WARNOLD & BLEAUCHAMP
[2010] FamCAFC 154
•20 August 2010
FAMILY COURT OF AUSTRALIA
| WARNOLD & BLEAUCHAMP | [2010] FamCAFC 154 |
| FAMILY LAW - APPEAL – PARENTING – Whether the trial Judge erred in failing to make orders that the existing daily arrangements for the child should continue – Where neither party sought orders which reflected the daily arrangements for the child – Where there was uncertainty as to where each party would live – No appealable error – Whether the trial Judge erred in failing to make an order that the child spend time with the father each alternate Thursday – Where the parties agreed to amend the parenting orders by consent – Appeal allowed in part. FAMILY LAW - APPEAL – JURISDICTION – Where neither party disputed that the Full Court was the appropriate court to hear the appeal – The trial Judge and the Full Court are obliged to apply the law in force at the relevant date in the Australian Capital Territory – The Full Court can re-determine the matter under the relevant provisions of the Domestic Relationships Act 1994 (ACT) if appealable error established. FAMILY LAW - APPEAL – PROPERTY – Whether the trial Judge erred in his evaluation of the parties’ contributions – Whether the trial Judge erred in failing to give any or sufficient weight to the father’s post-separation contribution of the property occupied by the mother – Whether the trial Judge’s evaluation of the parties’ contributions was plainly wrong – Where the trial Judge was conscious of the requirement of s 15 of the Domestic Relationships Act 1994 (ACT) – Where there was no dispute that at the commencement of the parties’ relationship there was a significant imbalance in the parties’ initial contributions – Where the initial contributions could not have been given appropriate weight given the overall contribution findings – Where the contribution based assessment was outside the reasonable ambit of discretion – Appealable error established. FAMILY LAW - APPEAL – PROPERTY – Whether the trial Judge erred in making a further s 19(2) adjustment in the mother’s favour – Where the adjustment was not outside the reasonable ambit of discretion – No appealable error established. FAMILY LAW - APPEAL – RE-DETERMINATION – Where the father’s contributions post-separation outweighed the mother’s – Where contributions assessed to be 82.5 per cent to the father and 17.5 per cent to the mother – Where the father’s property and financial resources significantly outstrip those of the mother – Where the mother’s parenting obligations involve her in greater periods of time caring for the child – Adjustment of 10 per cent in the mother’s favour appropriate – Where the parties’ entitlements are 72.5 per cent to the father and 27.5 per cent to the mother. FAMILY LAW - APPEAL – APPLICATION TO ADDUCE FURTHER EVIDENCE – Where the mother conceded an error in the accidental omission of an investment from the list of assets and liabilities provided to the trial Judge – Where there was no dispute the father paid mortgage and outgoings in respect of one property – Application, other than the agreed and undisputed evidence, dismissed. |
| Family Law Act 1975 (Cth) – s 94(1) Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) – s 11 Domestic Relationships Act 1994 (ACT) – s 15, s 19(2) Jurisdiction of Courts (Cross-vesting) Act 1993 (ACT) – s 4(2), s 7(1), s 11 Supreme Court Act 1933 (ACT) – Part 2A, s37N, s 37O |
| Cabbell & Cabbell [2009] FamCAFC 205 Crellin v Robertson (2004) DFC 95-296 Hallinan v Witynski (1999) DFC 92-219 Huen v Hyland [2004] ACTCA 5 Mallet v Mallet (1984) 156 CLR 605 Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 |
| APPELLANT: | Mr Warnold |
| RESPONDENT: | Ms Bleauchamp |
| FILE NUMBER: | CAC | 975 | of | 2007 |
| APPEAL NUMBER: | EA | 44 | of | 2009 |
DATE DELIVERED: | 20 August 2010 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Canberra |
| JUDGMENT OF: | Bryant CJ, Finn & Boland JJ |
| HEARING DATE: | 8 December 2009 |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 24 March 2009 |
| LOWER COURT MNC: | [2009] FamCA 214 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Mr Brzostowski SC |
| SOLICITOR FOR THE APPELLANT: | Dobinson Davey Clifford Simpson |
| COUNSEL FOR THE RESPONDENT: | Ms Rees SC |
| SOLICITOR FOR THE RESPONDENT: | Ken Cush & Associates |
Orders
By consent, the appeal against the parenting orders of the Honourable Deputy Chief Justice Faulks made 25 March 2009 be allowed in part.
By consent, and in addition to the parenting orders made on 25 March 2009, the child shall spend time with the father each alternate Thursday from the conclusion of school, or such other time as may be agreed between the parties, and commencement of school the following day.
The father’s application to adduce further evidence, except in respect of the mother’s Netwealth investment and payment of expenses associated with the R property, is dismissed
The appeal against the property orders of the Honourable Deputy Chief Justice Faulks made 25 March 2009 under the provisions of the Domestic Relationships Act 1994 (ACT) be allowed.
The property orders made by the Honourable Deputy Chief Justice Faulks on 25 March 2009 be varied as follows:
(a)Order 9(d) be varied by deleting where appearing therein “35 per cent” and substituting in lieu “27.5 per cent”;
(b)Order 9(e) be varied by deleting where appearing therein “35 per cent” and substituting in lieu “27.5 per cent”; and
(c)Order 9(f) be varied by deleting the words “the sum of $390,000 less 35 per cent of the sales costs associated with the auction” and substituting in lieu “the sum of $289,165.32 less 27.5 per cent of the sales costs associated with the auction”.
The parties are at liberty to file written submissions with regard to the costs of the property appeal in accordance with the following timetable:
(a)on behalf of the appellant within 21 days of the date hereof;
(b)on behalf of the respondent in response thereto within 21 days thereafter;
(c)on behalf of the appellant in reply thereto within seven days thereafter; and
(d)that each submission have endorsed on the cover sheet the date on which a copy of that submission was served on the other party.
IT IS NOTED that publication of this judgment under the pseudonym Warnold & Bleauchamp is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT CANBERRA |
Appeal Number: EA 44 of 2009
File Number: CAC 975 of 2007
| Mr Warnold |
Appellant
And
| Ms Bleauchamp |
Respondent
REASONS FOR JUDGMENT
Introduction
This is an appeal by Mr Warnold against parenting and property orders made by Faulks DCJ on 25 March 2009 in proceedings between Mr Warnold and Ms Bleauchamp.
Mr Warnold and Ms Bleauchamp are the parents of H. H is the parties’ only child and is presently aged 11 years. Faulks DCJ ordered that the parties have equal shared parental responsibility for H, except for medical decisions, which are to be made by Ms Bleauchamp. The balance of the parenting orders provide, in broad terms, that H is to live with Ms Bleauchamp, and spend time with Mr Warnold each alternate weekend, unless the parents otherwise agree, from after school on Friday until the commencement of school on Monday, together with one half of all school holidays.
Mr Warnold and Ms Bleauchamp never married. Their property claims fell to be adjusted under the provisions of the Domestic Relationships Act 1994 (ACT) (“the DR Act”), the proceedings being cross-vested to this Court under the provisions of the Jurisdiction of Courts (Cross-vesting) Act 1993 (ACT) (“the cross-vesting Act”). The parenting orders were made pursuant to Part VII of the Family Law Act 1975 (Cth) (“the Act”). Before the trial Judge both parties sought orders for the sale of two properties each located in the Australian Capital Territory (“ACT”).
