VONTEK & VONTEK
[2016] FamCA 276
•14 March 2016
FAMILY COURT OF AUSTRALIA
| VONTEK & VONTEK | [2016] FamCA 276 |
| FAMILY LAW – CHILDREN – Orders by Consent - that the parents have equal shared parental responsibility for the children FAMILY LAW – CHILDREN – Orders by determination – that the children live with the wife and spend time with the husband as agreed or failing agreement as set out in the orders |
FAMILY LAW – PROPERTY – Superannuation – evaluation of contributions and future needs - just and equitable division of matrimonial property whereas the husband receives 33 per cent and the wife receives 67 per cent
| Family Law Act 1975 (Cth) s 60CC, s 75(2) and s 79 |
Bevan & Bevan (2013) FLC 93-545 |
| APPLICANT: | Mr Vontek |
| RESPONDENT: | Ms Vontek |
| FILE NUMBER: | SYC | 7165 | of | 2013 |
| DATE DELIVERED: | 14 March 2016 |
| PLACE DELIVERED: | Parramatta |
| PLACE HEARD: | Parramatta |
| JUDGMENT OF: | Benjamin J |
| HEARING DATE: | 7, 8, 9, 10, 11 & 14 March 2016 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Lloyd S.C. |
| SOLICITOR FOR THE APPLICANT: | Slater & Gordon |
| COUNSEL FOR THE RESPONDENT: | Mr Dura |
| SOLICITOR FOR THE RESPONDENT: | Clear Lawyers |
CHILDREN’S ORDERS
BY CONSENT
Mr Vontek (‘the husband’) and Ms Vontek (‘the wife’) have equal shared parental responsibility for B (born … 2006), C (born … 2008) and D (born … 2012) (‘the children’).
BY DETERMINATION
The children live with the wife.
The children spend time with the husband as is agreed in writing between the parties and in the absence of any such agreements, as is set out below.
During school terms the children shall spend time with the husband:-
a.for the remainder of 2016; each alternate weekend from after school Friday to 6.00pm Sunday;
b.from the commencement of term one in 2017; each alternate weekend from after school Friday to commencement of school Monday (or in the case of D pre-school or to the wife at 8.00am Monday, as arranged) or Tuesday if the Monday is a Public Holiday or Student Free Day;
c.such alternate weekend time to commence the first week after the commencement of school term, if the children were primarily with the wife during the last week of the preceding school holiday period and the second weekend if the children were primarily with the husband during the last week of the preceding school holiday period;
d.for the remainder of 2016; each alternate week from after school Tuesday to 7.00pm;
e.from commencement of term one in 2017; from after school Tuesday until the commencement of school Wednesday morning;
f.such alternate Tuesdays to commence the second week after the commencement of school term if the children were primarily with the wife during the last week of the preceding school holiday period and the first week if the children were primarily with the husband during the last week of the preceding school holiday period.
Subject to these orders; for one half of the mid-year school holiday periods, being the first half in even numbered years and the second half in odd numbered years. If the first half; then commencing after school on the Friday (or Thursday if the Easter break is included in the holiday) and concluding at 6.00pm on the Saturday in the middle of that holiday. If the second half; then commencing 6.00pm on the Saturday in the middle of that two week holiday period and concluding 6.00pm Sunday before the commencement of term or the Monday if the first day of school is a student free day or a public holiday.
Notwithstanding the orders above, if Easter falls in the first mid-year school holiday the parents shall arrange to have the children spend equal time with each parent in such first mid-year school holiday with the children spending from Easter Friday to Easter Sunday with each parent on a year about basis.
In the event that the Easter period does not fall in a mid-year end of first term school holiday period then;
a.in the first of such particular events and each alternate event thereafter; the children shall live with the husband from after school on Thursday before Easter until 9.00am Easter Sunday and if the children would otherwise spend time with the husband on the Tuesday following Easter, such time shall be suspended; and
b.in the second of such particular events and each alternate event thereafter; the children shall live with the husband from 9.00am Easter Sunday to the start of school Wednesday.
As to the Christmas/New Year holiday period;
a.from December 2016 and each alternate year thereafter; from after school on the last day of term for a period of three weeks (excluding the period from 10.00 am on 25 December to 6.00pm on 26 December when the children will live with the wife); and
b.from December 2017 and each alternate year thereafter for three weeks from the following 1 January, plus the children to spend time with the husband from 10.00 am on 25 December to 6.00pm on 26 December.
In the event that the operation of these orders would mean that children are not to otherwise spend time with the husband on Father’s Day, then the children are to spend time with the husband from 6.00pm on the Saturday preceding Father’s Day to the commencement of school the following Monday.
In the event that the operation of these orders would mean that children are not to otherwise live with the wife on Mother’s Day, then the children are to spend time with the wife from 6.00pm on the Saturday preceding Mother’s Day and the normal arrangements resume the following week.
As to changeovers if the children are at school then that shall be the place of changeover. If otherwise (including if the younger child is not attending local preschool) the parent collecting the child or children shall do so from the other parent’s home. To make it clear for the purposes of changeover the husband or his nominee shall collect the children from school/pre-school if they are attending local school or otherwise at the wife’s residence at the commencement of the children’s time with him and the wife or her nominee shall collect the children from school/pre-school if they are attending local school or the husband’s residence at the re-commencement the children’s time with the wife.
The wife be permitted to change the children’s primary place of residence to the E Town area and a consequential order that the parties do all acts and things to enrol the two elder children in the F School as and from the commencement of term three of the 2016 school year and to enrol D in that school when he commences primary school. The wife shall be permitted to continue D’s attendance at the pre-school or day care at G University.
D shall commence primary school in the year as is agreed by the parents; which in turn shall be reasonably based upon the advice given to them by the teachers and staff at D’s pre-school.
Both parties shall, within twenty one (21) days of the date of this order, do all such acts and things and sign all documents necessary (with the provision that the husband shall pay all passport application fees and the wife to provide passport photographs) to apply to the Department of Foreign Affairs and Trade to seek the issue a passport for each of the children. Such passport to be held by the wife. This order shall apply to the renewal of such passports within the year preceding the expiry of each such passport.
That both parents be permitted to reasonably travel overseas with the children whilst the children are living with them. Such travel to generally occur during the school holiday period and is subject to the written consent of the other parent, such consent will not be unreasonably withheld. The traveling parent shall provide to the other parent a copy of the children’s itinerary and contact details in a timely way.
Within seven (7) days from the date of each child’s commencement at school, each parent do all acts and things as may be required by each child’s school to authorise that school to provide each parent with all information or documents provided by the school to parents.
Each parent keeps the other party informed in writing of any change to their residential address, landline and mobile telephone number and in respect of any change shall notify the other parent within two (2) days of any such change.
Pursuant to s 65DA(2) and s 62B, the particulars of the obligations these orders create and the particulars of the consequences that may follow if a person contravenes these orders and details of who can assist parties adjust to and comply with an order are set out in the Fact Sheet attached hereto and these particulars are included in these orders.
PROPERTY ORDERS
Both parties shall (within forty two (42) days from the completion of the sale of both the Suburb H and Suburb I properties referred to in these Orders) do all acts and things necessary to transfer the wife’s interest in the property J Street, Suburb K (“Suburb K”) to the husband and:-
a. the husband shall (simultaneous with such transfer and at his own expense) refinance the existing mortgage secured over Suburb K so as to discharge the wife’s liability for the said mortgage; and
b. the husband shall indemnify the wife and keep her indemnified with respect to all outgoings (including normal mortgage instalments, rates, taxes and insurance) relating to Suburb K as and from the date of this order.
