WADE & ALAWI
[2020] FCCA 832
•15 April 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| WADE & ALAWI | [2020] FCCA 832 |
| Catchwords: FAMILY LAW – Property – whether leave pursuant to section 44(6) of the Family Law Act 1975 (Cth) required – declaration under section 90RD of the Family Law Act 1975 (Cth) – adjustment of property interests under section 90SM of the Family Law Act 1975 (Cth) – consideration of section 90SF(3) of the Family Law Act 1975 (Cth). |
| Legislation: Family Law Act 1975 (Cth), ss.4, 4AA, 39B, 44(5), 44(6), 79, 90RD, 90SF, 90SM |
| Cases cited: Ricci v Jones [2011] FamCAFC 222 Scofield & Shaw [2012] FamCAFC 193 |
| Applicant: | MS WADE |
| Respondent: | MR ALAWI |
| File Number: | BRC 1772 of 2019 |
| Judgment of: | Judge Tonkin |
| Hearing date: | 28 January 2020 |
| Date of Last Submission: | 28 January 2020 |
| Delivered at: | Brisbane |
| Delivered on: | 15 April 2020 |
REPRESENTATION
| Counsel for the Applicant: | Mr Baston |
| Solicitors for the Applicant: | Lyn & Rowland Lawyers |
| The Respondent appearing in person. |
IT IS DECLARED
Pursuant to section 90RD of the Family Law Act 1975 (Cth) (“the Act”) it is DECLARED that a de facto relationship existed between MS WADE and MR ALAWI for the period commencing 2010 until December 2012 and from early 2014 until July 2017.
ORDERS
By way of adjustment of property interests pursuant to section 90SM of the Act, within sixty (60) days of the date of these Orders the husband shall pay to the wife the sum of $40,000.
Upon compliance by the husband with Order (2) hereof, the husband is declared the sole and beneficial owner of the property situated at B Street, Suburb C in the State of Queensland being the whole of the land more particularly described as Lot ... SP ... Local Government Region D Title Reference ... (“the B Street, Suburb C property”) to the exclusion of the wife.
Simultaneously with Order (2) hereof, the husband shall indemnify the wife and keep her indemnified with respect to any mortgages secured against the B Street, Suburb C property.
In default of Order (2) hereof the following shall apply:
(a)The husband shall do all things and sign all documents necessary to list the B Street, Suburb C property for sale on the following terms and conditions:
(i)The property be listed for sale by private treaty with such agent as agreed in writing by the parties or failing agreement the wife shall nominate three real estate agents and the husband shall appoint an agent (“the selling agent”) from the nominated list;
(ii)The property shall be listed at a price agreed to in writing by the parties or failing agreement as recommended by the selling agent;
(iii)The husband shall co-operate in every way with the selling agent in relation to the sale of the property including maintaining the property in good condition and making the property available for inspection upon reasonable notice by the selling agent; and
(iv)The parties shall accept an offer to purchase the property being an offer that is at least 90% of the listed price or as recommended by the selling agent or as otherwise agreed in writing between the parties.
(b)The proceeds of sale of the B Street, Suburb C property shall be distributed as follows:
(i)In discharge of the mortgages secured against the property;
(ii)In payment of the selling agents costs and costs of conveyance;
(iii)In payment of $40,000 to the wife; and
(iv)The balance to the husband.
In the event that the B Street, Suburb C property fails to sell by private treaty by 1 August 2020 the parties shall do all things necessary to list the property for sale by auction and the proceeds of sale following auction shall be distributed in accordance with Order 5 (b) above.
The husband shall retain to the exclusion of the wife his interest in:
(a)The Motor Vehicle 1; and
(b)The Motor Vehicle 2.
The husband shall solely be liable for all debts attaching to the Motor Vehicle 1 (currently $55,000) and any debt attaching to the Motor Vehicle 2 and he shall indemnify the wife and keep her indemnified with respect to those liabilities.
The wife shall retain to the exclusion of the husband her interest in the Motor Vehicle 3 motor vehicle and indemnify the husband with respect to any debt attached thereto.
Each party shall retain to the exclusion of the other all chattels in his or her possession or control as at the date of these orders.
Each party shall be solely be liable for the following:
(a)Any credit card debt in that parties sole name; and
(b)All other debts in that party’s sole name.
Pursuant to section 90XT(1) (a) of the Family Law Act 1975 (“the Act”) whenever a splittable payment becomes payable with respect to the husband’s interest in the Alawi Superannuation Fund (“the Fund”) the wife shall be entitled to be paid an amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001 using a base amount of twenty thousand dollars ($20,000) and there shall be a corresponding reduction in the entitlement of the husband in that Fund.
Pursuant to Items 1 and 2 of Schedule 1 of the Alawi Self Managed Superannuation Fund the Trustee of the Fund (being Alawi Superannuation Fund Pty Ltd ACN ...), shall do all acts and sign all necessary documents to effect the splittable payment required to be made to the wife in accordance with Order (12) hereof to a superannuation fund as directed by the wife or her solicitor.
The operative time for Order 12 is seven (7) business days after service of a certified copy of this order upon the Alawi Superannuation Fund.
That in the event that either party fails to execute any deed or instrument necessary to give effect to these Orders within time frame specified, the Registrar or Deputy Registrar of the Brisbane Registry of the Family Court or the Federal Circuit Court of Australia is hereby appointed pursuant to the provisions of Section 106A of the Family Law Act 1975 to execute the Deed or instrument in the name of the defaulting party and do all acts and things necessary to give validity and operation to these orders.
The parties have liberty to apply with respect to the implementation of these orders.
IT IS NOTED that publication of this judgment under the pseudonym Wade & Alawi is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT BRISBANE |
BRC 1772 of 2019
| MS WADE |
Applicant
And
| MR ALAWI |
Respondent
REASONS FOR JUDGMENT
Introduction
This matter involves property proceedings heard over one day on 28 January 2020. The applicant de facto wife[1] was represented by Counsel while the respondent de facto husband appeared for himself.
[1] Hereafter the applicant de facto wife is referred to in this judgment and the “wife” and the respondent de facto husband is referred to as the “husband” for convenience.
Competing proposals
The wife commenced proceedings on 15 February 2019. In support of her application she deposed that the parties were in a de facto relationship for 14 years separating on a final basis in July 2017. Accordingly the wife contends that she commenced proceedings within the standard application period.
Section 44(5) of the Family Law Act 1975 (Cth) (“the Act”) provides:
“Subject to subsection (6), a party to a de facto relationship may apply for an order under section 90SE, 90SG or 90SM, or a declaration under section 90SL, only if:
(a) the application is made within the period (the standard application period) of:
(i) 2 years after the end of the de facto relationship; or
[…] or
(b) both parties to the de facto relationship consent to the application.”
The husband filed a response on 8 May 2019 seeking that the wife’s application be dismissed contending for a declaration under 90RD of the Act that the relationship subsisted between 2010 and December 2012. He filed an amended response on 21 June 2019 seeking that the wife’s application be dismissed.
In her amended application filed 29 November 2019 the wife sought leave to extend time in which to commence proceedings insofar as leave was required.
Documents
The wife relied on her further amended application filed on 30 January 2020 and affidavits filed on 15 February 2019, 18 July 2019 and 29 November 2019 and financial statements filed on 15 February 2019 and 29 November 2019. In addition she relied on affidavits from Ms E, Mr F and Mr G filed on 18 July 2019. The husband relied on his amended response filed on 20 June 2019 and affidavits filed on 8 May 2019 and 22 November 2019 in addition to a financial statement filed on 2 August 2019. A number of documents were tendered in the proceedings.