The trial Judge determined that the parties’ property, which he found to have a net value of $1,112,026.55 should be divided between them as to 65 per cent or $722,817.00 to Mr Warnold and 35 per cent or $389,209.00 (rounded up to $390,000.00) to Ms Bleauchamp. The property as found by the trial Judge did not include the parties’ superannuation entitlements which the trial Judge found to be $192,998.00 for Mr Warnold and $72,188.00 for Ms Bleauchamp.
The practical application of these findings took the following form in Order 9 of his Honour’s orders:
…
Property matters
9.Within 14 days of this order, both the applicant and respondent will do such things and sign such documents as may be necessary to arrange for the property at [T] to be listed for sale by auction within such time as the listing agent may nominate, but it is suggested within 30 days. The arrangements for the auction are to include the following:
a.The parties will confer and agree about the agent and the auctioneer to conduct the sale of the property. If the parties are unable to agree about the agent and the auctioneer they will accept the nominee of the President of the time-being of the Real Estate Institute of the Australian Capital Territory.
b.The parties will confer and agree upon a reserve price for the property but if they are unable to agree about the reserve price they will accept the recommended reserve price by the auctioneer as a realistic market price likely to attract a buyer.
c.Either party may bid at the auction.
d.If the gross sale price of the property is less than $800,000 the amount to be paid by the applicant to the respondent in accordance with order 9(f) hereafter will be reduced by an amount equal to 35 per cent of the difference between the actual selling price and $800,000.
e.If the sale price of the property exceeds $800,000 the amount to be paid by the respondent pursuant to the same order is to be increased by 35 per cent of the difference between $800,000 and the actual sale price.
f.Otherwise by way of property settlement, [the father] will pay to [the mother] the sum of $390,000 less 35 per cent of the sale costs associated with the auction including real estate agent’s commission, any expenses of the auction so-called, and the legal costs. Otherwise each of the parties shall retain as against the other any interest he or she may have in any property in his or her possession or control including any entitlement to superannuation in any fund in respect of that person.
…
Mr Warnold was the applicant in the proceedings before the trial Judge. However, for convenience, in these reasons we will refer to Mr Warnold as “the father”, Ms Bleauchamp as “the mother”, and H as “the child”.
At the hearing of the appeal the father sought to amend his Notice of Appeal by abandoning a number of grounds (grounds 4, 7(b), 7(c), 12 and 13) and relying on five new grounds. The amendments were opposed by the mother’s senior counsel although in her written submissions each proposed new ground was addressed. As we were satisfied no prejudice was caused to the mother, we granted leave to rely on the amended Notice of Appeal on the basis the mother had notice of the amendments for over a month prior to the hearing, and had responded to the proposed amended grounds.
The father also sought to adduce further evidence. He relied on this evidence, not to demonstrate error by the trial Judge, but in the event that we allowed the appeal and re-determined the parenting and property matters.
It was not in dispute before us that due to an inadvertent error, not detected by either party’s counsel at trial, an asset of the mother’s, being an investment with Netwealth valued at the date of the trial at $22,954.46 had been omitted from the table of the parties’ assets and liabilities. It was submitted that we could, by consent, in the event we found appealable error in respect of the property orders, amend the list of assets to include this sum for the purpose of re-determination. In the event the father’s appeal was dismissed, it was conceded by senior counsel for both parties, that the error could be corrected by an application to the trial Judge under the slip rule.
The mother’s senior counsel also submitted that the parenting orders could be amended by the trial Judge by consent pursuant to the slip rule to “add” time the father is to spend with the child to include time to be spent by the child with the father overnight on Thursday evening on the alternate week. At the conclusion of the hearing before us, it was agreed to save the parties’ unnecessary expense, we could allow the appeal to the extent necessary to amend the parenting orders on the basis such a concession by the mother would not sound in costs. We propose to adopt that course.
Although the father relied on multiple grounds to challenge the trial Judge’s parenting orders, before us his senior counsel distilled the arguments to a single challenge – that his Honour had failed to make an order that the child spend time with the father every morning for a period of about one hour before school on the days when he was in the care of the mother. We will address that issue shortly.
The challenge to the trial Judge’s property orders was mounted on three bases:
(i)that the contribution assessment of 25 per cent in favour of the mother was manifestly excessive;
(ii)that the contribution assessment failed to have regard to the father’s significant post-separation contribution of a rent free residence for the child (and the mother); and
(iii)the adjustment made in the mother’s favour of 10 per cent under s 19(2) of the DR Act was outside the reasonable range of discretion.
In his Notice of Appeal the father sought, in the event the appeal was allowed, that the mother’s property entitlement be reduced from 35 per cent of the net assets to an entitlement of 20 per cent.
Save and except for accidental failure to include a provision for the child to spend time with the father each alternate Thursday evening, we were satisfied that there was no error by the trial Judge in respect of the parenting orders made. Insofar as the challenge to the property orders is concerned we were satisfied there was merit in the appeal, and that we should re-determine the parties’ property entitlements. These are our reasons for those decisions, including our re-determination of the property proceedings.
Background
The facts necessary to understand our reasons are set out below.
The father was born in July 1955 and the mother was born in January 1961. They were respectively aged 53 and 48 years at the date of the hearing.
The parties were in dispute as to both the nature of their relationship, and the commencement of it. The father asserted the parties met in April 1998 and commenced cohabitation in February/March 1999. The mother asserted they met in January or February 1997 and formed a relationship by the latter half of that year. What was not in dispute was that the mother became pregnant in September 1998 and the child was born in June 1999.
At the commencement of their cohabitation the father owned an unencumbered property at T in the ACT. He had also purchased a professional practice for $210,000.00 in 1994. He worked in that practice thereafter and was servicing a loan acquired to purchase the practice.
At the commencement of cohabitation the mother had qualifications as a physiotherapist. She ceased work for a short period after the birth of the child, then resumed part-time work for two half days per week when the child was aged eight months. She increased her working hours in 2003, and resumed full-time work pursuant to a three year contract commencing in April 2005. She was engaged in full-time employment at the date of the trial.
In 2003 the father purchased a house at R in the ACT (“the R property”) for a purchase price of $470,000.00.
The parties’ separated in about August 2005 and the father left the T property and commenced living in the R property. He remained living in that property at trial. He paid all the mortgage payments and outgoings in respect of the R property, and outgoings in respect of the T property. The mother and child, after a short absence, returned to the T property and were living in that property at the date of trial. The father thus asserted he provided rent free accommodation for the child (and the mother) for a period of four years. This fact, as we will later discuss in more detail, became a significant issue at the appeal hearing.
The trial Judge recorded, in paragraph 20 of his reasons, that the mother asserted she had contributed money for a number of expenses during the period from commencement of cohabitation until 2003. She asserted she contributed money for groceries, significant maintenance work on the T property, including plumbing and electrical expenses, and that she provided clothing and entertainment for the child. The trial Judge accepted her evidence about these contributions.
The grounds of the parenting appeal
Because of the number of amendments to the grounds in the Notice of Appeal we have annexed to these reasons as Annexure “A” a copy of the grounds relied on by senior counsel for the father. It is not necessary that we deal with the grounds individually. Senior counsel for the father argued grounds 1, 2, 3, 5, 6, and 7(a) together. The combined effect of these grounds is to assert error on behalf of the trial Judge in failing to make orders that the existing arrangement for the child, which the parties had instituted by the time of the trial, should continue.