Within fourteen (14) days from the date of these Orders each of the parties shall do all acts and things necessary to cause property L Street, East Suburb H (“Suburb H”) to be listed for sale with a Real Estate Agent as agreed between the parties.
Upon the completion of the sale of Suburb H, as provided for by these Orders, the parties do all acts and things and sign all documents necessary to cause the proceeds of the sales to be applied in the following order and priority:-
a.the payment of all costs, commissions and expenses associated with the sale;
b.the payment of any council and water rates outstanding in respect of the Suburb H property;
c.the discharge of the first mortgage secured over the Suburb H property;
d.the payment of 67 per cent of the balance then remaining to the wife; and
e.the balance then remaining to the husband.
Within fourteen (14) days from the date of these Orders the parties do all acts and things to cause property M Street, Suburb I (“Suburb I”) to be listed for sale with a Real Estate Agent as agreed between the parties.
Upon the sale of Suburb I as provided for by these Orders, the parties do all acts and things and sign all documents necessary to cause the proceeds of the sales to be applied in the following order and priority:-
a.the payment of all costs, commissions and expenses associated with the sale;
b.the payment of any council and water rates outstanding in respect of the Suburb I property;
c.the discharge of the first mortgage secured over the Suburb I property;
d.the payment of 67 per cent of the balance then remaining to the wife; and
e.the balance then remaining to the husband.
The husband is declared the sole owner, in law and in equity to the exclusion of the wife, to the property at N Street, Suburb O (“Suburb O”).
To the extent necessary, simultaneous with the wife’s compliance with the preceding Order, the husband shall do all acts and things necessary to cause the existing mortgage secured over the Suburb O property to be refinanced such that the wife is released from any and all obligations pursuant to the existing mortgage secured over the property.
As and from the date of these orders, the husband shall be liable for and shall continue to pay the mortgage instalments of principal and interest, rates taxes, unit levies and the like in respect of Suburb O and Suburb K. Consequently, the husband shall be entitled to the rents on Suburb O.
Within forty two (42) days from the date of these Orders the husband pay to the wife such further sum as may be required to effect a division of the matrimonial assets as to 67 per cent to the wife and 33 per cent to the husband.
In the event that one or both of parties are issued with an income tax assessment from the Australian Taxation Office relating to capital gains (in effect requiring them, or either of them, to pay Capital Gains Tax) arising from the sales of Suburb H and Suburb I as referred to in the Orders above, the sale of the husband’s T Bank Shares and the wife’s IAG and Company S shares referred to in the Orders below; then the parties shall share in that joint tax liability as to 67 per cent by the wife and 33 per cent by the husband.
Within fourteen (14) days from the date of these Orders the wife do all acts and things to cause the Company S and IAG shareholdings to be sold.
Upon completion of the sale of the Company S and IAG shareholdings as provided for by these Orders, the parties do all acts and things and sign all documents necessary to cause the proceeds of the sales to be applied in the following order and priority:-
a.the payment of all costs, commissions and expenses associated with the sale;
b.the payment to the husband of 33 per cent any balance then remaining; and
c.the payment of the balance then remaining to the wife.
That, as between the husband and the wife, the wife be declared the sole owner in law and equity, to the exclusion of the husband, to the Telstra shareholdings currently registered in her name.
Within twenty eight (28) days from the date of these Orders the husband do all acts and things to cause the registered number plates (DOH111) on the husband’s European car to be transferred to the wife.
Except as otherwise provided for by these Orders, each of the parties shall as between themselves retain ownership and possession of the following, to the exclusion of the other party:-
a.any credits in accounts held with any financial institution in their respective names;
b.any motor vehicle in their respective names;
c.all personalty and household contents in the possession and/or control;
d.all shares in their respective names;
e.any real estate registered in their respective names; and
f.any and all other items of property, personalty, superannuation and/or financial resource in their respective names and/or to which they have an entitlement.
Disposal of assets
Pending completion of compliance with these orders, the husband shall not, other than for the purposes of giving effect to these Orders:-
a.dispose of any shareholding held by him without prior written consent of the wife; and
b.enter into any agreement that has the effect of encumbering Suburb H, Suburb K, Suburb I and Suburb O without the prior written consent of the wife.
Each of the parties shall equally be responsible for and pay one half of the net outgoings payable on the Suburb I and Suburb H properties.
The wife shall and hereby does give her consent to the leasing of Suburb K; with the rental to be retained by the husband as and from the date of this order and the husband shall be solely responsible for all outgoings relating to Suburb K.
In default of either or both of the parties doing all such things and executing all such documents as may be needed to comply with these Orders, a Registrar of the Family Court of Australia Sydney Registry or such other person as may be appointed by the Court be authorised pursuant to s 106A of the Family Law Act1975 (Cth) to do all such acts and things and execute all such documents on behalf of either or both of the parties; and in the event that either party procure compliance with these Orders by obtaining execution of documents pursuant to these Orders, then the party procuring such execution of documents be indemnified by the party for his or her costs and expenses incurred in obtaining such compliance.
Each party be at liberty to re-list these proceedings on seven (7) days notice in writing to the other and to the Court, in respect of implementation and any mechanical issues in relation to the property Orders, such leave shall apply for a period of six (6) months from the date of these orders.
All outstanding parenting, property and maintenance applications be dismissed except as to costs. Any costs applications to be made in accordance with the Family Law Rules 2004 (Cth).
At the expiry of the appeal period all subpoenaed documents be returned to the persons or institutions from which they emanated and all exhibits are returned to the person or persons who tendered the same.
THE COURT NOTES
Consent Partial Property Orders were made on 9 March 2016 in the following terms:-
1.the husband shall forthwith do all acts and things to cause the sale of the T Bank Shares to the value of approximately two hundred thousand dollars ($200,000.00) and upon completion of the sale provide to the wife the sum of ninety five thousand ($95,000.00), such sum to be by way of partial property settlement with the balance to be retained by the husband as partial property settlement.
2.As and from the date of payment of the said sum of $95,000.00 to the wife, each of the parties shall be responsible for and pay one half of the net outgoings on the Suburb I and Suburb H properties until such time as the completion of sale of those properties.
3.Each of the parties will be liable for a proportionate part of the capital gains tax on the sale of these shares given the proposed order 9 in Exhibit ‘W9’ to these proceedings.
IT IS CERTIFIED
Pursuant to Rule 19.50 of the Family Law Rules 2004 it was reasonable to engage senior counsel and counsel to attend.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Vontek & Vontek has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| FAMILY COURT OF AUSTRALIA AT PARRAMATTA |
FILE NUMBER: SYC 7165 of 2013
| Mr Vontek |
Applicant
And
| Ms Vontek |
Respondent
EX TEMPORE REASONS FOR JUDGMENT
INTRODUCTION
When the matter was before me last week, the parties regularly referred to a joint balance sheet, which was handed up to me. It was not formally tendered as an exhibit.
In that case the joint balance sheet will be Exhibit W11, and I note for the purpose of the transcript, that the European car is deleted, and that the capital gains tax on the sale of the Suburb I and Suburb H properties will be dealt with on the sales of those properties as the parties had anticipated.
I am delivering these reasons ex tempore, and, of course, I reserve to myself the ability to polish those reasons, although not to change them in any substantive form, afterward.
These are proceedings between Mr Vontek (‘the husband’), and Ms Vontek (‘the wife’) relating to parenting, children and property. The proceedings were heard on 7, 8 and 9 March 2016 in Parramatta, and each of the parties was legally represented.