Agreed facts
The husband is 59 years old born in 1961. The wife is 49 years old born in 1971. The parties met in 2003. There are no children of the relationship. The wife has two sons from previous relationships.
The parties purchased a property at B Street, Suburb C for $780,000 in 2009 in the husband’s sole name with the wife contributing $80,000. The wife and her son moved into the B Street, Suburb C property in early 2010.
It is not in dispute that a de facto relationship existed between the parties from early 2010 until December 2012 so much was conceded by the husband in his affidavit and during the proceedings.
The parties separated in December 2012. The husband has made all mortgage payments on the loans secured against the property.
In February 2017 the wife and her son moved back into the B Street, Suburb C property. In July 2017 following the involvement of Queensland Police the wife left the property. In December 2017 the husband without consulting the wife refinanced the property increasing the mortgage from about $540,000 to $820,000.
Issues
The issues in contention at trial were as follows:
a)The nature and length of the parties’ relationship;
b)Whether leave to extend time to bring an application for adjustment of property interests is required and/or whether leave should be granted;
c)Assessment of contributions under section 90SM of the Act; and
d)Assessment of relevant section 90SF (3) factors;
e)Whether it is just and equitable to make an order; and
f)Whether the proposed order (if any) is just and equitable in the circumstances.
Legal principles
The applicant has the onus of establishing that a de facto relationship existed for the requisite period (see Ricci v Jones (2011) FamCAFC 222) and that onus is on the balance of probabilities (see section 140 (1) Evidence Act 1995). In S v B (No.2) (2004) 32 Fam LR 429 Dutney J said at [49]:
“In a de facto situation it is the party asserting the relationship that must prove cohabitation of the required quality” and at [50] “the party asserting a de facto relationship must prove the ‘positive aspects’ of the relationship rather than the party denying it being required to prove the negative.”
Pursuant to section 39B of the Act the Court has jurisdiction with respect to matters arising under the Act in respect of which de facto financial causes are instituted under the Family Law Act 1975 (Cth). Part VIIIAB of the Act deals with financial matters relating to de facto relationships. Under section 4 of the Act a de facto financial cause means relevantly, “(c) proceedings between the parties to a de facto relationship with respect to the distribution, after the breakdown of the de facto relationship, of the property of the parties or either of them.”
Section 90SM (1) of the Act provides:
“In property settlement proceedings after the breakdown of a de facto relationship, the court may make such order as it considers appropriate:
(a) in the case of proceedings with respect to the property of the parties to the de facto relationship or either of them – altering the interests of the parties to the de facto relationship in the property; or
…….”
Section 90RD (1) of the Act provides that the court may declare that a de facto relationship existed. Pursuant to subsection 90RD (2) the Court may also declare whether one of the parties to the de facto relationship made substantial contributions of a kind mentioned in paragraph 90SM (4) (a), (b) or (c ).
Section 4AA of the Act provides:
(1) A person is in a de facto relationship with another person if:
(a) the persons are not legally married to each other; and
(b) the persons are not related by family (see subsection (6)); and
(c) having regard to all the circumstances of their relationship they have a relationship as a couple living together on a genuine domestic basis.
Paragraph (c ) has effect subject to subsection (5).
(2) Those circumstances may include any or all of the following:
(a) the duration of the relationship;
(b) the nature and extent of their common residence;
(c ) whether a sexual relationship exists;
(d) the degree of financial dependence or interdependence and any arrangements for financial support between them;
(e ) the ownership, use and acquisition of their property;
(f) the degree of mutual commitment to a shared life;
(g) whether the relationship is or was registered under a prescribed law of a State or Territory as a prescribed kind of relationship;
(h) the care and support of children;
(i) the reputation and public aspects of the relationship.
(3) No particular finding in relation to any circumstance is to be regarded as necessary in deciding whether the persons have a de facto relationship.
(4) A court determining whether a de facto relationship exists is entitled to have regard to such matters and to attach such weight to any matter as may seem appropriate to the court in the circumstances of the case.
(5) For the purposes of this Act:
(a) a de facto relationship can exist between 2 persons of different sexes and between 2 persons of the same sex; and
(b) a de facto relationship can exist even if one of the persons is legally married to someone else or in another de facto relationship.
…….”
Discussion
The applicant wife asserts that after meeting the husband in 2003 at the Employer H where they both worked they started dating in 2003. After a few months they regularly spent weekends together at either her home or the husband’s home and would spend weekend nights at her home. From 2007 or 2008 the wife was studying for a degree in health care through J University.
The wife contends that the parties would spend 4 or 5 nights a week at the wife’s home prior to purchasing the B Street, Suburb C property. She had recently sold her Suburb K property and had $80,000 in the bank which she contributed to the purchase of B Street, Suburb C. She and her son moved into the B Street, Suburb C property in 2010 and remained there until December 2012.
When the parties separated in December 2012 the wife and her son moved into a rental unit at Suburb L. The wife said in mid - 2013 she and the husband began communicating again when she sent him a message about his new Motor Vehicle 1. She deposed that over the coming months they would spend time together and went out together and to the Casino. By 2013 she said they had started “seeing each other again.” In 2013 (the husband’s birthday) he was ill and she left him a message. He came over to her unit in Suburb L to see her. Thereafter the parties saw each other more frequently.
The wife annexed to her affidavit filed on 18 July 2019 copies of text messages and emails she and the husband shared. The exchanges are personal and affectionate and support the wife’s contention that the parties were maintaining a relationship. Some of those exchanges include:
a)25 October 2013 at 11.21am from the wife:
“Hey babe miss you, here’s a couple of pics from trip. Heading to Town M this morning. 7 hr bus trip that peaks at 4500m……. Ms Wade xxxxxxx”
b)25 October 2013 at 4.18pm from the husband:
“Hey bub, glad to know ur safe and well. Thanks for the photos, they look unreal. U look very cold tho. Please take care and be safe, and send me email/photos/texts when u can. Xxxxxxx.”
c)In work related emails the parties refer to each other as “babe” or “bub” and sign off with “xxxxxx”. On 2 April 2014 the husband in an exchange to the wife wrote:
“Take care and thanks for the referral bub, legend xxxxxx.”
In late 2013 the parties took a trip to City N for the weekend. She said they reconciled after their trip to Country O and they spent more time together. She would spend time at the B Street, Suburb C home and the husband would visit her at her unit at Suburb L. When staying at the B Street, Suburb C home she took over the household duties and did the cooking and cleaning and purchased groceries and other household items and maintained the garden. The husband did not dispute this.
The wife contends that from January 2014 she and her son spent a significant period of time in the B Street, Suburb C home. She kept the lease on the Suburb L property for her son and out of concern for her safety. She claimed the husband’s behaviour could be unpredictable. She commenced working for the husband in his practice one day per week either in April or June 2014 until June 2017. She deposed that their intimate relationship continued and in addition they would often talk about work together.
The parties visited Country P in 2014 for 5 days sharing meals and romantic experiences. They returned to Country P together in 2015 for a long weekend. They stayed in the same accommodation and dined together. She said during the weeks that her son Mr F spent with his father on the Region Q she would spend those weeks at the B Street, Suburb C home with the husband.
She said the husband flew to meet her in Country P in early 2017 to join her there for family celebrations and they flew home together. Thereafter she spent every night at the B Street, Suburb C home and in early February 2017 decided to move back into the home permanently with her son giving her lease on the unit at Suburb L. She said the parties purchased a dog “R” together that they had both researched. In early 2017 they discussed purchasing an investment property together. The husband did not take issue with the facts as asserted by the wife. I found the wife’s evidence in this regard credible.
