Waterfield and Callander
[2012] FMCAfam 568
•5 July 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| WATERFIELD & CALLANDER | [2012] FMCAfam 568 |
| FAMILY LAW – Property distribution – alleged forgery or dishonest business transactions [alleged forging of other party’s signature] by one party but with little or no personal gain – gifts of jewellery (conditional or not?) – relationship of modest length – parties of senior years – evidentiary doctrine of ‘spoliation of evidence’ considered – potential conflict of judicial authorities between Supreme Court of New South Wales and Federal Court of Australia. |
| Family Law Act 1975, ss.75(2), 75(2)(o), 117(1), 117(2), 117(2A) |
| Allen v Tobias (1958) 98 CLR 367 J.D. Heydon, Cross on Evidence (Eighth Australian Edition) (Sydney: LexisNexis Butterworths, 2010) |
| Applicant: | MS WATERFIELD |
| Respondent: | MR CALLANDER |
| File Number: | CAC 1780 of 2010 |
| Judgment of: | Neville FM |
| Hearing dates: | 25 & 26 October 2011 and 9 & 10 March 2012 |
| Date of Last Submission: | 11 April 2012 |
| Delivered at: | Canberra |
| Delivered on: | 5 July 2012 |
REPRESENTATION
| Counsel for the Applicant: | Mr N Macpherson |
| Solicitors for the Applicant: | Dobinson Davey Clifford Simpson |
| Counsel for the Respondent: | Mr J Millar |
| Solicitors for the Respondent: | Watts McCray Lawyers |
ORDERS
The Husband pay to the Wife the sum of $105,000.00. In the absence of agreement, this amount is to be paid within 45 days of the date of these Orders.
Except as otherwise provided for in these Orders, the Husband be solely entitled to the exclusion of the Wife, to all property in his name or possession at the date of these Orders.
Except as otherwise provided for in these Orders, the Wife be solely entitled to the exclusion of the Husband, to all property (including superannuation) in her name or possession at the date of these Orders.
Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders.
Each party be at liberty to file and serve submissions in relation to costs (maximum 2 pages) within 7 days. In the absence of receiving written submissions an Order will be made pursuant to s.117(1) that each party bear their own costs.
IT IS NOTED that publication of this judgment under the pseudonym Waterfield & Callander is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT CANBERRA |
CAC 1780 of 2010
| MS WATERFIELD |
Applicant
And
| MR CALLANDER |
Respondent
REASONS FOR JUDGMENT
Introduction
For ease of reference, these reasons proceed according to the following index:
Introduction [1] – [8]
Nature of the Contest
Commencement of Relationship [9] – [16]
End of Relationship [17] – [23]
Looking for Contests? [24] – [30]
(omitted) Diamond Ring [31] – [41]
Orders Sought [42] – [45]
Evidence
Issues of Disclosure
Mr Callander [48] – [57]
Ms Waterfield [58] – [80]
Issues of Credibility [81] – [82]
Allegations of Forgery [83] – [95]
Claims Regarding Dementia [96] – [104]
Spoliation of Evidence [105] – [128]
Contributions [129] – [140]
Section 75(2) Factors [141] – [147]
Just & Equitable Order [148] – [150]
Separation between couples who have “pledged their troth” with a view to a life-long relationship is always a cause of deep regret – and much else besides. When separation occurs in a relationship that involves persons of senior age and significant maturity, and who have known the bitterness and pangs of separation and or death of a previous spouse, I would suggest, adds an extra, almost elemental, level of tragedy.
Very regrettably, such is the case that has enveloped the parties in the current, long-running property proceedings.
The Applicant Wife is aged just on 62 years and had been in three marriages prior to her marriage to Mr Callander in (omitted) 2004, her first Husband dying in approximately 1984. She left a reasonably well-paying, full-time job as a (occupation omitted) at the (omitted) Hospital in (omitted) to join Mr Callander on his long-held property near (omitted) on which he raises stock, both (omitted) and (omitted). Mr Callander contends that Ms Waterfield intended to retire in any event. Since separation she has returned to her professional work and earns an average weekly income now of approximately $607.
In August 2004 Ms Waterfield sold her property at Property W, which was part owned with her son, and received net proceeds of $182,441.98.[1] In May 2006, she received a superannuation payout of $154,681.67.[2] She said that with Mr Callander’s agreement she invested the balance of these funds (subject to some payments made from them for which she contends and Mr Callander disputes) into a self-managed superannuation fund.[3] She also had a car of modest value (about $7000) at the commencement of the marriage.
[1] Ms Waterfield’s trial affidavit filed 25th July 2011, par.40. Unless otherwise required, this affidavit will simply be referred to in these reasons as Ms Waterfield’s “trial affidavit.”
[2] Ms Waterfield’s trial affidavit, par.41.
[3] See the same trial affidavit, pars.42-43. In her original affidavit filed in support of her Initiating Application on 9th November 2010, Ms Waterfield confirmed that her self-managed super fund comprised a property at Property T ((omitted) is a suburb of (omitted)) and a share portfolio. See par.21 of that affidavit. At par.24 of that same affidavit, Ms Waterfield swore that the share portfolio was estimated to be worth $113,000, and the Property T property had equity of $200,000. There is no mortgage over that property. Ms Waterfield’s original Financial Statement, filed 9th November 2010, advised that her superannuation fund was/is styled “(omitted) Investments Super Fund” and that its value was $310,000. A valuation of the Property T property became Exhibit U; a statement of Shares from (omitted) became Exhibit W; a Superannuation Fund Compilation Report of Ms Waterfield (dated 21st February 2011) became Exhibit Y.
The Respondent Husband is aged 71. His first wife died in 1991 after a long marriage. As noted below, including funds from an investment property in (omitted) (now recently sold) his weekly income is (or was) approximately $772.
Both parties have adult children from their previous relationships.
A few brief cameos give some insight into the significantly unfortunate contest that has proved impossible to resolve without litigation – and this is so notwithstanding that the difference between the parties, in percentage terms, of the final orders sought is somewhere in the region of approximately, and only, 7% (on which more below).
The Nature of the Contest
The first cameo of the intractability, and something of the fateful nature, of the dispute relates to the duration of the relationship.
Commencement of the Relationship
Mr Callander contended in his trial affidavit that the relationship was of only 5 years duration, being from the date of the marriage (in (omitted) 2004) until what he says was the separation in late 2009. Prior to their marriage, and for the period since they met (he says in 2000; Ms Waterfield says the couple met in December 1999), Mr Callander says that they [merely or only] “courted.”[4] Mr Callander’s affidavit evidence was later qualified by his oral testimony (noted below) which was nowhere near as dogmatic about the duration of the relationship being 5 years.
[4] See, for example, Mr Callander’s affidavit, filed 21st July 2011, par.5. Unless otherwise required, this affidavit will be referred to as Mr Callander’s “trial affidavit.” In his written submissions for Mr Callander, learned Counsel contended (at [22]) that the couple “behaved in a way which displayed nothing more than two parties to a romantic “boyfriend/girlfriend” relationship.”
Ms Waterfield contends that the reality was rather different. She says that the relationship commenced in 2000 and that separation occurred in March 2010.[5] Ms Waterfield says that Mr Callander proposed to her during an overseas trip to England, (omitted) in 2002/2003.[6] For reasons detailed more fully later, in my view, the relationship began in earnest and with more dedication sometime earlier than suggested by Mr Callander, but not as early as Ms Waterfield indicates. For the purposes of these reasons, I will take the relationship to have begun in approximately 2002/2003.[7]
[5] Both sides agree that there was an interlude in their relationship, although Mr Callander says that that interruption was between 2001 and 2002, while Ms Waterfield says that it was approximately one year earlier until a ‘reconciliation’ or resumption of the relationship in about (omitted) 2001.
[6] Among other places, see par.26 of Ms Waterfield’s trial affidavit.
[7] Among many places, see Mr Callander’s agreement that he “pursued” Ms Waterfield to be his wife and to live with him at Property K some [unspecified] time prior to their marriage. Transcript 73 – 74 (8th March 2012) (hereafter such references will be “T followed by page number, and date, as necessary”). In the same place, in his cross-examination Mr Callander suggested that this ‘pursuit’ of Ms Waterfield regarding their living arrangements, given that they spent time in each other’s residence at least monthly, and having regard to the travel involved between (omitted) and (omitted), may have been in 2002. See also T 77 where Mr Callander confirmed that in their travels overseas together in approximately 2003, they “lived together as man and wife.” Respectfully, how can one claim a committed relationship did not start until 2004 but also give evidence, which I accept, that the parties lived as “man and wife” while on holidays? Or, to put it in the vernacular, and with no disrespect intended: one cannot have one’s cake and eat it too.