These ex tempore reasons were delivered a few days after the close of evidence, and the exchanges between bench and bar during the hearing are included as part of the reasoning. As to the children’s issues: it is the wife’s desire to move with the children to E Town in the west of Sydney, some 63 kilometres, as I understand it, from her current address which is in northern Sydney.
The parties are agreed as to equal shared parental responsibility. The wife wants the children to live with her, divide school holidays equally between the husband and herself, and provide that the husband spend time with the children each alternate weekend, plus one day during the week as set out in the wife’s Exhibit W10. This includes having the children from Friday evening (Friday morning if a non-school day) to 6.00pm Sunday, and from the conclusion of school on Tuesday to 7.00pm, and if a non-school day from 9.00am to 7.00pm.
The husband seeks orders set out in his case outline, Exhibit H1, and a subsequent form of order that his senior counsel tendered. The husband wants the children to primarily live close to where he resides and attend at the local school, and it is his application that his time with the children moves fairly quickly to equal time. He does not oppose the wife moving to E Town, but says that the children should not be expected to move with her and their primary residence should be near where they attend school.
Given the types of orders sought, I am not sure how that could work. The husband consents to the children spending more time with him, as I said, but proposes to move quickly to equal time.
The parties agree to arrangements where passports should issue for the children and that they can travel overseas at regular times.
The husband wants the youngest child, D, enrolled in Suburb K Community Pre-School and to ensure the child’s attendance at that school. D is currently attending a day-care centre, or a pre‑school at G University, as the wife is studying this year towards obtaining qualifications.
In terms of the property, the parties have essentially agreed on the nature and value of most of the property. There are some relatively minor issues of value and liability which I will discuss later in these reasons.
It was the husband’s case that the whole of his contributions over the marriage were greater than the wife. It was submitted that this was at about 60 per cent to him and 40 per cent to the wife. It is the wife’s position that the husband’s contributions are less than hers and she seeks, on the contribution basis, 55 per cent to her and 45 per cent to the husband.
The husband says that his earning capacity is greater than that of the wife, and there should be some modest adjustment in her favour in relation to the so-called s 75(2) factors. The wife, on the other hand, says that there ought to be an adjustment of some 20 per cent in her favour. Thus, the range between the parties is that the husband seeks an equal division of the property, in essence, and the wife seeks 75 per cent.
The overall difference is that there are issues of contribution during the relationship, and post separation, particularly as to how significant assets came into the husband’s hands following their separation and how they were applied. There is no evidence of hiding assets or waste of assets, simply the process adopted by the husband in terms of contribution.
In terms of the s 75(2) factors, there is a reflection of the above issue in that regard in the income-earning disparity between the parties and some other issues.
BACKGROUND
The husband is aged 43 and the wife is aged 42. They are both in good health. The husband presently works with T Bank in a senior position and earns a significant income. He works full-time, although this at times has some flexibility as he has, from time to time, been able to leave early to collect the children in terms of some parenting arrangements and been able to attend some of their school functions.
The wife has worked full-time and part-time during the marriage. There is a contest as to the extent of the involvement each of the parties had in the care of the children, and I have dealt with that in terms of contribution, and in terms of parenting.
In October 2003, the husband purchased a property at N Street, Suburb O, (‘the Suburb O property’) for about $425,000. He borrowed $382,000 and said there was $5,000 for mortgage insurance. Therefore he had equity in that property of some $40,000 at that time.
At cohabitation the wife had a one-quarter interest in P Street, E Town. The other three-quarters were as to one-half by her parents, and a quarter by her estranged brother. That property was acquired by the wife’s parents and the quarter share was gifted to her in 1992 to 1993. In addition, at cohabitation the wife had a half-interest in a property which she owned with her brother at M Street, Suburb I (‘the Suburb I property’).
The brother’s one half share in the Suburb I property was purchased by the husband in about 2007. Suburb I had a value at that time of $350,000 and was subject to a mortgage of about $57,000.
The wife also had a legal interest in 8,000 Telstra shares, half of which were sold to assist in the purchase of J Street, Suburb K (‘the Suburb K property’).
Both parties have tertiary qualifications and the husband has a PhD.
In November 2003, the husband and wife commenced cohabitation at the husband’s Suburb O property. The wife was working with Company S. In 2004, the husband was employed by Company R. In 2006, the parties were married.
In 2006, B was born, and the husband took three weeks off work to assist in the settling in of the child and care of the child for that period of time. From November 2006, the husband’s employment with Company R took him to Melbourne, leaving Sydney on Monday and returning on Thursday. The husband left that employment in March 2007 and commenced working for a bank, which eventually led to his employment with the T Bank in May 2007, at that time earning about $200,000 a year, plus bonuses.
The husband asserts that in late 2007 the wife returned to employment. It was not clear as to the full nature of her work or the payment she received at that time. In December 2007, the parties purchased the Suburb K property, for $813,500. They borrowed $630,000 from T Bank. In consideration of the contribution factors, I have had regard to the money being borrowed from T Bank for the various purchases, and that such money was provided at a reduced employee rate and other benefits as set out in the husband’s affidavit.
The parties paid the difference of about $200,000, from the modest proceeds of sale of the 4000 Telstra shares and other savings. In 2008, C, their second child, was born, and the husband took three weeks off work following that birth. The parties were also assisted by the husband’s mother and the wife’s parents.
The parties agreed for the husband to purchase the wife’s brother’s half interest in the Suburb I property. The husband obtained a staff discount on the interest rate to acquire that property and pay out the existing mortgage of about $57,000.
In mid-2009, the husband asserts that the wife returned to work with the children attending childcare two days per week.
In 2010, the Suburb K property was flooded and the parties were required to vacate and undertake significant work to remedy the damage.
In and around 2012, the parties advanced to the husband’s mother a total of $432,329.74, the largest part of which was $320,000 advanced in March 2012. That advance was raised by way of mortgage secured over the Suburb K property. The advances to the husband’s mother were subsequently repaid in July 2014.
According to the husband in Exhibit W2, which was a cash‑flow summary, his mother returned to the parties an amount of $477,000 in July 2014. Subsequent to separation there was a further advance by the husband to his mother, and that then was repaid in October 2015
In addition, the husband lent his mother $25,000 in February 2013, which sum was repaid on 22 March 2013. Subsequently, the husband borrowed the sum of $8,800 from his mother in February 2016 to assist with the payment of legal fees. He says he still owes that money.
In December 2010, the parties had purchased L Street at Suburb H (‘the Suburb H property’) for $1,315,000. The purchase was funded from savings in the form of T Bank shares and a staff mortgage through T Bank, that mortgage was about $1,115,000.
The husband asserted that in December 2011 the wife ceased paid employment.
In 2012, D was born, and the husband took five weeks off work to assist and participate in the welcome to D to the parties’ lives. The parties separated under the same roof in January or February 2013. The husband eventually vacated the former matrimonial home at Suburb K and moved to rented accommodation in Suburb U, where he still resides, although it is in a different apartment.
The husband and his present fiancée commenced cohabitation in 2014. The husband says he now financially supports her as she is undertaking study towards her master’s degree.
The husband is significantly involved in the children’s activities outside his work hours, and he spends time with the children during their sporting activities, not during his time but at other times, and spends half of their school holidays with them when he takes time off work.
These proceedings were commenced by the husband in the Sydney Registry of the Family Court on 3 December 2013 when he sought parenting and property orders. The proceedings went to a conciliation conference before a registrar on 15 September 2014, and in the absence of settlement, the proceedings were transferred to the Federal Circuit Court, Sydney.
The matter was listed for hearing, as I understand it, before a judge of that Court in June 2015. The hearing was not reached as the property and parenting issues were to take four days. The proceedings were then transferred to the Parramatta Registry of the Family Court. In many ways these parties have been caught up in the shortage of judges and the delays that arise from that.