The wife said she visited City S for her son Mr T’s wedding in 2017. The husband did not accompany her as his relationship with Mr T had broken down. She contends that upon her return home in mid 2017 the husband had moved out of their shared bedroom into another room in the home. In 2017 she asked the husband if he was seeing someone else and he refused to answer her. She said several weeks later she discovered the husband was having an affair. They argued and the husband became distant. It is common ground that the relationship between the parties deteriorated. On 11 July 2017 the husband called the police to have the wife removed from the B Street, Suburb C property. In his statement to police he said their relationship had lasted 14 years and the wife had moved back in “for three months” but now the relationship was over. He advised police that “he did not want to continue the relationship.” That statement was made in mid - 2017 confirming that he believed he was in a relationship with the wife at that time.
The wife’s sister Ms E filed an affidavit which was not challenged in cross examination.[2] She deposed that she first met the husband in 2004 and “assumed they were in a relationship.” The wife told her that the parties had purchased a property at B Street, Suburb C together in 2009 and they were both excited about moving in together.
[2] The wife’s Counsel noted that the wife’s sister and brother in law were available at Court for cross examination however the respondent declined the opportunity to cross examine those witnesses.
She said she, her husband and children relocated to the Region D in 2010 from Melbourne. Initially they moved into the B Street, Suburb C property for about 2 months with the parties and the wife’s son Mr F and then rented in the B Street, Suburb C area and purchased a property in Suburb U in 2012 where they continue to live.
She observed that the wife and husband would attend family gatherings, barbecues, weddings and special occasions together and the husband would refer to the wife as “babe.” This is confirmed in email correspondence above. She said they also took holidays together in Country P.
Ms E said when they stayed in the B Street, Suburb C home she observed that the parties shared a bedroom together and displayed affection towards each other. She said they were a very social couple going out together frequently.
She observed that in 2012 the husband poured petrol over Mr T’s furniture and threatened to set it alight. She said this shocked her though she observed the parties’ relationship was volatile at times. In December 2012 the wife and Mr F moved into her home for 6 weeks before obtaining rental accommodation in a unit at Suburb L.
She said in early 2013 the wife told her that she and the husband were going to holiday together in City N and Country P. She was advised by the wife in mid 2013 that the parties had reconciled. In February 2017 she observed that the wife moved back into the B Street, Suburb C home permanently.
She said she worked as the husband’s assistant from 2013 to early 2016 and the husband had photos of the wife all over his office at that time. He would talk about her at work and discuss their committed relationship with her. She observed that the parties were openly affectionate with each other and their body language indicated they were in an intimate relationship with each other. I accept that evidence which was not contradicted by the husband.
She said on 7 July 2017 the husband contacted her and asked her to remove the wife from his home. She attended the home to find the wife distraught and refusing to leave the home. She assisted Mr F to pack up his things and they left together while the wife remained in the home. Later that night the wife phoned her and said “I’m scared help me I don’t know what he is doing the house has no power and it sounds like chains are being put on things.” She told her to hang up as she intended to call 000. She called police and requested they attend the home. The police accompanied them back to the house to collect the wife’s belongings and the dog.
The wife’s brother in law Mr G deposed that in mid – 2013 the wife told him that she and the husband had re-kindled their relationship and were considering living together again. He observed that between mid – 2013 and June 2017 the parties were frequently at family functions together and socialised together and displayed outward signs of affection towards each other.
The wife’s son Mr F who is now 19 years old said he was aware that his mother and Mr Alawi were in a relationship. He said occasionally Mr Alawi would collect him from school or his father’s house. He observed that his mother and Mr Alawi display affection towards each other. In late 2012 he saw Mr Alawi take his brother Mr T’s furniture out of the B Street, Suburb C home and onto the driveway. He concluded he was trying to kick him out of the house. He recalled his aunty Ms E came over with her husband and children and helped him pack a bag to take to their Suburb U house. He was aware his mother and Mr Alawi were breaking up.
He said he and his mother stayed with his aunty until they organised a unit in Suburb L. His mother did not date other men as far as he was aware. He said sometime in 2013 his mother and Mr Alawi were back together and he would come to the unit in Suburb L and stay over. He said he and his mother would at times stay over at the home in B Street, Suburb C. He observed when they were over at the B Street, Suburb C property his mother did the household chores cleaning, gardening and cooking. He said friends and family would come to the B Street, Suburb C house and socialise and his mother and Mr Alawi would also socialise together.
He said he knew his mother and Mr Alawi went to Country P together. He remembered his mother and Mr Alawi broke up “for good” in June/July 2017. In February 2017 his mother decided she would cease renting the Suburb L unit and they moved back permanently with Mr Alawi into the B Street, Suburb C home. He observed they would argue when she moved back into B Street, Suburb C but otherwise he did not observe any change. He said Mr Alawi would occasionally cook and do some work outdoors and he would feed the cat. They all went to a houseboat for five days on the V River . In June/July 2017 his mother told him her relationship with Mr Alawi was over and they would be moving back in with her sister. He has not spoken to Mr Alawi since that time.
The husband submitted that little weight should be placed on Mr F’s evidence given he was a child when the parties were in a relationship. Mr F was not cross examined. His affidavit contained his observation of his mother’s relationship and Mr Alawi’s involvement in his and his mother’s life. I accept Mr F’s evidence.
The husband cross examined the wife. She agreed that she had a separate residence at Suburb L during their relationship where her son resided for most of the time. In her affidavit she deposed that she kept the residence for her son for a period of 4 years and because her relationship with the respondent could be volatile and unpredictable.
The fact that the parties did not share a common residence for the entirety of their relationship is not determinative. In Sha & Cham [2017] FamCAFC 161; (16 August 2017) the Full Court discussed the notion of common residence:
“[62] The determination of common residence requires a consideration of the facts and circumstances of the particular case. Indeed, as the section itself clearly contemplates, a person may live at more than one place and of course, parties can be in a de facto relationship notwithstanding that one of them is married to another person or in a de facto relationship with another person.
[63] In Clarence & Crisp(2016) FLC 93-728 at [46] the Full Court held that:
Since one of the matters in in the checklist is “the nature and extent of [the parties’] common residence”, it inexorably follows that it is possible for a couple to be in a de facto relationship without residing in the same home on a full-time basis.
[64] This supports the comments of the Full Court in Jonah & White (2012) FLC 93-522 at 86,683 that:
In this regard, we note that his Honour was alive to the issue that the term “living together” can encompass circumstances where parties live together “...for only a small part of each week...” (at [65]).
We agree that the definition may be fulfilled where parties have lived together for limited periods provided that other indicia or the circumstances of the matter enable a finding that they were “living together on a genuine domestic basis”.
It was suggested to the wife by the husband that in 2014 she was not happy because the money she was earning at her employer was not sufficient to support her living expenses. He put to the wife that he offered that she come and be his employee to work one day a week. The wife disagreed that she was having financial difficulty and that he made that offer to her. She said she did work with him but it was not because she was in financial difficulty. She said she worked there from 2014 to 2017 one day a week.
The husband suggested to the wife that in early 2017 she told him that she was having trouble with her landlord at Suburb L and had an exam coming up and she wanted to come and stay at his residence for three months until she finalised that exam. The wife denied that. She said she did move back into the B Street, Suburb C residence in early 2017. The husband suggested to her that during that period they were not in a relationship. She disagreed. She said they were in an intimate relationship during this period. She said their relationship continued from 2013 to early 2017.
The husband suggested to the wife that after they separated in 2012 he had relationships with other women and the wife was aware of that and their relationship (if it was a relationship) was not exclusive. She denied that. She said “towards the end I thought he was seeing other women…when I moved back into the house.”