The wisdom that hindsight brings in matters of this kind can also tend to bring a level of distortion. On the evidence of both parties (and their respective supporting witnesses) – I do not say so critically – there were varying elements of distortion, forgetfulness (curious and genuine), and the unspoken elements of deep disappointment if not quiet grief at what had befallen the parties and their families.
Nonetheless, a relationship that began, like all others, in hope and joy had come to grief. And such are the follies and foibles of human life that the commencement of something joyous, promising hope, happiness, comfort and support, had now become a source of rancour and disagreement. Neither would yield regarding a commencement date of their relationship for the purposes of the litigation.
Human experience tells that a committed relationship does not commence on the exchange of marriage vows or promises. Thus, to hold exclusively to a commencement date of the relationship as the date of marriage, respectfully, denies the reality of the commitment evident between the parties at an earlier time.
The same human experience tells against the contention advanced by Ms Waterfield that the abiding commitment of the relationship that reached its fruition in marriage in (omitted) 2004 actually began in 2000. Indeed, her evidence tells against such a proposition. For example, in paragraph 81 (among other places) of her trial affidavit, she swears to a certain (and understandable) caution “before moving full-time to the farm.”[8]
[8] Respectfully, I was not overly assisted by the supporting evidence of Ms Waterfield’s long-time friend, Ms B, either in the material in her affidavit, filed on 22nd July 2011, or in her brief cross-examination, which was made all the more difficult because it was by telephone. Her evidence went to the questions of (a) the duration and nature of the relationship and (b) the contributions of Ms Waterfield. This is not to say that I disbelieve her in any respect, but simply that her evidence, in the larger evidentiary scheme, did not advance matters very much.
A similar contest played out in relation to the end of the relationship, which provides a second cameo of the nature and depth of the contest.
End of the Relationship
As already noted, in his trial affidavit Mr Callander said that the relationship ended when Ms Waterfield left the farm on 24th December 2009. She said that the relationship ended in March 2010. As I note below, the parties spoke in late December (and then again a number of times in early January 2010) with Mr Callander suggesting to Ms Waterfield that she come home to the farm where they could have a chat over a cup of tea.[9] In the course of that discussion Ms Waterfield confirmed to Mr Callander that she was leaving. She returned to the farm in March 2010 to collect her belongings. Mr Callander contends that she collected rather more than just her things.
[9] See T 108 (8th March 2012).
In his trial affidavit, at par.9, Mr Callander said (emphasis added):
“On 27 December 2009 I telephoned Ms Waterfield in Melbourne and said “When are you coming home?” or words to that effect. She replied “I’m not coming home Mr Callander.” I said “What do you mean by that?” and she repeated “I am not coming home.” I telephoned Ms Waterfield around six times in the following couple of weeks asking her things like “What is going on?” She eventually said to me “Mr Callander I am not coming back, we are separated” and I formed the view after Ms Waterfield said these words that the marriage was over.”
Yet in cross-examination, and contrary to his sworn position in his trial affidavit, Mr Callander agreed that (a) he did not regard the relationship as being over in December 2009, and (b) the end of the relationship occurred in March 2010.[10]
[10] See T 107 – 110.
For my part, while there are arguments for each of the positions advanced by the parties, and particularly in the light of Mr Callander’s evidence to which I have just referred (and emphasised), I take the end of the relationship as being no earlier than January 2010. Respectfully, while I accept her evidence that she thought that the marriage might be able to be revived (my term), I have some difficulty accepting Ms Waterfield’s contention, and even Mr Callander’s agreement therewith in cross-examination, that the marriage ended in March 2010. It may have been possible, but the evidence suggests that the prospects of reconciliation were remote. Her actions in December, albeit done, as she said out of a degree of anger for Mr Callander’s refusal (although understandable) to go with her to Melbourne for Christmas,[11] tell somewhat against that, as does Mr Callander’s evidence, which tends strongly to his acceptance of the end of the relationship sometime in January 2010.
[11] See Ms Waterfield’s cross-examination at T 67 (25th October 2011).
And, all that being said, whether the relationship ended in December 2009, January 2010, or March 2010, respectfully, in the result, little turns on it ending in any of the months mentioned. But such discord over literally a few months highlights again the fateful depth of the dispute.
In any event, contest there was, on both sides, regarding the duration of the relationship. Respectfully, a more conciliatory and realistic approach should have been taken on both sides in relation to this and other matters. True it is that the Court rarely sees all of the background (and backroom) discourse between parties, their various teams, and especially as between the respective lawyers. The Court can only deal with what is presented to it. It is certainly the case that if this was a commercial matter, it would have been settled a very long time ago. Alas, as is often the case, family law litigation often results in parties needlessly litigating, and invariably at great personal and financial cost to all. For some, compromise can only go so far. Indeed, some see “principle” as worth the fight, and or ensuring that a particular stance is vindicated against the other party. But the reality is that such contests over “principle”, “vindication” and much else besides, regrettably come at a disproportionately high price. In such cases, only the lawyers win.
In the result, and in the light of what I have traversed here already, I take the duration of the relationship to be approximately 6½ - 7 years.
Relevant Detail or Looking for Grounds of Contest?
A third ‘opening cameo’ to consider relates to order 1 in Mr Callander’s ‘orders sought.’
Respectfully, Mr Callander may properly be described as a classic, hard-working, ‘no-frills’ (omitted). He has worked the land essentially all his life. He lives on a large property known as Property K, which is near (omitted) in New South Wales. In addition to the Property K property, in approximately 2001, Mr Callander purchased a property in Property N. It has recently been sold for $373,000.
In 2006, pursuant to a family inheritance in relation to mineral rights that attach to land owned by (omitted) in Property M, Mr Callander received a dividend payment of $74,767. He avers that he does not expect to receive another payment any time soon.[12] Curiously or otherwise, these mineral rights were not the subject of any submission and do not appear in the proposed table of assets or balance sheet.
[12] See Mr Callander’s trial affidavit, par.26. Mr Callander also confirmed in his July 2011 trial affidavit, at par.13, that from his (omitted) Bank line of credit facility he drew $100,000 and gave this sum to his daughter, Ms Callander, to assist her in the purchase of her first home. That gift is included in the agreed liability to (omitted) Bank of $340,710.
Subject to further evidence noted later, there was no dispute that Mr Callander earns an average weekly income of $772.00 as a (omitted).[13]
[13] Presumably this figure is likely to change following the recent sale of the investment property in Property N earlier referred to.
He struck me as a man of earnest and honest bearing, forthright and fair.[14] At times in the course of his cross-examination he gave ready and candid acknowledgment of the wide-range and selfless quality of the contributions that Ms Waterfield brought to the marriage, and indeed to his wider family. It seemed to me there was also, however, an element of a man who, although not spoken about openly, felt rather slighted by all that had happened, including being taken to Court by the woman he had once loved, courted, married and provided for. He mentioned this on a number of occasions in his November 2010 Affidavit.[15] The comments are slightly revised in his trial affidavit of July 2011 (par.20).
[14] Apart from the age difference between the parties, there also seemed little dispute that there are greater “health issues” for Mr Callander than there are for Ms Waterfield. Ms Waterfield swore in her original affidavit, filed 9th November 2010, par.31 that she had had a “cerebral vascular accident.” Otherwise there was little medical evidence before the Court in relation to Ms Waterfield. Mr Callander has some hearing difficulty that required hearing assistance throughout the trial, he attended Court with his arm in a sling, and he has had a heart event (or events) that have required surgery, circa 2004. See his November 2010 affidavit, par.15, and the affidavit of Dr E, filed 28th July 2011. Mr Callander confirmed that Ms Waterfield looked after him, post surgery for a heart bypass operation following a heart attack. See also pars.19 and 33 of his July 2011 trial affidavit.
[15] See, for example, pars.16 & 18. Thus: “During the marriage, I entirely financially supported Ms Waterfield. Ms Waterfield lived in my home with me and when she was home she undertook homemaking activities.” “Ms Waterfield had a comfortable life while she was living with me and she had everything she wanted.” Such remarks and views were not confined to Mr Callander. His daughter-in-law, Mrs Callander, described, in an obviously (and unfortunately) disparaging manner, Ms Waterfield’s life at Property K as being a “lady of leisure.” T 163. Respectfully, among other things, Mr Callander’s evidence would refute such a description, particularly if it was intended to convey a picture of a lady of indolence, luxury and disengaged from the lives and concerns of others. For example, Mr Callander said: “She wasn’t idle or lazy. I can assure you, she’s not lazy.” T 91 (8th March 2012).