Fortunately, or unfortunately, depending on what people’s perceptions of the result will be, I became available and heard the matter last week. The proceedings were heard by me over three days. I make no criticism of the Federal Circuit Court, particularly given the high volume and workload of the judges of that Court.
In these reasons any statement of fact is to be regarded as a finding of fact unless it is clear from the context that it is otherwise.
THE EVIDENCE
The husband
The husband relied upon his affidavit and statement of financial circumstances, both filed 1 March 2016. He also relied upon an affidavit of his mother filed that same day, and an affidavit of his fiancé also filed the same day.
The husband was cross-examined on his affidavit material. The affidavit of his mother and fiancée were read into evidence, and I accept their evidence as uncontroversial.
In terms of his fiancée, she said she is now a full-time student but had been working at W University. She lives in the northern Sydney area and says that she engages well with the children. There was no criticism of her involvement with the children by either party in any meaningful way.
Ms V Vontek is the husband’s mother, who provided evidence in accordance with her affidavit filed 1 March 2016. She is 64 years of age and lives in northern Sydney. She borrowed money from the parties during the course of their marriage and those moneys were repaid to the husband in July 2014.
As I said earlier, she lent the husband $8,800 to assist him in payment of his legal fees.
The husband also relied on an affidavit of Mr X, sworn 19 June 2015, in regard to the state and value of the wife’s interest in the property at E Town. The improvements on the property at that time were described as being:-[1]
Erected on the site is a single living residence of a quite compact and basic nature, appearing to be originally dated around the 1950s.
[1] At page 13 of 45 (page 8 of report).
It has two bedrooms, living room, kitchen, bathroom and laundry. The living area is about 61 square metres.
I was asked to look at the photographs in respect of the property. It is a modest dwelling. I accept that it is either habitable or could be relatively easily made habitable, although certainly a much lesser accommodation than is currently the circumstances for the children having now moved from Suburb K to Suburb H.
The parties also relied upon a joint balance sheet, which was unfortunately not tendered during the trial, but which I raised with their solicitors at the commencement of today, and I have now treated as Exhibit W11.
The husband was cross-examined and no submissions were made that the husband was being intentionally dishonest. He gave evidence in accordance with his affidavit and it was not overly impeached, although that was given from his subjective perspective.
In terms of the evidence of the children, their financial needs and the wife’s household, the husband was at times, in the words of Dr Y, rigid and unresponsive. The husband was not open to assisting the wife in the context of the care of the children, beyond that which he felt obliged to pay.
The husband met the majority of the real estate mortgage instalments, the council water rates and expenses on their real property from rent (when available) and from capital from the sale of shares and part of the repayment of the advance to his mother.
The wife sought spousal maintenance from the husband and he declined to provide the assistance, notwithstanding that the wife was contributing by way of the capital, to which I referred above. The wife made an interim maintenance application, but it was not pursued and no spousal maintenance was pursued at the hearing. I accept the husband is fixed in his views and that he will pay what he believes is appropriate but not beyond those amounts.
In his case the husband tendered the following documents:-
(a)Exhibit H1, the case outline prepared by his senior counsel;
(b)Exhibit H2, the minutes of order he has sought; and
(c)Exhibit H3, the letter from Slater and Gordon showing his costs paid to date of about $105,943.
The wife
The wife relied on an affidavit of her father, Mr Z, filed 16 June 2015. He was not cross-examined on this material and it was read into evidence without controversy.
The wife relied upon her affidavit filed 4 March 2016, and her financial statement of the same date.
There was an issue in relation to what the wife had done regarding her intention to move to E Town. There was criticism of her that she had not been to visit the various extra-curricular organisations available for the children and that her inquiries in relation to whether the building of two houses on the E Town property was permitted.
I reject that criticism of the wife and make findings that given the uncertainty that litigation creates, particularly in the terms of the movement of these proceedings between the Courts over the last 12 or 18 months, that she made appropriate inquiries in respect of school activities and proposed redevelopment, with a considered alternative if the two-house proposal was not permitted.
There was also criticism as to why there was no formal arrangement in relation to an acquisition of E Town from her parents and her brother. Given the sale of the Suburb I property by her brother to the husband and the wife’s reasonable belief that her brother will sell her his one-quarter share, and combined with her father’s support of the move, including her acquisition of the half share from her father and his wife (see paragraph 40 of her father’s affidavit) I do not adopt that criticism.
The affidavit of the wife’s father shows it was clear that her parents are supportive of a move to E Town and I infer that they will facilitate the sale, or at least their portion, of E Town to her. The wife believes, rightly or wrongly, that her brother, from whom she is estranged and has been estranged for at least 13 years, will sell his share. She believes this based upon things her parents have said to her.
In that regard, as I have said, it is significant that the brother sold his interest in the Suburb I property. The wife attended at the local council near E Town and made inquiries about putting two houses on the land. As I said earlier, the house in E Town is modest. However, the wife could not reasonably commit to spending significant moneys given these proceedings.
She has given an estimate as to the cost of building a home as a back‑up position. She has made inquiries as to the cost of homes in a general sense. It is the wife’s intention to reside in the very small house at E Town, which has some limitations. I referred to those earlier.
The wife’s vision of E Town is somewhat romantic. However, E Town is within the Sydney area and the wife will not have the income-earning capacity of the husband and seeks to preserve those assets which she will have following the property orders, in the absence of large earnings formerly provided to the household by the husband when the parties were together.
The wife tendered, through her counsel, a series of documents:-
(a)Exhibit W1 - her case outline;
(b)Exhibit W2 - the husband’s cash flow estimate;
(c)Exhibit W3 - emails in relation to the husband’s approach to child support in circumstances where he, in 2014, insisted that the wife be responsible for electricity bills and the like. It is of note that he did this in the light of the fact that he believed he needed to pay about $1,800 per month child support; for example about $22,000 per year;
(d)Exhibit W4 - the assertion that the husband maintains a mortgage repayment from the joint account. That needs to be read in terms of Exhibit W2;
(e)Exhibit W5 - an email from the husband dated September 2012 in relation to a proposed change of residence;
(f)Exhibit W6 - the wife’s costs letter showing payments to date of about $41,000;
(g)Exhibit W7 - letters regarding the wife’s request for financial support in February 2015;
(h)Exhibit W8 - the husband’s income tax returns for 2013, 2014 and 2015, together with his 2014 income tax assessment showing taxable income of $625,410, presumably including capital gains calculations on his sale of his shares.
In the context of the husband’s income tax I would regard in the circumstance that any tax losses by him in respect of the property may reduce the income tax otherwise payable by him, through some very modest levels of negative gearing. This, of course, only applies to his share of the negatively-geared properties, although Suburb O, as I understand it, is in his name. This would, of course, not provide the wife with significant benefits in terms of her losses given her modest, if any, income.
(i)Exhibit W9 - was an amendment to the property order sought by the wife;
(j)Exhibit W10 - the minute of parenting orders sought by the wife; and
(k)Exhibit W11 - which is the joint balance sheet to which I referred to earlier.
As I indicated, the parties addressed me that there were questions as to the agreed property pool set out in Exhibit W11. As to the wife’s evidence, she was cross-examined at some length and was at times distressed and upset.
She endeavoured to give evidence frankly from her own subjective point of view. My observations are that she presented as child focused, was organised and made relatively thoughtful, flexible, child-centred decisions, although still exhibits some anger towards the husband. The relationship between the wife and the husband has been difficult since separation. The wife also explained the circumstances of the flooding of the Suburb K property and the impact on her, which appears to have been quite significant.