It was not in dispute that the parties had adopted a very sensible arrangement which benefited each of them, but most importantly the child. That arrangement may be described as a “before and after school care” arrangement. During school terms when the child was in the mother’s care he was delivered by the mother to the father’s house each morning before school where he had breakfast and was then taken to school by the father. The mother was able to start work at 7.30 am and be available to collect the child after school. This practical arrangement, which was possible because of the parties’ geographical proximity, had obvious benefits for the child.
In his application to adduce further evidence in the event we found appealable error the father sought to put before us evidence that, notwithstanding that no orders for continuation of the daily arrangement were made by the trial Judge, the parties had continued the arrangement. The mother also came to the father’s home en route to her workplace to see the child for a short period on the day he stayed overnight with the father.
It was not in dispute that neither party sought in their application and response or minute of orders sought, orders which reflected their daily arrangements for the child. It was not in dispute that the father’s application at trial was that both the T property and the R property be sold. Faced with that application at the first day of the hearing the trial Judge specifically raised the issue of where each party would live after the conclusion of the proceedings. The father referred to the fact that he may in due course move to Sydney, and that for his high school years the child may attend his old school at U.
Before us, the mother’s senior counsel conceded the continuation of the daily arrangement, but said the mother could not agree to orders being made by consent to reflect this arrangement because of the uncertainty about where the parties would live at the conclusion of the proceedings.
We are satisfied there was no appealable error by the trial Judge in failing to make an order about the daily arrangements for the child. He was not asked by either party to do so, and even if he concluded such an order may be in the child’s best interests, in view of the uncertainty about the parties’ living arrangements it was not practical for such an order to be made.
The second complaint raised on behalf of the father was the fact that the trial Judge failed to make an order for the child to spend time with the father each alternate Thursday overnight. In his reasons the trial Judge said at paragraph 42:
I propose to make orders in accordance with the mother’s amended proposal to include the Friday night until the Monday morning. However, if the parties are in agreement after reading my judgment that it might be extended to the Thursday then (in lieu of the one off Thursday in the following week) I would be prepared to make orders to that effect. I note this would be in accordance with the original recommendation of the Family Consultant in October 2007.
Our reading of that paragraph is that his Honour intended to make an order for time each alternate Thursday night, and in the event the parties themselves determined that rather than the child continuing to spend each alternate Thursday evening with the father, that evening could be forgone but an additional night added at the commencement of the weekend time so that weekend time became a “block” period of Thursday through to Monday. Thus his Honour intended to, but did not, make an order for the child to have time with the father each alternate Thursday overnight.
We will allow the appeal and include in the orders an order for the child to spend each alternate Thursday overnight with the father.
The law and principles relevant to an appeal under the provisions of the dr act
Before commencing our discussion of the relevant legal principles applicable to the appeal against the property orders it is necessary we refer briefly to this Court’s jurisdiction in respect of the appeal, and to the case law under the DR Act.
Neither party disputed that the Full Court of this Court was the appropriate court to hear an appeal from the trial Judge. This Court’s original and appellate jurisdiction is found in s 4(2) of cross-vesting Act.
Section 4(2) of the cross-vesting Act vests in the Family Court, but not the Federal Magistrates Court, original and appellate jurisdiction in respect of ACT matters. It provides as follows:
(2) The Family Court has and may exercise original and appellate jurisdiction in respect of ACT matters.
Section 7(1) makes it clear that an appeal is not to be instituted from a decision of a single Judge of the Family Court to the Full Court of the Supreme Court.
Section 11 of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) and s 11 of the cross-vesting Act are in similar terms. Section 11 of the cross-vesting Act provides as follows:
(1) If it appears to a court that the court will, or will be likely to, in determining a matter for determination in a proceeding, be exercising jurisdiction invested or conferred by this Act or by a law of the Commonwealth or another State relating to cross-vesting of jurisdiction—
(a) subject to paragraphs (b) and (c), the court shall, in determining that matter, apply the law in force in the State or Territory where the court is sitting (including choice of law rules); and
(b) subject to paragraph (c), if that matter is a right of action arising under a written law of another State or Territory, the court shall, in determining that matter, apply the written and unwritten law of that other State or Territory; and
(c) the rules of evidence and procedure to be applied in dealing with that matter shall be such as the court considers appropriate in the circumstances, being rules that are applied in a superior court in Australia or in an external Territory of Australia.
(2) The reference in subsection (1) (a) to the State or Territory where the court is sitting is, in relation to the Federal Court or the Family Court, a reference to the State or Territory where any matter for determination in the proceeding was first commenced in or transferred to that court.
(3) If a proceeding is transferred or removed to a court (the transferee court) from another court (the transferor court), the transferee court shall deal with the proceeding as if, subject to any order of the transferee court, the steps that had been taken for the purposes of the proceeding in the transferor court (including the making of an order), or similar steps, had been taken in the transferee court.
Thus it is clear that in determining the property proceedings the trial Judge, and this Court, is obliged to apply the law in force at the relevant date in the ACT.
The DR Act itself contains no provisions relating to appeals. An appeal from a decision under the DR Act of a Judge in the Supreme Court of the ACT lies to the Court of Appeal of the Supreme Court of the ACT (Supreme Court Act 1933 (ACT) (“the Supreme Court Act”). Part 2A of the Supreme Court Act deals with the appellate jurisdiction of the Supreme Court of the ACT.
However, s 94(1) of the Act allows an appeal under the Act in respect of an appeal against a decree of the Family Court under “any other law”.
If s 94(1) of the Act is applicable then the Full Court may, pursuant to s 94(2), if appealable error is established re-determine the matter or remit the matter for re-hearing on such terms and conditions as are appropriate.
Section 37N of the Supreme Court Act provides that the appellate court must have regard to the evidence given in the proceedings out of which the appeal arose and may draw inferences of fact from that evidence. The appellate court is also empowered to receive further evidence.
The powers of the Court of Appeal are found in s 37O(1) as follows:
(1) The Court of Appeal has the following powers in relation to the order appealed from:
(a) to confirm, reverse or amend the order;
(b) to give any order it considers appropriate, or refuse to give an order applied for;
(c) to set aside the order (completely or in part) and remit the proceeding to the court constituted by a single judge for further hearing and decision, subject to any directions the Court of Appeal considers appropriate;
(d) to set aside the verdict and order in a trial on indictment and order a verdict of not guilty (or another verdict) to be entered;
(e) to order a new trial, with or without jury, on any appropriate ground;
(f) to award enforcement of any order, or remit the proceeding to the court constituted by a single judge for enforcement of the order.
Section 37O(1)(b) although not expressed in identical language to s 94(2), when read in connection with s 37N(3) gives power to re-determine the subject matter of the appeal (see Huen v Hyland [2004] ACTCA 5 at paragraph 54).
We are satisfied whether we exercise jurisdiction under the provisions of the Act or the Supreme Court Act that if we find appealable error we can re-determine the matter under the relevant provisions of the DR Act.
The property appeal
We propose to deal with the amended grounds of appeal relevant to the property orders in the grouping identified earlier in these reasons.