His tastes in life, I suspect, were (and are) relatively simple and unadorned. And [perhaps, but not only] for understandable reasons of sentiment, he sought in his orders before the Court, the return of a wide range of things, such as (omitted) porcelain (even though it was without particularity as to both quantity and type), (omitted) pottery (again not particularised as to quantity or type), an antique (omitted) trinket box, and various other things. Mr Callander may, in fact, have a keen eye and particular delight in this porcelain and pottery. He did not swear or otherwise indicate that he did so. Rather, as I apprehend his request, most of these things were acquired by his deceased Wife. I do not know if either his daughter, Ms D, or either of his daughters-in-law, has any particular interest in them.
Among the items sought, however, are a ‘variety of (omitted) and (omitted) white ceramic platters.’ Again with no disrespect to anyone or anything, I ask (rhetorically of course) why would there need to be a contest over platters worth relatively little in the larger scheme of things, and which are readily procurable from any department store? Moreover, subject to later comments on evidence, Ms Waterfield’s evidence was to the effect that either she did not have the items listed, that she had not taken them, and or that she did not recall them being at the farm while she was in residence.[16] The evidence, again noted later, certainly confirmed that Mr Callander had no clear recollection of such items, or of them not being in the house, and that the list of said items – in relation to the absence of all items the blame was laid squarely at Ms Waterfield’s feet – was prepared by members of his family (also on which, more later).[17]
[16] Among other things, see Ms Waterfield’s trial affidavit, par.66. This paragraph might also be read as somewhat opaque and or a tad pregnant with what is not detailed. It reads, in part: “I do not have all the items referred to in Orders 1 a to n.” Clearly it does not specify what items she suggests that she does have in her possession. See also T 67 (25th October 2011).
[17] See Mr Callander’s affidavit, filed 17th December 2010, par.9 and his July 2011 trial affidavit, par.10. The list of items and values ascribed to them is in Mrs Callander’s affidavit, filed 21st July 2011, par.20 (a) – (m).
The (omitted) Diamond Ring & Emerald Earrings: Unconditional Gift?
A fourth example that, again rather balefully, typifies the nature and depth of the contest, and also referable to Mr Callander’s “order 1”, relates to Ms Waterfield’s diamond ring (and emerald earrings) given to her by Mr Callander.
Subject to what is said later, I simply observe that I have some difficulty seeing why Mr Callander would want these items returned, or on what legal basis he could ‘reclaim’ them, given that they were provided, as far as I apprehend, unconditionally to Ms Waterfield.[18] There is no suggestion, and never has been, that the gifts were conditional upon Ms Waterfield remaining married to Mr Callander, or on any other terms. Nor have I heard it said (and would be astonished if it were) that some member of Mr Callander’s family otherwise wanted the jewellery.
[18] See Mr Callander’s trial affidavit, par.24. Generally, it has long been the case that a gift is complete upon the item in question being “delivered” to the intended recipient of the gift. “Delivery” has been effected here, and quite some time ago. There is no suggestion, as I have indicated, that the gifts of jewellery were conditional on the marriage continuing, or that if it did not the gifts would be returned to Mr Callander. Generally, see Halsbury’s Laws of England, (Fourth Edition: Reissue, 1993) Vol.20, “Gifts.”
Both parties want to keep the ring and earrings. Ms Waterfield says they were gifts from Mr Callander. Indeed, in par.16 of her trial affidavit, she swears that the ring was in relation to their engagement, and the earrings a birthday gift.[19] And in her cross-examination, she detailed with quite some particularity how the ring was not only a diamond ring, but that the ring itself comprised gold from rings from her family, and with side diamonds from her Grandmother’s eternity ring. Wedding bands were made at the same time.[20] There was no challenge to this evidence.
[19] See also par.66 of her trial affidavit.
[20] See T 71.
Mr Callander wants the said jewellery returned. He simply says that they were gifts. They were purchased for significant sums: the replacement value of the ring was estimated to be $44,000, and for the earrings, $2750. Their current second-hand value is significantly less, and was said to be $12,000 and $800 respectively.[21] Mr Callander swore that he paid $20,000 for both items.[22]
[21] See the valuations before the Court, Exhibit A. I leave to one side the contests about the valuations. Mr Callander swore that he paid, for both items, $20,000. See his November 2010 affidavit, par.18. For a consideration of valuation and treatment of jewellery, see the discussion in the joint judgment of Kay & Holden JJ in Khademollah & Khademollah (2000) FLC ¶93-050 at [93] – [95], [110] – [113] & [178]; Finn J concurring, at [33].
[22] See his trial affidavit, par.24. It is not said critically, but the detail in relation to the purchases and the surrounding circumstances thereof is, to say the least, rather spare. Thus: “I purchased a two carat (omitted) diamond ring and emerald earrings. The total purchase price for these items was $20,000.” After the trial concluded, in answer to some questions, his lawyers have confirmed that the ring was in relation to the couple’s engagement.
In this regard, and assuming that his income at the time of the engagement of the parties was similar to that which has now been agreed (approximately $772 per week, including the rental from the now sold property in Property N), one might ask rhetorically (and not critically) how someone on that income can afford a diamond ring (and earrings) for which he paid $20,000? Perhaps the very significant sums earned in stock sales (noted below) provided a convenient source of funds from time to time amidst the income and expenses in running Property K.
I make these comments in no disparaging way, especially since no such questions or issues were posed during the trial. Nonetheless, there is a certain interest piqued, and which might reasonably be expected, where there are (a) very significant income flows, (b) relatively modest taxable income, and (c) very significant expenditure on a particular item (or items), such as $20,000 on a diamond ring and emerald earrings.
Mr Callander also swears that Ms Waterfield had agreed, in a post-separation discussion, that the jewellery (meaning the diamond ring and earrings) would be returned to him ‘at settlement.’[23]
[23] See his trial affidavit at par.10.
Patently, the position of the parties in relation to these items of jewellery is diametrically opposed; nor can the respective accounts of the gifts be reconciled, except in relation to the ring, which is now agreed to have been purchased on the occasion of the couple’s engagement.
Although there is agreement in relation to the value of Ms Waterfield’s jewellery, it seems to me that the only way in which this particular aspect of the dispute – i.e. the return (or otherwise) of the diamond ring and emerald earrings - can be resolved is to make some specific provision in the distribution of the asset pool for this particular jewellery. I simply note again the lack of evidence of these gifts being in any way conditional. In my view, it is sufficient that there is an agreed figure for jewellery in the asset pool. Other than that, I do not see any basis (legal or moral) by which Mr Callander could require these gifts to be returned to him.
As I seek to show by these [somewhat] simple examples, the contest was earnest in every respect. In the course of the proceedings I repeated often my grave concern about the nature and depth of the dispute, the damage that could (and likely would) proceed from it, especially arising out of allegations of fraud or dishonest conduct against Ms Waterfield, and all of this involving older parties who should be able to get on with their lives in their senior years without such distress. But the fight went on, with neither side prepared to yield.
What follows is the resolution of this deeply regrettable, and in my view, to a significant degree, unnecessary personal battle. After outlining the orders sought by each party, and a consideration of the evidence, I proceed in the usual, four-step way.[24]
[24] See Hickey and Hickey and Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC ¶93-143 at p.78,386, and In the Marriage of Omacini (2005) 33 Fam LR 134 at p.147 [46].
Orders Sought
Orders sought by the Wife:
1. That the husband makes payment to the wife, by way of cash adjustment, such payment to reflect an overall division of assets as to 25% in favour of the wife.
2. That except as otherwise provided for in these Orders, the Husband be solely entitled to the exclusion of the wife, to all property in his name or possession at the date of these Orders.
3. That except as otherwise provided for in these orders, the wife be solely entitled to the exclusion of the husband, to all property (including superannuation) in her name or possession at the date of these orders.
4. Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders.
5. The Husband will pay for the Wife’s costs of and incidental to this application.
Orders sought by the Husband:
1. That the wife return to the husband the following items:
a. The (omitted) diamond ring and emerald earrings (with a jeweller’s certificate of authenticity)
b. Set of silver (omitted) in grey velvet case;
c. Silver milk jug, sugar bowl and a tea pot;
d. Four silver serving trays worth approximately;
e. Variety of (omitted) and (omitted) white ceramic platters;
f. The (omitted) porcelain;
g. Eight (omitted) silver napkin rings;
h. (omitted) pottery;
i. Antique square crystal decanter;
j. Antique (omitted) trinket box;
k. The Laptop;
l. The files from the hard drive on the computer.
m. Six round silver placemats; and
n. Antique silver salad server.