The husband suggested to the wife that when they separated in December 2012 they were not in a relationship for 2 years and when they started seeing each other again it was only on a professional level and they were not a de facto couple. The wife disagreed.
The husband agreed that the parties met in 2003 when he was working at Employer H as a health care professional and the wife was employed as a health care worker. He agreed the wife commenced studying for a degree in health care in 2007 or 2008 and he supported and encouraged her in that regard. He contends that the parties “enjoyed a casual, dating relationship between 2004 and 2009 and during this period they maintained separate residences.” The wife does not argue to the contrary.
The husband agrees that the parties were in a de facto relationship from 2010 until separation in December 2012 during which time the wife and her son lived in the B Street, Suburb C property where he provided practical and financial support.
The husband contends that the parties agreed to separate in late 2012. He moved into a self - contained flat for 7 days to avoid further conflict. The wife and son moved out and rented a unit at Suburb L. He deposed that in December 2012 the wife said to him “I have never asked for any financial benefit from any previous relationships and this separation is not going to be any different.”
He said they had no contact between December 2012 and April 2014 though he was aware she was friends with his daughter Ms W. That statement is contradicted by the affectionate email exchanges between the parties in October and December 2013. In April 2014 he said the wife visited him with his daughter Ms W and advised him that she was having financial problems. He offered her employment in his practice one day a week between 2014 and 2017. The husband’s daughter was not on affidavit to corroborate the husband’s claim which is denied by the wife. I note that she was working in a company at the time while she had previously existed on Austudy benefits. Even so she only worked one day a week with the husband. No evidence was adduced regarding the income she earned in undertaking this work for the husband. I prefer the wife’s evidence disputing she was in financial difficulty at the time.
The husband said he contributed financially to the wife’s university tuition fees over the period from 2014 to 2017. The husband said the wife would request assistance with her university fees which he provided to her upon her request. I infer from the substantial financial support provided by the husband to the wife that the parties were maintaining a relationship.
The husband contends that in late 2016 the wife approached him to say she was having difficulty with her landlord and she had an important final exam due. She requested she move back into the B Street, Suburb C property for a period of 3 months stating “until I sit my final exams.” He said that on that short term basis he agreed that the wife could move back into the B Street, Suburb C property. This evidence appears starkly at odds with the wife’s account that in January 2017 the husband flew over to Country P to meet her at a family gathering and they returned home together. That evidence is corroborated by members of the wife’s family who observed the parties to behave in an affectionate manner towards each other. The husband did not dispute visiting Country P to meet the wife and her family for a family gathering and the couple returning home together. I reject the husband’s evidence that the wife returned for a period of 3 months until her final exams.
The husband does not dispute that the wife moved back into the property in February 2017 with her son however he contends that she slept in a separate bedroom and kept her clothing and personal belongings in her bedroom. She disagrees. I make no finding about whether the parties slept in the same bedroom. I note that the husband agrees that the wife paid no rent during this period and continued to work in his practice one day a week.
The husband deposed that he found the wife’s mobile phone in his car and believed she had placed it there using it as a surveillance device. He said he expected her to move out of the home in May 2017 however when she did not he became increasingly uncomfortable. On one occasion he asked her when she was moving out and was told she would not be moving out. The parties agree that the relationship was in difficulty during his period.
The husband agreed that the wife left the home in July 2017 following a request by police. He said a week later the wife’s brother in law collected the wife’s personal items. He said he contacted the wife enquiring where his passport was including the documents for the B Street, Suburb C property and several thousand dollars in cash. She told him “you can deduct that from my equity in the house…I will see you in court.” On 21 January 2019 the wife lodged a caveat on the B Street, Suburb C property.
Paragraph 4AA (1) (a) and (b) of the Act are satisfied in this case.
I am satisfied that the parties enjoyed a de facto relationship for a period of 2 years and 10 months until December 2012.
I am satisfied having regard to the wife’s evidence, the evidence from the wife’s sister and Mr F and the personal, affectionate exchanges between the parties that by early 2014 they had resumed their de facto relationship. From 2014 they took several overseas trips together, frequented the casino and restaurants and socialised at family events together confirming the public aspect of their relationship. The husband did not dispute that.
I accept the evidence that the husband joined the wife and her family in Country P as late as January 2017 and the parties flew back to Australia together. I find that the husband supported the wife and her son financially throughout the period from early 2014 until July 2017. I accept that when the wife was in the B Street, Suburb C property she performed household tasks. I accept that the parties did not share a common residence consistently between April 2014 and early 2017 however I also accept that each party spent overnights in the other party’s residence from time to time in whatever manner was convenient to the parties. I accept the husband’s evidence that when the wife returned to live in the B Street, Suburb C property in early 2017 she did not pay rent.
I accept that the parties demonstrated a mutual commitment to a shared life by sharing each other’s accommodation from time to time, holidaying together, socialising together, working together and providing practical and financial support for the other. I accept that the parties shared an intimate relationship from time to time until early 2017 though it appears the relationship deteriorated in about May 2017.
I am satisfied that the parties lived together on a genuine domestic basis for a further 3 years and 5 months from early 2014 until July 2017. I am unable to be more precise.
I am satisfied that the parties finally separated in July 2017. In so far as the respondent argues that the wife requires leave to extend time to commence proceedings I reject that assertion. The wife commenced proceedings in February 2019 therefore she filed within the standard application period. I am satisfied that the wife does not require leave to extend time in which to commence proceedings pursuant to section 44 (6) of the Act.
Principles with respect to property settlement
The approach to determining applications with respect to adjustment of property interests between either married or de facto partners is well settled: See In the Marriage of Lee Steere (1985) FLC 91-626; In the Marriage of Ferraro (1993) FLC 92-335; Clauson & Clauson (1995) 18 Fam LR 693. The Court is required to identify the property, liabilities and financial resources of the parties at the time of the hearing, to evaluate the contributions made by the parties under section 90SM (4) (in de facto cases) including the matters referred to in section 90SF (3) in so far as they are relevant. Under section 90SM (3) the Court must not make an order unless it is satisfied that in all the circumstances it is just and equitable to make the order. It is the justice and equity of the actual order that the court is required to consider: See Russell v Russell (1999) FLC 92-877.
In Watson & Ling [2013] FamCA 57 (12 February 2013) Murphy J discussed the approach to property settlement mattes having regard to the principles enunciated by the High Court in Stanford v Stanford [2012] HCA 52; (2012) 247 CLR 180:
“[12] Provided the discretion is exercised judicially, it is at large; it is neither possible nor desirable to specify its “metes and bounds” (Stanford at [36]-[40] and [46]). Recognition is given to the fact that the circumstances of individual marriages (their nature, form and characteristics) can and do differ and those differences – the way in the which the parties have organised and lived their marriage/relationship – may be relevant to the exercise of the s 90SM(3)/s79(2) discretion. Equally, provided that the questions required by s 90SM(3)/s79(2) and s 90SM(4)/s79(4) are seen as separate and applied as such, and not conflated, the enumerated factors within s 90SM(4)/s79(4) can inform the s 90SM(3)/s79(2) discretion together with any such other considerations as are properly relevant (see, Stanford at [40]).
[13] As a result of those matters, the Court’s approach to s 79/s90SM may be less compartmentalised than what a strict or unthinking adherence to four (or three) “steps” might otherwise reveal. The task is essentially holistic; is it just and equitable in the particular circumstances of the particular relationship or marriage under consideration to make an order and, if so, its terms must similarly meet that criteria. Of course, holistic though the approach is, it must be referenced to what the Act requires and care must be taken to ensure that the Court’s reasons make that clear. (See, for example, Davut & Raif (1994) FLC 92-503 at 81,237).”