As this is an appeal under the DR Act we propose, before referring to the trial Judge’s reasons and the challenges to his Honour’s orders, to refer to the relevant sections of the ACT legislation. Although it is similar to, it is not identical to the Act.
Although before the trial Judge senior counsel for the husband contended that the parties’ relationship was not a domestic relationship within the terms of the DR Act, no challenge was made to his Honour’s finding that the parties were in a domestic relationship and were able to bring proceedings for an adjustment of property interests. No issue was raised before the trial Judge or us that jurisdiction under the DR Act was improperly exercised by the trial Judge.
Section 15 of the DR Act is in broad terms similar to s 79 of the Act. It provides:
(1) On application by a party to a domestic relationship, a court may make an order adjusting the interests in the property of either or both of the parties that seems just and equitable to it having regard to:
(a) the nature and duration of the relationship; and
(b) the financial or non-financial contributions made directly or indirectly by or on behalf of either or both of the parties to the acquisition, conservation or improvement of any of the property or financial resources of either or both of them; and
(c) the contributions (including any in the capacity of homemaker or parent) made by either of the parties to the welfare of the other or any child of the parties; and
(d) the matters referred to in section 19 (2), as far as they are relevant; and
(e) such other matters (if any) as the court considers relevant.
(2) A court may make an order under subsection (1) whether or not it has declared the title or rights of a party in respect of the property.
Section 19(2) of the DR Act (which is not identical to s 75(2) of the Act but which provides the basis for an “adjustment” in favour of one or other party after the assessment of contribution) provides as follows:
(2) In exercising a power under subsection (1), a court shall have regard to—
(a) the income, property and financial resources of each party; and
(b) the physical and mental capacity of each party for appropriate gainful employment; and
(c) the financial needs and obligations of each party; and
(d) the responsibilities of either party to support any other person; and
(e) the terms of any order made or proposed to be made under section 15 with respect to the property of either or both of the parties; and
(f) any payments made to the applicant, under an order of a court or otherwise, in respect of the maintenance of a child or children.
In considering the provisions of the DR Act we are satisfied that we should have regard to the approach to the evaluation of contributions adopted under the Act. In so doing we accept as appropriate to this approach the caveats referred to by Crispin J in Crellin v Robertson (2004) DFC 95-296 in paragraphs 22-25. At paragraph 25 his Honour said:
In some cases the nature of the relationship could be quite dissimilar to that of a marriage and little guidance might be obtained from decisions of the Family Court of Australia concerning the division of property between separating spouses. The breadth of the discretion provided by s 15 presumably reflects a legislative intention to ensure that the court can make orders that will be just and equitable in any case that may properly come before it. Accordingly, whilst I accept that decisions of the Family Court of Australia may often provide useful guidance, I do not accept that they should be followed in all applications of this kind. In Davey v Lee (1990) DFC ¶95-084; (1990) 13 Fam LR 688 at 689 McLelland J said that what is required in dealing with an application under s 20 of the De Facto Relationships Act 1984 (NSW) is “a holistic value judgment in the exercise of a discretionary power of a very general kind”. This formulation was adopted by a Full Court of the Family Court of Australia in Harris v Harris (1991) FLC ¶92-254 at 78,705 in relation to applications under s 79 of the Family Law Act 1975 (Cth) and by Cooper J in Ferris v Winslade at [33] in relation to applications under s 15 of the Act.
We observe at this juncture that there is no provision in s 19(2) of the DR Act identical to s 75(2)(c) the Act which requires the court in dealing with property proceedings under s 79 of the Act to take into account whether either party has the care and control of a child of the marriage who has not attained the age of 18 years. This difference in the legislation was referred to by the Full Court (Lindenmayer, Finn and Warnick JJ) in Hallinan v Witynski (1999) DFC 92-219 at paragraph 60 as follows:
We have some reservations whether, in proceedings under the [DR Act], it is open to the Court, in considering the s.19(2) factors, to have regard to the burden of the future care and supervision of a child of the relationship, as distinct from the financial support of such a child. Section 19(2) has no equivalent to s.75(2)(c) of the [Act]. Section 19(2)(d) is confined to “responsibilities of either party to support any other person” (emphasis added), and all the other paragraphs of that sub-section have a distinctly financial flavour. We suppose, however, that it is possible that s.15(1)(e), which enables the Court to have regard to “such other matters, if any, as the Court considers relevant” is wide enough to encompass the physical and emotional demands of child care and supervision. However, as this issue was not raised or argued in this case, we refrain from expressing any concluded view about it. (original emphasis)
Senior counsel for the mother submitted that the interpretation suggested, but not definitively determined by the Full Court in Hallinan v Witynski, was correct.
Similarly to the appeal in Hallinan v Witynski no specific ground of appeal is directed to the interpretation of s 19(2), rather the broad ground relied on by the father is that the trial Judge’s adjustment under s 19(2) failed to take into account relevant matters and was outside the reasonable range of discretion. We will return to that argument when discussing the s 19(2) challenge.
The contribution challenge
The trial Judge’s evaluation of the parties’ respective contributions was asserted to be flawed on two bases. First as being plainly wrong (manifestly excessive) having regard to the father’s contributions including his significant initial contributions and his financial contributions over the period of the parties’ cohabitation which spanned some seven years. Second, it was asserted his Honour erred in failing to give any weight, or any sufficient weight, to the father’s post-separation contribution of the T property when that property was solely occupied by the mother.
The mother’s senior counsel challenged the father asserting error in failing to take into account the father’s post-separation contribution in permitting the mother to live in the T property while he paid all the outgoings in respect of the R property. The challenge was twofold. First, it was asserted no submission had been made to the trial Judge that such a contribution should be taken into account in the father’s favour, and thus the father should not be permitted to rely on this submission on appeal (see Suttor v Gundowda Pty Ltd (1950) 81 CLR 418). Secondly, it was asserted that the T property was the child’s home.