The wife gave evidence that she will be attending university four days per week between 10.00 am and 4.00 pm, Mondays and Wednesday; 11.00 am to 1.00 pm, Thursday, and 10.00 am to 11.00 am Friday. The youngest child has been booked into childcare or pre-school at the university.
The wife’s financial circumstances in terms of income and expenditure have been tight from time to time, and she relies on her parents to assist her with groceries. She has clearly used her capital to meet some expenses.
The wife said she considered the impact of the move on the children and the advice or concerns of Dr Y as to the children being resentful. Her view is that given the children’s age and her knowledge of them, they would adjust and they would not be resentful. I accept that evidence.
There was some cross‑examination about whether the 8,000 Telstra shares were entirely the wife’s or her parents’. The wife said that they were half her parents’, although for the purpose of these proceedings she treated them as her own, and I have adopted that course. I have also treated them as coming to the wife from her family and not being jointly acquired.
The wife should not be criticised for adopting that pragmatic approach. The parties had the benefit of the capital sale of the Telstra shares being used in a very modest way to assist with the purchase of the Suburb K property, and, of course, the dividends being applied for the benefit of the family over the years.
The wife gave evidence that at one stage when she was working full time with Company S she was earning about $92,000 a year.
Similarly to the husband, I accept her evidence is reliable but from her subjective point of view.
PARENTING
The provisions of the Family Law Act 1975 (Cth) (‘the Act’) that deals with children is set out in Part VII of the Act, in particular s 60B articulates the objects and the principles underlying them as follows:-
(1) The objects of this Part are to ensure that the best interests of children are met by:
(a) ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with the best interests of the child; and
(b)protecting children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence; and
(c) ensuring that children receive adequate and proper parenting to help them achieve their full potential; and
(d) ensuring that parents fulfil their duties, and meet their responsibilities, concerning the care, welfare and development of their children.
(2) The principles underlying these objects are that (except when it is or would be contrary to a child’s best interests):
(a) children have the right to know and be cared for by both their parents, regardless of whether their parents are married, separated, have never married or have never lived together; and
(b) children have a right to spend time on a regular basis with, and communicate on a regular basis with, both their parents and other people significant to their care, welfare and development (such as grandparents and other relatives); and
(c) parents jointly share duties and responsibilities concerning the care, welfare and development of their children; and
(d) parents should agree about the future parenting of their children; and
(e) children have a right to enjoy their culture (including the right to enjoy that culture with other people who share that culture).
A statutory presumption, albeit a rebuttable presumption, is created by s 61DA(1) of the Act. It sets out that ‘it is in the best interests of the child for the child's parents to have equal shared parental responsibility for the child’. The presumption does not apply if there are reasonable grounds to believe that a parent of the child, or a person who lives with a parent of the child, has engaged in either abuse of the child or another child who, at the time, was a member of the parent’s family, or that other person’s family, or family violence. The section also provides that the presumption may be rebutted if the court is satisfied that an order for equal shared parental responsibility would not be in the best interests of the child.
If an order is made providing that a child’s parents have equal shared parental responsibility, either pursuant to the presumption or otherwise:-
(a)Section 65DAA(1) of the Act obliges the Court consider, in the context of the child’s best interest, making an order or provision in an order for the child to spend equal time with each of the parents, provided such arrangement is reasonably practicable, and if not;
(b)Section 65DAA(2) of the Act obliges the Court consider, in the context of the child’s best interest, making an order or provision in an order for the child to spend substantial and significant time with each of the parents, provided such arrangement is reasonably practicable.
(c)In the context of these determinations, section 65DAA(3) sets out some parameters in considering the term ‘substantial and significant time’ and section 65DAA(5) sets out the factors which a court must consider when determining the question of ‘reasonably practicality’.
The next step in the statutory path is contained in s 60CA, which provides that in deciding whether to make a particular parenting order the Court must regard the best interests of the child as the paramount consideration and consequently in determining the child’s best interests the court must consider the matters set out in s 60CC.
In Maldera & Orbel (2014) FLC 93-602 the Full Court discussed the relationship between the objects contained in s 60B and the factors which must be considered in s 60CC, concluding that the objects are able to be used to aid in the construction of words of the legislation, but cannot be used to undermine the plain and unambiguous requirement to consider the factors contained in s 60CC to determine the child’s best interests. The section relevantly provides:-
(1)Subject to subsection (5), in determining what is in the child's best interests, the court must consider the matters set out in subsections (2) and (3).
(2)The primary considerations are:
(a) the benefit to the child of having a meaningful relationship with both of the child's parents; and
(b)the need to protect the child from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence.
Note: Making these considerations the primary ones is consistent with the objects of this Part set out in paragraphs 60B(1)(a) and (b).
(2A)In applying the considerations set out in subsection (2), the court is to give greater weight to the consideration set out in paragraph (2)(b).
(3)Additional considerations are:
(a)any views expressed by the child and any factors (such as the child's maturity or level of understanding) that the court thinks are relevant to the weight it should give to the child's views;
(b)the nature of the relationship of the child with:
(i) each of the child's parents; and
(ii) other persons (including any grandparent or other relative of the child);
(c) the extent to which each of the child's parents has taken, or failed to take, the opportunity:
(i) to participate in making decisions about major long-term issues in relation to the child; and
(ii) to spend time with the child; and
(iii) to communicate with the child;
(ca) the extent to which each of the child's parents has fulfilled, or failed to fulfil, the parent's obligations to maintain the child;
(d)the likely effect of any changes in the child's circumstances, including the likely effect on the child of any separation from:
(i) either of his or her parents; or
(ii) any other child, or other person (including any grandparent or other relative of the child), with whom he or she has been living;
(e)the practical difficulty and expense of a child spending time with and communicating with a parent and whether that difficulty or expense will substantially affect the child's right to maintain personal relations and direct contact with both parents on a regular basis;
(f)the capacity of:
(i) each of the child's parents; and
(ii) any other person (including any grandparent or other relative of the child);
to provide for the needs of the child, including emotional and intellectual needs;
(g)the maturity, sex, lifestyle and background (including lifestyle, culture and traditions) of the child and of either of the child's parents, and any other characteristics of the child that the court thinks are relevant;
(h) if the child is an Aboriginal child or a Torres Strait Islander child:
(i) the child's right to enjoy his or her Aboriginal or Torres Strait Islander culture (including the right to enjoy that culture with other people who share that culture); and
(ii) the likely impact any proposed parenting order under this Part will have on that right;
(i)the attitude to the child, and to the responsibilities of parenthood, demonstrated by each of the child's parents;
(j)any family violence involving the child or a member of the child's family;
(k) if a family violence order applies, or has applied, to the child or a member of the child's family any relevant inferences that can be drawn from the order, taking into account the following:
(i) the nature of the order;
(ii) the circumstances in which the order was made;
(iii) any evidence admitted in proceedings for the order;
(iv) any findings made by the court in, or in proceedings for, the order;
(v) any other relevant matter;
(l)whether it would be preferable to make the order that would be least likely to lead to the institution of further proceedings in relation to the child;
(m)any other fact or circumstance that the court thinks is relevant.
There are no issues under s 60CC(2)(b) of the Act in that each parent acknowledges that the other parent is well able to care for the children, and each have provided care at various levels throughout the course of the relationship. The children are not at risk of abuse, violence or neglect in the unsupervised care of either parent.
To the credit of both parties, and particularly the wife, each child has a close relationship with the father, or the other parent. The youngest child was quite young at the time of separation. The wife adopted a sensible approach in relation to the child spending regular time with the father, but certainly not to the degree sought by the husband, but on an increasing basis. It is clear that this was the source of some conflict between the parties.