The husband is the sole legal proprietor of the property situated at B Street, Suburb C in the State of Queensland. The wife does not suggest otherwise. However she contends that she made a substantial financial contribution to the acquisition of that property in advancing $80,000 towards the initial deposit. The husband agrees she contributed $80,000.
The parties relationship extended over two periods the first being a period of 2 years and 10 months and the second (following a separation) being a period of about 3 years and 5 months with final separation in July 2017. Both parties wish to finalise the financial relationship and sever all ties. They have now been separated for two years and each party has re-organised their personal and financial circumstances. I am satisfied that it is just and equitable to make an order altering the parties’ interests in property.
Assets & Liabilities
The wife asserted that the husband’s property at B Street, Suburb C was worth $965,000. She argued that he refused to allow a valuation to be undertaken on the property so X Real Estate undertook a curb side valuation of the property on 24 January 2020. The value attributed to the B Street, Suburb C property was $900,000. The husband accepted that estimate. (Exhibit A1). I find the property is worth $900,000.
The parties agree that the husband obtained a mortgage secured against the property at the time of purchase in 2009. The wife contends the mortgage at separation in July 2017 was $465,000 whereas the husband asserts the mortgage was $540,000. No documents were produced in support of that assertion. As the husband was responsible for paying the mortgage I accept the mortgage in July 2017 was $540,000. I found the husband to be a credible witness.
The husband agreed that after separation he drew down on the mortgage the amount of $274,913 to purchase Bitcoins. He said he refinanced the home in late 2017 with Y Bank. He said he lost the whole of his investment in Bitcoin when the price crashed. He contends this was “public knowledge.” The purchase of Bitcoins remained an issue between the parties in these proceedings. No documents were adduced into evidence regarding the Bitcoin transaction. The husband claimed that his previous solicitor had produced those documents “as far as he was aware.”
The wife has a Motor Vehicle 3 2016 in her possession valued at $35,000. The value of that vehicle is agreed. She has a car loan of $9,250.
The husband has a Motor Vehicle 1 that is leased. The vehicle is valued at $90,000. The husband the vehicle has a debt of “60% of the total value” ($55,000). That is agreed.
The husband has a Motor Vehicle 2 vehicle valued at $12,000. The value is agreed.
The parties’ contents are not in issue in these proceedings and have been excluded from the asset pool by agreement.
The wife has a credit card debt of $40,000 of which she claims $20,000 is referrable to the post separation period. No documents were produced in that regard.
The husband has a credit card debt of $30,000 all of which accrued post separation.
In her financial statement filed on 29 November 2019 the wife deposed that she had an interest in Z Super in the amount of $167,868. The husband has a self - managed superannuation fund with a balance of about $194,000.
The wife has a HECS debt of $151,329 and a tax debt of $29,346.
Contributions
The husband said when the parties met in 2003 he was working full time as a health care professional at Employer H and the wife was employed as a health care worker at the same employer. She commenced studying health care full time at J University in 2007 or 2008. He said prior to the wife moving into his home at B Street, Suburb C the wife owned property in Suburb K. He paid for external improvements to that home including landscaping, decking, water feature and plants. In addition he would deposit money into the wife’s account (at her request) to cover her and her son’s living costs. He said from time to time the wife would ask him to deposit funds into her account to cover her and her son’s general living costs. He always made those payments when she requested them. He said “due to the nature of the relationship at the time I felt that there was no need to keep a record on the payments.” He ceased making the payments when she sold her Suburb K house.
The wife said prior to 2009 the parties occasionally spent weeknights together at her home as the employer where they both worked was close by. Up until they purchased the B Street, Suburb C home they would spend 4 or 5 nights together usually at the wife’s home. I accept that both parties made contributions prior to moving into the B Street, Suburb C property together.
B Street, Suburb C property
The parties agree they discussed buying a property in 2009. In 2009 the property at B Street, Suburb C was purchased for $780,000. The wife said the decision to buy the property was a joint decision and they were both excited about purchasing a home where they could live together. The property was purchased in the husband’s sole name with the wife contributing $80,000 by way of deposit. At the time of purchase the wife had recently sold a property at Suburb K for $420,000. She had $80,000 in the bank and contributed the whole of that amount to the purchase. The husband contributed either $20,000 or $25,000 towards the deposit on the B Street, Suburb C property from proceeds from the sale of a property he owned in Suburb AA which he sold around that time. The balance of the purchase price for the B Street, Suburb C property was funded through a mortgage in the husband’s sole name. The parties did not require mortgage insurance to complete the purchase. The wife contends this was due to the sizeable deposit provided. When the property was purchased the husband worked full time as a health care professional while the wife was a full time student.
The husband said the wife agreed that she would contribute some money towards the deposit as a way of offsetting the money he had paid towards her Suburb K home and towards her and her son’s living expenses. The wife denied this. She said the parties agreed that until she completed her degree the husband would be responsible for the mortgage payments and she would assist once she finished her degree and commenced work as a health care professional. She said as the husband had a significant income they agreed that he would pay the utilities in addition to the mortgage and the wife would purchase the groceries and other expenses and maintain the home. I am unable to make any finding whether the parties reached any agreement or not.
The husband denied the wife made any financial contribution other than the $80,000. He said the wife did not work during their short relationship and was financially supported by him. She was in receipt of Newstart benefits from 1 January to 30 June 2010 and received $6416, from 1 July 2010 to 30 June 2011 she received $13,029 and from 1 July 2011 to 30 June 2012 she received $6074. Since 19 March 2003 he alleged she had recorded her marital status to Centrelink as “separated.” He cross examined the wife suggesting that he paid all the mortgage payments on the property. She agreed that “she did not make one mortgage payment.” She said she paid “some bills” but accepted she did not have any evidence that she paid a water rates bill, electricity or Council rate bill. She agreed she did not pay those bills. The husband suggested that while the wife was a student and studying medicine he paid all the bills. She disagreed. She said while studying she was in receipt of Austudy and she would purchase groceries and things for the home. The husband said when the wife left the B Street, Suburb C property in December 2012 they both went their separate ways. According to the husband the wife said to him “I have never asked for any financial benefit from any previous relationships and this separation is not going to be any different.”
Following the parties’ separation in December 2012 the husband continued to make all payments against the mortgage save that he indicated during the proceedings in January 2020 that he had been unable to pay “the last two mortgage payments.” He continued to pay rates and utilities. The wife did not suggest that she made any further financial contribution towards the B Street, Suburb C property after December 2012. She leased a unit in Suburb L until returning to the B Street, Suburb C property in February 2017. The husband said she did not pay rent on her return. I accept that evidence. I find that the husband made a substantially greater contribution towards the B Street, Suburb C property than the wife between late 2009 and July 2017.
Early 2014
The parties agree that in late 2012 they stopped communicating. The husband said he rented a self - contained unit at City BB for seven days to avoid any further conflict and to allow the wife to pack up her personal belongings and move out. The relationship ended when the wife and her son moved out of the B Street, Suburb C property. Though the husband contends that the parties did not maintain contact between December 2012 and April 2014 this is contradicted by affectionate email exchanges between them. I accept the wife’s evidence that the parties relationship resumed in early 2014. The wife commenced working for the husband as his assistant at Employer CC one day per week (Friday) between April 2014 and June 2017.
I find that when the wife returned to live in the B Street, Suburb C property with the husband in early 2017 with her son Mr F she paid no rent. The husband continued to support the wife financially until separation in July 2017.
