W & C

FAMILY LAW ACT 1975

FAMILY COURT OF AUSTRALIA NO. BRF 5737 of 2000

AT BRISBANE

BETWEEN: MS W (Applicant/Wife)

AND: MR C (Respondent/Husband)

AND: B PTY LTD (2^nd Respondent)

AND: MR E (3^rd Respondent)

REASONS FOR JUDGMENT

BEFORE: JUSTICE I R COLEMAN

DATE OF HEARING: 28^th day of April – 1^st day of May 2003

REASONS DELIVERED: 30^th day of May 2003

APPEARANCES: Mr Hamwood of Counsel (instructed by Saunders Downing Hely Solicitors, PO Box 837 Ashmore QLD 4214), appeared on behalf of the applicant wife.

Mr Kirk of Senior Counsel (instructed by Hopgood Ganim Solicitors, 3/141 Queen Street Brisbane QLD 4000), appeared on behalf of the respondent husband, and the 2^nd and 3^rd respondents.

By Amended Application filed 29 November 2001 Ms W (“the wife”) sought orders against Mr C (“the husband”), the second respondent B Pty Ltd, the third respondent D Pty Ltd and the fourth respondent Mr E in the following terms:-
“1. That the Order of the Family Court of 3^rd June 1996 be reviewed pursuant to the provisions of Section 37A(9) of the Family Law Act.
2. That in lieu of the Orders of 3^rd June 1996, the husband be ordered to pay to the wife such amount as is just and equitable.
3. Alternatively, that the Orders of 3^rd June 1996 be set aside pursuant to Section 79A of the Family Law Act.
4. That the dispositions between about […] 1999 and […] 2000 (both inclusive) by the husband to his brother [Mr E] of the sum of $879,000.00 (“the [Town F] funds”) be set aside.
5. That the disposition between about 1996 and 2000 (both inclusive) by the husband to his brother [Mr E] and/or the said [Mr E]’s company [G Company] of the net proceeds of sale of the husband’s residence and boat (“the [Suburb H funds]”) be set aside.
6. That the said [Mr E] pay or cause to be paid the [Town F] funds and the [Suburb H] funds into the trust account of the wife’s solicitors, to be disbursed by the said solicitors in accordance with the orders of this Court.
6A. That the instruments dated […] 1995 pursuant to which the Husband purported to tender his resignation as “The Appointer” of the [C Family Trust No 1], [C Family Trust No 2] and [C Family Trust No 3] be set aside.
6B. That the instrument dated […] 1995 pursuant to which the Husband purported to transfer his shares in [B Pty Ltd] to [Mr E] be set aside.
6C. That the Husband as “The Appointer” exercise his power of appointment of the Trusts referred to in paragraph 6A hereof so as to cause the Wife to be appointed Trustee thereof.
6D. That the Wife as Trustee of the said Trusts cause to be paid to the Wife in her personal capacity out of the assets of the said Trusts such sum as this Court finds to be appropriate.
7. That the Court thereafter hear and determine the property proceedings between the parties.
8. That the husband pay to the wife by way of property settlement such amount as is just and equitable.
9. That the husband pay to the wife the sum of $1,000.00 per week by way of spousal maintenance, the first payment made on 14^th September 2000 and weekly thereafter.
10. That the husband pay the wife’s and the respondents costs of and incidental to these proceedings.
11. That the husband forthwith pay to [D Pty Ltd] the sum of $27,904.88 together with interest and costs in satisfaction of the said company’s claim against the wife in the […] Magistrate’s Court claim […] (“the claim”).
12. Further or alternatively, that the husband forthwith indemnify the wife and forever keep her indemnified in respect of all or any liability of the wife in respect of the said claim including the wife’s solicitor and own client costs in defending the claim.
13. That the amount paid by the husband pursuant to paragraph 12 hereof or alternatively the amount the subject of the indemnity pursuant to paragraph 13 hereof be taken into account as a liability of the husband in the property settlement between the parties.
14. That the husband forthwith file and serve a Statement of Financial Circumstances in Form 17.
15. Such further or other orders as the Court deems meet.
16. That the husband pay the wife’s costs of and incidental to this application.”

The orders of 3 June 1996 provided:-
“BY CONSENT IT IS ORDERED:

PROPERTY

(1) That the Husband shall pay to the Wife the sum of $180,000 (ONE HUNDRED AND EIGHTY THOUSAND DOLLARS) as follows:-
(a)the sum of $22,250.00 (TWENTY-TWO THOUSAND TWO HUNDRED AND FIFTY DOLLARS) which has already been paid to the Wife and which the Wife acknowledges receipt.
(b)the sum of $157,750.00 (ONE HUNDRED AND FIFTY-SEVEN THOUSAND SEVEN HUNDRED AND FIFTY DOLLARS) on or before the 15^th June 1996 such payment to be made by Bank Cheque and payable to the Wife or, her Solicitors’ Saunders Downing Trust Account or, as the Wife, in writing, directs.

(2) That contemporaneously with the payment preferred to in paragraph (1) herein, the Wife shall remove the Caveat over the property known as and situate at [J Street], [Suburb H], Queensland […] and agrees that thenceforth she shall have no right, title or interest in the said property.
(3) That the Wife shall have the right to the sole use and occupation of the property situate at [J Street], [Suburb H], Queensland until the happening of one of the following events whichever is the earlier time.
(i)The settlement of the sale of the said property;
(ii)The 6 months anniversary of the Order made herein.

Upon the happening of that event the Wife shall immediately give vacant possession to the Husband or his nominee.
(4) That the Wife, upon vacation of the property, be entitled to take with her the following items:-
2 x bedside tables;
2 x lamps;
2 x pedestals;
1 x gold [statue];
1 x computer, printer and accessories;
1 x silver cutlery set;
1 x white and gold dinner set;
1 x brown and white dinner set;
1 x bookcase;
1 x set of encyclopedias;
1 x [statue];
2 x […] plants in planters.
(5) That unless otherwise specified in these Orders and except for the purposes of enforcing the payment of any money due under these or any subsequent orders:
(a)each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the possession of such person as at this date.
(b)each party hereby foregoes any claim they may have to any superannuation benefits belonging to or earned by the other.
(c)all insurance policies to become the sole property of the life assured named thereunder.
(d)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders.
(e)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.

CAPITALISED SPOUSAL MAINTENANCE

(6) (a) This is an Order to which Section 77A of the Family Law Act applies.
(b)The amount of $10,000.00 (TEN THOUSAND DOLLARS) of the money ordered to be paid to the Wife is attributable to the provision of maintenance of the Wife.

GENERAL

IT IS DIRECTED:
(7) That the Minutes of Consent Orders remain on the Court file.
(8) That these proceedings be removed from the Acting Pending Cases List maintained by the Court
THE COURT NOTES the parties intend that these orders shall as far as practicable finally determine the financial relationships between them and avoid further proceedings and that the parties have undertaken to each other to be of good behaviour towards each other.”

All acts and things were done by each party to give effect to those orders in accordance with their terms. Since the wife first filed her application for orders on 6 June 2000 there has been no restitution in respect of any of the benefits received by the wife pursuant to the orders.
On 27 November 2001, the husband filed an Amended Response to the wife’s original application, by which he sought orders in the following terms:-
“1. That the wife’s applications be dismissed.
2.That the wife pay the husband’s costs of an [sic] incidental to these proceedings.
3. Such further or other order as to the Court may seem just.”

Whilst the husband did not file a Response subsequent to the wife’s Amended Application filed two days subsequent to that Response, the orders sought therein clearly were applicable to the wife’s Amended Application.

On 14 March 2001 a Response was filed on behalf of B Pty Ltd, D Pty Ltd and Mr E, such Response seeking final orders in the following terms:-
“1. The Wife pay the costs of [B Pty Ltd] of and incidental to these proceedings.
…
1.The Wife pay the costs of the [D Pty Ltd] of and incidental to these proceedings.
…
1. The Wife pay the costs of [Mr E] of and incidental to these proceedings.”
At trial, [B Pty Ltd], [D Pty Ltd] and [Mr E] were all represented by Senior Counsel appearing for the husband.

Particulars of the wife’s claim

Prior to the commencement of the evidence at trial, Counsel for the wife particularised the wife’s claim for relief pursuant to s 79A(1A) of the Family Law Act 1975 (Cth) (“the Act”) in the following terms:-

“Particulars

s.79A Application

The Wife contends that the Orders should be set aside

1) Pursuant to s 79A(1A)
Particulars
(a)   The parties reconciled prior to the Orders being made
(b)   The parties by their conduct impliedly consented to the Orders being set aside
(c)   The parties cohabited for four years after the date of the Orders, during which period
(i)Each party made further significant contributions, both direct and indirect, of a financial nature
(ii)The Wife provided accommodation for the Husband
(iii)The Wife contributed in particular to the improvements of the Husband’s [City K] properties.
(iv)The Wife contributed as a homemaker in keeping herself available for the Husband during his periods of residence at [Region L] and during the parties’ overseas trips.
(v)The Wife used the proceeds of the Order to purchase a property and vehicle which were to be used and were used, by agreement, for the benefits of the parties during the balance of cohabitation.”

S.106B

1.The Husband’s resignation as appointor of [C Family Trust] 1, 2 & 3 and his transfer of his share in [B Pty Ltd] to [Mr E].

Particulars

1)   The transactions/instruments were made on the day prior to the parties’ marriage
2)   Prior to the making of the transactions & instruments, the Husband had the power as appointor to replace the trustees of each Trust
3)   Prior to the transactions being made the Husband effectively controlled the operation of the Trusts and had the legal capacity by virtue of his power of appointment to control the Trusts through an appointed trustee
4)   The transactions were made with the intention on the part of the Husband to divest himself of the legal power of appointments, so as to defeat any application the wife might bring with respect to the property of the Trusts.
5)   Alternatively the transaction had the effect set out in (4) above.

2.   The gifts to [Mr E]
-     $100,000 & $300,000 from sale of [Suburb H] Property
-     $600,000 from sale of [Town F] land
-     $279,000 from sale of [Town F] land

Particulars

(a)The transactions had the effect of depleting the assets available for property settlement by $1,279,000. Husband’s present case is that only $1,000,000 was given to [Mr E]
(b)In circumstances where the s.79 Orders were not intended as finalising the property proceedings between the parties, or where the parties consented by their agreement and conduct to act in a manner from which consent to set aside the orders ought to be implied, it could reasonably be anticipated that the wife might in the future seek to bring further property proceedings

The disposition of funds received post-separation or at the time of separation and subsequently from the Husband’s superannuation entitlements

(a)Insofar as the moneys were disposed of by payments of alleged debts to [D Pty Ltd], and [B Pty Ltd] as Trustee for the [C Family Trust], the payments were made to entities which are the alter egos of the Husband, and are not bona fide commercial transactions
(b)The payments were made with the intention of defeating the wife’s property proceedings
(c)Alternatively, the payments are likely to have the effect of defeating such proceedings.”

There was no objection to the wife’s claim being so particularised, the husband and other respondents maintaining their opposition to the relief therein sought.

The issues for trial

The matters for determination thus emerge as the wife’s application pursuant to s 79A(1A) and, within that context and to the extent that such relief would be necessary to give effect to any orders proposed to be made pursuant to s 79A, the wife’s application pursuant to s 106B to set aside the transactions identified in the particulars set out above. As was conceded on behalf of the wife, if the threshold question raised by the wife’s s 79A(1A) application is answered in the negative, no question of setting aside instruments pursuant to s 106B arises. Conversely, if the threshold question raised by the wife’s s 79A application is decided in her favour, the s 106B applications have the potential to assume significance.