The relevant law
This appeal is an appeal against a discretionary judgment. The constraints on interference with such a judgment are discussed by Mason J (as his Honour then was) in Mallet v Mallet (1984) 156 CLR 605 at 621-622 as follows:
It has been accepted, at least since the judgment of Gibbs J. in De Winter v. De Winter, that a judgment of the Family Court in determining what order should be made under s. 79 of the Family Law Act 1975 (Cth), as amended, is exercising a judicial discretion and that the well settled principle governing an appeal from the exercise of that discretion applies to the Full Court of the Family Court when it hears and determines an appeal from the making of an order under the section. The Full Court, in determining the appeal cannot substitute its opinion for that of the primary judge unless it is shown that he made some error in exercising the discretion, i.e., by acting on a wrong principle, by allowing extraneous or irrelevant factors to influence him, by failing to take into account some material consideration or by mistaking the facts: House v. The King; Australian Coal and Shale Employees’ Federation v. The Commonwealth. And in some cases the exercise of the discretion may be vitiated by the primary judge’s failure to give sufficient weight to a relevant factor. However, an appellate court needs to view this ground of appeal with considerable caution, as Stephen J. noted in Gronow v. Gronow:
“The constant emphasis of the cases is that before reversal an appellate court must be well satisfied that the primary judge was plainly wrong, his decision being no proper exercise of his judicial discretion. While authority teaches that error in the proper weight to be given to particular matters may justify reversal on appeal, it is also well established that it is never enough that an appellate court, left to itself, would have arrived at a different conclusion. When no error of law or mistake of fact is present, to arrive at a different conclusion which does not of itself justify reversal can be due to little else but a difference of view as to weight: it follows that disagreement only on matters of weight by no means necessarily justifies a reversal of the trial judge. Because of this and because the assessment of weight is particularly liable to be affected by seeing and hearing the parties, which only the trial judge can do, an appellate court should be show to overturn a primary judge’s discretionary decision on grounds which only involved conflicting assessments of matters of weight.” (footnotes omitted)
The trial Judge’s reasons – contribution
Before we refer to the trial Judge’s assessment of contribution we note that his Honour was very conscious of the unique requirements of s 15 of the DR Act and referred to the requirements of the section at paragraph 60 of his reasons. In dealing with the section his Honour found, at paragraph 67:
… that the nature of the relationship involved significant contributions on both the part of the father and mother and these contributions are relevant factors to be taken into account under s 15. (original emphasis)
At paragraph 68, after commenting that the father sought to minimise any contribution made by the mother, the trial Judge said:
… I accept that the mother has made financial contributions (although not as substantial as the contributions made by the father.) I accept that the mother has been the primary homemaker and parental caregiver before and after the separation of the parties and that this is a substantial benefit which should be given proper faith and credit. I also accept that by adopting the primary parenting role the mother has enabled the father to pursue his business activities to an extent to which he could not have done if he had been obliged to fulfil that role himself. In this regard, I accept the mother’s evidence about the hours the father worked and the work that she did in preparing meals and other household tasks and looking after the child which enabled him to do this.
His Honour explained that he accepted the mother’s role in working on a part-time basis had had an effect on the development of her career. The trial Judge was unable to precisely quantify the effect of this finding. The trial Judge also said he accepted the mother’s evidence about her non-financial or contributions of an indirect financial nature to the improvement and conservation of the T property.
His Honour went on to set out his findings on the parties’ earnings describing the mother’s earnings as “relatively meagre” and that he accepted the father’s evidence that her earnings were supplemented “probably substantially” by the father.
His Honour specifically rejected, at paragraph 71 of his reasons, that the father was the “almost sole” financial provider.
At paragraph 72, his Honour set out his substantial findings in relation to contributions. In that paragraph he said:
My consideration of these matters would lead me to conclude in relation to s 15 of the Domestic Relationships Act 1994 (ACT) that the father had made substantially greater financial contributions than the mother. This included the house in [T] which was in existence before the relationship began and his [professional practice]. The mother’s initial financial contribution was but vaguely proved and does not substantially affect my overall determination. That does not mean, however, that those were the only contributions made and I accept that the contributions made by the mother in the capacity of homemaker and parental caregiver and for the welfare of the child were substantially greater than those of the father. That is not to say that the father did not participate in the care and upbringing of the child. In many respects, he has contributed more than many other fathers do in the community. But as with finance in favour of the father so with parenting and homemaking with the mother. The greater contribution was made in the former case by the father and in the later case by the mother. I see no reason to differentiate between the two sorts of contributions. The contributions made as a parent and as a homemaker should not in any way be compared unfavourably or be regarded as qualitatively less than contributions made financially.
Having referred to two authorities which discussed the question of the application of income earned during the relationship, his Honour set out his conclusions in relation to s 15 at paragraph 77 as follows:
Balancing those matters as best I might so far as contributions are concerned, it seems to me that I should regard the father as having contributed 75 per cent and the mother as 25 per cent. This conclusion is necessarily my personal conclusion and others may differ from it. However, I have had the unique benefit of hearing the parties’ evidence both orally and in writing and of seeing them in court. I have taken account not only of their words but also their demeanour in reaching the conclusions I have.
Discussion
There was no dispute in this case that at the commencement of the relationship there was a significant imbalance in the parties’ initial contributions. Prior to the commencement of cohabitation the father was the owner of T property which was unencumbered. That property was valued at the date of hearing at an agreed value of $800,000.00. The mother had no assets of significance, save a small equity in a property in Melbourne.
The trial Judge does not, in his reasons, discuss this significant initial disparity in the parties’ contributions.
The Full Court discussed the weight to be given to initial contributions in Cabbell & Cabbell [2009] FamCAFC 205 at paragraphs 42 to 44 as follows:
42.As the wife’s senior counsel appropriately and candidly conceded before us, there is no formula, nor could there be, given the wide discretion exercised under s 79, which prescribes how a court should deal with initial contributions in cases of property adjustment.
43.The principles enunciated in decisions prior to 1999 are conveniently reviewed in Pierce & Pierce (1999) FLC 92-844 at paragraphs 25 - 27 of that judgment. In those paragraphs the Full Court (Ellis, Baker and O’Ryan JJ) referred to the cases which discussed the concept of an initial contribution being “eroded” or offset to a greater or lesser extent by later contributions during the marriage, and the qualification to or expansion of this concept by Fogarty J in Money & Money (1994) FLC 92-485 at 81,054, namely that later contributions over a long marriage did not need to be greater, but rather those contributions (sometimes referred to as the myriad of other contributions) “offset” the significance which might be placed on greater initial contributions. Their Honours then, at paragraph 28, explained that in assessing contribution (including initial contributions) rather than considering if an initial contribution had been “eroded”, what was relevant was the “weight to be attached, in all the circumstances, to the initial contribution”. Their Honours then explained the initial contribution should be weighed with all other contributions, and in paragraph 30 stressed the need for a trial Judge “not only to identify the relevant contributions, but also to assess them”. That latter statement of principle is consistent with the discussion in Mallet v Mallet (1984) 156 CLR 605 where Mason J said in discussing s 79:
The section contemplates that an order will not be made unless the court is satisfied that it is just and equitable to make the order (s. 79(2)), after taking into account the factors mentioned in (a) to (e) of s. 79(4). The requirement that the court “shall take into account” these factors imposes a duty on the court to evaluate them. Thus, the court must in a given case evaluate the respective contributions of husband and wife under pars. (a) and (b) of sub-s. (4), difficult though that may be in some cases.
44.In Williams & Williams [2007] FamCA 313 the Full Court (Kay, Coleman and Stevenson JJ), after discussing conflicting cases determined in the New South Wales Court of Appeal under the Property (Relationships) Act1984 (NSW) which involved discussion of how initial contributions should be assessed in a property adjustment case under that legislation, said at paragraph 26:
We think that there is force in the proposition that a reference to the value of an item as at the date of the commencement of cohabitation without reference to its value to the parties at the time it was realised or its value to the parties at the time of trial, if still intact, may not give adequate recognition to the importance of its contribution to the pool of assets ultimately available for distribution towards the parties. Thus where the pool of assets available for distribution between the parties consists of say an investment portfolio or a block of land or a painting that has risen significantly in value as a result of market forces, it is appropriate to give recognition to its value at the time of hearing or the time it was realised rather than simply pay attention to its initial value at the time of commencement of cohabitation. But in so doing it is equally as important to give recognition to the myriad of other contributions that each of the parties has made during the course of their relationship.