The husband sees the children on a regular basis, weekends and during the school week. He is extensively engaged in their sporting, social and school activities.
Dr Y
There was evidence given by Dr Y. He is an expert appointed by an order made in the Federal Circuit Court. He assessed the parties and the children in late February 2015 and issued a family report in April of that year. That report was in anticipation of the 2015 hearing. Dr Y’s qualifications were not challenged and his report, albeit one year old, was read into evidence.
Dr Y was provided with the parties’ trial affidavits in advance of giving evidence. His evaluation was set out in paragraph 81 to 84 of the report, and I have had regard to that. His recommendations were set out in paragraph 85 and 86 which provided:-
85.[The wife] both indicated having enrolled and started attending the ‘Keeping Kids in Mind’ program. She was able to articulate information she has learnt in just two weeks for the benefit of the children. In this regard, her efforts are to be commended. [The husband] has yet to complete his parenting after separation program and it is recommended that he enrol and attend at the earliest convenience, to encourage communication between the pair, positive parenting, and removing the children from the heart of the conflict. Continuing conflict in front of the children would be deleterious to their wellbeing, with significant ramifications for self-esteem. In the event either party does not evidence completion of such a course, then I would ask the court consider directing the party(ies) to complete said course, as a matter of priority.
86.I would also recommend that both parties be directed to attempt mediation via an accredited Family Dispute Resolution (FDR) practitioner. I would strongly recommend the need for a mediated communication process to commence such that both parties can reach agreement of future schools, the children’s health and medical needs, and participation in extra-curricular activities (and costs), so that both parties can be more supportive of the children’s pursuits. Such efforts would minimise further possible litigation, and (optimistically) further uncertainty and acrimony.
In terms of that evaluation, Dr Y observed that the parties’ relationship was not acrimonious and by implication they are likely to establish a positive communication. This expression of hope was tempered by the concerns that Dr Y had as to the unhappiness of the wife and the fixed nature of the husband’s personality.
Dr Y accepted, as I do, that both parents love their children. Unfortunately these parents are somewhat polarised and regard each other’s approach as being unreasonable. To that end, the husband is of the view that the wife’s move to E Town is some sort of endeavour by her to limit his time with the children. The parents have managed to keep the conflict away from the children (paragraph 73 of Dr Y’s report) and the children’s relationship is evidenced by the comfortable, loving relationship and loving behaviour Dr Y observed of them with the parents.
As the parents have different practices in their homes, Dr Y recommended that they try to improve their communication. Sadly, that appears not to have markedly changed since he saw them in February 2015. An example of this is the pre-school or childcare arrangements for D this year.
As to equal shared parental responsibility, Dr Y recommended that this was reasonable, and given that it is a request of both parties, and having independently assessed that, I will make that consent order.
I have considered the relevant factors under s 60CC of the Act. In considering those factors I have had regard to all of the evidence provided to me during the hearing and findings. I have considered the factors separately and together.
Section 60CC(2)(a) the benefit to the child of having a meaningful relationship with both of the child's parents;
As to s 60CC(2)(a) of the Act, the children have a meaningful relationship with each of their parents. To that end both parents are to take credit. There is no sign of either parent alienating, or trying to alienate, the children with the other parent. I do not regard the wife’s desire to move to E Town to be such a sign.
The parties had, albeit briefly, considered such a move to E Town when they were together (see Exhibit W5).
Section 60CC(2)(b) the need to protect the child from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence;
There is no evidence or claim that the children are at risk of being subjected to or exposed to abuse, neglect or family violence. The only caveat I put on that view is that the conflict and poor communication will, if it continues to fester, adversely impact upon the development of these children. Given this finding, I need not progress to ss 60CC(2A) of the Act.
Section 60CC(3)(a) any views expressed by the child and any factors (such as the child’s maturity or level of understanding) that the court thinks are relevant to the weight it should give to the child’s views;
There is some evidence, at least in relation to C, that he has concerns about the move to E Town. I have had regard to this evidence in making this determination.
Dr Y expressed concern the children may be resentful of the move to E Town, and I have referred earlier to the wife’s evidence that she believes that given their age and their close relationship with her that will not be a significant issue.
Section 60CC(3)(b) the nature of the relationship of the child with:
(i) each of the child’s parents; and
(ii) other persons (including any grandparent or other relative of the child);
As I have indicated elsewhere, the wife is the primary carer of the children. The children are closely bonded with both parents. Both parents are engaged in the children’s lives, although their communication, as I said, is inadequate.
The children have close relationships with their maternal grandparents and their paternal grandmother. Their maternal grandparents live in Blacktown, and the paternal grandmother lives in northern Sydney close to where the parties currently live.
The husband suggested the wife does not facilitate the relationship between him and the children. However, the nature of the children’s relationship with him, particularly after three years since separation, is counter‑indicative of that point of view. Disagreement and unwillingness to adopt the husband’s views is not a failure to facilitate time. The parties have managed, however, in that three years, without the need of parenting orders until the final hearing.
Section 60CC(3)(c) the extent to which each of the child's parents has taken, or failed to take, the opportunity:
(i) to participate in making decisions about major long-term issues in relation to the child; and
(ii) to spend time with the child; and
(iii) to communicate with the child;
As to these factors, each of the parties has fulfilled their responsibility in spending time and communicating with the children.
Their approach to decision-making has been somewhat compromised by their ongoing disrespect of each other, albeit to a limited extent.
Section 60CC(3)(ca) the extent to which each of the child's parents has fulfilled, or failed to fulfil, the parent's obligations to maintain the child;
The husband has paid child support and each parent has with capital payments provided the accommodation in which the children presently primarily reside. Initially this was Suburb K, now it is Suburb H. As I have said elsewhere the husband has a rigid view that the wife should be primarily responsible for her own financial support and he had declined her requests to pay spousal maintenance and disconnected services to the home in which the children resided at a time when he could have easily met those expenses.
Section 60CC(3)(d) the likely effect of any changes in the child's circumstances, including the likely effect on the child of any separation from:
(i) either of his or her parents; or
(ii) any other child, or other person (including any grandparent or other relative of the child), with whom he or she has been living;
The husband complains that his relationship with the children will be significantly reduced if the children are allowed to move to E Town, which is some two hours away by car, and some 63 kilometres. I do not accept the full breadth of the husband’s submission in that regard.
It will certainly change their relationship and it will impose, if it occurs, some practical difficulties upon the husband. However, the husband has clearly shown his intention of maintaining his relationship with the children and I believe he will continue to do so.
Section 60CC(3)(e) the practical difficulty and expense of a child spending time with and communicating with a parent and whether that difficulty or expense will substantially affect the child's right to maintain personal relations and direct contact with both parents on a regular basis;
In terms of section 60CC(3)(e) of the Act, there will be practical difficulties in the wife moving to a different part of the Sydney metropolitan area, but that is not insurmountable. The children will continue to have relationships with both their parents and grandparents.
There may need to be more thought in terms of how that would occur, but the significant relationships with the children will continue. The wife has said, and I accept, that she will endeavour to be more flexible in terms of the arrangements with the husband and how that should occur.
The wife does not wish to remain in the northern Sydney area and provides some cogent reasons for the move, and I might add some reasons that are not quite so cogent, such as her suggestion about north sunlight.
It is not as if the wife is proposing to move out of the Sydney area and to another state. The wife ought not to, in effect, be chained to a particular area of the city. She is reasonably entitled to find a home that meets her needs and ambitions and those she has for the children, provided always that it does not unreasonably inhibit the children’s relationship with their father. This move will not, if it occurs, unduly inhibit the husband’s relationship; it will certainly make it more difficult.