The wife’s application to amend particulars of claim subsequent to the completion of the trial

10. The trial of the proceedings occupied 28, 29, 30 April and 1 May 2003, at the completion of which the matter was adjourned for submissions on Tuesday 6 May 2003, on which occasion it was anticipated that, at least in part, written submissions would be made. Unfortunately the Court was unable to sit on 6 May, or at all during the remainder of that week. Written submissions were, by agreement, exchanged and provided to the Court, hopefully minimising the costs implications of the Court being unable to proceed with the matter on 6 May.

11. In circumstances detailed in his written submissions, Counsel for the wife applied to “amend the particulars so as to add a ground which is open on the evidence under s.79A(1A)” in the following terms:-

“2. Pursuant to S. 79A(1)(a) “… miscarriage of justice … any other reason”
(i)the wife did not enter into the Consent orders on the basis that they finally disposed of the property issues between the parties, by reason of the husband’s representations to the wife that the parties would immediately reconcile and that the financial arrangements were so as to give effect to the parties’ intentions with respect to the reconciliation, including the husband’s future support of and provision of financial security to the wife, and because the parties did in fact so reconcile
(ii)in the circumstances, the orders ought to be set aside in that the wife’s consent was not a true consent to final property orders.”

12. In support of the application for leave to thus amend the particulars, it was submitted that:-

“No further or other evidence would be sought to be led on behalf of the wife in respect of the amended particular. If leave is granted and the husband’s counsel seeks to further cross-examine the wife on the amended particulars, this would not be opposed.”

It was further submitted that:-

“Despite the eleventh-hour nature of the application, it cannot be said to work and prejudice to the husband [sic], particularly if further cross-examination occurs to the extent necessary.”

13. Senior Counsel for the respondents opposed the granting of leave, submitting that the amendment would “inevitably involve an extension of the hearing with further cross-examination of the Wife”. It was submitted by Senior Counsel for the respondents that:-

“During the course of the hearing, there were a couple of occasions when I questioned the particulars supplied and whether the Wife intended to supplement them in any way. One of those occasions was before I concluded cross-examination of the Wife and another was later in the hearing during cross-examination of the Husband in relation to financial matters which I submitted (as I recall) could only relate to credit as the Wife had conceded the property settlement received by 3 June 1996 orders was appropriate.”

Reference was also made to subsequent discussions in relation to amendments. There is no suggestion that the particulars of the wife’s claim were sought to be amended or such a course foreshadowed, prior to her Counsel seeking Leave to Amend. It was submitted on behalf of the respondents that “The amendment involves a different section and completely different issues”. It was further submitted that:-

“The trial progressed on the basis that whilst “final” orders were made, the parties had by their conduct impliedly consented to the orders being set aside. Now that very basis is being challenged by the proposed amendment.”

14. As a reading of the transcript would confirm, prior to the commencement of evidence in the trial, Senior Counsel for the respondents sought to obtain particulars of the wife’s claims pursuant to s 79A. The Court embraced that request, for reasons which were then given and which do not need to be extensively restated. Essentially, the Court agreed with Senior Counsel for the husband that the wife should specify the grounds upon which she relied for the relief sought by her, rather than, given the breadth of s 79A(1A), be allowed to embark upon a wide ranging inquiry which, when completed, might reveal, or be thought to reveal a basis for relief, given the adversarial nature of the proceedings and terms of s 79A. Counsel for the wife, properly, did not oppose either the provision of particulars of his client’s claim, or the suggestion that the wife would, in the circumstances, be likely to be held to such particulars.

15. Time was allowed for the particulars of claim to be prepared by Counsel and, as their terms reveal, the particulars were drawn with care and specificity. Importantly, the particulars were based upon instructions from the wife. It cannot be successfully asserted that anything occurring during the trial in relation to the wife’s evidence was not known to those advising her, or could not have been known to those advising her when the particulars relied upon by the wife were drafted and settled. With great respect to Counsel for the wife, whose submissions in relation to the amendment tacitly acknowledge the fact, it is an almost irresistible inference to be drawn that the amendments now sought to be made to the wife’s particulars of claim arise from more mature reflection upon the wife’s evidence than anything which has emerged in the course of the forensic processes of testing the respondents’ evidence at trial.

16. Ultimately, as the Court must strive to do justice to both parties, the issue become whether granting or refusing Leave to Amend is likely to lead to a miscarriage of justice. The Court is persuaded that to grant Leave to Amend at this time would be unjust. It would clearly, as Counsel for the wife’s own submissions concede, lead to a prolongation of the trial, the costs of which have already been substantial for all parties. Where, and at what cost, that process might lead cannot be predicted with confidence.

17. The Court accepts the submission of Counsel for the respondents, that the amendment suggests a quite different case to that upon which the wife has hither to relied and may even be inconsistent with matters put to the Court by Counsel for the wife, on her instructions. There is, as Senior Counsel for the respondents has submitted, a fundamental difference between the case which the Court has heard and that apparently raised by the amendments now sought to be raised. The latter case involves investigation of the circumstances surrounding the making of the orders and their integrity, as opposed to the former case which involves a consideration of events subsequent thereto.

18. At trial, the case for the wife was, at least inferentially, that the orders made were final, and intended to be final, no injustice arising at the time they were thus made. The amendment sought to be made however, asserting the “wife’s consent was not a true consent to final property orders” raises other issues. Even if the amendment were allowed, and these new issues thus agitated, the requirement of a miscarriage of justice at that time is not asserted. The case particularised by the wife at the commencement of the trial was that it would, in the circumstances which have occurred since the orders were made, be unjust to allow the orders of 3 June 1996 to remain unvaried. The amendment sought to be made to the claim, to succeed, must demonstrate that, by reason of what occurred at the time, a miscarriage of justice occurred. The grounds currently relied upon do not require that a miscarriage of justice be proved. The additional requirement would be likely to broaden the ambit of the case, both in terms of disputed issues of fact and issues of principle.

19. There is much in the submission of Senior Counsel for the respondents that having “conceded the orders made on 3 June 1996 were appropriate … it is difficult to understand how a miscarriage of justice can arise in such circumstances, so, presumably, we will also be confronted with some form of request to withdraw that concession. If not, the amendment must be doomed to fail.” Realistically, it is difficult to see how, if Leave to Amend in the terms now sought were allowed, the new ground could succeed unless the appropriateness of the orders in 1996 was impugned. Whilst the Court did not understand Counsel for the wife to expressly make the concession referred to by Senior Counsel for the respondents in the terms suggested, no part of the wife’s case at trial could objectively be regarding as having been directed to demonstrating that her consent to the orders in 1996 was other than voluntary, at a time when she was legally represented, or that any complaint was made in relation to her understanding of the terms of the orders, or the appropriateness of the benefits she received pursuant to them. There is no dispute that the orders were implemented, and that the wife received, and has retained, the benefits to which she was entitled pursuant to the orders.

20. To the extent that refusing the wife Leave to Amend her claim now might have the potential to visit an injustice upon her, that injustice is more than outweighed by the potential injustice to the respondents. That potential injustice cannot be said to necessarily be able to be remedied by an order for costs if leave were granted in the event of the wife being unsuccessful in her prosecution of her claim(s) having regard to the wife’s current financial position.

21. The Court thus refuses the wife’s application for leave to further amend her particulars of claim.

Credit

22. The case turns significantly upon issues of credit. The Court will, in due course, refer more fully to the evidence of the wife, the husband, the husband’s brother Mr M, who is a shareholder in and director of B Pty Ltd and D Pty Ltd, and Ms N, a friend of both parties. As will be seen, issues arise in relation to the absence of evidence with respect to a number of matters and to the inferences, if any, appropriate to be drawn from such absences.

23. As will be seen, none of the wife, the husband or Mr M was an entirely acceptable or reliable witness. Both the husband and wife were shown to have inaccurate or untenable recollections of a number of events. The circumstantial evidence rendered improbable a number of the assertions made by each of them. In this case, credit is a relative commodity. The evidence of neither the husband nor the wife, nor Mr M can be accepted without reservation. Each of the three witnesses has recollections of events which are convenient or advantageous in the context of the litigation between them. Where money is concerned, none of the three parties has demonstrated a capacity to pursue candour in preference to perceived self-interest. Whilst the differences are of degree, the Court prefers the evidence of the wife to that of the husband where the two are in conflict. Notwithstanding this general preference, as will be seen, the Court prefers the husband’s claims with respect to the resumption of “co-habitation” subsequent to the June 1996 orders, albeit in reliance upon circumstantial and documentary evidence which is more reliable than the testimony of either party in that regard. The wife’s evidence with respect to the “co-habitation” of the parties must be regarded with considerable caution, as the examples referred to in the submissions of Senior Counsel for the husband confirm (Submissions on behalf of Respondent Husband and Respondents, paragraph 3.2), but the inadequacies in her evidence are overshadowed by the inadequacy and inaccuracy of the husband’s evidence with respect to financial matters. The concessions made by the husband’s Counsel in the following terms are well founded:-

“CREDIBILITY OF THE HUSBAND
However, there are two sides to credibility and we must recognise that there are problems with some of the Husband’s evidence as he acknowledged during cross-examination.
We deal with these below:

(a) His denial that he told the Wife he was sending every penny out of the country to avoid [a government body]
-clearly, he did say that to the Wife as the taped transcript of his conversation with her revealed;

(b) Non-disclosure of his interest in [the United Kingdom] property
-the Husband acknowledged this interest and informed Your Honour he had forgotten about it. In the trying circumstances of his past few years, it is perhaps understandable;

(c) Promise to pay out [Motor Vehicle 1]
-in his early affidavit, the Husband says that he did not promise to pay out [Motor Vehicle 1] and give it to the Wife and whilst there are references in the phone transcripts to that happening in certain circumstances, at least while their relationship continued, those circumstances (sale of practice, etc) never occurred. In addition, this telephone call occurred before separation and before the Husband was told to cease work due to his health;

(d) [Mr M]’s reference to the [City K] properties
-the answer to Question 50 by [Mr M] that the Husband had told him that “he has purchased properties in the United Kingdom” and that “his wife knows of all his real estate in [City K]” may, at first blush, appear difficult to overcome. However:
(i)the Husband denies that he said that to [Mr M];
(ii)clearly, the Husband was involved in the purchase of these [properties] as set forth in paragraph 17 of his first hurriedly prepared affidavit. In that, he said the three [City K] properties “were in fact purchased not by myself personally but by the trust in which I have no share or directorship but some of the money for the purchase were gifted by me to the trust for the benefit of my family”;
(iii)the Husband habitually used loose language in referring to property owned by the [C Family] Trusts;
(iv)the trust or company involved is known as [G Company] and is controlled by his brother, [Mr E].

(e) His reference to “business interest” in Queensland in his 1996 Affidavit
-the Husband acknowledged that although he was investigating business opportunities in Queensland at that time, he did not “own” any business interests at that time;

(f) There are some minor conflicts upon which the Wife’s Counsel dealt, such as his reference to the [Suburb O] home as “his mother’s residence”, ascribing values to properties at various times that were very different (i.e. in the pre-nuptial agreement and a draft financial statement prepared by his accountant) but none of these will cause Your Honour to question the Husband’s credit.” (Submissions on behalf of Respondent Husband and Respondents, paragraph 3.3)

24. As will be seen, the Court is not satisfied that the husband has “come clean” with the Court in relation to his finances. As the documents prepared by him, or on his instructions, and adopted by him confirm, the husband has a demonstrated history of saying what best suits him financially at any given time. The absence of source documentation, or evidence from witnesses having the potential to confirm the husband’s evidence in relation to a number of significant matters is telling.