In fairness to the trial Judge we note that while the father’s senior counsel at trial made submissions that the father’s contributions exceeded those of the mother, and the adjustment the mother was seeking (which he calculated to be about 40 per cent of the net assets) was excessive, no specific oral submissions were made to his Honour about the disparity in the parties’ initial contributions, or to the asserted greater post-separation contribution made by the father in providing the T property for the mother’s exclusive occupation including payment of the substantial mortgage secured over the R property.
However the outline of case document filed by the father made reference, albeit in general terms, to the father’s initial contribution of the T property and his professional practice as well as a motor vehicle and furnishings. Further although not specific to the post-separation period the father submitted, at paragraph 3.6 that “[t]he father made a home available for [the child], and ipso facto, for the Mother. She has not paid rent”. In these circumstances we are satisfied that the post-separation contribution by the father was raised before the trial Judge and the claim to the contrary cannot be maintained.
We accept however that given the weight the father’s senior counsel placed on both initial and post-separation contributions before us, it is regrettable they were not specifically raised before the trial Judge in oral submissions.
The mother’s counsel at trial, while placing emphasis on the fact that the parties had lived in a de facto relationship, conceded the relationship was a short one, and that the father made the major financial contributions (transcript, 12 March 2009, p 144).
Before us there was no challenge to the pool of assets as found by the trial Judge. However, as we will discuss later in these reasons, both parties conceded that the mother’s investment with Netwealth had been accidently omitted from the schedule of assets and liabilities provided to the trial Judge.
At the commencement of cohabitation the mother owned an encumbered property in Melbourne in which she had little equity. Her evidence about her initial contributions was scant, as was that of the father. He adduced no corroborative evidence about the purchase price of the T property or any valuation of its worth at the commencement of cohabitation. Although he deposed he was a self employed professional, no retrospective valuation of his professional practice was adduced. However there was no dispute that other than contributions essentially of a non-financial nature, save and except the provision of a dishwasher, fly screens, limited painting and installation of a steel fence between the back and front garden, and to maintenance such as payment of plumbing bills for drain blockages and the like, the mother made no direct financial contributions to the T property. She made no financial contributions to the father’s professional practice which at the date of the hearing was valued according to the father at $264,000.00 and according to the mother at $282,077.00.
The T property and the professional practice were the two most substantial assets of the parties at the date of trial. It must be remembered that not only did the father introduce these assets into the relationship, the T property provided the parties’ and the child’s home during their relationship, and it was from the father’s professional practice that he derived the income which provided support for the mother and child during the relationship. The practice enabled the father to provide a car for the mother and to make contributions to her superannuation fund.
Notwithstanding the very unsatisfactory evidence before his Honour, and the lack of direct submissions as to how he should treat the disparity in the parties’ initial contributions, we are satisfied that those contributions could not have been given appropriate weight given his Honour’s overall contribution finding of 75 per cent by the father and 25 per cent by the mother. Nor do we think his Honour gave sufficient weight to the far greater financial contributions made by the father during cohabitation, albeit those contributions were offset substantially by the mother’s role in caring for the child and the welfare of the family.
While we accept post-separation the mother continued to make a contribution as the primary caregiver of the child and the father had arrears of child support, the father too provided regular care for the child including care each morning before school when the mother resumed full-time work, as well as payment of the child’s school fees and other expenses.
Whilst we recognise the mother made an important and valuable contribution in her role as the child’s primary caregiver, and to the welfare of the family during the relationship, and are conscious of the width of discretion exercised by the trial Judge, we are nonetheless satisfied that a 25 per cent contribution based assessment or $278,000.00 (as rounded) was outside the reasonable ambit of discretion and constitutes appealable error.
The section 19(2) challenge
Having assessed the parties’ respective contribution findings at 75 per cent by the father and 25 per cent by the mother, the trial Judge made a further adjustment in the mother’s favour of 10 per cent or $111,202.00.
It is necessary before we discuss this challenge that we refer to the fact that under the DR Act the trial Judge did not have jurisdiction to make a superannuation splitting order.
It was not in dispute before the trial Judge that the parties’ superannuation interests were in accumulation funds. His Honour was not asked to treat the parties’ respective superannuation interests as property, rather they were to be taken into account by him under s 19(2) as a financial resource. The value of the father’s superannuation interest at trial was $192,998.00 and the mother’s superannuation interest was valued at $72,188.00. Neither party adduced admissible corroborative evidence as to the value of their respective superannuation entitlements at the commencement of cohabitation, or how much each contributed post-separation.
In his financial questionnaire, which was sworn by the father to be true, he deposed that the value of his superannuation as at June 1999 was $43,948.00. The mother’s sworn financial questionnaire disclosed no interest in superannuation at the commencement of the relationship.
The grounds challenging the s 19(2) adjustment made by the trial Judge were directed to an asserted error by his Honour in his consideration of the parties’ respective earning capacities on the basis that if the father’s child support liability (or payments in kind for the child) were taken into account there was not a significant disparity in earning capacity. Otherwise a general challenge was raised that the adjustment, particularly in tandem with the contribution assessment, was outside the reasonable ambit of discretion and clearly wrong.
The trial Judge’s reasons in respect of s 19(2)
His Honour commenced his discussion of this section at paragraph 78 of his reasons and explained that the section “is very similar in form to s 75(2)” of the Act.
In dealing with the question of the income, property and financial resources of each party, his Honour found there was a difference in earning capacity. He rejected the submissions of senior counsel for the father of near equivalence in the parties’ respective earning capacities, finding that the difference of approximately $30,000.00 represented one-third of the mother’s income.
His Honour then went on to note that the mother would continue to have a larger share of the care of the child.
The third matter considered by the trial Judge was the difference in the parties’ superannuation entitlements. Having explained that the parents did not agree they should opt into the new de facto property regime provisions under the Act, which would have enabled their superannuation interests to have been split, his Honour noted the difference between the funds represented approximately 11 per cent of the total pool as found by him.
His Honour then turned to deal, under the heading “Financial needs and obligations of each party”, with the father’s potential liability for tax. His Honour pointed out that he had not included the father’s asserted tax liability as a liability reducing the pool of assets to be divided. Although he found that the amount had not been precisely quantified in front of him he accepted that the father would have a liability. However, he went on to say:
It is not necessary for me to make a determination about that in this matter. It was open to the father (particularly as this was a matter identified by me in an earlier order made in August 2008) to seek to reach agreement with the mother about his tax liabilities. His failure to do this even up to the day of the hearing has left a situation where I am being asked to make determinations based on calculations without evidence. I am not prepared to assume in circumstances where the father might reasonably claim a level of expertise that I should make determinations … without any qualification.
The trial Judge also considered the father’s assertion of a liability to one of his employees he asserted he would incur in the event he sold his business. Under the heading “Proposed sale of the father’s [professional practice]” his Honour concluded, notwithstanding the father regarded it as a moral requirement he make the payment to the employee of his professional practice, that the terms of the payment and the timing were matters “beyond the evidence at this point”. Ultimately his Honour concluded it was a factor but not a strong factor that he should take into account under s 19(2).
The trial Judge then turned to deal, under the heading “Loan between the father and his brother”, with the father’s assertion of money owed to his brother. Having discussed the evidence about this loan his Honour said:
… In such circumstances, although it represents a potential liability (possibly) for the father it is a factor which does not weigh heavily in adjustments so far as I am concerned under s 19(2).
We note that no challenge is made to his Honour’s reasoning in respect of that conclusion.