Wife’s degree
The wife said up until the time she completed her degree in 2011 through J University the husband was financially supportive of her. He had a well - established practice as a health care professional and she accepted that he assisted her financially during these years. She agreed he paid some funds towards her degree but believed he contributed only to one or two semesters. She denied there was any agreement between them that in turn for his financial support of the wife while studying for her degree this cancelled out her $80,000 contribution towards the B Street, Suburb C home. She said he assisted her financially from time to time as they were in a romantic relationship together. The wife also claimed that her degree “was self – funded by her.” She commenced working full time in 2012. The wife has a current HECS debt of $151,329.25.
The husband said he contributed towards the wife’s degree over a seven year period. He said she stopped being a health care worker and attended J University to study health care full time. The cost of her degree was in excess of $200,000. He said he paid “tens of thousands of dollars towards her university fees and would make frequent deposits to her account which she then used to pay her university fees.” He said they discussed these payments and it was agreed his contribution towards her degree would offset the $80,000 she paid towards the B Street, Suburb C property. She denied this.
The husband paid the following tuition fees for the wife
a)Between April and December 2014 not less than $15,945.40;
b)Between January and December 2015 not less than $17,910.18;
c)Between January and December 2016 not less than $13,326.30 and
d)Between January and June 2017 not less than $7,980.05.
I accept the husband’s evidence and find that he made a significant financial contribution towards the wife’s university tuition fees. I also find that he supported her both practically and financially during the time she studied for a degree. In Clauson (supra), the Full Court: “It has long been recognised that in most cases the most valuable ‘asset’ which a party can take out of the marriage is a substantial, reliable, income-earning capacity: see Best and Best [1993] FamCA 107; (1993) FLC 92-418 at 80,295.”[3] I place significant weight on the contribution by the husband towards the wife in this regard.
[3] Clauson & Clauson (1995) 18 Fam LR 693, 710.
Non - financial contributions
The parties commenced living together in the B Street, Suburb C property in 2010. The wife’s son Mr F was about 9 years old when she and Mr F moved into the property. The husband said he supported both the wife and child practically and financially during their relationship. I accept that evidence. I note that Mr F confirmed that the husband would sometimes transport to and from his father’s home on the Region Q.
The husband deposed that the wife’s son Mr T who was 17 at the time and his girlfriend Ms DD moved into the B Street, Suburb C property for a period of 6 months. No date is given. Mr T and his girlfriend occupied the spare room downstairs and stored their personal belongings in the B Street, Suburb C home. Neither Mr T nor Ms CC paid rent. I accept that the husband provided accommodation and practical support for the wife’s other son. There was apparently an incident between the husband and Mr T which ended their relationship on poor terms.
It is common ground that the wife’s sister Ms E, her husband and children relocated to the Region D in 2010. Initially they moved into the B Street, Suburb C property for about 2 months. I take into account the husband’s contribution towards the wife’s two children, her sister and her sister’s family.
The husband said during the period early 2010 and December 2012 the wife undertook most of the household duties including cooking meals on most days, cleaning and washing. He looked after the outside chores including the garden. He said he would drive to the Region Q on a fortnightly basis to collect the wife’s son after he spent time with his father. I accept that evidence.
Throughout the parties relationship the husband’s income was far greater than the wife’s income. The husband worked full time for Employer EE until he commenced his own private practice in 2011. At this time he also commenced work as a health care professional at Employer V as visiting health care professional in 2011. His income as a consultant health care professional was significant. Recently he was engaged by Employer J. Prior to separation in July 2017 his earnings were in the vicinity of about $500,000. The wife did not commence working until late 2012 and as such she was reliant on Centrelink benefits. She worked in a business however it is unclear what her income was in that capacity. From April 2014 she was employed by the husband in his practice one day a week. She said she became unwell and suffered muscle weakness and associated issues with stress in 2015 and took 3 months off from work and then returned to work part time in January 2016 until December 2016. From December 2016 the wife worked only casually and was studying and sitting exams. Those exams cost about $20,000.
The husband said in addition to paying for the costs associated with the B Street, Suburb C property he paid for all groceries, household supplies and holiday expenses including a holiday for the wife’s sister and brother in law to Country P. He said they socialised together during their relationship including attending family functions and his work functions and he paid any associated costs. He said the parties visited the wife’s sister who lived at Suburb K and her mother who lived on the Region Q on a nearly weekly basis. He paid any associated expenses.
When the parties resumed their relationship they would each stay in each other’s homes where the expenses of that home was met by the party occupying that property. The parties visited City N over a long weekend in late 2013. The parties travelled to Country P in 2014 for five days sharing romantic experiences. They returned again for a long weekend in 2015. In 2017 the husband flew to Country P to meet the wife who was holidaying there with her family returning to Australia together in 2017. It is unclear who paid for the costs of travel.
Upon the wife returning to the B Street, Suburb C property in early 2017 the parties purchased a puppy named R. According to the wife they had been discussing purchasing a dog for years. She drove to Sydney to collect the dog as a surprise to the husband and they were both very excited about their new pet. In early 2017 the parties discussed whether they would purchase an investment property to renovate and then sell. They both researched this but ultimately did not purchase a property.
The wife said when she stayed at the B Street, Suburb C home she would perform household chores, purchase groceries, prepare meals and maintain the garden.
I accept that the wife worked as the husband’s assistant at his practice from about April 2014 until July 2017 one day per week. She said she re-organised her work as a health care professional working from Monday to Thursday and then on Friday worked as the husband’s assistant at Employer CC. There is no suggestion that the wife did not receive adequate remuneration for this work.
The wife said during the period between September 2013 and July 2017 the parties would have friends and family over for dinner parties and barbecues at the B Street, Suburb C home and the also attended outings with family and friends during this period. I accept that both parties made substantial non - financial contributions during the relationship.
Separation
The parties separated on poor terms. The husband said against his wishes the wife stayed in the B Street, Suburb C property until July 2017. He became increasingly uncomfortable with her staying in the home. On one occasion he asked her when she intended moving out and she replied she would not be moving out and left the house in an angry state. He deposed that on Saturday 8 July 2017 he called the wife’s sister and asked her to come over and speak with the wife after she had locked herself in her bedroom and refused to open the door. Her sister attended the home the same day and went upstairs to the wife’s room and a short time later left the home carrying several bags with her. He said he believed that they had left together and thereafter he organised for an electrician to attend the home to disconnect the electricity to ensure the wife did not return to the property. He left the property and went to City BB Airport to travel to Sydney for a friend’s birthday party. When he left he locked all doors and chained the front door to prevent the wife from returning. He was unaware she remained inside the property. The police contacted him upon his arrival in Sydney following the wife’s complaint to them.
When he returned to the Region D the following Tuesday he gave the police a statement. He said he stayed away from the home that night at a motel in Suburb FF and upon his return the following morning found the wife in the home. He called the police to ask her to leave the property. The police attended the home. They suggested he leave the home for an hour to allow them to request the wife to leave the property. He left and when he returned the wife had left the property. He said that she had left her personal belongings behind. A week after she left the property the wife’s brother in law contacted him to make arrangements to collect her personal belongings and collected them on her behalf. The last contact he had with the wife was one week after she moved out when he asked her about the whereabouts of several items that had been at the B Street, Suburb C property including his passport, documents concerning the purchase of the property and several thousand dollars in cash. He said she told him “you can deduct that from my equity in the house” and “I will see you in court.” On 21 January 2019 the wife lodged a caveat against the B Street, Suburb C property.
The parties relationship deteriorated after she returned from City S in 2017 where she had attended her son Mr T’s wedding without the husband. On her return from two weeks in the Country GG in 2017 the husband behaved differently towards her. He was distant and moved to a separate bedroom and gave her no explanation. He frequently spent nights away from the home. She said she discovered that the husband was “seeing someone else.” He started disappearing and would not communicate with her. He was either “very aggressive or gave her the silent treatment.” She was due to sit an exam the husband “turned up with another woman” just as she was leaving to sit the exam. She failed the exam by one mark and had to re-sit it.