25. Mr M was partisan, essentially willing to say what seemed most helpful to his brother’s case, albeit in relation to the City K apartments he made a statement which was contrary to his brother’s interests. Mr M’s attempts to adhere to the “party line” were undermined by his inability to explain or validate details of transactions which were asserted to have been instigated or orchestrated by him. The Court regards with considerable reservation the evidence of Mr M.

26. The evidence of Ms N, on balance, is essentially able to accepted.

History of proceedings

27. The following chronology of events provides a context for the dispute. It is helpful to separately chronicle the proceedings between the parties and the history of their relationship with each other.

28. As has been stated, these proceedings spring from consent orders made on 3 June 1996. Subsequent to that date, the parties reconciled. The parties are in dispute as to when they reconciled but the evidence leaves little room for doubt that they finally separated on or about 6 June 2000, a decree nisi for dissolution of marriage subsequently being granted, which became absolute in 2002.

29. On 6 June 2000 the wife filed applications for final and interim financial relief. On 7 June 2000 ex parte orders were made in this Court restraining the husband from leaving Australia, ordering the surrender of his passport and directing expeditious service on the husband by electronic or other means. Service of those orders was effected in accordance with their terms on 7 June 2000. Further ex parte orders were made in this Court on 8 June 2000, requiring the husband to maintain payments on Motor Vehicle 1 then in the possession of the wife.

30. On 27 July 2000 orders were made in this Court that the husband’s brother (Mr M) and mother disclose the husband’s whereabouts, particulars of departure from Australia, contact particulars, and for Mr M to disclose the allegations against the husband by a government body and the particulars of the sale of D Pty Ltd business and premises.

31. On 17 August 2000 the wife’s application for spousal maintenance was adjourned to 7 September 2000, at which time an order was made by a Judicial Registrar for $5,000 urgent lump sum maintenance and periodic maintenance commencing 14 September 2000. On that date the wife was granted leave to file an Application for Review of Orders made on 3 June 1996, an application pursuant to such grant of leave being filed on 15 September 2000. On 26 September 2000 Mr M served answers to interrogatories.

32. On 17 November 2000 orders were made in this Court adjourning the wife’s applications, then pending, to 8 December 2000. An order was also then made for the husband to file and serve an affidavit with respect to his financial circumstances by 4 December 2000. On 12 December 2000 the wife filed an application for the joinder of D Pty Ltd and B Pty Ltd (as trustee of the C Family Trust No 1 and C Family Trust No 2). On 13 December 2000 that application was adjourned until 15 March 2001. On 3 January 2001 the wife filed an Amended Application. On that day the husband gave an undertaking not to draw down and/or dispose and/or diminish the proceeds from his superannuation entitlement below the limit of $800,000.

33. On 15 March 2001 orders were made in this Court granting the husband leave to file an Application for Review of the orders of the Judicial Registrar of 7 September 2000. An injunction order was made restraining the husband from dealing with $300,000 of his superannuation proceeds. The wife was ordered to remove a caveat over land owned by B Pty Ltd at Town F.

34. On 18 May 2001 an order was made in this Court that the wife’s application for a review of the consent orders of 3 June 1996 filed 15 September 2001 be dismissed and the husband’s application for a review of the spousal maintenance orders of the Judicial Registrar be allowed.

35. On 12 September 2001 the wife filed an Amended Application for interim and final orders. On 14 September 2001 Applications for Costs were made by a number of third parties, including those who remain parties to the proceedings. Those applications were adjourned. The husband was ordered to pay arrears of spousal maintenance. An order was also made that the injunction restraining the husband’s departure from Australia and for the surrender of his passport be discharged and his name removed from the airport watch systems. Orders were also made that, conditional upon the deposit of the maintenance arrears, and personal attendance by the husband at the hearing for a review of orders made on 7 September 2000, time be extended for the husband to file an application for a review of the orders made on that date. On 29 November 2001 the wife’s Amended Application for final orders was filed. On 27 November 2001 the husband had filed his response.

36. On 30 November 2001 an order was made in this Court that the husband pay spousal maintenance in the sum of $400 per week pending trial and that the wife’s application for child maintenance (in respect of a child of hers of a prior relationship of whom the husband was not the father) and lump sum maintenance be dismissed. On subsequent occasions procedural orders which are not currently of significance were made.

Material facts

37. The husband was born in Country P in 1946, moving to Australia to live in about 1976. The wife was born in 1954 in Country Q. When the wife moved to Australia is not clear, but it was, relevantly for present purposes, well before 1983, the year in which the parties first met, at which time the wife worked for the husband in his business. The husband is accordingly 56 years of age and the wife is 49.

38. At the time the parties met, the husband’s second marriage had ended and the wife and her second husband were experiencing difficulties in their relationship. In 1984 the wife gave birth to her son Mr R, the father of Mr R being the wife’s then husband.

39. In 1978 C Family Trust No 1 was created by deed of settlement. B Pty Ltd was the trustee of the trust. The husband, who at all material times has been a medical professional, had, in that year, set up a business at Suburb S, in the state of Victoria. In about 1979 C Family Trust No 1 acquired the reality in Suburb S, from which the husband conducted his business. In 1980 C Family Trust No 2 was created by deed of settlement, B Pty Ltd again being the trustee of the entity. The shareholders of B Pty Ltd are Mr M and Mr E (whose shareholding was transferred from the husband in 1995), the brothers’ mother, Ms T is a director as are Mr M and Mr E. The beneficiaries of the trusts include the husband. In that same year the C Family Trust No 2 purchased real estate in U Street Melbourne.

40. In about 1981 the husband purchased land at Town F in the state of Victoria. In about 1982 the C Family Trust No 1 purchased a residence at Suburb O in the state of Victoria, usually referred to as the “[C] Family Home”. Various members of the husband’s family lived in the C Family Home from time to time.

In 1988 the husband purchased real estate at V Street. In that same year the husband asserts that he sold his business at Suburb S to third parties who incorporated D Pty Ltd as a service company, the husband being appointed to a role in the company. The husband contends that he and other medical professionals from time to time entered into service agreements with D Pty Ltd. An issue at trial has been the interest, if any, of the husband in the company and/or real estate at Suburb S from which it is conducted. The husband asserted that in the same year his brother Mr M took over the management of the family trust assets. Prior to the end of 1990 the husband purchased a property at Suburb QQ in Region L, Queensland, which he thereafter visited from time to time.

42. In 1989 the wife consulted the husband in his capacity as a medical professional. Thereafter, a relationship developed. By 1990 the husband and wife had a sexual relationship. At that time the wife owned a home at X Street Suburb S in the state of Victoria. From then until 1992 that remained the wife’s primary residence, whilst Suburb O remained the husband’s primary residence. The husband also spent time at Region L. The parties had an ongoing social and sexual relationship during this period, regarded by the husband as a “casual relationship”, by the wife as “co‑habitation”. The probabilities are that the relationship was rather less than the wife asserts, and rather more than the husband concedes.

43. In 1992 the wife sold her home at Suburb S and moved to Queensland, renting a property at Suburb Y. The husband continued to work as a medical professional from Suburb S, but visited Region L on occasions and continued his relationship with the wife, either at her home or at Suburb QQ. In 1992 the husband contracted to purchase a home at J Street, Suburb H. Included with the sale was a vehicle. The husband provided the whole of the purchase price of the property. The wife provided no monies from the sale of her Suburb S property towards the purchase of the property. In 1992 the Suburb QQ property was sold.

44. In 1992, the wife was receiving government support. Later in 1992, utilising the money she received after selling her former matrimonial home in Victoria, the wife purchased an investment unit at Suburb Z in the state of Queensland. Throughout 1992 the husband visited Queensland from time to time, spending approximately seventy one days in Region L in that year. During that time the parties continued their relationship, staying either in the wife’s rented property or at J Street. In late1992 the wife completed the purchase of her property at Suburb Z.

45. In 1993 the husband spent approximately fifty one days in Queensland. The parties holidayed in Queensland for a week during that year and continued their relationship, in much the same manner as previously.

46. In 1993 C Family Trust No 3 was created by deed of settlement, BB Pty Ltd being the trustee of that entity. CC Company (of which Mr M is a shareholder and director) and Mr DD are the shareholders and directors of BB Pty Ltd, whilst Mr E is a director. During 1993 the husband visited Region L and the relationship of the parties continued in much the same manner as it had since 1990.

47. In 1994 the husband concedes having spent approximately ninety days in Queensland. In that year the parties holidayed together overseas. The parties were together for approximately 132 days in that year. In 1994 the husband resigned from his role at B Pty Ltd. In that same year the parties were engaged to be married. The wife was still at that time receiving government support.

48. In 1994 the parties attended upon the wife’s solicitor (Mr Downing) and jointly instructed him to prepare a pre-nuptial agreement. In 1995 a pre-nuptial agreement prepared by other solicitors was signed by the parties. The husband then resigned as appointor of the C Family Trust No 1, C Family Trust No 2 and C Family Trust No 3. His brother Mr M was appointed as replacement appointer of all three trusts. The husband signed a share transfer form with respect to his holdings in B Pty Ltd to his brother Mr E. He also resigned from his role at the Suburb S business.

49. The parties married in 1995 and honeymooned overseas. Upon the parties returning, the husband opened a joint bank account in the names of himself and the wife. The wife’s brother commenced to rent the wife’s home at Suburb Z and the wife ceased to receive government support.

50. Throughout 1995 the husband spent approximately 210 days in Queensland, during which time there is no question that the parties were co-habiting. The parties travelled overseas to the United States in mid-1995.

51. The parties separated under the one roof in early February 1996. In 1996 the wife also lodged a caveat against the title to J Street. In the same year the wife obtained a temporary protection order in respect of an application filed by her. The husband had travelled to Melbourne. For a period in 1996 the parties were in negotiations through solicitors.

52. In 1996 the husband contacted Ms N, a mutual friend from Victoria, to “mediate” between the parties. The parties met with Ms N and agreed upon a settlement pursuant to which the husband would pay the wife $180,000. The circumstances surrounding the “mediation”, and its aftermath, are in contest, but it is not in dispute that the parties had dinner together on the night following the agreement being reached in discussions with Ms N and resumed a sexual relationship shortly thereafter at a motel on Region L. The paries consulted a solicitor, Mr EE, to draw up terms reflecting the agreement they had reached with Ms N.

53. In 1996 Mr EE forwarded draft consent orders to the wife’s solicitor, Mr Downing, and the husband’s solicitor, Mr Hopgood. During 1996, despite the existence of a temporary protection order in her favour, the wife and husband stayed together for periods when the husband was in Queensland. During this period the husband was not financially supporting the wife. Prior to the making of consent orders, in the Registry of the Family Court, the husband paid to the wife $22,250 as a pre-payment of her entitlement under the preposed consent orders.

54. In 1996 the wife received the sum of $157,500, the balance of the monies to which she was entitled under the orders of 3 June 1996 and commenced to reside in her home at Suburb Z. In 1996 the husband sold J Street. The wife sold her home at Suburb Z and, using the proceeds of such sale and her property settlement monies from the husband, purchased a home at FF Street, Suburb Z which she and her son Mr R commenced to occupy. During the latter quarter of 1996 the husband took an overseas trip, during which he visited a former wife and gifted to her the sum of $40,000. He also “gifted” the sum of $100,000 to his brother Mr E, allegedly by drawing on his overdraft. In late 1996 the parties had an overseas holiday together.