2. That each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the name or possession of such party at the date of these Orders;
3. Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders; and
4. That the Wife pay the Husband’s costs of, and incidental to, these proceedings.
As is clear from the above, both parties seek orders for costs against the other. In my view, given the scope of the dispute, the evidence, and the way in which the matter was conducted, I cannot see any order that is appropriate other than that each party should bear their own costs in accordance with s.117(1) of the Family Law Act1975 (“the Act”). Further, although both parties provided detailed written submissions at the conclusion of the trial, neither party made any submissions in relation to costs by reference to s.117(2) and/or s.117(2A) of the Act, or in any other respect. Having had that opportunity to make relevant submissions, and with “costs” not having been addressed, I see no reason why the statutory terms of s.117 should not apply. However, for more abundant caution, I will give the parties seven (7) days within which to make written submissions in relation to costs (limited to 2 pages), failing which the order I have indicated will be made.
For completeness, I note that there was originally an application by Ms Waterfield seeking spousal maintenance, but in the light of her employment that application is no longer pressed.[25]
[25] This now abandoned application also provided another ground of attack on Ms Waterfield’s credibility and the veracity of her evidence. Having regard to the plethora of other issues addressed at trial and in these reasons, and given that the application was not pressed, I do not propose to consider it further.
The Evidence
Most [property] cases have some degree or level of contest in relation to evidence, such as whether there has been proper or complete disclosure, the late provision of documents, or questions over hearsay, and also commonly, issues in relation to ‘add-backs.’ Such are the normal or usual warp and woof of litigation. This case was no exception.
I note the following specific matters of contest in relation to evidence. After the consideration of each of the specific matters that were addressed in the detailed written submissions I will then treat the further issue of the credibility of Ms Waterfield, which was prominently a feature of the trial and the submissions.
Evidence of Mr Callander & Disclosure
There are a number of matters to consider here.
It was submitted by Ms Waterfield that Mr Callander had not disclosed the sale of stock at Property K (including post-separation (omitted) farming and trading), nor its value. In his Financial Statement, at Item 59, Mr Callander simply stated that he had sold some livestock. He also stated that the value or proceeds were “not known” but that his “financial statements have detail.” Formally, that detail only came during the trial, although it was submitted by learned Counsel for Mr Callander that the relevant documents containing the information sought were earlier available for inspection. Those documents, being Mr Callander’s tax returns and financial statements for the years 2007 - 2011, became Exhibit P.
A more readily accessible source of the information sought is a hand-written note, which became Exhibit Z, and which was provided in the closing stages of the trial that summarised the information that would otherwise have been included in Item 59 in Mr Callander's Financial Statement. That information confirmed the following recent sales of livestock and their significant value:
2009:
56 (omitted) $50,101
8239 (omitted) $674,176
Total $724,277
2010:
113 (omitted) $116,423
4640 (omitted) $440,810
Total $557,233
2011:
71 (omitted) $102,230
3329 (omitted) $410,457
Total $512,687
Stated summarily, it was submitted by learned Counsel for Ms Waterfield that (a) these significant sums should have been disclosed by Mr Callander (and certainly at a time earlier than they were), (b) there was in fact no detail as to how these [significant] sums were dispersed, and (c) they should, in effect, be added back into the asset pool or that they should otherwise be considered as part of the asset pool.
Learned Counsel for Mr Callander submitted that not only were the relevant records available at an earlier time for inspection (and therefore there had been proper disclosure), but also it was the fact that the proceeds of stock sales are income to the farm business conducted on Property K. That income is then disbursed to meet the expenses of the business and to provide profit if there is one. Certainly, the Court was not taken to any relevant detail regarding the use of those funds from stock sales, save for the reference in submissions to the filed tax returns and the details able to be foraged from them. It would have been of assistance to provide particulars regarding how the funds were “dispersed.” I certainly agree with Counsel for Ms Waterfield that detail of the disposal of such large funds was required and that it was insufficient simply to state that it was ‘dispersed to meet the expenses of the business.’[26]
[26] In his oral evidence, Mr Callander confirmed that he knew how much he banked and how much he paid out from the sale of his stock, and that he kept these figures ‘in his head.’ See T 96 – 97 (8th March 2012). If more were needed (which it is not) this evidence might be taken to be yet further confirmation of how much Mr Callander despised (or even avoided) bookwork. For example, Mr Callander confirmed in his oral evidence that he “… never used to do the books.” T 97.
For my part, notwithstanding any misgivings regarding the disposal of the said sums, and it should be said quite substantial sums as noted earlier, on balance I accept the submissions on behalf of Mr Callander. That said, in addition to the detail of expenditure to which I have referred, it would have negated yet another area of contest that was needlessly engaged if his Financial Statement at Item 59 had been either completed and or if the summary that became Exhibit Z had been provided much earlier rather than at the end of the last day of the trial.
Although not formally a matter relating directly to matters of ‘disclosure’, it may be convenient here to deal with another contest, being the liabilities claimed by Mr Callander in relation to farm creditors. The amount so claimed is set out in his Financial Statement of July 2001 (Item 53), in an amount of $82,824.
In the course of the trial, a ‘call’ was made for supporting documents in relation to the liabilities/farm creditors claimed. The call was not answered. It was not explained why such documents were not available.
Notwithstanding that no documents were produced in answer to the call, having regard to the totality of the evidence, I accept Mr Callander’s evidence as sworn that the amount claimed are creditors of Property K. But again, it would have been helpful, and saved everyone another area of contest, if supporting documents had been produced to support the sum claimed, and that this had occurred early in the piece. It was a contest that could have been easily avoided – but contest there was.
A larger number of [non] “disclosure” issues were levelled at Ms Waterfield. I turn to those now. They lead into the over-arching issue of challenges to Ms Waterfield’s credibility.
Evidence of Ms Waterfield & Disclosure
The first matter to consider here concerns the valuation of Ms Waterfield’s superannuation interests.
For example, Ms Waterfield provided accounts in relation to her superannuation fund for the year ended 30th June 2010. They became Exhibit Y. A ‘call’ was made in relation to accounts for the next financial year. She is the only member of the fund, and otherwise controls it. There was no answer to the call for the documents sought. Nor was it explained why they were not available.
It was submitted on behalf of Mr Callander that, on the principles articulated in the old cases of Blatch v Archer and Armory v Delamirie, Ms Waterfield’s failure to provide the most recent documents in relation to her superannuation fund should lead to an adverse inference against her.[27] Perhaps somewhat surprisingly, no similar submission was made in relation to Mr Callander’s failure to produce documents in response to calls made to which I have earlier referred concerning farm creditors.
[27] Blatch v Archer (1774) 98 ER 969; Armory v Delamirie (1722) 93 ER 664. Lord Mansfield's dictum in Blatch v Archer, at ER p.970, states: "[i]t is certainly a maxim that all evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted.” Blatch v Archer has recently been considered, and at some length, in the prominent High Court decision in Australian Securities and Investments Commission v Hellicar (2012) 286 ALR 501; [2012] HCA 17. See especially the plurality judgment of French CJ, Gummow, Hayne, Crennan, Kiefel & Bell JJ, at [164] ff, and in the concurring in the result, but otherwise detailed, judgment of Heydon J at [250] ff. I note in particular that, at [259], Heydon J stated that “in truth the conditions for the application of the "principle in Blatch v Archer" on which they [the Respondent directors] relied were not different from those necessary to invoke the principle in Jones v Dunkel.” Jones v Dunkel (1959) 101 CLR 298. As a historical aside, it will be recalled that Armory v Delamirie, like this aspect of the current matter, also involved the value of jewellery; in that case a chimney sweep’s “boy” found a jewel and took it to a jeweller for valuation, whereupon the jeweller’s apprentice kept it. An action in trover was brought against the jeweller and issues raised about its value.
In the same submissions, learned Counsel for Mr Callander then set out, on the basis of documents tendered in his own case, and which became Exhibit W, and together with the valuation of the Property T property (Exhibit U), what he says are the correct and up to date figures for the superannuation fund. On the basis of this material, he submits that the value of that fund should be taken as $396,162.99. I accept this submission.
In relation to the Blatch v Archer submission, even if disposed to accept it, it is difficult to see what would flow from it in the light of the materials (and submissions made) by Mr Callander – other than perhaps it going to the larger issue of credit/credibility. The Court has accepted the submission made on his behalf. The Court has accepted the value of Ms Waterfield’s superannuation fund as submitted by Mr Callander. In my view, it is sufficient that the Court has the most accurate information and documents available. This has occurred.
Counsel goes further, however, and submits that because nothing has been produced by Ms Waterfield in relation to her fund the Court should infer that her interest is likely to be even higher than that which has been established. And as such, it is a factor to be taken into account pursuant to s.75(2)(o). Along with other matters, this may well properly be so, but would, in any event, on the basis of Blatch v Archer, and the High Court’s recent detailed discussion of that case in ASIC v Hellicar, be a matter of degree and discretion. Indeed, as the case law notes, and as summarised in Cross on Evidence,[28] the exercise of any such adverse inference remains discretionary. Thus, as Cross states, at [1215] (internal citations omitted, emphasis added):
… unexplained failure to give evidence, to call witnesses, or to tender documents or other evidence or produce material to an expert witness may (not must) in appropriate circumstances lead to an inference that the uncalled evidence or missing material would not have assisted that party’s case.