His Honour set out his conclusions on s 19(2), at paragraph 84 of his reasons, saying:
Overall, I believe that the adjustments under this s 19(2) favour the mother and do so to the extent that the overall division of property between the parties should be on the basis of 65 per cent to the father and 35 per cent to the mother.
His Honour then considered the overall effect of his orders at paragraph 86 as follows:
This means that the mother should receive (if the values hold (in cash terms)) about $389,209.00 which I round up to $390.000.00. The father would receive about $722,817.00 which after taking account of his [professional practice] ($282,077.00) would leave him with about $440,740.00. I am satisfied that such a result in all the circumstances seems to me to be just and equitable.
Discussion
Before the trial Judge, the father asserted he had a tax liability for the year ended 30 June 2006/2007 of $30,263.30 and for the following year 2007/2008 of $24,026.60. His Honour correctly, in our view, gave such weight to that factor as he could, given the lack of accurate, up-to-date evidence before him.
As a result of the trial Judge’s orders (as amended by consent) the child lives with the mother and spends substantial and significant time with the father. We have already noted that although the parties had a very child focussed arrangement in place at the date of the hearing, there was no error by the trial Judge in not entrenching that arrangement into orders when the mother’s future accommodation was unknown. We accept, in these circumstances, the trial Judge was correct to take into account that the mother would have the ongoing primary care of the child.
The mother’s most recent financial statement before the trial Judge disclosed her income to be $1,775.00 per week and that the father’s financial statement disclosed his earnings to be $2,595.00 per week. The father disclosed expenditure for the child of $224.00 per week.
Having regard to the matters his Honour took into account we are not satisfied that it can be said the adjustment made under s 19(2) was outside the reasonable ambit of discretion, although we think it at the upper end of the range in the circumstances of this case.
Re-determination
At the conclusion of the hearing before us both parties sought if we found appealable error that we should re-determine the matter on the list of assets and liabilities as found by the trial Judge with the addition of the mother’s interest in the Netwealth investment.
The father sought for the purposes of the re-exercise that we should admit his further evidence being an affidavit affirmed by him on 23 November 2009.
The mother opposed the application to adduce further evidence, although she conceded that an error had occurred in the accidental omission of her investment from the list of assets and liabilities provided to the trial Judge. She did not seek to otherwise put any updating evidence before us.
The parts of the father’s affidavit relevant to the re-determination as to the arrangements for the child which had pertained up to the hearing of the appeal ultimately were not in dispute. At paragraph 4 of his affidavit, the father asserted, and provided corroborative evidence by way of annexures, that he had solely paid mortgage payments in respect of the R property since separation and continuing since the making of the orders on 25 March 2009. The father deposed, at paragraph 4 of his affidavit:
… Between 25 March 2009 until 2 November 2009 I have paid $28,500 by way of repayments on the loans secured by mortgage over [the R property]. I usually pay the sum of $4,000 into the Commonwealth Bank …. The sum $2,979.00 is automatically deducted from the … account and paid toward the Commonwealth Bank home loan repayment. …
The father asserted he had also paid general rates to the ACT Revenue Office in respect of both the R and T properties. There was no challenge to this evidence or the evidence in respect of the mortgage payments, and we propose to admit the evidence
At paragraph 6 of his affidavit, the father deposed:
In accordance with Order No.9 of the Property Orders made on 25 March 2009 the [T property] was listed for sale by auction. The auction was conducted in May this year. The property was passed in at auction at a highest bid of $745,500 and then listed for sale by private treaty. Subsequently the agent advised that a buyer had offered to purchase the property at $800,000. There were also a small number of lower offers made for the purchase of the property preceding the maximum offer being made. It is now my proposal that I retain the [T property] and make a cash payment to the respondent on the basis that the agreed value of the property is $800,000. This was in fact the agreed value of the property as contained in the Agreed Assets and Liabilities Table adopted by Deputy Chief Justice Faulks on page 21 of the Appeal Book.
Although the mother has not adduced any evidence disputing the facts asserted by the father in his affidavit in support of his application to adduce further evidence we have decided it would be unsafe and potentially unfair to rely on the father’s material in respect of the attempted sale of the T property.
Our principal reason for rejecting this evidence is that the father’s affidavit was affirmed on 23 November 2009. In the affidavit the father referred to the auction of the T property having been conducted in May 2009. We are simply unable on the evidence before us to be satisfied that the property would not if now sold by auction realise more than $800,000.00. Accordingly the further evidence application, except the agreed evidence about the mother’s Netwealth investment and the payment of expenses associated with the R property, will be dismissed. There is of course nothing to prevent the parties reaching their own agreement regarding a purchase by the father of the mother’s interest at a price agreed between them
It was agreed if we re-determined the matter we could rely on the assets and liabilities as found by the trial Judge together with the addition of the mother’s Netwealth investment of $22,954.46. The assets, liabilities and financial resources of the parties are:
ASSETS T property H 800,000.00 R property H 595,000.00 Professional practice of the father H 282,077.00 Household contents H 5,000.00 Netwealth investment W 22,954.46 Total Assets 1,705,031.46 LIABILITIES Mortgage H 567,790.00 Unpaid rates H 2,260.45 Total Liabilities 570,050.45 TOTAL ASSETS AND LIABILITIES 1,134,981.01
There is no dispute that the father introduced the T property, which was unencumbered. That property was valued at trial at $800,000.00. Additionally the father introduced his interest in his professional practice. That practice at trial was found by the trial Judge to have a value of $282,077.00. Those two assets represent almost 100 per cent of the assets available for distribution between the parties. While recognising that the father’s professional practice was subject to borrowings at the commencement of cohabitation, we are satisfied a very substantial weighting should be made in the father’s favour to reflect these initial contributions. The T property provided a home for the parties and the child during their relatively short cohabitation. It remained the largest significant asset at the date of hearing. The father’s professional practice enabled him to maintain the family, make financial contributions to the mother and to provide her with a car and at least part of her superannuation entitlement.
We accept that the mother’s contribution throughout the parties’ cohabitation was principally that of primary caregiver of the child, as well as homemaking duties. That role should be recognised in a substantial and not token way. The mother also made some contribution to the maintenance and upkeep of the T property.
Post-separation both parties made a contribution to the care of the child. We accept the mother’s role in that regard was greater than that of the father. Post-separation the mother had the benefit of the occupation of the T property and the father made all payments in respect of the mortgage and other outgoings in respect of the R property.
There was no evidence before us which would enable us to quantify just how much each contributed to their superannuation entitlements post-separation.
We are satisfied that the father’s contributions post-separation outweighed those of the mother. Having regard particularly to the father’s significant initial and post-separation contributions, we would assess the father’s overall contributions to be 82.5 per cent or $936,359.33 and the mother’s contributions to be 17.5 per cent or $198,621.68.
In considering the relevant matters under s 19(2) of the DR Act we accept that the father’s property and financial resources ($936,359.33 + superannuation $192,998 = $1,129,357.33) significantly outstrip those of the mother ($198,621.68 + superannuation $72,188.00 = $270,809.68). This factor requires some adjustment in the mother’s favour.
We are satisfied that both parties have professional qualifications and are engaged in full-time work. We are not satisfied any substantial adjustment is warranted under s 19(2)(b).