55. In 1997 the husband received the proceeds of sale from his Suburb H home, approximately $585,000, having previously received approximately $46,000 in respect of such sale. In 1997 the husband “gifted” a further sum of $300,000 to his brother Mr E.

56. In 1997 the husband paid $80,000 to B Pty Ltd which he claims was referable to a loan from the C Family Trust No 1. In the same year the husband paid $42,770 to an entity known as GG Pty Ltd; $241,121 to D Pty Ltd; and a further $81,600 to that entity.

57. Until late 1997, by which date the parties had undoubtedly reconciled, the husband visited Region L numerous times, staying with the wife on a number of those occasions. During this time the parties lived financially independently of each other. When the parties reconciled they co-habited in the wife’s home as Suburb Z. In 1997, the parties having reconciled, the wife ceased to receive government support. In 1997 the parties spent approximately 112 days together.

58. From late 1997 to early 1998 the parties holidayed overseas. The husband paid for such holiday. During 1998 the husband continued to work as a medical professional from Victoria, visiting the wife and co-habiting with her on a regular basis. In late 1998 the parties travelled overseas, during the course of which they visited three properties in City K, the ownership of which is in dispute. The wife had arranged for furniture for the properties to be purchased and forwarded from Australia prior to that time. In 1998 the parties spent approximately 111 days together.

59. By early 1999 the relationship between the parties was again becoming strained. The wife received government support for a period that year. Later in 1999, the relationship having clearly improved, the husband provided the wife with Motor Vehicle 1. That year the parties holidayed in Region HH, during the course of which they collected Motor Vehicle 2, which vehicle remained overseas. The parties also looked at “bed and breakfasts” during the course of their travels. By late 1999 the husband had come under examination by a government body, a committee hearing then occurring, nothing subsequently developing from such hearing.

60. In 1999 the husband received $600,000 from B Pty Ltd in respect of the sale of his Town F land to B Pty Ltd. The husband allegedly “gifted” that sum to his brother Mr E for the benefit of the latter’s business in Country JJ. In 1999 the husband and wife holidayed together overseas. They resumed co-habitation in Region L upon their return. The parties were together for approximately 114 days in 1999.

61. The parties again travelled to the United Kingdom in 2000. The husband later booked a flight to travel to City K to inspect “bed and breakfast” establishments, that flight being subsequently rescheduled to later in 2000. At this time D Pty Ltd was engaged in negotiations for the sale of the business. In mid-2000, the husband, who had become concerned about his health, consulted two medical professionals. The husband rang the wife to tell her she was going overseas the following week. On two occasions in mid-2000, the wife recorded telephone conversations between herself and the husband. The parties spent approximately 50 days together in 2000.

62. Particulars of proceedings have previously been referred to. In 2000 the husband received from B Pty Ltd the sum of $279,000 for the part sale of the Town F land. The husband claims to have repaid debts with such sum. In 2000 the husband claims to have sold the Motor Vehicle 2 for 15,000 pounds and used the monies for his own purposes. Also in 2000 the wife commenced to receive government support.

63. In mid-2000 the husband received $530,025 from superannuation proceeds which he deposited to a joint bank account with Mr E in Country JJ. Again in 2000 he received a further $370,025 from superannuation proceeds which he similarly deposited. In 2001 Motor Vehicle 1, used by the wife, was repossessed, the lease payments having not been made by D Pty Ltd.

64. In January 2001 the husband commenced to pay spousal maintenance in the sum of $500 per week on a “without admission basis”. From March 2001 the husband has paid $400 per week interim spousal maintenance. The husband has worked as a medical professional from December 2001 to May 2002, from June 2002 to September 2002.

Evidence at trial

65. In cross-examination, though claiming to have co-habited with the husband from early in 1992, the wife conceded that she had maintained a lease on the Suburb Y property until the purchase of her Suburb Z property in late 1992. The wife was unable to adequately explain why, given her contention that she had been living at J Street from early 1992, she had done this. Despite the recording of many far less significant matters in her 1992 calendar (Exhibit R1), the wife failed to record on that calendar her alleged moving into J Street in 1992. The wife had recorded her move out of the Suburb Y property in late 1992. Whilst these matters do not establish that the wife was not in residence, at least on a part time basis, prior to the end of 1992, they suggest, on balance, that the wife continued to reside in rented accommodation at Suburb Y throughout 1992. They reinforce the Court’s conclusions that the wife consciously strove to maximise the extent of her co- habitation with the husband, both pre and post the 1996 orders.

66. The wife’s 1993 tax return (Exhibit R3) recorded the wife’s address as Suburb Y. Whilst that was, at least from late 1992, clearly not the wife’s address, she did not in the document suggest that she was living at J Street. In the 1992, 1993, 1994 tax returns the wife did not show herself to be living in a defacto relationship despite her clear assertion that such was the case. The document clearly provided for such information to be disclosed. The wife’s explanation of having left the document blank at that time was that she had been “under instructions from [Mr C]” to do so. The difficulty this evidence creates for the wife is that, in reality, she seeks to rely upon untrue statements made in the past to persuade the Court that she is now telling the truth. The probabilities are that, prior to the date of the parties’ marriage, or perhaps late 1994, the relationship of the parties was such that the wife’s failure to disclose a defacto relationship was true, in substance and in form. Similar observations apply with respect to the wife’s obtaining government support during that period.

67. Quite apart from the difficulty the Court has in allowing a person to advance a claim in reliance upon what can only be regarded as fraud on the Commonwealth, the circumstantial evidence points to the reality being as has been described. On balance, it is probable that the Department of Social Security and the Income Tax Commissioner were told the truth about the wife’s relationship in 1992, 1993 and 1994. The relationship between the parties from early 1992 until their marriage in 1995 was of a sexual nature involving companionship and mutual emotional support, albeit the parties remained financially independent of each other, maintaining essentially separate finances.

68. In her 1995, 1996 and 1997 tax returns (Exhibit R11), the wife represented herself as married to the husband in 1995, but not so in 1996 or 1997. As previously asserted by her, and in conflict with her earlier evidence, the wife suggested this to have been because she had been “forced to go back to the pension or part-pension”. As earlier recorded, the inference most realistically emerging from this evidence is that the wife was back on the pension or part-pension for those tax years by reason of her being separated from the husband. Such a conclusion is consistent with the other evidence to which reference has been made.

69. The wife asserted that the husband ceased to financially support her for only one month subsequent to their separation in February 1996, despite which, the wife resumed receiving government support from that time until 1997. This claim does not sit well with the assertions referred to above. The wife’s evidence makes clear that from 1997 to 2000, save for possibly a period of two months in 1999, the wife was not on a pension. The wife’s explanation for receiving the pension until 1997 was unconvincing. The probabilities are that, during the period from 1996 to 1997, the parties were not cohabiting on a basis which precluded legitimate receipt of the pension on that basis. The receipt of the pension is consistent with the husband’s assertion that he did not provide financial support for the wife during that period although the evidence of the wife is clearly that, throughout their co-habitation, the husband provided very substantial support for her son Mr R.

70. By letter dated 1996, the husband’s solicitors suggested to the wife:-

“Your client has no doubt instructed you that during the whole of the relationship your client was on a pension and could not receive financial support from our client or indeed live in a de-fact relationship with him otherwise she would have lost her pension or alternatively been prosecuted for breach of the terms of the pension grant.”

In response to that suggestion, and on the wife’s instructions, her solicitor, Mr Downing wrote to the husband’s solicitors in 1996 stating:-

“As you have correctly surmised, we have received our client’s instructions in relation to the circumstances surrounding the period of time when our client was in receipt of [government support]. We similarly assume your client has provided you with full instructions in relation to his abject failure to provide proper and adequate financial provision for the support of our client and the conduct of the household that your client expected be maintained for his benefit both before and during the marriage.”

That letter is inconsistent with the claims the wife now makes with respect to her receipt of government support between 1992 and 1996. The probabilities are that the account there suggested was more consistent with the truth than the account the wife now conveniently offers.

71. The wife was cross-examined on an affidavit she swore on 5 June 2000 (Exhibit R6) wherein the wife swore:-

“The money received by me pursuant to the Consent Orders approved on 3^rdJune 1996 represented approximately 2 – 3 % of the assets owned and/or controlled by the husband. I agreed to this settlement not only out of fear of the consequences of not consenting to the orders (my health and that of my son (who was 11 at the time) had deteriorated to such a point that I had to bring the disputation, threats and emotional blackmail to an end) but in the hope that the husband and I could resume our marital relationship once the husband had satisfied himself that he should not consider any further relationship with his ex-wife.” (emphasis added)

The wife conceded that such statement was at variance with her current assertion that the parties agreed to reconcile in 1996, more than two months prior to the making of the consent orders. The wife suggested “there might be a typing error” in the affidavit, a possible but implausible explanation.

72. In paragraph 15 of the same affidavit the wife deposed:-

“Following approval of the Orders in June 1996, the prior fortnightly cohabitation arrangements resumed from […] 1996 onwards. Subsequently I purchased my present residence at [FF Street], [Suburb Z] which I renovated [in late] 1996. The husband was absent in the United Kingdom [for part of] 1996 looking for properties to purchase. He contacted me at my [Suburb Z] home on his return and wanted a reconciliation. I agreed and the husband then resumed his visits to my [Region L] home every 10 days for a 4 or 5 day visit (on average) on each occasion from [late] 1996 onwards.”

Read in conjunction with paragraph 14, that paragraph was inconsistent with the wife’s assertion that reconciliation was “immediate” in early 1996. Moreover, the inconsistency between the wife’s claim in 2000 that the husband “wanted a reconciliation” in late 1996 and her claim that the parties were reconciled in early 1996 was not adequately or credibly explained by the wife. The wife’s suggestion that the “mistakes” in the affidavit were not referable to her and had been matters which she had simply overlooked when she re-read the affidavit, though convenient, is unconvincing. Again, the wife has a difficulty by virtue of her willingness to swear different things at different times. Rationally it can be asked on what basis her evidence is now any more reliable than it was when she swore the affidavit in June 2000. Logic suggests that an affidavit sworn closer in time to the events therein referred to is more likely to be accurate in that regard than one sworn much later and at a time when the issues in dispute have crystallised and the desirability of asserting a particular course of conduct become more apparent. Interestingly, the final sentence of paragraph 15 does not differ significantly from the husband’s version of events from that time until 1997 at which time co-habitation undoubtedly did resume.