[28] J.D. Heydon, Cross on Evidence (Eighth Australian Edition) (Sydney: LexisNexis Butterworths, 2010) at [1215].
Further, Cross also makes the points that for the operation of a possible adverse inference, inter alia, (a) no inference can be drawn unless evidence is given of facts requiring an answer, and (b) the rule (in Jones v Dunkel, and by inference, in Blatch v Archer) does not operate to require a party to give merely cumulative evidence.
It may be argued here (although formally it was not) that, because Ms Waterfield provided evidence (including documents) of value of her superannuation for 2010, documents for the succeeding year would be little more than cumulative. On such an argument, accounts for the financial year 2011 would be simply cumulative.
At the very least, this is not a case where there is no evidence provided by Ms Waterfield; rather, it is a case of not the most recent (or complete) evidence. That gap has been remedied, as I have already noted, by documents provided by Mr Callander. All of that said, it was unfortunate that updated accounts were not provided by Ms Waterfield. It was, as with many others, a further instance where a dispute was fomented which need not have been.
Another area in which it was said that there had been incomplete (or inaccurate) disclosure by Ms Waterfield related to her failure to disclose her share portfolio, which matters were put before the Court in Exhibit D. Further, it was said that her claim for spousal maintenance, which has since been withdrawn, was predicated upon facts that she knew to be either incomplete or inaccurate.[29]
[29] See the Husband’s Submissions, pars.28 ff.
For my part, while I considered Ms Waterfield’s evidence to be inconsistent in a number of respects, by which I mean that, in my view, she was a credible witness with detailed recollection of many things but seemingly little or poor recollection of others, I did not, and do not, take her evidence to be untruthful, still less dishonest. That said, how and why some basic things were explained somewhat inconsistently between earlier and later affidavits, such as when she resumed employment after the end of the relationship with Mr Callander, was not illuminated. It did not help her case. Indeed, in a number of respects, Ms Waterfield’s evidence was not as fulsome as might have been expected – or hoped.
There was also a contest about the cash at bank for Ms Waterfield. The evidence from her Financial Statement (Items 37 & 43), filed 25th July 2011, is that the amount held is $16,972. No evidence was provided to challenge this figure, which must be accepted in such circumstances. Why there needed to be another dispute, again in the face of clear, straightforward evidence, was not explained.
Two other matters need to be addressed directly.
First, there was a dispute in relation to whether there should be an amount ‘added back’ to the asset pool in relation to Ms Waterfield’s purchase of a motor vehicle. The basic facts surrounding the purchase are not much in issue. What is in issue is whether, and if so, in what amount, should there be an add-back in relation to this car.
In Omacini, the Full Court (Holden, Warnick & Le Poer Trench JJ), at [30], detailed the three general categories where it is appropriate notionally to add back to the pool assets that no longer exist.[30] Those categories are (a) where parties have expended funds on legal fees; (b) where there has been a premature distribution of matrimonial assets; and (c) ‘course of conduct’ matters of the kind set out by Baker J in Kowaliw.[31]
[30] See In the Marriage of Omacini (2005) 33 Fam LR 134.
[31] In the Marriage of Kowaliw (1981) FLC ¶91-092 at p.76,644. The relevant extract from Kowaliw is set out in Omacini also at [30].
In 2009, Ms Waterfield purchased a (omitted) motor vehicle for $38,000. She used $33,000 of her own funds, and the balance of $5000 was paid via her credit card. That credit card debt was ultimately paid for out of funds from Mr Callander’s cheque account. At separation, Ms Waterfield kept that vehicle, which was later sold for $21,000. She used $5000 of those proceeds of sale to purchase another car (a Toyota (omitted)), and used the balance, she said, “to meet her legal and personal expenses.”[32]
[32] See Ms Waterfield’s trial affidavit, par.13.
In all the circumstances, I accept the submissions made on behalf of Mr Callander. First, as at the time of separation, Ms Waterfield had in her possession a car that was later sold for $21,000. Secondly, only Ms Waterfield knows with precision (and the Court does not) how much of the proceeds of sale of that vehicle were expended on legal fees and how much was used for living expenses.[33]
[33] Curiously, in her trial affidavit Ms Waterfield said, at par.50, that the full purchase price of $38,000 was provided from her finances, and that Mr Callander did not contribute to the purchase of this motor vehicle. Clearly, in the light of the evidence at trial, this statement was not completely accurate at least in so far as it does not account for the use of payment by her credit card in the sum of $5000, which debt was subsequently paid out of Mr Callander’s cheque account.
Ms Waterfield contends that only the value of her most recently purchased vehicle of $5000 should be included in the asset pool. Mr Callander contends that the amount to be included should be $20,000. On the facts as presented, and in the light of the relevant authority previously noted, Mr Callander’s submission should be accepted and $20,000 should be added back to the asset pool in relation to the motor vehicle.
The second matter to address concerns a disputed sum of $57,054.
Mr Callander contends that this sum should be added back to the asset pool because it comprised funds retained by Ms Waterfield at the date of separation. In support of this contention he prays in aid Exhibit B3, which is a copy of Ms Waterfield's NAB bank statement as at 24th December 2009. The sum in question is arrived at by reference to a series of cheques that were paid into her bank account.
For her part, Ms Waterfield says in response that (a) it was conceded that she held a power of attorney for Mr Callander and that it covered the transactions in question; (b) it was also agreed (by Mr Callander) that Ms Waterfield was a signatory to his accounts and that it covered the transactions in question; (c) Ms Waterfield said that the funds were used for the parties’ (unfortunately unparticularised) personal and business expenses; and (d) it was conceded by Mr Callander that he could not identify what was done with the monies, nor to any account to which the funds were diverted.
I accept the submissions from Mr Callander. Among other things, it was not for him to trace and to identify the funds from the banked cheques that had, on their face, been used by Ms Waterfield.
In the light of the above discussion, the asset pool should be taken to be as submitted by Mr Callander. In this regard, I note that the overall difference between the net asset position as asserted by each of the parties was ultimately only $21,270 in any event. On the figures in the balance sheet, the net asset pool (including super) as proposed by Mr Callander, and which I have now accepted, is $2,842,835.40. How that figure is achieved is set out in the following balance sheet.
Asset
Ownership
Value
Property K
Husband
$2,000,000
Property N
Husband
$385,000
(less sale costs and agent’s commission
Net $373,000
Stock Plant and Equipment including Husband’s motor vehicles
Husband
$323,620
Proceeds from Sale of Stock September 2010 and Post Separation
Husband
Not declared
CBA Shares (370)
Husband
$17,774.80
CBA Shares (93)
Husband
$4,467.72
(omitted) Shares (1000 @ $4.13, Exhibit D)
Wife
$4,130
Bank Funds
Wife
$16,972
Motor Vehicle
Wife
$20,000
Contents
Husband
$20,000
Contents
Wife
$7,000
Jewellery
Wife
$25,650
Wife’s savings as at separation (add back)
Wife
$57,054
$2,870,668.50
Liability Ownership
Value
(omitted) Bank
Husband
$340,710
Farm Creditors
Husband
$82,824
Credit Card
Husband
$462
$423,996
Superannuation Ownership
Value
(omitted) Investments (omitted) Super Fund
Wife
$396,162.99
(value of Property T share-holding at 30 06 10 using current share values)
$394,162.99 Net Total (incl Super)
$2,842,835.40
Issues of Credibility
Having already noted a significant number of evidentiary matters earlier in these reasons, I turn to further, but important, related issues.
The most important matter to address here concerns the regularly made attack on Ms Waterfield’s honesty, and in turn her credibility. There were multiple dimensions to it, which requires consideration of a number of witnesses, primarily Mr Callander and his daughter-in-law, Mrs Callander. In my view, nothing was added to the totality of the evidence from Mr Callander’s daughter, Ms Callander. Accordingly, I do not propose treating her evidence in the light of the detailed evidence of her Father and her sister-in-law, Mrs Callander. Ms Callander’s evidence was quite brief and confined in any event.
Allegations of Forgery & Dishonesty: Ms Waterfield
This matter was couched in terms initially of forgery, for example, in a letter from Mr Callander’s solicitors to Ms Waterfield’s solicitors in June 2011 (Exhibit Q). This was the alleged forging of Mr Callander’s name on a wide range of documents - financial, business and much else besides.[34]
[34] It was also contended, and denied, that there had been some forged entries in the Property K cashbook. See, among other places, T 101 – 102 (26th October 2011).