It is appropriate, therefore, for me, in that context, to set out the existing property interest and the liabilities.
THE PROPERTY
The husband’s property
The Suburb K Property
$1,675,000
The Suburb O Property
$700,000
Remainder of husbands T Bank Shares
(Note: part of that has already been divided by way of a partial property order as to $105,000 to the husband and $95,000 to the wife)
$49,529
The husband’s NIB shares
$3,056
The husband’s IAG shares
$9,160
The husband’s T Bank savings account
$105,000
The husband’s European motor vehicle
$19,000
The husband’s furniture
$10,000
The husband’s Australian Superannuation
$246,259
The husband’s Plum Superannuation
$36,204
The husband’s Tower Superannuation
$18,853
Amount to be distributed to the husband through proceeds of sale of some of the T Bank shares
$105,000
Total
$2,977,061
The wife’s property
The wife’s IAG shares
$9,160
Telstra shares to be retained by the wife
$20,480
Company S shares (to be sold and divided)
$13,592
The wife’s 4WD motor vehicle
$10,000
The wife’s furniture
$10,000
The wife’s savings account
$17
The wife’s T Bank Account
$22,913
The wife’s AMP Cal-Superannuation
$99,951
The wife’s TAL Superannuation
$1,110
The wife’s AMP Superannuation
$14,703
Amount to be distributed to the wife through proceeds of sale of some of the T Bank shares
$95,000
Total
$296,926
Liabilities
There are liabilities which need to be deducted from the husband’s share which are as follows:-
Mortgage on the Suburb K Property
$538,148
Mortgage on the Suburb O Property
$358,133
The husband’s liability to the Australian Taxation Office
$99,541
Capital Gains Tax on sale of T Bank Shares (which I presume are the last T Bank Shares)
$68,000
Total
$1,063,822
Legal Costs
As to the $8,800 liability by the husband to his mother for legal costs, I have not included this liability in the calculations. I was provided with letters as to monies spent by each party on legal costs. The husband has paid about $105,943 legal costs so far, including, presumably, the $8,800. This has in effect come out of the joint property of the parties. The husband borrowed $8,800 from his mother to partly fund this debt. The wife has spent considerably less in legal costs so far. Each party will have significant legal costs.
I have had regard to the application of those funds by each party as disclosed in their cost letters in terms of contribution, but I do not intend, as I said, to include the $8,800 incurred by the husband in it.
OTHER PROPERTY
I have included the wife’s shares in IAG and Company S, although they will need to be deducted when the calculation of the amount due to the wife is given to her as they are to be sold and the proceeds divided in accordance with the determined percentage.
There remained the issue at the conclusion of the hearing as to the value of the wife’s 4WD motor vehicle. There was no expert evidence as to the value, and senior counsel for the husband submitted initially that its value was $15,000, and then suggested the Court adopt a halfway house of $12,500. However, when the only evidence I have is the wife asserting that it is $10,000 without a valuation, and the husband asserting it is $15,000, without a valuation, I am left with little choice but to adopt the lower amount.
I have not included the properties at Suburb H and Suburb I in the list of property as they are to be sold and the net proceeds are to be distributed in accordance with the orders, and in accordance with the percentage that I will have determined. The parties have agreed that they will be equally responsible for the outgoings on Suburb H and Suburb I, and similarly I have not included the liabilities in respect of those properties for the same reason.
I have not included capital gains tax liability on the sale of those properties given the orders made providing for the payment of capital gains tax in accordance with the percentage that I have otherwise determined.
The 4,000 shares will remain in the wife’s property and will be included in the list.
CONTRIBUTIONS
At the commencement of cohabitation the wife had a half interest in the property at Suburb I, a one quarter interest in the property at E Town and the shares in Telstra to which I have alluded earlier.
The wife worked initially full-time and then part-time.
The husband worked full-time and at times was away working during the week (for a period of about five or six months) after the eldest child was born.
It was unclear as to the relative superannuation of each of the parties at cohabitation. The husband had a modest interest in a property at Suburb O of some $40,000. The wife had an interest in the properties referred to earlier, although the amount of the mortgage and the value of the Suburb I property were not clear as at the date of cohabitation.
There is some evidence however, that the E Town property was purchased for $195,000 in 1992 or 1993, and therefore the Court can infer that the wife’s quarter share had a value of just short of $50,000 at that time.
In the two years before the parties commenced cohabitation the wife and her brother bought the property at Suburb I for $220,000. As I said, when the half share was purchased in 2007 or 2008, the whole was valued at $350,000. Thus there was an increase in the value of Suburb I over that period by some $130,000, being a growth of the wife’s share over that time.
The mortgage in 2007 was some $57,000. I am satisfied that given the shares and the two properties, the wife made a relatively greater capital contribution at the commencement of the relationship.
I am also satisfied the husband, particularly in the time following his employment with the T Bank, earned a significantly larger income than that of the wife. However, the wife undertook employment full‑time and part-time, from time to time and has had the primary care of the children.
This is not in any way to derogate from the husband’s involvement with the children when he was not working. Some examples of this were the husband giving up the interstate travel so that he could provide more support for the wife and for the children.
These parties were provided with assistance from their respective families. They have provided substantial financial assistance to the wife’s mother during their relationship and the husband provided modest assistance to his mother shortly after separation.
I am satisfied that overall the wife’s contribution, having regard to all aspects under s 79, other than s 79(4) of the Act, was slightly greater than that of the husband at the time of separation.
Following separation the wife had the primary care of the children, including the youngest child who was just over 12 months at that time.
Each of the parties was critical of the other. Much of this arose out of the heat in the separation.
I accept that the husband earned more income than the wife. However, in his affidavit[7] he acknowledged the wife’s paid employment in paragraphs 15, 19, 27, 28, 36, 43, 44 and 46.
[7] Filed 1 March 2016.
As I said earlier, the husband was critical of the wife in terms of cooking and housework. From his perception it may have been the case. However, this ought to be seen in the context that she had the primary day-to-day care of their three young children. I accept the husband was significantly involved in the house when not working his normal working hours.
The parties used their assets to assist the husband’s mother financially. However, subsequent to separation the wife’s responsibility in caring for the children increased as a consequence of it, and I offer no criticism of the parties as relationships from time to time fail.
The wife had the primary care of the parties’ young children. The husband assisted given the context of his work and the parties living in separate houses from June 2013.
The husband provided a cash flow estimate of how he disposed of capital payments made to him following separation; that is Exhibit W2. He sold his T Bank shares in 2013, 2014, 2015 and 2016, for $151,000; $34,615; $82,212; $92,917 and $156,797. He received from his mother the repayment of the loan of some $477,000, of which $319,000 was used to repay the loan. In summary, the husband received capital payments from the sales of his T Bank shares of slightly more than $500,000, and repayment of the loan from his mother of slightly less than $500,000.
Out of those sums he paid out the loan in respect to his mother of $340,000, and paid about $301,000 in tax. The husband applied the remainder as follows:-
Joint loan repayments
$282,732
Rates, land tax, insurance on the properties
$44,199
Costs of setting himself up after separation
$35,745
Withdrawal of funds by the wife
$5,646
Suburb K Property clean up
$6,596
Total
$374,918
It was not suggested, nor do I accept, that there was any waste or hiding of funds. What it shows through this capital is that the wife contributed to her own accommodation, the Suburb K property, and subsequently the Suburb H property.