73. The wife was also cross-examined with respect to an affidavit she swore on 12 December 2000. In that affidavit the wife deposed (paragraph 33):-

“Shortly following approval of the Consent Orders, I reconciled with the husband and we resumed (in or about [mid] 1996) our relationship with each other. Ultimately, the husband did not fund the return to Australia of his ex-wife but he did insist that he intended to travel to England [in] 1996 to examine properties to invest in. I again felt threatened because I believed the husband intended to visit his ex-wife and provide her with assistance behind my back. The husband went to England, returning to Australia [in late] 1996 when he came to Queensland and wanted to resume our marital relationship again. I agreed that provided the husband had put his relationship with his ex-wife behind him, our marriage could go forward and the husband thereafter resumed his cycle of visits equating to 4-5 days out of every 10. During this period, in late 1996, the husband continued to assure me that he had the [D Pty Ltd business] on the market for sale and, that as soon as it was sold, he would relocate to Queensland to be with me. That never happened.” (emphasis added)

74. The wife was unable to explain the “mistake” in the affidavit as to when co‑habitation resumed, suggesting that she was “hopeless with dates”. The parties undoubtedly resumed a “relationship” the day after the mediation in Melbourne with Ms N, albeit the evidence suggests not one of co-habitation as man and wife. The probabilities are that the “cycle of visits” alleged by the wife was closer to the truth than the suggestion in any of the several versions of events offered by her that full time co-habitation resumed at any time prior to 1997. The wife’s concession that the husband did not resume financial support for her until 1997, provides further support for this conclusion, as does the wife’s removal from J Street in 1996. The wife suggested that the husband wanted to “get [J Street] ready for sale” and that she had moved out for that reason, although two months before the property was sold. The terms of the letter written by the wife’s solicitor (Exhibit R8) to the husband’s solicitor in 1996 “insisting” on immediate payment of the balance of the monies due under the orders of 3 June 1996 provide further support for the conclusion that, although the parties had a relationship at that time, the relationship was less than one of harmonious co-habitation.

75. The documents contained in Exhibit R8 leave little scope for doubt that the wife knew the nature and effect of the consent orders of 3 June 1996 and that such orders were final. Nothing appearing in any of the documentation contained within the exhibit assists the wife’s assertion that the orders were merely to give the wife “some security” or in anyway intended by the wife to be other than final orders for settlement of property, at least at the time the orders were made. Given the matters which the wife revealed to Mr Downing in the course of giving instructions, the absence of any notation of this kind is significant. It is probable that, had the wife regarded the settlement in the terms she now asserts in 1996, she would have told Mr Downing who no doubt would have been diligent in making a file note to that effect, together with a file note of the advice he tendered to the wife with respect to the consequences of entering into the consent orders. These omissions are significant.

76. The wife was cross-examined about diary notes made by her former solicitor Mr Downing in 1995. The wife agreed that Mr Downing had handled two legal matters for her in 1992 and 1993, and that she had consulted him in relation to the proposed pre-nuptial agreement with the husband in 1994. The wife did not dispute that she had seen Mr Downing in 1995 (some two months after she and the husband married) but suggested, for reasons which she could not explain, that Mr Downing had inaccurately recorded what then transpired. In his notes, Mr Downing noted the wife as having stated that she and the husband “co-habited on and off for the four and a half years” during which period they were “going out together”. The probabilities are that Mr Downing wrote what he did because that is what the wife told him. Mr Downing again saw the wife in 1995 at which time the wife told him that she “hadn’t heard for ten days” from the husband and that the parties were “likely to separate”. Again, there is no basis for suggesting that Mr Downing made any of these entries other than as a consequence of the wife having told him what appeared in the document. Mr Downing continues to be the wife’s solicitor in these proceedings. Mr Downing did not give evidence on the wife’s behalf. No explanation for such failure was proffered or emerges. The inference is inescapable that Mr Downing did not give evidence because such evidence would not have assisted the wife’s cause (see Jones v Dunkel (1959) 101 CLR 298).

77. The wife was cross-examined with respect to a file note from a date in 1996 which suggested that a telephone call to the wife’s premises at 9.50am that day was answered by the husband, the wife returning the call sometime thereafter to arrange a conference and advising that the “husband staying but in separate rooms”.

78. With respect to the period from 1996 to 2000, the wife agreed that she had not made any purchase of significance for which she had not been reimbursed, and had not made payment for, or in respect of, any properties of the husband in such period. The wife conceded that there had been no joint account subsequent to 1996, no property acquired in joint names, and that the husband had paid her Visa card accounts. The wife conceded that she knew in 1996 that final property settlement orders had been made. As previously recorded, there has never been any complaint as to the adequacy or appropriateness of the property settlement which the wife received in 1996, whatever its basis.

79. The wife was cross-examined in relation to the pre-nuptial agreement which the parties entered into (Exhibit R9). Given that the parties have, at no time since it was entered into, sought to determine their respective financial rights by reference to it, the pre-nuptial agreement is of extremely limited potential significance in these proceedings. As will be seen, ultimately the only real significance which can properly be attached to the agreement is in the context of attempting to ascertain the husband’s true financial position.

80. In cross-examination the wife agreed that in 1996 the husband visited Queensland on three occasions, staying a total of eleven days. In cross-examination with respect to 1997, 1998 and 1999, the wife conceded the husband’s visits to have been substantially as he asserted. Given that the husband was, at all material times, a medical practitioner practicing in the state of Victoria, it is not surprising that he was not permanently in the state of Queensland, although, the frequency of the parties’ co-habitation was augmented significantly by the overseas trips they jointly took, details of which have been chronicled earlier in these reasons.

81. In relation to the husband’s contributions to the welfare of Mr R, the wife was genuinely magnanimous, conceding that from 1990 to 1992 he made gifts to Mr R and paid for excursions for him. From 1992 the husband paid for school uniforms, encyclopaedias, books, “anything that Mr R needed”. The wife conceded that the husband had met “all of his expenses”, volunteering “thank God he did”. The wife agreed that “to an extent”, the husband had provided food for the household over the years, “filling up the cupboards” or words to that effect, being the wife’s description of the husband’s contributions in that regard.

82. The wife’s evidence was that Ms N visited Queensland “probably a couple of times a year” in 1992, 1993 and 1994, during which she had stayed with the wife at the husband’s property at J Street.

83. In contradistinction to her evidence in relation to “co-habitation” the wife was an impressive and frank witness so far as her financial position, post, present and future is concerned.

84. The wife was cross-examined with respect to her earning capacity, her last employment in a managerial position having been with a business, who she “left decades ago”. The wife disclosed that when the case is over she will seek to retrain. A government agency will apparently assist with payment of the training. The wife said that she is not currently proficient in her new area of work, the course she proposes being aimed at rectifying that state of affairs. The wife does not expect that Mr R will be living with her for long into the future.

85. The wife was cross-examined with respect to her current expenses. Leave had been given, without opposition, to the wife preparing, filing and relying upon an updated statement of financial circumstances. In that statement, the wife set out that she receives government support of $182.45 per week. The wife omitted to refer to the receipt of interim spousal maintenance of $400 per week from the husband, a payment which she did not dispute. Such failure was clearly an oversight and does not impact adversely on her credibility.

86. To the extent that the wife was cross-examined in relation to her capacity for appropriate gainful employment, such cross-examination does not establish that the wife has a present capacity which she is failing to exercise or attempt to exercise. Whilst the wife has had some experience in, and demonstrated talent in certain areas, the combination of age, lack of formal qualifications and recent relevant employment experience, combined with the absence of any suggested avenue of employment reasonably open to her but not sought to be pursued, entitle the wife to a finding that she has discharged the threshold requirement of s 72 and is unable to support herself. The evidence does not reveal or suggest that the wife has income other than as disclosed by her. The government support cannot be regarded as income having regard to the provisions of s 75(3) of the Family Law Act.

87. The wife particularised her fixed expenditure. To the extent that her mortgage payments have increased from her previous financial statement, the wife’s explanation in that regard is credible and acceptable. None of the other fixed expenses of the wife was successfully challenged. So far as her weekly expenses (Wife’s Financial Statement of 18 October 2002, Part F) are concerned, the wife conceded that her $50 per week phone bill was largely referable to the current litigation and could be expected to reduce in the future to approximately $25 per week. The wife explained that $20 per week for fares is referable to a cab one night out per week, which does not seem unreasonable. The wife explained the circumstances surrounding her spending $40 per week for chemist/pharmaceutical expenses, her explanation in that regard being not unreasonable. The wife also explained her $30 per week bill for alcohol and referred to the $20 per week for health insurance which does not appear in the statement. On balance, the wife’s current reasonable weekly needs for herself, inclusive of fixed expenses, approximate $650 per week.

88. In re-examination the wife identified records (Exhibit A4), which reveal the times when she was in Melbourne. Such documents do not materially advance matters. Nor does the evidence of the wife in re-examination that in 1996 she and the husband made two visits to a “fertility specialist” who advised that it was “too late to do anything”.

89. The cross-examination of the wife leaves little room for doubt that the wife has exaggerated, consciously or otherwise, the duration and extent of the co-habitation between herself and her husband. There is little scope for doubt as to the nature and extent of contributions made during the period of co-habitation. Her evidence in those respects was essentially credible. Contrary to the wife’s assertions, the Court concludes that the parties “co-habited” in the full sense, from the date of marriage in 1995 or shortly prior thereto, until 1996 and thereafter from 1997 to 2000. At all other times, save for interruptions of as long as two to three months (as occurred in late 1996) there was what the wife herself, at an earlier time, frankly described to her solicitor as an “on and off relationship”.

90. Having concluded as it has in relation to the duration of the co-habitation of the parties subsequent to the making of the consent orders in 1996, and given that the contributions during that period are not really in dispute, or in doubt if they are, the Court’s primary interest in the husband’s cross-examination involves the adequacy and accuracy of his financial disclosures and ascertaining his true current financial position. This is particularly so given that there is no suggestion, by either party, that the property settlement entered into by the parties on 3 June 1996 was other than appropriate. If the husband’s financial position is as he contends, any further order in favour of the wife would be difficult, if not impossible to sustain in the event that the wife made out the ground for relief sought by her. In such circumstances the wife’s applications for relief pursuant to s 106B would assume critical significance.

91. The husband confirmed that he is still a medical professional in Victoria and is also entitled to work in the United Kingdom. The husband suggested that he lives with his mother in rented accommodation at Suburb O in Melbourne and with friends when in Queensland. He did not elaborate on the financial arrangements with respect to either arrangement. The husband has been back in Australia for “a year and a bit”. The husband, who does not normally keep a diary, stated that he had recently discovered his 1993 diary. So far as the City K apartments are concerned, the husband “understands” that his brother Mr E owns the properties through an offshore company “G Company”. The husband said that he knew that prior to the final separation of the parties in 2000 and could not recall having previously given a different account in that regard.

92. The husband was cross-examined on an affidavit he swore in Country JJ on 13 November 2000. The document had been prepared by Mr EE, the husband’s solicitor from 1996. In paragraph 17 of the affidavit the husband had deposed (Exhibit A5):-

“As to paragraph 18, the properties […] were in fact purchased not by myself personally but by the trust in which I have no share or directorships but some of the money for the purchase were gifted by me to the trust for the benefit of my family. Those gifted funds were from the sale of my [vehicle] and house [in Suburb H] the balance of the funds were borrowed and in fact the borrowings were 80 per cent of the purchase price and after payment of the Estate Agent’s management fees (12%-13%) and interest due to the bank the properties are negatively geared.”

The husband conceded that he had not, in paragraph 17, or anywhere else, ever previously mentioned the “G Trust”. The husband refuted any suggestion that he had intended the reference to be to the C Family Trust No 1, of which he is a beneficiary. Who the beneficiaries of the “G Trust” are, if it exists, the husband was not able to clarify. The husband conceded that he had not discovered any documents for the trust and suggested that his brother Mr E would have the documents. Mr E is a respondent to these proceedings, who has given instructions to solicitors, including instructions to brief Senior Counsel to appear on his behalf, but has never appeared or filed any affidavit material. These failures were not adequately explained. The husband conceded that he was in contact with Mr E at the time he swore the affidavit. The husband further conceded that he has not provided any document showing that he gave money to the “G Trust”. The husband insisted that the documents existed and are with Mr E. The husband could not recall how he transferred the money to Mr E. The husband thought that the sum involved was $100,000 and that the transaction had been in 1997 although he could not recall how it had occurred. The husband suggested that his brother Mr E would have a better recollection of what occurred. The husband was reminded that his brother Mr M disputed that the husband had made payments of money from the sale of his house at J Street for the purchase of City K properties. The husband conceded that Mr M’s account was likely to be more accurate than his own, ultimately accepting that he had not paid any money from J Street to his brother Mr E.