It even got to the stage where a hand-writing expert (Dr S) was retained, at significant expense (Dr S’s account became Exhibit V), to determine what were Mr Callander’s signatures and what were those written by Ms Waterfield.[35]
[35] Complaints were made regarding the tardiness of Ms Waterfield confirming (or denying) whether she signed Mr Callander’s name, and the need, in the end otiose, to employ the handwriting expert. I need not canvass such matters.
In the result, Ms Waterfield confirmed in her trial affidavit (par.48) that she regularly wrote Mr Callander’s signature, but did so (a) with his express authority, and (b) often at his express direction.[36] Significantly in his evidence, Mr Callander forthrightly and candidly confirmed that (i) he had authorised Ms Waterfield to sign documents (but in her name as his agent) and (ii) if Ms Waterfield had signed his name with the additional words “on behalf of” [Mr Callander], he would have no complaint at all.[37] He denied that Ms Waterfield signed any document ‘under his direction’, although in answer to other, similar questions this evidence was qualified or changed somewhat in cross-examination, as I note shortly.
[36] See further, for example, T 68 – 69 (25th October 2011) and T 116 (26th October 2011). There was no dispute that Ms Waterfield had never worked on a farm and had no relevant experience, for example, dealing with farm accounting records. See Mr Callander’s evidence, T 82 (8th March 2012).
[37] See, among many places, for example, T 49 (8th March 2012).
Further, Ms Waterfield confirmed, both in her affidavit material and in her oral evidence, that she gained no financial advantage from any of the instances either put to her in cross examination, or as she recounted at some length in her trial affidavit (see par.48 (a) – (l)). The instances Ms Waterfield gives in her affidavit range from signing change of telephone number forms, to herd registration fees, to strata management proxy forms, to an application for credit at an abattoir, to deposit books and related forms (including cheques) with (omitted) Bank. In all such instances, Ms Waterfield said that she signed the relevant documents with Mr Callander’s full knowledge (and under his direction), that she gained no personal benefit (other than as being part of the marriage), and that Mr Callander had access to check any and all relevant documents (as did his accountant) lest anything untoward may have occurred.[38]
[38] Ms Waterfield confirmed that some seven or so months prior to the end of the marriage she retained an accountant in (omitted), different to the one she had shared up to that point with Mr Callander, in relation to dealing with her superannuation fund. See T 56 ff (25th October 2011).
Mr Callander’s learned Counsel submitted in Reply that ‘bookwork is not a task he is well equipped to perform.’[39] I note too that in his oral evidence, Mr Callander confirmed, and on more than one occasion, that he hated bookwork.[40] By this I infer (and in no way critically) that he sought to avoid doing it and had others do it for him – either his accountant, and or Ms Waterfield. I infer also that his aversion would likely be even greater with respect to records (accounting and other matters relating to Property K) contained on and or produced by a computer.
[39] See Husband’s Submissions in Reply, Section E (viii), p.7.
[40] See T 26, 27 & 31 (8th March 2012).
However, leaving computer records to one side, if the submission made in relation to Mr Callander is correct in relation to him being ill-equipped to do the “bookwork”, a fortiori should not the same submission apply to Ms Waterfield, who came to the farm without any relevant experience or expertise in relation to the kinds of business (stock sales and the like) conducted at Property K? In my view, the answer must be clearly in the affirmative.
In this regard I simply observe (a) the farm and its operations at Property K have been and remain in every respect Mr Callander’s business (indeed his life in almost every respect),[41] and (b) Ms Waterfield was trained as a (omitted). She came to the farm without any relevant background or experience in the running, operation or the finances of the farm and its business. There is little dispute that whatever she did was at the direction and with the agreement of Mr Callander.[42] What is disputed is the manner in which certain things were done, and the precise directions given by Mr Callander.
[41] In cross examination Mr Callander confirmed that he bought Property K in 1981. See T 22 (8th March 2012).
[42] Mr Callander agreed with such a proposition. See T 82 (8th March 2012).
The primary area of dispute in this hotly contested part of the evidence, in my view, comes down to the divergent claims by the parties. Ms Waterfield said that Mr Callander said to her words to the effect “just sign my name.” Mr Callander vehemently disputes that he ever made such a statement or gave such a direction.
For my part, given that Mr Callander confirmed that he directed Ms Waterfield to sign documents regularly on his behalf, and that this occurred over a significant number of years and across all manner of farm-related matters (financial and non), it may well have been the case of simple (and on-going) mis-understanding. Ms Waterfield said that she understood that Mr Callander intended that she sign “as him.”[43] What is undeniable is that Ms Waterfield operated in the way confirmed at trial by signing Mr Callander’s name, and that this practice carried on over the duration of the marriage. Thus, her ‘signing practice’ took place over quite a number of years, not weeks, or merely months. And it is clearly not the case that it occurred on a very occasional basis, or that Mr Callander (or the joint accountant) did not have any opportunity to check up on what was going on in relation to the farm and Ms Waterfield’s role in it on behalf of Mr Callander.[44]
[43] See Ms Waterfield’s trial affidavit, par.49.
[44] I note that Mr Callander said that he checked bank statements every three or four months, and went to see his accountant maybe twice per year. T 94 – 95.
In such circumstances I find it difficult to attribute the degree of culpability to Ms Waterfield for which Mr Callander now contends. Her financial gains, if there be any (but which are denied in any event), have clearly not made her wealthy, and (subject to what has been already addressed earlier in these reasons, and what follows) it is difficult to see specific areas of financial loss suffered by Mr Callander as a result of Ms Waterfield signing her Husband’s name. Indeed, most of the documents put before the Court that were signed by Ms Waterfield were patently all to benefit, in the first instance (and primarily so), Mr Callander and the conduct of the business (and life) at Property K. And to repeat: Mr Callander’s strong evidence was that if Ms Waterfield had signed his name but added some rider, such as “on behalf of”, he would have nothing of which to complain. Indeed, he confirmed that Ms Waterfield did not benefit from any of the documents she signed using his name.[45]
[45] See T 44 & 45. Later in his cross-examination, as I have just recorded, at T 95, Mr Callander said that he looked at his bank statements and such documents perhaps every three or four months.
Further, I would think it highly unlikely that in all the years the parties lived together there was no occasion that Mr Callander did not question, inquire about or otherwise check or consider any of the documents bearing his signature (e.g. those detailed in Ms Waterfield’s trial affidavit at par.48 – noted above at [86]) around the time they came into existence and which are now before the Court. True it is, and I accept, that Mr Callander said consistently that he never questioned or doubted Ms Waterfield. He said that his unquestioned trust simply followed from the fact of their marital relationship. I do not cavil with his evidence in this regard. However, in the totality of the evidence (on which there is more yet to come), in my view there is an element of ex post facto inquisition and judgment (which, of course, happens in most cases in any event) and casting of doubt and suspicion when, at the time, and over the years, there was either little or no basis for it, and or that Mr Callander could have, and I infer would very likely have done so, had more than ample opportunity to check and rectify the signing practice(s) of Ms Waterfield. Either he did not do so (which I consider highly unlikely that it never occurred) or having noted or noticed it he had no cause to complain or to seek to rectify it. Indeed, he confirmed in cross-examination that he could have checked on anything, but he did not do so.[46]
[46] See T 59 (8th March 2012). See also Ms Waterfield’s cross-examination regarding entries in the farm cashbook and related matters at T 68 ff (25th October 2011).
In any event, as I have previously indicated, I have quite some difficulty in finding the degree of culpability (legal or moral) levelled at Ms Waterfield in relation to the alleged forgery of Mr Callander’s signature on the range of documents before the Court. His signature was plainly and openly made. True it is that it would have been preferable that some qualification was identified (such as “on behalf of”). But almost invariably, the signing of documents benefitted Mr Callander directly, and or the business conducted at Property K.
Related to the attack on Ms Waterfield’s credibility (and honesty) were contentions that (a) she had endeavoured to have Mr Callander diagnosed with dementia;[47] (b) there was a range of absences from the farm which, it was contended, exhibited her intention (and her planning and resolve) to leave the marriage earlier than she now avers;[48] (c) there was either no, or inaccurate, disclosure of her jewellery;[49] and (d) Ms Waterfield deliberately took and destroyed a hard drive from a computer at Property K, but which, not insignificantly, belonged to her.[50]
[47] For example, see the Husband’s Submissions in Reply, Section E (v), p.5, and Mrs Callander’s affidavit, filed 21st July 2011, pars.7-13. Related to this aspect of the evidence, and in my view of some moment, are a series of questions to Mrs Callander regarding Mr Callander’s power of attorney, which was granted jointly to Ms Waterfield and one of Mr Callander’s sons, Mrs Callander’s husband. See T 173 (26th October 2012).