She said on 8 July 2017 while she was at the B Street, Suburb C home a man attended and disconnected the internet. The husband had left the home and was on his way to airport for a function in Sydney. She phoned the police upon discovering she was locked in the house from the inside. On 11 July 2017 the husband called the police to have her removed from the B Street, Suburb C property. I am unable to make any finding regarding the breakdown of the parties relationship save that I find they separated on a final basis in July 2017.
Post separation
The husband has continued to occupy the B Street, Suburb C property. He has made all mortgage payments and paid utilities and insurance and kept the property in good order. Following separation the mortgage on the B Street, Suburb C home increased from $540,000 to $820,000. The husband said he borrowed additional funds to invest in cryptocurrency and that investment had failed.
Bitcoin investment
The husband was cross examined at length about the investment in Bitcoin. Hs said “on 20 December 2017 he purchased Bitcoin with $280,000. What happened is public knowledge, the price of Bitcoin plummeted down. I sold all my assets which were worth just over $6000. There is a statement from the company with the loan contract which was sent to my lawyer and the wife’s solicitor.” Counsel for the wife suggested that no documents had not been produced. The husband responded that he had given the relevant documents to his solicitor and understood these had been forwarded to the wife’s solicitor.
During cross examination the husband agreed that he drew down on the mortgage the amount of $274,913 to purchase Bitcoins without consulting the wife. He said the home was refinanced in late 2017 with Y Bank. He lost the whole of his interest in Bitcoin when the price crashed. The wife’s Counsel suggested that the husband was being “completely reckless” in investing in Bitcoin. He disagreed and said had he made a substantial profit and those assets existed the wife would be making a claim against that property.
During cross examination the husband agreed that there was relatively “little equity” in the B Street, Suburb C property given that the mortgage was about $820,000 and the costs of sale were likely to be $35,000 to $40,000. Counsel suggested that the husband had caused “a huge reduction in the equity in the home.” The husband responded saying “well it might have gone the other way as well. The Bitcoin investment may have made a huge profit as well.” He agreed he didn’t discuss this investment with the wife.
Regarding his failure to produce financial records he said the wife removed documents when she left the home in 2017. I note however that the husband did not invest in Bitcoins until late 2017.
In Kowaliw[4] Baker J said at 76,644:
“ As a statement of general principle. I am firmly of the view that financial losses incurred by parties or either of them in the course of a marriage whether such losses result from a joint or several liability, should be shared by them (although not necessarily equally) except in the following circumstances:
(a) where one of the parties has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets, or
(b) where one of the parties has acted recklessly, negligently or wantonly with matrimonial assets, the overall effect of which has reduced or minimised their value.
Conduct of the kind referred to in para. (a) and (b) above having economic consequences is clearly in my view relevant under sec. 75(2)(o) to applications for settlement of property instituted under the provisions of sec. 79.”
[4] In the Marriage of Kowaliw (1981) FLC 91-092.
In Browne & Green [1999] FamCA 1483 (29 October 1999) the Full Court at [44] – [48] discussed at length the fact that the statement made by Baker J in Kowaliw (supra) “did not constitute any form of fixed code” but was no more than a guideline for use in the exercise of the discretion conferred by section 79 (also section 90SM) of the Act.
The Full Court observed at [47] that in Townsend [1994] FamCA 144; (1995) FLC 92-569 Fogarty J said at 81,656 – 81, 657:
"… I think that at times the judgment of Baker J in Kowaliw (supra) has been misunderstood. The decision of his Honour is correct as to the principles to which it was directed but it should not be taken as marking out the parameters of the considerations to be applied in cases where the property of a party has been reduced or disposed of prior to trial."
At [48] in Browne & Greene (supra) the Full Court said that in Temminck (Barblett DCJ, Fogarty and Faulks JJ. 9 August 1996), the Court upheld the decision of May J that the husband should be solely responsible for certain debts, citing the following passage from her Honour's judgment:
"It is well established that except for losses occasioned by the deliberate waste or dissipation of assets by one party, or by one party's reckless, negligent or wanton conduct, economic losses suffered by the parties to a marriage during the marriage should be shared by them, just as gains made are shared (although not necessarily equally) see Kowaliw and Kowaliw (1981) FLC 91-092."
At [50] the Court in Browne & Greene (supra) said “such a guideline can of course be departed from if a trial judge considers such a departure is warranted on the facts of a particular case.”
In the present case the husband did not produce any documents in support of his contention that he had invested in Bitcoins and that investment had failed. He accepted that he had not consulted the wife regarding that investment. Notwithstanding the absence of any documents I accept that the husband invested in Bitcoin. It was not suggested by Counsel for the wife that he had disposed of those funds otherwise or that he retained the funds elsewhere. I found the husband’s evidence with respect to his investment credible. He was distressed that this investment had not gone well and he had lost a substantial amount of money.
I accept that the investment failed and this was not a case where the husband had deliberately wasted funds. I accept that the failed investment has diminished the asset pool however in my view the loss was unintentional. I accept that the husband may be considered to have been reckless in the sense that he disregarded any potential impact of his investment on the wife however I accept that he did not consider that the wife had a legal interest in the B Street, Suburb C property. I also accept the husband’s evidence that if the Court determined that a de facto relationship existed after December 2012 he would accept the Court’s decision in that regard.
I am of the view that if the investment had returned a substantial profit it is without doubt any funds still in existence would have been taken into account in adjusting the interests of the parties in property. I find that the parties should share in the losses incurred as a result of the failed investment in Bitcoin. The reality is that the mortgage on the B Street, Suburb C property is about $820,000.
Income and income earning capacity
The husband is 58 years old and the wife is 48. I take into account the parties’ age when assessing income earning capacity. The husband said he was in good health. I assume the wife is in good health there was no evidence to the contrary.
The wife is a health care professional employed with the Employer HH. She earns $4012 per week before tax. She deposed that the husband’s income for the month of July 2019 was $51,677. In the year ending June 2016 the husband’s taxable income was $334,961, in 2017 it was $312,068 and in 2018 it was $324,142. She maintains that notwithstanding the charges against him and the suspension of his licence to work he is a well - qualified health care professional who prior to the police investigation had a private practice consultancy at Employer CC and as a casual health care professional at Employer H and was also a team leader at J University. She argued that the husband could readily earn the income he earned prior to 2019.
I accept the husband’s evidence that he has not worked at all since mid 2019 and find that he currently earns no income. The husband said that in 2019 he was charged with multiple offences including possession of drugs and drug paraphernalia and driving whilst under the influence of drugs. As a result of the criminal charges he was suspended. His employment at Employer CC, Employer H and J University was terminated. His registration was suspended. Details of the charges and his photo were published in the Region D newspaper and broadcast on television. He said his professional reputation was severely damaged and he did not know if he would ever be permitted to work as a health care professional in Australia again or as a health care professional. The husband has since that time supported himself with loans from friends.
Counsel for the wife cross examined the husband at length regarding his future income earning capacity. It was suggested that prior to his suspension the husband was a highly regarded health care professional. He agreed. In addition he was employed at J University and had published many articles and journals in his field of expertise. He agreed. He said he had practised full time until 2019 from specialist suites at Employer CC on the Region D and his gross income had been about $500,000 p.a. and in addition he received income from J University.