In relation to the shortfall in the mortgages, the husband had available to him the remainder of his substantial income from which he paid modest child support, given the level of his income and bonuses. His income, including bonuses, was approximately as follows: -
Financial year 2010
$300,000
Financial year 2011
$350,000
Financial year 2012
$425,000
Financial year 2013
$450,000
Financial year 2014
$462,000
Financial year 2015
$462,000
Financial year 2016
$440,000
In this regard refer to paragraph 147 of the husband’s affidavit.[8]
[8] Ibid.
This enabled the husband to pay significant amounts for legal costs (see Exhibit H3) and to live in a relatively comfortable lifestyle, including a trip to Europe.
The husband was not as generous with his funds and insisted that the wife pay expenses such as electricity, gas and telephone. I am satisfied that he declined to pay this when he could well have afforded to do so, and in giving evidence made it clear that he believed this was the expense of the wife and had little insight into the impact upon her and the children. At the same time, I accept that the wife had the capital to pay the day‑to‑day expenses for herself if she chose to do so. Her income was very modest at that time.
Overall, and given the submissions, I accept the submissions made on behalf of the wife, that there was, all together, a greater contribution by the wife, having regard to all of the relevant matters which were raised in submissions. I am satisfied, considering past contributions, that the wife’s were 55 per cent and the husband’s 45 per cent.
Future Needs
The husband and wife are in good health. They were born in the same year. Each has a university education. The wife has a history of working full‑time and earning an income up to $92,000 per year. I accept, for the children, there will be an impact in respect of their care and that it will impact upon her earning capacity.
The wife has, in a child‑focussed way, undertaken study so that she can obtain a qualification employment. She will not complete that course until at least the end of 2016.
There was a submission made that she could go back and work in her previous occupation. Given the responsibility and her desire to care for the children, having regard to the provisions, that is not a reasonable expectation at this time.
I accept the wife will have, at the end of this year, an earning capacity of somewhere between $50,000 and $80,000. I accept that in the current year the wife will be studying to enable that working capacity and, in terms of future need, I have had regard to that study.
The husband and wife each has a responsibility to maintain the children. The husband has been in a relationship with his fiancée for slightly less than two years, and became engaged to her last year. She was employed on a casual basis at W University last year, but is now undertaking full-time study. I am satisfied that the husband, as he is entitled to do, is financially supporting his fiancée through this course, and I accept that he is providing that support within the context of his large income.
The wife has an income of about $675 per week by way of child support. Neither party have set out that they are receiving any Government benefits.
Given the husband’s application of capital to meet the expenses over recent years, the proposed sale of property, I am satisfied the husband’s standard of living remains at the same high level as before separation.
Given the wife’s separation from the husband and her ongoing responsibility and choice as primary carer of the children I am satisfied that her standard of living has reduced. I am further satisfied that the wife is applying her intellectual abilities in educational efforts to obtain employment better suited to the needs of the children.
The husband’s earning capacity is much superior to that of the wife, and is likely to remain superior in the foreseeable future, barring, of course, any unforeseen exigencies of life. The parties had been in a relationship for 10 years, and the care of the children and the need for the wife to be available, most of the time, before school have impacted on her earning capacity, that she displayed prior to and initially at the time of having children. The wife wishes to continue in her role as the primary parent for the children.
The husband and wife have valued the 7,904 shares in T Bank at some $249,529. That values each of those shares at about $31.57. In that context, the husband has an entitlement of 740 shares with T Bank, which does not vest until December 2016. His evidence was that he did not know whether he would remain with the bank until the end of the year. Given his long history with the bank and given that he has disclosed no other offers of employment at this time and all of those other factors, it is likely he will receive those shares.
I will, of course, not treat those as capital because they have not vested. However, when the share entitlement vests, if the shares remain at the same level, they could be worth somewhere in the vicinity of $23,000, less capital gains tax. I have had regard to this, in a minor way, as a financial resource of the husband. Overall, I am satisfied there ought to be an adjustment in favour of the wife in the sum of some 12 per cent. An overall difference of 24 per cent in terms of the so called future needs and with the contribution adjustment, there will be a difference of some 34 per cent.
Consideration of Just and Equitable
I am satisfied, in those circumstances, that it is appropriate to make an order, and I am satisfied that the wife will retain some property. The husband will retain some property after the sale of Suburb H, Suburb I and the shares. The total property retained by the husband will be:-
The Suburb K Property
$1,675,000
The Suburb O Property
$700,000
Remainder of interest in T Bank Shares
$49,529
Husband’s NIB Shares
$3,056
Husbands T Bank savings account
$105,000
Capital received from sale of T Bank Shares by partial order
$105,000
IAG
$9,160
European motor vehicle
$19,000
Furniture
$10,000
Australian Superannuation
$246,259
Plum Superannuation
$36,204
Tower Superannuation
$18,853
Total
$2,977,061
The husband will retain the liabilities of:-
Suburb K property mortgage
$538,148
Suburb O property mortgage
$358,133
Capital Gains Tax on sale of T Bank Shares (which I presume are the last T Bank Shares)
$68,000
The husband’s liability to the Australian Taxation Office
$99,541
Total
$1,063,822
The wife will retain the following:-
The E Town property
$168,750
The wife’s IAG shares
$9,160
Telstra shares to be retained by the wife
$20,480
Company S shares (to be sold and divided)
$13,592
The wife’s 4WD motor vehicle
$10,000
The wife’s furniture
$10,000
The wife’s savings account
$17
The wife’s T Bank Account
$22,913
The wife’s AMP Cal-Superannuation
$99,951
The wife’s TAL Superannuation
$1,110
The wife’s AMP Superannuation
$14,703
Amount to be distributed to the wife through proceeds of sale of some of the T Bank shares
$95,000
Total
$465,676
There are no liabilities to set off against this.
The impact of this overall adjustment will be 67 per cent to the wife and 33 per cent to the husband which will mean the wife will receive slightly more than two thirds of the property pool, and the husband slightly less than one third of the property pool. That is a very large differential and means the wife receives slightly more than double that of the husband.
However, given the factors to which I have alluded above, in terms of contribution, in terms of future needs, particularly the differential of the husband’s earning capacity, I am satisfied that this approach is, in the circumstances, just and equitable. In particular, the husband’s earnings, bonuses and share options, against the wife’s modest income.
The husband received gross bonuses of just under $140,000 per year in the last five years. He received gross shares vesting of about 1,500 shares per year in the last two years.
In considering the orders contained in Exhibit W9 the parties did not overtly contemplate the assessed income tax that may be payable by the wife on any capital gains tax on her IAG and Company S shares. Consequently, I have included any such tax to be treated as the other tax arising out of the sale of the Suburb I, Suburb H properties and, of course, the recent sale of the T Bank shares.
Further orders contemplated in the said exhibit did not address rents received and outgoings, and I have made orders providing that they continue, in terms of the Suburb K and Suburb O properties, to be that of the husband. Given the rents have been collected by the husband, at least on the Suburb O property, and the liabilities have been met by him since separation, I have determined that he continue with those collections and payments until the transfer, in terms of the Suburb K property. Clearly, the wife will be entitled to rent, if any, on the interest in E Town and will be liable for the outgoings, in respect to that property.
The parties addressed the outgoings in relation to Suburb H, in terms of the consenting, from orders made 9 of March 2016.
Given all of the above, I will make the orders on the percentage basis which I have set out.
I certify that the preceding one hundred and ninety eight (198) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Benjamin delivered on 14 March 2016.
Associate:
Date: 14 March 2016
Key Legal Topics
Areas of Law
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Family Law
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Equity & Trusts
Legal Concepts
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Consent
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Remedies
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Fiduciary Duty
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