[48] See the Husband’s Submissions, pars.32 & 41.
[49] See Husband’s Submissions, pars.27 & 39. In relation to the allegations concerning jewellery, because (a) there are now valuations before the Court, (b) there is an agreed value for the purposes of the asset pool, (c) in the context of the whole pool, the amounts in question are relatively small, and (d) having discussed at some length earlier in these reasons matters relating to jewellery, I do not propose to consider these contentions any further.
[50] See Husband’s Submissions, pars.33 & 42. Ms Waterfield’s ownership of the computer, and its hard drive, was not referred to in Mr Callander’s submissions. The acknowledgement that the computer belonged to Ms Waterfield is noted in Mrs Callander’s affidavit, filed 21st July 2011, par.20(k). The paragraph numbering is in fact discordant in this affidavit, with the preceding paragraph designated “18” and the next listed as “21.” In any event, the relevant list and items to which I refer are located at p.5 of the affidavit in question.
Claims regarding Mr Callander's & Ms Waterfield's Absences from Property K
Respectfully, in the light of all the evidence, these were horses that had no genuine legs upon which they could run. The reasons for this conclusion are as follows.
The most convenient and appropriate sources for the background to and basic details of these contentions might be taken from Mrs Callander's 2011 affidavit (pars.7-13) and her cross-examination.[51]
[51] See also T 153 – 181 (26th October 2011) & T 10 – 14 (8th March 2012).
Mrs Callander confirmed that she and Ms Waterfield “got along well”, so much so that Ms Waterfield often confided in her. In cross-examination, she agreed that she was a confidante of Ms Waterfield.[52] One of the matters broached between the two ladies was Ms Waterfield saying on one occasion that Mr Callander had recently started calling her “(omitted)” – the name of his deceased wife. Ms Waterfield indicated also that Mr Callander had started to do some slightly odd things, such as ploughing the same paddock several times. There is no dispute that Ms Waterfield arranged for Mr Callander to be seen by his long-time general practitioner, Dr E, among other things, to check whether there were any relevant signs of dementia.
[52] Among other places, see T 164 & 175 (26th October 2011) & T 12 (8th March 2012). Ms Waterfield’s confidence was not always reciprocated by Mrs Callander. Indeed, she confirmed that she lied to Ms Waterfield on one occasion in relation to matters which I need not rehearse. See T 179.
Mrs Callander said that she, her Husband (Mr Callander), Ms Callander, Mr Callander’s other son (M) and his wife, “agreed to closely monitor Mr Callander and Ms Waterfield.. We all felt that Ms Waterfield may have a motive because he was not showing any sign of dementia to us.”[53] It was not specified with any particularity what that “motive” was or the alleged ultimate goal of Ms Waterfield, save that it was understood that Ms Waterfield’s “motive”, as perceived by Mr Callander’s family, was (I infer) at least questionable if not ultimately malevolent and predatory of Mr Callander’s assets.[54]
[53] Mrs Callander's 2011 affidavit, par.9. Emphasis added.
[54] See, for example, the comments by Mrs Callander at T 172, 177 & 180.
I do not propose to traverse all aspects of Mrs Callander’s evidence. To do so would add nothing to the issues to be determined by the Court and the evidence relevant to them. I would fear also that it would needlessly add to the grief and aggravation patently felt by everyone. I took Mrs Callander’s evidence to be fulsome and candid. I also accept that her actions, and those of other members of the family, were motivated exclusively to protect Mr Callander. An unfortunate concomitant of that was a growing distrust towards Ms Waterfield. I need not retail some of the evidence in this regard. It is sufficient to state that it was hostile to Ms Waterfield; in my view, needlessly so.
Unfortunately, in my view much of the action taken by the family, and certainly the doubts, fears and misgivings ventilated in Mrs Callander’s evidence, were not supported by the facts. As often happens in families, and particularly where there is a marital break-up, much proceeds by way of innuendo and suspicion. Such was the case here, as I summarise below.
To move quickly to the result and the reasons for it: (a) Mrs Callander confirmed that Ms Waterfield was candid in her conversation and alleged disclosures regarding her concerns for Mr Callander (thus there was no attempt to conceal anything); (b) Mrs Callander agreed that she later learnt that Ms Waterfield had some expertise in relation to dementia arising out of her (omitted) experience, and conceded, with some reluctance, that the appointment with Dr E was or could genuinely (and reasonably) be viewed as precautionary; and (c) although Ms Waterfield held a power of attorney for her Husband, she did so with one of Mr Callander’s sons – thus the chances of anything ‘untoward’ being perpetrated by Ms Waterfield, using the power of attorney, one might reasonably conclude, was significantly problematic if not highly unlikely. Moreover, Mrs Callander confirmed that her Husband telephoned the family solicitor who advised that there had been no changes to the power of attorney, and that it remained vested in both Ms Waterfield and Mr Callander.. Notwithstanding all of these matters, Mrs Callander confirmed that there was a genuine concern among Mr Callander’s family that Ms Waterfield was ‘up to no good.’[55]
[55] See Mrs Callander’s cross examination at T 153 – 181 (26th October 2011); T 10 – 14 (8th March 2012).
Although it was put to her later in the trial that her concerns (and those of other family members) could be viewed as having some degree of self-interest, I accept that the primary and over-riding motive of the Callander family was to protect and support Mr Callander. In the result however, in my view, their anxiety and distrust of Ms Waterfield was more a triumph of suspicion over fact. However genuinely and understandably held (up to a point), the level and nature of suspicion was unwarranted and unjustified. Moreover, Mr Callander confirmed that he knew about the purpose of the appointment with Dr E, albeit after the event, and that he considered the appointment made by Ms Waterfield as part of her care for him. Indeed, he said that he makes no complaint against her for taking such a course.[56] This somewhat begs the question: if Mr Callander had no complaint, why was this issue raised as another matter to contest? It certainly, and unfortunately, featured prominently in the evidence of members of Mr Callander’s family.
[56] See the discussion at T 106 – 107.
The same is true about the almost mania of suspicion and distrust in relation to Ms Waterfield’s absences from Property K. Respectfully, that level of concern seemed much more an abiding interest for members of Mr Callander’s family than it was for Mr Callander. Ms Waterfield explained them in some detail in her cross-examination.[57] Leaving aside absences closer to what is now known to be the last days or months of the marriage, prior to that Mr Callander had little or no complaint about, and certainly knew of, her absences and the reasons for them.[58] I pose the rhetorical question again: if Mr Callander had no misgivings or disquiet, why did his family consider such absences (e.g. in Ms Waterfield visiting sick friends) as yet another indicator of her mala fides and malevolent or predatory intent towards Mr Callander (or his assets)?
[57] See T 120-121, 134-139 & 143 (26th October 2011).
[58] See T 59-60 (8th March 2012).
Spoliation of Evidence: Destruction of a Computer Hard Drive
There are a number of facets to this particular claim - factual and legal.
Factual Matters: First, in my view, somewhat surprisingly, whenever the contentions about Ms Waterfield ‘taking the hard drive’ and later ‘trashing it’ (something she conceded in cross-examination),[59] little or no mention was made of the fact that, whatever information it contained, the computer from which the hard drive was removed belonged to Ms Waterfield. She confirmed that it was “her hard drive.”[60] There was no challenge to this evidence. And Mrs Callander (as previously noted) confirmed that the computer from which the hard drive was removed belonged to Ms Waterfield. However, by not mentioning (for example, in submissions and elsewhere) its ownership subtly suggested notions of possible theft or at least some under-handedness on Ms Waterfield’s part, thus adding to the climate of suspicion around her evidence and its trustworthiness.
[59] See the general discussions at T 67, 69, 70 & 74-75 (25th October 2011). She said that she ‘trashed’ the hard drive about five months prior to the trial. She averred that it contained nothing beyond what had been disclosed in the documents put before the Court.
[60] T 74.
In evidence that I took to be both significant and more than plausible, Ms Waterfield said that she removed the hard drive out of anger and spite. In its totality and context, it is important to have regard to Ms Waterfield’s evidence. She said:[61]
HIS HONOUR: Can I ask you this just going back to the computer, you referred to the Christmas 2009 as being a debacle, correct. What is the correlation between the debacle of Christmas and the removal of the hard drive of the computer?‑‑‑The removal of the hard drive on the computer had my personal issues on it – my personal business on it as well as Mr Callander’s and that was due to the running of the – his business and I was angry with him because he wouldn’t come with me at Christmas time and I guess it was a bit spiteful to think, “Fine, you can find out what’s going on this month because I’ve told you every other month.” I was angry with him.
I see?‑‑‑And the only way that I could hurt him was through business - certainly not through a heart.