He agreed that he had engaged lawyers to represent him in dealing with the Australian Health Practitioner Registration Authority (AHPRA). He agreed that he made an application QCAT to be allowed to practise following the criminal investigation. He said conditions were imposed on his registration including drug testing to ascertain the nature and extent of any drugs he may have in his system. He agreed he did not mention going before QCAT in his affidavit filed 22 November 2019. He said he did not think he needed to mention the QCAT proceedings when the outcome regarding his registration remained with AHPRA. He said he is still not working. His right to practise was suspended.
He agreed that in 2019 he was granted a licence subject to conditions. He said “that doesn’t mean I’m practising.” It was put to the husband that as of 21 January 2020 the only conditions imposed on his licence to practise were ones of supervision i.e. he is required to have a practitioner who he can talk to and report to from time to time and talk about issues that arise. He agreed. It was suggested that he argued before QCAT that the only restriction on the doctor practising was to have a practitioner he could talk to about his practise and other issues. He agreed however he said “this is still unresolved to this date.”
He agreed that he had not provided the wife with a copy of the QCAT decision or the submissions made on his behalf to QCAT by his lawyers. He agreed that his lawyers submitted to QCAT he wanted to return to practise again. He said following being charged by police his registration was immediately suspended. He said he was required to be undergo a psychiatrist assessment which he did and was required to undergo urine and hair follicle drug testing which he did. He was then required to have a treating practitioner through which AHPRA could communicate and be provided with an updated report which he did. He said it is then up to AHPRA to determine if he is fit to hold a licence to practice. He said that matter is still ongoing. Counsel for the wife tendered a record from AHPRA which is a register of practitioners dealing with the husband dated 20 January 2020. The only condition imposed on the husband is one of supervision of his practice by another practitioner (Exhibit A2). It was suggested to the husband that once he had nominated a practitioner and a relief practitioner he would be able to practice. The husband agreed. It was suggested that the husband’s registration was in fact current from 2019. The husband denied that and said he could not renew his registration until the matter was resolved. The documents indicated that the husband’s registration had expired in late 2019.
It was put to the husband by Counsel that his registration is only subject to him doing one thing “giving the supervisor’s name and filling in a form.” He said the two employers he used to work at namely employer CC and Employer E “no one was happy to be my supervisor.” He said “this is a matter we’re struggling with AHPRA at the moment. To lift this restriction off which is the supervisor restriction because I have not done any malpractice. I don’t need someone to supervise me. I have been practising for 30 years.” It was put to the husband that he failed to properly disclose the circumstances of his registration because he will be in a position to commence practise again within a short period of time and return to having income, gross income in excess of $500,000 a year. He replied “No I completely disagree with that.”
I accept the husband’s evidence that his reputation has been tarnished and this is likely to affect his ability to find employment particularly in the Region D area. I accept that he has attempted to find a practitioner to supervise his practice and no one has come forward. I also accept his evidence that his previous employers are reluctant to offer him work. At this point it has been 9 months and the husband still has not found any employment.
These are uncertain times not just for the husband but for society as a whole. I accept that the husband has valuable skills and experience as a health care professional. I am satisfied that the husband may find work during the Covid19 pandemic however I am not satisfied that the husband will readily return to earning income in excess of $300,000 p.a. Elective surgery is now delayed. It may be that the husband finds works as a health care professional, however I accept that he has not been able to do so to date.
I find that the husband may find employment as a consequence of the current pandemic otherwise there is uncertainty surrounding his future income and earning capacity.
Legal costs
It was suggested to the husband that he had spent $100,000 in legal costs, He could not recall the costs for the QCAT proceedings. He said he probably spent less perhaps $75,000. I accept that the wife was in no part responsible for the husband’s expenditure on legal costs however it is unclear whether the costs were paid from income or otherwise.
Assessment
Though the parties knew each other over a 14 year period I find that they were in a relationship for two discrete periods from 2010 to December 2012 and from early 2014 until June 2017 a period of about 6 years and 3 months. I find that they lived separately and apart between December 2012 and early 2014.
During the time the parties lived together the husband earned a far greater income than the wife. He supported her financially as well as her son Mr F throughout and her son Mr T and his girlfriend for a period of 6 months and the wife’s sister and her family for a period of 2 months.
Importantly the husband made a substantial financial contribution towards the wife’s university tuition fees as well as supporting her practically through her degree. I find this was a substantial contribution on his part without which she may not have the security of income she now has.
I accept that the wife contributed $80,000 towards the purchase of B Street, Suburb C however I also accept that the husband contributed $20,000 to $25,000, paid all mortgage payments from late 2009 until late 2017 (a period of 8 years), paid for insurance and utilities and maintained the property in good order. I take into account that the husband has occupied the B Street, Suburb C property since separation.[5]
[5] See Scofield & Shaw [2012] FamCAFC 193
I take into account that the husband increased the mortgage in late 2017 by about $280,000 and made a poor investment diminishing the equity in the B Street, Suburb C property however I also accept that the husband solely paid the mortgage during this 2 year period (save for two payments following the loss of his income in 2019). I do not accept that the husband intentionally diminished the parties’ assets though I accept he did not consult the wife. I take that factor into account.
I find that the both parties made indirect contributions to each parties’ interest in superannuation.
I find that both parties made non – financial contributions with each party undertaking domestic tasks including cooking, gardening and the like. I find that the husband made a significant contribution to the wife’s son Mr F in providing care for him including transporting him to and from school and to the Region Q.
I take into account the discrepancy in the parties’ age and the fact that the wife’s income is far greater than the husband’s income and she has a secure income earning capacity. I take into account that the husband currently has no income and his future income earning capacity remains uncertain.
Conclusion
I intend to take an asset by asset approach in this matter. Having regard to all the facts and circumstances both section 90SM contributions and section 90SF (3) factors I adjust the parties interests in property as follows:
a)Each party will retain the motor vehicles in his or her possession and indemnify the other with respect to any liability. The husband’s Motor Vehicle 1 has a net value of $35,000 and his Motor Vehicle 2 is valued at $12,000. The husband will be liable for his personal loan of $30,000.
b)The wife’s Motor Vehicle 3 has a net value of $25,750 and she has a credit card debt of $40,000 which she will be liable for.
c)Both parties have an interest in superannuation the wife’s interest in Z super is about $167,868 and the husband’s interest in his self - managed superannuation fund is about $194,000. I intend to make an order that there be a splittable payment to the wife of $20,000 from the husband’s interest in superannuation. I find that the wife has a significantly longer period in the workforce to accrue superannuation than has the husband.
d)I intend to make an order that the husband pay the wife the sum of $40,000. I accept the analysis of Counsel for the wife that there is relatively little equity in the B Street, Suburb C property and the costs of sale are likely to be about $35,000. The sale of the property will further erode the funds available to the parties.
I intend to give the husband 60 days in which to make the payment of $40,000 to the wife. In default thereof the B Street, Suburb C property will be listed for sale, the mortgages discharged and the payment of $40,000 be made to the wife with the balance to the husband.
The husband has no income at present however he has a Motor Vehicle 1 and a Motor Vehicle 2 which if sold would allow him to make a payment to the wife of $40,000. In the event that the husband is able to make that payment to the wife within 60 days he may be able to approach the bank for a moratorium on the mortgage until he can find employment. The wife has the capacity through her income to support herself including paying for accommodation. She will have cash to discharge her liabilities and a modest contribution to superannuation. I am satisfied that the orders I propose are just and equitable in all the circumstances. I make orders accordingly.
I certify that the preceding one hundred and thirty nine (139) paragraphs are a true copy of the reasons for judgment of Judge Tonkin
Date: 15 April 2020
Key Legal Topics
Areas of Law
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Family Law
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Statutory Interpretation
Legal Concepts
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Jurisdiction
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Remedies
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Procedural Fairness
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Statutory Construction
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