult.  That is unquestionably the case involving all the areas of dispute in this proceeding. 

2. I note that I have not heard any evidence from Mr G and there is nothing to suggest he was unavailable.  While the facts do not go far enough to justify a Jones v Dunkel (1959) 101 CLR 298 inference and indeed no such submission has been made by counsel for the wife, the fact is that I have not had the benefit that I would have thought one might expect of having Mr G confirm not only that the $70,000 is owing to his entity but also for example the validity of the 10 per cent management fee charges that are paid by the (omitted) company.

3. In my view for present purposes the $70,000 advanced by (omitted) Pty Ltd to (omitted) Pty Ltd remains as a book entry in those two respective entities.  There is no suggestion that Mr G will call for its return.  If it is to be repaid it must be repaid in due course. 

4. The one thing I do know is that $70,000 was paid to fulfil Mr Vass’ purchase obligations under the Share Sale Agreement.  This vested the three shares in the (omitted) business in (omitted) Pty Ltd.  I note that Mr L pointed out, when dealing with the alleged indebtedness of the parties to (omitted) Pty Ltd but there was nothing in the accounts to show a countervailing entitlement on the part of the trust to any funds.  This is an important omission. 

5. As Mr L also pointed out, while ostensively there is a loan in favour of (omitted) Pty Ltd from (omitted) Pty Ltd, the Court is not privy to whatever arrangements must subsist between Mr Vass and Mr G in their entirety.  It is clear beyond doubt that the various companies and trusts are to all effects (subject of course to the wife’s nominal 50 per cent ownership of (omitted) Pty Ltd) their creatures. 

6. It is in these circumstances almost impossible to workout exactly what occurred.  On one view the moneys advanced by way of loan was simply paid back to complete Mr Vass’ purchase of the business in a circular transaction.  It is not possible to make any detailed sense of it.  In my opinion, and bearing in mind my observations at paragraph 68 above, the $70,000 should not be included in the pool.

Contributions

1. It seems common ground that the husband owned a property in (omitted) at the commencement of the relationship which had a measure of equity in it.  It was sold at or about the time the parties started to cohabit.  Each of the parties gave differing evidence as to how much savings they had at the time.  The husband puts his estimate as high as $80,000 and the wife says it was much lower and that her own savings were of approximately $25,000.  It is not surprising that neither party presently has any records to prove their position.

2. What does seem clear, however, is that when the (omitted) property was sold it generated a net benefit of somewhere between $60,000 and $80,000.  That is not commensurate with the far more substantial savings that the parties assert.  For these purposes I accept that the husband's initial contribution was substantially greater than that of the wife.  It formed the springboard which enabled them to buy a property which they later sold and which contributed the springboard to the matrimonial property in Property W. 

3. Counsel for the wife suggested that in a relationship that subsisted from 2000 to 2012 these initial contributions should be set at zero.  It is accepted by the parties that in a general way their contributions were otherwise equal. 

4. In my view, although it is not possible to say exactly how much the husband's initial contribution exceeded that of the wife, it was substantial and I think must be given some weight despite the length of the relationship.  This conclusion is bolstered by the husband’s unchallenged assertion that he contributed a redundancy package of about $90,000 in 2009 (see paragraph 9, affidavit filed 14 September 2012).  Without his initial contribution it is impossible to say that the parties would have been able to buy the property they did.  In my view, there should be a 5 per cent adjustment in the husband's favour. 

5. The husband always earned substantially more than the wife but she worked and also brought up the children.  She was clearly the primary child rearer and in a general way I accept that the contributions would be otherwise even.  Weight must however be given to the fact that for a period of some seven or eight months after separation, the husband paid all of the relevant household bills and although it is not possible to say exactly how much this would amount to it would have to be in a five-figure sum. 

6. It should be noted that the mortgage was only some $200,000-plus at separation and has now ballooned very significantly to $328,000.  While the husband asserts that this is through his impecuniosity and cash flow problems associated with his businesses, I think it is more accurate to say that the predominant reason for this increase is that the husband drew down on the mortgage because it disadvantaged the wife. 

Section 75(2) Factors

1. The husband is slightly younger than the wife and is in good health.  She is generally well although she is undertaking counselling to cope with the breakdown of the marriage and related issues. 

2. Whatever the husband makes (and bearing in mind that I accept Mr L's evidence it is substantially more than he says) he will certainly earn far more than her in the future.  I note that the mortgage had been substantially reduced in the latter years of the relationship.  The husband's evidence that he applied some $90,000 of a redundancy payment in 2009 to the mortgage, nonetheless, does not explain all the reductions.  It is more probable than otherwise not only that his income is bigger than he has declared but that it will continue to be so. 

3. The husband was vividly critical of the wife for abandoning her previous employment with (omitted) Pty Ltd following separation.  He said words to the effect that she could make as much as him.  He said that average weekly earnings were about $75,000 and the wife was better than average. 

4. I fully accept the wife's reasons for ceasing her employment.  She candidly admitted that Mr G had told her she could go on working but since the work had to be mainly done at (omitted) where the husband was (and he was by now the subject of an Intervention Order following the incident that led to separation) the wife's lack of desire to be involved is all too understandable.  The fact is that she would have to re-train and her future employment prospects remain wholly unclear. 

5. The wife will have the primary care and responsibility for these two still relatively young children for years to come. 

6. In all the circumstances, I accept counsel for the wife's submission that there should be a 20 per cent adjustment in her favour. 

Just and equitable

1. What is the Court to do to achieve a just and equitable outcome bearing in mind that overall there should be a 15 per cent adjustment in the wife's favour.  The husband has said that if I accept Mr L's report the (omitted) business should be sold and the proceeds divided 80/20 in the wife's favour. 

2. Doubtless the wife would prefer to have the cash involved from the sale of the property in Property W. 

3. On the one hand I am concerned that if the (omitted) business is not sold in a sense I am requiring the husband to pay to the wife moneys that he says he does not have.  Notwithstanding my acceptance of Mr L's report this sort of outcome is always unattractive. 

4. On the other hand if I order a sale of the (omitted) business I have every expectation that Mr G will not buy Mr Vass out.  They are close friends and clearly conduct their business very much as a (albeit unequal) partnership.  This matter may drag on for some considerable time. 

5. In all the circumstances I am going to tell the parties to do the sums, and to make further submissions having done so, if they are not able to agree both as to what the outcome is as to the figures and as to the practical means of enabling this case to be brought to a just and equitable conclusion. 

I certify that the preceding eighty-eight (88) paragraphs are a true copy of the reasons for judgment of Judge Burchardt

Date:  16 August 2013