93. The husband was cross-examined in relation to the sale of Motor Vehicle 3 in about 1997. In an affidavit he swore in 2000 the husband said shortly after separation he sold it (Husband’s affidavit of December 2000, page 19). Motor Vehicle 3 had been acquired at the time J Street was purchased in 1992. At trial the husband suggested that Motor Vehicle 3 was sold to the trustee of the C Family Trust No 3, BB Pty Ltd in about 1993. The husband’s evidence was that he had hired Motor Vehicle 3 from BB Pty Ltd, the directors of whom are his brother Mr E and a brother in law, Mr DD. The husband’s evidence was that he then paid BB Pty Ltd to use Motor Vehicle 3. On the sale of Motor Vehicle 3 to KK Bank, for $100,000, the husband claimed that he had made a gift of the proceeds of sale to his brother Mr E. He could not recall how he had given Mr E the monies. The husband volunteered in his evidence with respect to Motor Vehicle 3 “I rented it from myself”, paying an hourly rate as well as the repairs. Why that would have been was never explained and the Court is unable to imagine why, as a commercial reality, that would have occurred other than pursuant to some tax minimisation scheme, an explanation the husband declined to embrace.

94. The husband was adamant that he has not had and does not have any interest in properties in the United Kingdom. The husband was reminded of his brother Mr M’s sworn answers to interrogatories (Affidavit of 24 September 2002, annexure MM-17) which read:-

“The husband has informed me that he has purchased properties in the United Kingdom. He also told me that his wife knows of all his real estate in [City K].”

The husband was unable to explain why Mr M would have made the statements which he there did, but did not suggest that Mr M lacked the knowledge to have given that evidence. Despite shortcomings in the evidence of Mr M where financial matters are concerned, the Court has little difficulty preferring his evidence to that of the husband where the two are in conflict. The husband’s evidence in relation to the City K properties was quite unsatisfactory, raising more questions than it answered. The complete absence of documentation from himself or Mr E was significant.

95. The husband was cross-examined on his 1997 tax return (Exhibit R12) relating to an investment in property in the United Kingdom. The husband ultimately recalled that he had an interest, acquired for $40,000 “fifteen or twenty years ago” through solicitors in Melbourne in a United Kingdom property, and that his failure to disclose the asset has simply been due to his having failed to recall that he held the interest. The husband stated that he hoped that the investment “might have grown in past years”. The husband did not suggest that he no longer holds the interest, nor did he suggest its current valuation.

96. The husband was extensively cross-examined with respect to transcribed telephone calls between himself and the wife at the time of separation in 2000. There is no suggestion that the transcripts of such calls, which were annexed to the wife’s affidavit, are other than accurate. There was no challenge to the transcripts being received into evidence, nor, with respect, could such a challenge have been successfully maintained in the circumstances, particularly having regard to s 128 of the Commonwealth Evidence Act 1995 (Cth). The transcripts are damaging for the husband’s credit in relation to financial matters and constitute evidence by way of admission against interest of his probable financial position. It is necessary, and very instructive, to examine the transcripts in some detail. Before doing so, it is to be noted that the husband asserted throughout his evidence that he was not concerned in 2000, or at any other time, that a government body might, as a result of its investigation, take any of his assets. In this regard, the circumstantial evidence points overwhelmingly to that having been precisely the husband’s concern, and his assertion:-

“I deny saying that I sent every penny out of the country to avoid [a government body] gaining access to my assets. I have nothing to fear from the [government body]. [Mr LL] and I have conducted our [businesses] honestly and appropriately and the only reason that we were investigated was that we were in the top 10 percent of income earners, because of the many hours that we put in every day and the large number of [clients] that we saw.” (Exhibit A5, paragraph 23)

to have been untrue.

97. Should it become material to do so, the Court would be comfortably able to be satisfied that the husband’s alleged movement or disbursement of funds was far more referable to a concern that the government body would get its “friggin hands” on such funds than any concern about “anticipated” Court orders under the Family Law Act in the wife’s favour. Whether, irrespective of intention, the transactions had the effect of defeating an anticipated claim is a separate issue which may require consideration. It is perhaps ironic that the husband, in proceedings in which s 106B is raised, will not concede what the evidence renders transparently obvious as to his concerns in 2000 when so doing would have limited the potential operation of s 106B to transactions having the effect of defeating a claim, without that having been intended.

98. Relevant portions of the transcripts annexed to the wife’s affidavit of evidence in chief reveal:-

“[Mr C]: Well I was going to stay here if you want, I was going to fly up and see you before I go away and I want to tell you that you know whatever happen I’m really sorry that like …. I’m not the right person.
Well I’ll find myself I know that and I won’t be away for long I just want to get things started.
You see [Ms W] I want to tell you that I want to get everything out of this country so that whatever happens you will always have something
[Ms W]: Mm
[Mr C]: and I was gonna do a will you see I wanna put it in the will that whatever happen to me you be looked after for the rest of your life
[Ms W]: Well God I hope I don’t have to wait for you to die
[Ms W]: I was thinking last night like with the car if they buy [D Pty Ltd] then the car belongs to them. Is it …
[Mr C]: No no no no no You see when you buy [D Pty Ltd] they have to have a list of assets that we are selling to them so if that car is not listed we which it wouldn’t be ..right? … And I’m the one that sign it so if I don’t sign anything it wouldn’t be Why should I sell it to them [Ms W] just like [Motor Vehicle 4] I’m not going to sell them [Motor Vehicle 4]
[Ms W]: Mmm but but that’s you told me that wasn’t leased anymore, mines the only car that’s leased
[Mr C]: No [a vehicle] is still leased [Mr M] renew the lease
[Ms W]: Oh Ok
[Mr C]: Yeah it’s still leased only [Motor Vehicle 4] that’s why I transfer [Motor Vehicle 4] up .. Up to [Region L] While I’m living here,
[Ms W]: Right
[Mr C]: No [Motor Vehicle 4] I paid off quickly because that way ..Ahhh..but … I don’t have to sell anything if I don’t want to. What I want to sell to them they will pay me which is good.
[Ms W]: Why can’t you transfer it over into my name?
[Mr C]: Because if I transfer into your name you have to pay with after tax money as it is at the moment if … if … It’s before tax money
[Ms W]: But knowing that they are going to buy the [business] and you are going to pay it out anyway, why can’t we do that?
[Mr C]: Yeah I can do that for you, when … when we get our two million or whatever if that makes you fell happier Yes!
[Ms W]: Well it would make me feel more secure, I just
[Mr C]: I know
[Ms W]: Do you know what I mean?
[Mr C]: I do know. Yes, I want you to feel secure
[Ms W]: I mean I …….
[Mr C]: I’ll do that for you”

…

“[Mr C]: Ok I hope you be happier and you feel better for yourself pup, don’t worry about the car nobody is going to take you car away”

…

“[Mr C]: I know, but I been paying all the bills up to now for [Mr R] and I will continue to pay it, unless I’m bankrupt, that’s why [Ms W] I make sure that the bloody [government body] can’t get it’s friggin hands on me. Because whatever I do, I have protected ALL of us, so that whatever happens even if I go to this bloody bed and breakfast thing, so that the money can be sent back to you and you never have to worry, why do you think I do that? If I don’t send every single friggin penny out of this country these bastards trying to put a stop on my account or anything, you and I will be dead! …. I’ve done all that [Ms W] ……….”

99. The husband’s statements in those conversations are inconsistent with his assertions that he had no interest in the business in Suburb S, or the real estate from which the business was carried on. The figures referred to by the husband in respect of the realisation of those interests are significant. The statements are inconsistent with the husband’s claims that he has no present interest in D Pty Ltd.

At paragraph 27 of his affidavit, sworn 13 December 2000 (Exhibit A5) the husband said “I did not promise to pay out [Motor Vehicle 1] and give it to her”. The statements appearing in the transcribed telephone calls to which reference has been made refute such suggestion.
The husband was cross-examined with respect to Ms N’s evidence and conceded that there had been “hugging and kissing” at the “mediation” meeting. The husband initially could not recall whether the parties had said that “they loved each other” but then denied that such had been the case. The husband sought to explain his actions at the “mediation” as “just relief”, denying that the parties then agreed to reconcile. The husband confirmed that the parties had gone out for dinner after the meeting with Ms N, that he had collected the wife the following morning to go and see Mr EE the solicitor. The husband further confirmed that shortly thereafter he followed the wife to Queensland on a different aircraft to her and that they stayed at a motel in Region L where a sexual relationship was resumed. A temporary violence order then in force necessitated their adopting these tactics. The husband conceded the sexual relationship thus resumed to have continued until his departure for overseas in 1996.

