WARNER & WARNER - [2013] FamCA 495

FAMILY COURT OF AUSTRALIA

WARNER & WARNER

[2013] FamCA 495

FAMILY LAW – PROPERTY – Application for property settlement orders – Whether just and equitable to alter property interests and rights – Stanford v Stanford [2012] HCA 52 considered – Where at issue is the wife’s shareholding in a company incorporated in 1976 and controlled by her parents along with her position as a discretionary beneficiary of two trusts controlled by her father – Where the wife holds shares in the company but which carry no voting rights; where she has no control whatsoever of the company; cannot influence its operation or future direction and has no means to bring about the winding up of the company – Where the single expert was justified in his reluctance to assign a present value to the wife’s one hundred D class shares in the company – Where the company was treated as a financial resource of the wife – Where the parties’ amassed their present net assets with the financial assistance from the wife’s father – Where the husband understated his income to the court, the wife and the Child Support Agency – Consideration of factors under s 79 and s 75(2) of the Family Law Act 1975 (Cth) – Where the financial and non-financial contributions of the parties up to the date of settlement were assessed at 30 per cent to the husband and 70 per cent to the wife in respect of the net pool of assets and superannuation – Where an adjustment pursuant to Section 75(2) of 10 per cent made in favour of the husband of the net value of the pool of property and superannuation.

Family Law Act 1975 (Cth)

Mallet & Mallet (1984) FLC 91-507
Ramsay & Ramsay FLC 92-742
Stanford v Stanford (2012) HCA 52

APPLICANT:

Ms Warner

RESPONDENT:

Mr Warner

FILE NUMBER:

SYC

5933

2011

DATE DELIVERED:

26 June 2013

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Stevenson J

HEARING DATE:

11,12,13 March 2013

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Lethbridge SC with Ms Hausman

SOLICITOR FOR THE APPLICANT:

KDB Holmes Solicitors

COUNSEL FOR THE RESPONDENT:

Mr Kenny

SOLICITOR FOR THE RESPONDENT:

Campbell, Paton and Taylor

Orders

That each of the parties do all things and execute all documents required to effect the sale, for the best price reasonably obtainable of the property known as “Y”, C Street, Town G in the State of New South Wales being the whole of the land contained folio identifier … and to distribute the proceeds of sale as follows:
1.1in payment of agents commission and expenses and legal costs of and incidental to the sale
1.2in payment of all outstanding rates
1.3in discharge of the Westpac Bank mortgage secured on the title
1.4in payment of 37% of the balance to the husband
1.5in payment of the balance to the wife.
That each of the parties do all things and execute all documents required to effect the transfer by the Ms Warner Family Trust to the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: WARNER & WARNER [2013] FamCA 495
Case: [2013] FamCA 495
Decision Date

CaseChat Overview and Summary

In the Family Court of Australia, Ms Warner (the applicant) and Mr Warner (the respondent) were involved in proceedings concerning property settlement. The primary dispute revolved around the division of the parties' assets and liabilities, with a significant focus on the wife's shareholding in R Pty Limited and her position as a discretionary beneficiary of trusts controlled by her father. Parenting orders for the parties' three children were resolved by consent prior to the property settlement determination.

The court was required to determine whether it was just and equitable to alter the parties' property interests and rights, considering the factors outlined in sections 79 and 75(2) of the *Family Law Act 1975* (Cth). Key legal issues included the valuation of the wife's non-voting shares in R Pty Limited, which she had no control over or ability to wind up, and how to treat her interests in various family trusts. The court also had to consider the financial assistance provided by the wife's father to the parties throughout their relationship and the husband's understatement of his income.

Stevenson J reasoned that the wife's shareholding in R Pty Limited, carrying no voting rights and no control over the company's operations or winding up, was appropriately treated as a financial resource rather than a directly divisible asset with a present value. The court acknowledged the substantial financial assistance received from the wife's father, which contributed significantly to the parties' accumulated assets. Applying the principles from *Stanford v Stanford* and other relevant authorities, the court assessed the parties' financial and non-financial contributions to the net pool of assets and superannuation as 70% to the wife and 30% to the husband. An adjustment of 10% was made in favour of the husband under section 75(2) of the Act.

The court ordered the sale of a rural property known as "Y" with the proceeds to be distributed, with 37% allocated to the husband and the balance to the wife after payment of expenses, mortgage, and costs. The husband was to receive the business known as "Business S" and associated properties, and was to discharge certain mortgages and loans, indemnifying the wife. The parties were to transfer shares and loan accounts in various companies (F Pty Limited and H Pty Limited) to each other, and the wife was to transfer her interest in Warner Partners to the husband. Each party was declared solely entitled to property in their possession, and each was to assume sole liability for debts attached to motor vehicles they received.

Orders