In considering s 19(2) we were particularly referred to the Full Court’s decision in Hallinan v Witynski. We have also had regard to the decision of Crispin J in Crellin v Robertson at paragraph 28 of his reasons where, having previously referred to a number of decisions under the relevant New South Wales legislation, his Honour said:
It does appear that the preponderance of authority in New South Wales favours the view that post-separation contributions to the welfare of a child may be taken into account in an application under the Property (Relationships) Act 1984 (NSW) but, whatever the position may be in that state, I have no doubt that such contributions could be considered in the exercise of the more broad discretion provided by s 15 of the ACT enactment.
As presently advised we consider that, although this section is not identical with s 75(2)(c) of the Act that we should have regard to the fact that both parties have an obligation to support the child (under the provisions of the Child Support (Assessment) Act 1989 (Cth)) and have obligations under the parenting orders made by the trial Judge as varied by us by consent. The mother’s obligations under the parenting orders involve her in greater periods of time in caring for the child. If not taken into account under s 19(2)(c) and (d) we would have regard to this fact under s 15(1)(e). We give some weight to this factor in the mother’s favour.
We note the father did not seek to adduce any updating evidence in respect of his tax liabilities. Like the trial Judge we have regard to the fact that the father has an outstanding tax liability, but note this was in respect of income earned post-separation, which the father has substantially retained for his own benefit. We do not think in these circumstances any significant adjustment in the father’s favour is warranted.
We have regard to the fact that under s 15 of the DR Act we are unable to make a splitting order in respect of the parties’ superannuation interests. Both parties will, in those circumstances, retain their existing superannuation entitlements. However the mother is some five years younger than the father and will have the opportunity to contribute over a longer period to her superannuation than the father. We have already noted that the father’s superannuation was not all acquired during the course of the parties’ cohabitation and he had an existing superannuation entitlement at the commencement of cohabitation of almost $44,000.00. We do not think any significant adjustment in the mother’s favour is required by reason of the disparity in the parties’ superannuation entitlements.
We take into account under s 19(2)(f) that the father has and will continue to have obligations to pay child support for the child by way of periodic and/or periodic and in kind payments.
Balancing each of these matters we give most significant weight to s 19(2)(a) and (c) and find a further adjustment should be made in the mother’s favour of 10 per cent or $113,498.10.
The parties’ respective entitlements will be 72.5 per cent or $822,861.23 to the father and 27.5 per cent or $312,119.78 to the mother.
The father will retain:
FATHER T property 800,000.00 R property 595,000.00 Professional practice of the father 282,077.00 Household contents 5,000.00 Total Assets 1,682,077.00 LIABILITIES Mortgage 567,790.00 Unpaid rates 2,260.45 Total Liabilities 570,050.45 TOTAL ASSETS AND LIABILITIES 1,112,026.55 Adjustment by Father 289,165.32 Father’s entitlement 822,861.23
Additionally he will retain his superannuation entitlement of $192,998.00.
The mother will retain:
MOTHER Netwealth investment 22,954.46 Total Assets 22,954.46 LIABILITIES Total Liabilities 0.00 TOTAL ASSETS AND LIABILITIES 22,954.46 Adjustment by Father 289,165.32 Mother’s entitlement 312,119.78
The mother will additionally retain her superannuation entitlement of $72,188.00.
We are satisfied that this represents a just and equitable adjustment of the parties’ property interests under the provisions of the DR Act.
Costs
At the conclusion of hearing the appeal we sought submissions from each party’s senior counsel about costs.As we noted earlier in these reasons, it was agreed that the appeal against the parenting orders was allowed in part, in circumstances where the mother’s concession was not to sound in costs. We were aware there are likely to have been offers of settlement made in respect of the property proceedings. In those circumstances, we propose to afford the parties the opportunity to make submissions in writing in respect of costs.
I certify that the preceding one hundred and twenty-four (124) paragraphs are. a true copy of the reasons for judgment of the Honourable Full Court delivered on 20 August 2010.
Associate:
Date: 20 August 2010
Annexure “A”
Warnold & Bleauchamp (EA 44 of 2009)
Amended Grounds of Appeal
(amended as proposed in the Summary of Argument filed 12 November 2009)
That the learned trial Judge fell into error by making parenting orders defining the times that the child [H] shall spend with the father, that are against the evidence and the weight of the evidence.
That the learned trail Judge fell into error by abolishing for the future the
frequent and regular amount of time that the child has been spending with the father each work-day morning between the time the mother has to depart for her work and the start of school, which mornings were part of the family consultant’s recommendations in October 2007, and which time were clearly part of [H’s] wishes as recorded by the consultant in October 2008.
That the learned trial Judge fell into error by abolishing for the future the
overnight time the child has been spending with his father on the Thursday of the “off week” which abolition was clearly contrary to [H’s] wishes as recorded in October 2008, and contrary to the proposal by the mother.
That the learned trial Judge fell into error by not appreciating that the overnight on Thursdays of the “off week” were part of the family consultant’s recommendations in October 2007.
That the learned trial Judge fell into error by making orders that,
notwithstanding the very frequent times that [H] was used to seeing each of his parents, and notwithstanding [H’s] recorded wishes as recently as October 2008, by imposing a long period of 11 nights a fortnight when [H] will not spend time with his father.
That the learned trial Judge fell into error by failing to give any or any
adequate reasons for -
(a) abolishing the times [H] has been spending on week-day mornings and for abolishing the overnight times on Thursdays of the “off-week”;
8..That the learned trial Judge fell into error by failing to maintain at least the frequency and amounts of time [H] spent with his father and by failing to increase the alternate weekends to start at least on the alternate Thursdays after school till the start of school on the following Monday mornings.
8A.That the learned trial Judge fell into error by failing to make an order that would ensure that [H] has the benefit of both of his parents having a meaningful involvement in his life to the maximum extent consistent with his best interests.
8B.That having formed the view that the arrangement that his Honour had formulated in para 39 was “superior to either of the plans devised by the parties” the learned trial Judge fell into error by not making such an order.
8C. In order to decline to make an order reflecting a superior arrangement, the learned trial Judge fell into error by allowing himself to be excessively influenced by the fact that neither party had intuitively formed a similar view.
8D. In order to decline to make an order reflecting a superior arrangement, the learned trial Judge fell into error by not giving the parties an opportunity to be heard on whether they would still want his Honour to depart from his view of what constituted a superior arrangement.
That the learned trial Judge fell into error in his assessment that the mother
had made contributions of 25% over such a short relationship with such predominant financial contributions by the father, in that such an assessment was outside the reasonable ambit of judicial discretion.
9A. That the learned trial judge failed to place any or any sufficient weight on the contribution that was and is continuing to be made by the Appellant of accommodation for the Respondent and their child for over 4 years since the physical separation in mid-2005.
That the learned trial Judge fell into further error by making further adjustment of another 10% of about 1.1M which adjustment is beyond the reasonable ambit of judicial discretion, on account of income disparity and superannuation disparity and after taking into account that fact that certain liabilities will have to be paid.
That the learned trial Judge fell into error by not taking into account the fact that the father will have to pay a child support obligation, whether direct or in specie, thereby reducing the appearance of the “income disparity” between the parties.
Such further or other grounds of appeal as the father may be advised to plead upon receipt of transcript and his file from his former solicitors, subject to leave being granted in the event leave may be necessary.
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