The issue is not without complexity, and a measure of artificiality. Senior Counsel for the respondents conceded that “We know of no reported case with facts similar to those Your Honour has to deal with in this case” (Submissions on behalf of Respondent Husband and Respondents, page 18). Where parties resume co‑habitation, maintaining their finances separately, contributing directly and indirectly, financially and non-financially, to their union, without apparent regard to the terms of Court orders they have previously entered into, no intention can necessarily be implied. The evidence in this case suggests that the parties did not, at least at a conscious level, consider the terms and conditions of their reconciliation, much less the impact of them on the 1996 consent orders, or of those orders on their legal rights with respect to each other or their assets during their further co-habitation. They simply reconciled and that was that.
In Sommerville v Sommerville [1999] FamCA 958, the Chief Justice referred with approval to the decision of Fogarty J in Drew and Drew (1985) FLC 91-601. If the wife’s application is dismissed, the parties in this case will “find themselves in a most curious position” as neither could “institute property proceedings in any other court because such proceedings would constitute a “matrimonial clause” within the exclusive jurisdiction of the Family Court” (at 79,862 per Fogarty J). In Drew’s case the parties had acquired joint assets in the post-separation period, the absence of an order under s 79A resulting in the parties being locked in to continuing joint ownership of such assets, with no Court having jurisdiction to break that deadlock. In the present case that would not happen if the application of the wife were refused. The question is whether the injustice to the wife of being denied the opportunity to pursue a claim for property settlement in reliance upon the resumed period of co-habitation of approximately two and a half years is such as to enable the Court to be satisfied that the husband should be estopped from denying that there was an implied consent to the orders being set aside. Similarly, the 1996 orders having been fully complied with, no question of unenforceable orders remaining on foot would arise in the event of the wife’s application being refused.
On balance, the Court concludes that each party, by his or her conduct, evinced an intention not to rely upon the rights conferred or confirmed by the June 1996 orders to defeat any claim for financial benefits in reliance upon their further co‑habitation and that it would be unjust to refuse the wife the opportunity to seek an order for settlement of property in reliance upon co-habitation extending over a period of two and a half years commencing in 1997. Indeed whilst neither party suggested that the orders were other than “final” when made, there is no evidence as to their understanding of the implications of those orders so far as their further co-habitation was concerned. The Court is accordingly satisfied that the parties are, in the circumstances, estopped from denying that they consented to the 1996 orders being set aside or varied, thus enlivening the provisions of s 79A(1A) of the Act.
In order to determine whether to “vary or set aside” the orders of 3 June 1996, it is necessary to determine whether, having regard to the provisions of s 79(4) and s 75(2), the wife should receive any further settlement of property. In theory, this process could involve an evaluation of the contributions and relevant s 75(2) factors with respect to the parties’ co-habitation prior to the June 1996 orders being made, that is, from the time they first commenced to co-habit. In the circumstances of this case, the Court does not propose doing that. Neither party has asserted that the orders of 3 June 1996 were unfair, either in terms of the process which led to their being made, the provisions they contained, or any aspect of their making. Each party was legally represented at the time the orders were made and, as has been detailed, the orders were preceded by negotiation between solicitors, the details of which emerge with some clarity from Exhibit R8. The orders were implemented and, on the Court’s finding, the parties did not resume co-habitation until almost eighteen months after they were made and implemented. To go beyond or behind the orders would, in the circumstances, not be justified.
As has been recorded, whilst the parties had a “relationship” between the making of the consent orders in June 1996 and 1997, that relationship lacked the financial and non-financial elements of co-habitation which would attract the operation of s 79 of the Act. The question thus becomes one of evaluating the contributions of the parties between 1997 and 2000. Those contributions are not in serious doubt.
On behalf of the husband it was submitted:-
“CONTRIBUTION IN PERIOD TO THE FEBRUARY 1996 SEPARATION
Whilst there has been no issue that what the Wife received in June 1996 was other than appropriate, we make the following observations:
(a)   Throughout the entire period of the relationship (however it might be characterised) the parties predominantly lived in different states in their own respective homes. They effectively had short periods of time together just as many unmarried people in dating relationships do. The contributions the Wife could make in those circumstances were clearly limited and but a fraction of what a traditional wife would perform. The Husband financially supported the Wife after marriage but performed much of the homemaker role as regarded his needs without assistance from her as he was in Melbourne for a considerable part of the period.
(b)   The contribution to the stepson by the Husband is entitled to some weight but the primary role played by the Wife in respect of [Mr R] cannot enhance her entitlement to property settlement and must be ignored (Robb (1995) FLC 92-555);
(c)   The Wife, at no time, played any role of note in relation to the Husband’s business, her homemaker contributions were limited and the other contribution she identifies (some interior decorating, etc) have negligible weight due to the limited period involved and the property brought to the relationship by the Husband;
The Wife herself describes her role throughout (we would submit unfairly) as the Husband’s “Queensland consort to visit when he pleased” (para, 159).” (Submissions on behalf of Respondent Husband and Respondents, page 7-8)

The contributions relied upon by the wife have earlier been referred to. So far as direct financial contributions to the co-habitation from 1997 to 2000 are concerned, the husband was the overwhelming contributor. To the extent that the wife made financial contributions, those were indirect in the form of accommodation which she provided for the husband when he was in Queensland. The parties co-habited, in Australia or elsewhere, for approximately 25 days in 1997, 111 days in 1998, 114 days in 1999 and 50 days in 2000. During those periods, the wife cared for the husband, in the ways the husband conceded as well as providing food, entertainment for him, and driving him around. At other times, the parties maintained telephone contact. The wife was at all times the husband’s “confidante”, whether he was in Queensland or elsewhere. The husband’s regard for the wife’s efforts can best be gained from his candid remarks in the telephone conversations with her in 2000.
The husband provided materially, and generously, for the wife’s son Mr R. He had no obligation to do so and is entitled to credit for having done so. The husband provided generously for the wife during their second period of co-habitation and, the evidence reveals, provided a lifestyle which the wife would probably have been unable to have secured from her own resources. The wife did not obtain employment during the period of co-habitation and there is no evidence that the husband ever sought that she do so, he being content that she be available to be with him and to attend to his needs at all times when he came to Queensland or when the parties went overseas. On the evidence, the wife would not have been able to have maintained any significant employment and continue to be available to provide for the husband during their second period of co-habitation. As was conceded on behalf of the wife, the parties maintained separate finances, both in terms of assets and income, during this period. Whatever his true worth, the husband’s assets in 1997 exceeded those of the wife, although the absence of “intermingling” of assets renders that of minor significance.
The husband’s case is clearly that, at its highest for the wife, the contributions of the parties’ in the various respects were equal, and that, as such, the wife ought not be entitled to receive anything further. The husband would contend that his contributions exceed those of the wife in the second period of co-habitation.
On balance, during the period the parties co-habited, the contributions of the wife to the welfare of the parties, revealed by the evidence, exceed those of the husband. The submission on behalf of the husband, that he provided for himself materially for significant periods whilst he was in Victoria, overlooks the fact that the wife provided similarly for herself in Queensland during such periods. The husband went about his life and his business activities as he pleased during the second period of co-habitation. The evidence demonstrates that, during such a period, the wife’s primary commitment was to the husband and the relationship. The husband made the greater financial contribution, but his financial capacity to do so greatly exceeded that of the wife. The reasons for the wife’s absence of financial contribution referred to above are relevant in this context. The evidence does not establish that the wife benefited from the assets of the husband in this period. The husband did from the asset of the wife: in the form of accommodation within her home.
Objectively, if the Court accepted that the husband was worth $450,000 net in 1996, and is worth what is asserted on his behalf today, no order in favour of the wife could properly be made, whether by way of variation of the previous order or by setting the order aside and making a further order. It is therefore necessary to consider the current financial position of the husband. In the circumstances of this case, for reasons the Court had given, it is not necessary to determine (if that be realistically possible) the net assets of the husband at the time of the 1996 orders. The husband, who knew his worth better than anyone, consented to paying the wife $180,000 and has not asserted that doing so was unreasonable.
On behalf of the husband it was submitted that the assets of the parties comprised:-
“THE PRESENT POOL
The Wife’s assets are presently limited to:

· Home – [FF Street], [Suburb Z] $317,000
-Mortgage […] ($ 50,000)

·     Furniture  $ 10,000
·     Bank Accounts  $    3,000
·     Jewellery  $    5,000

$285,000

She has a substantial liability to her solicitor. My recollection of her evidence is that she has paid around $25,000 in respect of legal fees by increasing her mortgage debt.

The Husband’s assets are presently limited to:

·     Bank Account in [Country JJ] held in joint names of the $300,000
Husband and his brother, [Mr E]
·     The [United Kingdom property investment]  ?
·     Shares […]  $    6,600

The Husband’s liabilities are presently:

·     Total care  $ 45,876
·     Accountants  $   2,000
·     NAB fees  $   3,324
·     Legal fees  $ 50,000”
(Submissions on behalf of Respondent Husband and Respondents, page 12-13)

The husband conceded in cross-examination that he “hoped” that the United Kingdom property investment of $40,000 may have increased in value. In the absence of any evidence on his behalf as to the value of the asset, the asset is able to be brought in at $40,000 by way of admission against interest, the husband not having asserted that the investment was now worth less than such sum. The wife has a liability for legal fees of approximately $170,000 which, properly, is not included in the inventory of her assets asserted on behalf of the husband. The husband’s alleged liability of $50,000 for legal fees ought be treated the same way.
The Court has earlier referred to the two quite different figures which were offered on the husband’s behalf in 1996 (ranging from $2 million to $450,000 net assets). If one accepts, which the Court does not, that the husband’s assets were only worth $450,000 net in 1996, it is clear that he has received substantial funds since that time. The Court does not accept that the husband has dissipated such funds in payment of debts as he alleges. The failure to call witnesses who could have clarified transactions which have clearly been under challenge, or to produce source documentation relevant in that regard, extends to virtually every transaction sought to be impugned by or on behalf of the wife. The Court is unable to determine the husband’s true worth at this time, by virtue of his failure to make full and frank disclosures of his financial circumstances, both in terms of his assets and his liabilities.
By way of illustration some transactions are appropriate to be referred to. From what source the husband obtained the $180,000 which he paid to the wife pursuant to the 1996 consent orders has not been adequately explained or identified, much less evidenced by any source documentation or other records.
Subsequent to the making of the orders, the husband allegedly gifted $100,000 to his brother Mr E in 1996 and a further $300,000 in 1997. None of those “gifts” was documented, or the payments evidenced, and no explanation for the failure to seek such documentation or evidence was forthcoming. The husband’s brother Mr E, could have shed light on these dealings if they occurred as the husband alleges they did. He made no attempt to do so. The husband’s evidence (Affidavit of September 2002, paragraph 96) is in conflict with paragraph 55 of his brother, Mr M’s affidavit. No credible reconciliation of the two versions has been attempted. The husband initially asserted that the $100,000 came from the sale of the Motor Vehicle 3, although the vehicle, according to his later evidence, was sold in 1993. The Court does not accept the husband’s evidence as to the alleged disposition of these sums. It is unable to find what the husband has done with them. The husband’s failure to “come clean” in relation to these transactions gives rise to that state of affairs.
The husband asserts that in early 1999 he gifted a further $600,000 to Mr E by causing monies to be transferred at his direction from the lending facility of B Pty Ltd to a bank account identified by number only at PP Bank (Mr M’s Affidavit of 24 September 2002, annexure MM14). There is no confirmation from Mr E that the money was received, or from Mr M that the facsimile was sent, or that PP Bank confirmed receipt of the funds. It must be remembered that the transaction occurred against the background of the husband claiming to have very substantial liabilities. The Court does not accept that the husband has alienated the $600,000, or that, if he has, it ought not be notionally “added back” pursuant to the decision of the Full Court in Townsend v Townsend (1995) FLC 92-569. Similar observations apply to the $400,000 allegedly provided to Mr E earlier. The Court is unable to determine whether the $600,000 was ever transferred overseas, or, if it was, where it is now being held. The Court simply does not accept the husband’s assertion that he disposed of the monies. To the husband’s asserted net asset position at present the sum of $1million should thus be added back by reason of these transactions.
The husband asserted in earlier affidavits that he had gifted $279,000 to Mr E on or about 7 June 2000 (Affidavit of December 2000, paragraph 165). In his affidavit of evidence in chief in September 2002 (paragraph 167), the husband resiled from that suggestion and asserted that the monies were paid to D Pty Ltd, NAB, GG Pty Ltd (a reference to GG Centre Pty Ltd) and one of the C Family Trusts. These disbursements were not documented. Persons with the potential to give evidence about them did not give evidence about such repayments and, to the extent that Mr M purported to do so, he did not document or otherwise establish, on balance, that the loans were repayable, or repaid. Whether the husband retains the $279,000, has someone holding it for him, or disposed of it, it is appropriate to notionally add back this further sum. So doing produces (inclusive of the monies referred to above), net assets of not less than $1.5 million.
The husband received $900,000 from the proceeds of realisation of superannuation investments within months of his departure from Australia in 2000. That sum presumably resulted from the husband’s $284,000 entitlement at the time of the pre-nuptial agreement in 1995. The husband asserted (Husband’s Affidavit of December 2000, paragraph 188) in his affidavit of evidence in chief that he paid $437,500 to GG Centre Pty Ltd, $15,000 to B Pty Ltd, $5,000 to D Pty Ltd (payments for Motor Vehicle 1 formerly in the wife’s possession), $86,000 in legal fees, $24,000 in spousal maintenance and $25,000 in miscellaneous debts. None of these payments was documented and, particularly in the case of the GG Pty Ltd payment, no evidence was given by Mr DD, nor was any explanation for the failure to do so offered. On the evidence, other than the sum of $24,000 paid by way of spousal maintenance and $5,000 paid with respect to Motor Vehicle 1 in the wife’s possession, all of these monies are able to be notionally added back. It is little short of amazing that not a source document has been tendered on behalf of the husband to evidence any of these movements of substantial sums. The clear inference is that, whether the monies are held by the husband, someone on his behalf, or have been deliberately alienated or disposed, they should be brought into account for present purposes. Taking into account $871,000 of the $900,000 superannuation payments produces notional net assets of the husband of not less than $2.3 million.
The husband received (Affidavit of 25 September 2002, paragraph 189) further superannuation benefits of $170,000 which he allegedly disbursed as to $41,922 to B Pty Ltd, $27,625 to BB Pty Ltd, $27,635 to the C Family Trust No 3 (a trust fee), $26,000 to Mr M, $27,535.48 on legal fees and $17,227 on living expenses (Affidavit of 14 April 2003, paragraph 136). The husband has failed to prove these claims.
The husband also sold Motor Vehicle 2, and allegedly spent the money for “living expenses whilst overseas”. No documents were provided in relation to that transaction, if it occurred. The husband can be considered to thus presently have assets worth not less than $2.5 million net.
It has not been established on the balance of probabilities that the husband has an interest in properties in City K. The Court does not accept the husband’s assertion that he lacks any such interest. It has not been established that the husband has an interest in D Pty Ltd. The Court does not accept his assertion that he lacks such interest. Similar observations apply to the C Family Trusts. The evidence does not establish that the trusts are the alter egos of the husband. The Court does not accept the husband’s assertion that they are not controlled by him. The husband and Mr M have deliberately made less than full and frank disclosures of the financial positions of the trusts. The circumstantial evidence in relation to each of these entities leaves a strong and abiding suspicion that the husband has interests in and control of each of these entities, but ultimately the Court does not need to speculate, the evidence of the husband and, to the extent that he has attempted to support him, Mr M, leaving the husband in a position which allows the Court to proceed in accordance with decisions such as Weir and Weir (1993) FLC 92-338, Black and Kellner (l992) FLC 92-287 and Oriolo and Oriolo, (1985) FLC 91-653. In Weir and Weir (supra), the Full Court said:-
“This Court has pointed out in a line of cases leading up to the recent decision of the Full Court in Black and Kellner (1992) FLC 92 -287, that it is the duty of a party involved in property proceedings in this jurisdiction to make a full disclosure of their financial affairs. See also Giunti and Giunti (1986) FLC 91 -757, and Muzzacappa and Muzzacappa (1987) 11 FamLR 957 . It is clear enough from his Honour's findings in the present case that the husband had not done so and had in fact pocketed the proceeds of a substantial number of cash sales. It is obvious that in most cases of this nature it is difficult enough for the other party to establish that fact let alone establish the quantum of what has been taken.

It seems to us that once it has been established that there has been a deliberate non disclosure, which follows from his Honour's findings in this case, then the Court should not be unduly cautious about making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature.” (per Nicholson CJ, Strauss and Nygh JJ, at 79,593)

The facts of this case fall comfortably within the scope of those observations.

For the reasons given, even without having recourse to Weir v Weir (supra), the net assets of the husband at present are able to be regarded as being worth not less than $2.5 million.
So far as liabilities are concerned, the husband would contend that, if some or any of the transactions referred to above are to be written back, his liabilities should also be. His learned Senior Counsel clearly, in the figures advanced in final submissions, asserted the debts to have been paid out of the assets or proceeds of sale of assets which have been disposed of. The husband has not demonstrated on the balance of probabilities that the alleged loan repayments made by him were in fact made or that the liabilities ever genuinely existed. Not a source document evidencing any of the transactions, either as to the incurring of the debt or its discharge, was ever tendered. The husband’s evidence was singularly unhelpful in relation to such matters, as was that of Mr M. A number of persons could have given evidence about those matters, notably, Mr NN, the accountant and Mr E. None of these persons gave evidence and no adequate explanation for their failure to do so was ever given. The Court does not accept that the husband has or had debts which he claims were responsible for the diminution in his assets subsequent to 1996.
The Court concludes therefore that the wife has current net assets of approximately $300,000 (ignoring her debt to her lawyers) whilst the husband’s assets are worth not less than $2.5 million (ignoring his debt to his lawyers).
Contributions ultimately must be assessed in monetary terms. In many cases they can best be reflected in “percentage terms”. Where, as here, the assets of one of the parties cannot be reliably quantified, such an approach is unrealistic. In the circumstances of this case, a percentage determination would not be realistic even if the husband’s true worth was ascertainable.
The evidence does not establish that, whatever their quantum, the assets of the husband have been materially increased, as a direct or indirect consequence of any contributions by the wife during the second period of co-habitation, any more than it establishes that the quantum of the wife’s assets has been so enhanced. Evaluation of the wife’s contributions is, in the circumstances, confined to the areas previously identified. The question arises as to whether these warrant recognition by way of an order for settlement of property. The Court is persuaded that they do. Their recognition must reflect the nature of the parties’ co-habitation, its duration, and the contributions made by each party, having due regard to the undoubted contributions of the husband. Whilst, necessarily, a very discretionary figure, the Court considers a sum of $100,000 to be a reasonable reflection of the comparative contributions of the parties within the relevant heads of s 79(4) in their second period of co‑habitation. This reflects the Court’s conclusion that the contributions of the wife to the welfare of the parties, outweigh the relevant direct and indirect financial contributions of the husband in that period. The finding recognises the different roles the parties played, the husband being free to pursue his life and business interests as he chose, and did, the wife subordinating her activities and life to the co-habitation with the husband. The husband’s own admissions in 2000 confirm the worth of those efforts.

Section 75(2)

It becomes necessary to have regard to s 75(2) when considering the quantum of any proposed or likely order for settlement of property. In this regard, there are a limited number of significant factors. By far the most significant s 75(2) factor is the disparity of earning ability of the parties. The Court has earlier made findings in that regard. The husband is a medical professional entitled to work in Victoria, the United kingdom and, according to his telephone conversations with the wife in 2000, parts of Asia. He has a capacity to earn, whether or not he presently chooses to exercise it, which he conceded to be as great as $2,500 per week. The wife has no current capacity to earn income. She has given evidence of her intention to retrain. There is no evidence as to the probable magnitude of her earnings when she retrains and obtains employment, nor any evidence as to the availability or otherwise of appropriate employment for her. The husband is somewhat older than the wife, but there is no suggestion that he would be unable to continue to work for some years to come. Moreover, the wife is herself not so much younger than the husband that she could be realistically regarded as having an expected working life greatly in excess of his.
Whilst the co-habitation of the parties may not have caused or contributed to the wife losing any work skills, the fact remains that the husband was able to maintain his professional qualifications throughout the co-habitation whilst the wife, by making herself available full time to be a wife, a home-maker and “soul mate” for the husband, clearly would not have been advantaged in terms of her employment prospects. Having regard to the husband’s probable financial position, a very substantial adjustment for the disparity of earning ability is warranted.
There is a vast disparity in the financial resources of the parties, whatever the husband is actually worth. Given however, that, on any view of the evidence, the husband’s wealth is largely the wealth he had, or some re-organisation of it, when the parties married in 1995, entered into consent orders in 1996 and resumed co‑habitation in 1997, this factor can have but limited significance. This is particularly so given the comparatively short duration of the parties’ second co‑habitation the nature and extent of the parties’ contributions during it and the disparity in their financial positions when that co-habitation resumed.
The evidence reveals that, due to the husband’s wealth, the parties lived a very comfortable lifestyle. Both parties are now entitled to a standard of living which is reasonable in all the circumstances. The evidence does not suggest the wife’s lifestyle to be other than reasonable although, clearly, she is limited by her lack of earnings and necessity to service a mortgage over her home. The husband has not disclosed, other than in the vaguest and most unsatisfactory of terms, what his circumstances are. There is no evidence as to the details of the sale of the C Family home (in which the husband has from time to time lived), previously said to be worth $800,000 seven years ago, nor any satisfactory evidence as to the financial details of the husband’s living arrangements. On the evidence, the husband is more than able to provide for himself a very comfortable standard of living, in this country, in City K and perhaps elsewhere. The husband’s standard of living will be markedly superior to that of the wife, regardless of any order this Court could reasonably make. The co-habitation of the parties, even aggregated, was not such as to entitle the wife to a comparable standard of living to that of the husband, but she is entitled to some reflection of this factor.
If an order were to be made, an adjustment in the wife’s favour pursuant to s 75(2) of $125,000 would, in the circumstances, be justified. The bulk of such sum would be referable to the disparity of earning ability and disparity of financial resources.
In the circumstances, and particularly having regard to the absence of any evidence establishing that the parties intended to be bound by the terms of the June 1996 consent orders after their 1997 reconciliation, to not regard the husband as estopped from denying that he consented to those orders being varied or set aside would be unjust and inequitable. But for the existence of the 1996 orders, the wife would, in the Court’s view, be entitled to receive a further $225,000 by way of settlement of property. In all the circumstances, for the reasons previously advanced, the wife should have that opportunity and the orders for settlement of property be varied to so provide.

Section 106B applications

The existing assets of the husband being sufficient to satisfy the proposed order in the wife’s favour, and the proposed order being charged upon those monies, it is unnecessary to consider the applications pursuant to s 106B of the Act.

Form of order

There may in fact be no real distinction in this case between varying the original order and setting it aside and making a further order. The Act seems to require that the Court be satisfied that it is “appropriate” to make another order in substitution for an order set aside but not so required if the order is to be varied. Lest there be any doubt, the Court is amply satisfied that it is “appropriate” to make the proposed order in the wife’s favour, regardless of whether that be by way of new order, having set aside the old order, or variation. In the circumstances of this case, it would accord more with reality, the case having proceeded on the basis that the original order has not been challenged, but rather a further order sought in reliance upon events subsequent to it, to vary the original order to provide that within thirty days the husband make the further payment proposed, and to provide for such payment to be charged over the $300,000 currently injuncted to abide the outcome of the proceedings.

Spousal maintenance

The wife has made out a claim for $400 per week spousal maintenance. On her own evidence, that entitlement ought not be seen as open ended. A continuation of the current interim order would in the circumstances be justified, at least until the wife receives the monies to which she shall become entitled pursuant to the orders for settlement of property. Thereafter, the wife will be able to discharge her mortgage and repay the debt which she has to her lawyers. She will then be able to support herself, not without some difficulty, until the end of next year, by which time she should be able to secure employment in some form. The Court will accordingly order that the interim spousal maintenance order be discharged as and from the time the wife receives her entitlement pursuant to the orders for settlement of property.

Costs

Various submissions have been made in relation to costs. Consistent however with the usual practice of the Court, costs will be reserved so that all parties have the opportunity to consider the implications of the Court’s judgment and to make such further written submissions, if any, as each desires to make in the light of the Court’s decision with respect to the substantive issues.

Orders

The orders of the Court accordingly will be:-
1. That the orders for settlement of property made on 3 June 1996 be varied to provide that the husband, within 30 days, pay to the wife the further sum of $225,000 payment of which shall be and remain charged upon the husband’s Country JJ Bank Account having a balance of approximately $300,000.
2. That, upon compliance with the paragraph 1 hereof, the current order for interim spousal maintenance be discharged.
3. That save in relation to costs, all outstanding applications and cross-applications be dismissed.
4. That the costs of all parties be reserved.

I certify that these 85 pages are a true copy of the Reasons for Judgment herein of
I.R. Coleman J.

Associate
Date:29/5/2003

[2003] FamCA 575

30-May-2003