[61] T 68 ff (25th October 2011). Part of the ‘debacle at Christmas’ to which Ms Waterfield referred I understand to arise out of the following summary of facts: (a) Ms Waterfield and Mr Callander were to travel to Melbourne to spend Christmas with her family; (b) because of a perceived threat to the property because of a bush fire, Mr Callander decided not to go to Melbourne (and Ms Waterfield went on her own); and (c) in the result, Mr Callander, as confirmed by Mrs Callander, spent Christmas in (omitted) with his son Mr Callander, his wife Ms Callander and their family.
In answer to later questions put by Counsel for Mr Callander, Ms Waterfield confirmed that the hard drive contained various financial records in relation to the business at Property K. She also confirmed that all the information contained on the hard drive was otherwise contained in the “cashbook” that remained on the property. Given Mr Callander’s distaste for bookwork (and as I have inferred previously, I hope not unfairly, presumably even less appetite for computers and the eye-glazing business and other records they can contain), Ms Waterfield’s action of removing the hard drive from her computer would have required Mr Callander, in the first instance, and later his accountant, to rummage and forage in the traditional accounting records of Property K, thus causing them some difficulty if not aggravation to match (somewhat) Ms Waterfield’s patent agitation and anger over the failed Christmas arrangements. In this respect, her action may be characterised more accurately as vengeful rather than with the intention to destroy relevant evidence.
I accept Ms Waterfield’s evidence that the financial records of Property K, otherwise on her hard drive, were available in the accounting records that were never removed from the property. There was no challenge to this evidence. However, she should not have destroyed the hard drive of her computer. The Court (and of course Mr Callander) has no way of knowing what else the hard drive may have contained, other than Ms Waterfield’s sworn evidence that it contained nothing beyond what was in documents put before the Court and otherwise readily available to Mr Callander (and his accountant).
Further, given the detail that was put before the Court by both parties, I do not understand that there is any suggestion that Ms Waterfield somehow has secreted away some vast, unknown fortune. But that does not solve or deal completely with the issue of her destruction of the hard drive from her computer.
Spoliation of Evidence – Legal Principle: Although there is an even earlier case, which is predicated to some degree on the principle in Blatch v Archer to which I have earlier referred,[62] the destruction of evidence is classically dealt with by first referring to the Privy Council decision in The Ophelia.[63]
[62] The very early case is Gray v Haig (1855) 20 Beav 219; 52 ER 587, which involved the destruction of books of account on which commission for the sale of scotch whiskey was based. Gray v Haig was discussed by Kenny J in the Research in Motion case, (2009) 176 FCR 66 at [25], to which I presently refer.
[63] [1916] 2 AC 206.
That case was first heard by the President of the Admiralty Division, sitting in Prize,[64] following the seizure of a German hospital ship (the Ophelia) in the North Sea on suspicion of it acting as a signalling ship for military purposes. Upon being seized by the British ship, HMS Meteor, various records (including the signal log) were thrown overboard. It was also the case that the Court found that the Ophelia had a very large number of green and red lights, a number of which had been destroyed. In cross-examination, the Master of the vessel implausibly said that the green and red lights were installed as search lights to look for ship-wrecked mariners. Unsurprisingly, the ship’s Captain was not believed, and the Court found that the lights were most likely used for the purposes of [enhanced] Morse Code, notwithstanding that the ship was already fitted with a Morse lamp for such purposes.[65]
[64] “Prize” relates, of course, to the determination of rights in relation to ships and goods captured from an enemy at sea, so-called ‘droits of Admiralty.’ It can also apply to aircraft captured anywhere. I recognise right readily that it is rather far removed from a (omitted) property near (omitted) and the issues before the Court, but should any passing reader - ancient mariner or otherwise - be interested in the somewhat exotic law in relation to “prize”, see further the discussion by the Privy Council in Schiffahrt-Treuhand v Procurator-General [1953] AC 232, and more generally, Halsbury’s Laws of England, (Fourth Edition: Reissue, 1982) Vol.37, “Prize.”
[65] See [1916] 2 AC at p.212.
In all the circumstances, Sir Arthur Channell (who delivered the advice of the Board) said (at pp.228 - 231; emphasis in original)
… There seems, taking the evidence as a whole, the greatest uncertainty as to what books recording signals were really kept; but the one thing which is certain is that any which were kept, except the news log, were thrown overboard when it was seen that the vessel was about to be searched. If nothing but innocent signals had been sent, the signal log was the very book of all others which should have been preserved. The result, therefore, is that the appellant has nothing to show to vouch his story that all signals sent … were of an innocent character. Further, the absence of such evidence, if any ever existed, is caused by his own act.
This leads to the subject of what is technically called spoliation of documents, on which the President, rightly, as their Lordships think, laid much stress …
[I]t may be that in some respects the old doctrine was rather technical. The substance of it, however, remains and is as forcible now as ever, and it is applicable not merely in prize cases, but to almost all kinds of disputes. If any one by a deliberate act destroys a document which, according to what its contents may have been, would have told strongly either for him or against him, the strongest possible presumption arises that if it had been produced it would have told against him; and even if the document is destroyed by his own act, but under circumstances in which the intention to destroy evidence may fairly be considered rebutted, still he has to suffer. He is in the position that he is without the corroboration which might have been expected in his case.
…
Their Lordships are of opinion that Captain Pfeiffer [the “Ophelia’s” commander] and the other witnesses have by their acts put themselves in such a position that their evidence cannot be relied on; that the evidence discloses facts of which no satisfactory explanations are or can be given; and that although on the Crown affidavit evidence some ambiguities have been pointed out which have not been cleared up by cross-examination or re-examination, yet there are incriminatory matters in those affidavits to which no answer has been given. They are of opinion that the President was fully justified in finding that the Ophelia was not constructed or adapted or used for the special and sole purpose of affording aid and relief to the wounded, sick, and shipwrecked, and that she was adapted and used as a signalling ship for military purposes.
The case relied upon by learned Counsel for Mr Callander in relation to the so-called doctrine of ‘spoliation’ of evidence, is a recent decision of Ward J in the Supreme Court of New South Wales, Austin v Hornby.[66] In that case, her Honour dealt at a little length with The Ophelia and its consideration by, inter alia, subsequent High Court cases. Hence the need to consider the jurisprudential chain and its consequences. I will come back to Austin v Hornby because it may be that there is some conflict with her Honour’s decision and that of Kenny J in the Federal Court of Australia in Research In Motion Ltd v Samsung Electronics Australia Pty Ltd.[67]
[66] Austin v Hornby [2011] NSWSC 1059. See Husband’s Submissions, at [42].
[67] Research In Motion Ltd v Samsung Electronics Australia Pty Ltd (2009) 176 FCR 66.
The next case to consider in the so-called jurisprudential chain is the High Court decision in Allen v Tobias.[68] For current purposes it is sufficient to note that in Austin v Hornby, Ward J considered, at [113] – [115], the following from the High Court, and commented further on The Ophelia, thus:
[113] In Allen v Tobias (1958) 98 CLR 367 at [375], the High Court adopted the following statement of principle in this regard:
… no statement of the principle could be more apposite than that of Sir Arthur Channell delivering the opinion of the Privy Council in The Ophelia [1916] 2 AC 206:
If any one by a deliberate act destroys a document which, according to what its contents may have been, would have told strongly either for him or against him, the strongest possible presumption arises that if it had been produced it would have told against him; and even if the document is destroyed by his own act, but under circumstances in which the intention to destroy evidence may fairly be considered rebutted, still he has to suffer. He is in the position that he is without the corroboration which might have been expected in his case.
[114] There is some divergent judicial opinion on the nature of the inference to be drawn. Some cases (such as Allen v Tobias and The Ophelia [1916] 2 AC 206) suggest that the inference is limited to matters which could likely have been established by the evidence which has been destroyed or withheld. Other cases suggest that presumptions will be raised against the spoliator on all issues which are not otherwise positively proved, ie whether the use of the word “omnia” means all things which could have been proved by the spoliated evidence or means all things in the matter. Even if the more limited definition is accepted, adverse inferences as to credit are likely [to] be drawn from deliberate spoliation of evidence.
[115] There is also a debate as to the amount (if any) of “wrongdoing” or fault required to enliven the maxim, whether the blameworthiness requires malus animus or mala fides, (Delany v Tenison (1758) 3 Bro PC 659; 1 ER 1559) or whether it is sufficient for the presumption to be available that it cannot be shown that the destruction of evidence was proper or justifiable (Gray v Haig (1855) 20 Beav 219; 52 ER 587). Nevertheless, the passage of The Ophelia approved by the High Court suggests that even bona fide destruction can have negative consequences in that even where “the intention to destroy evidence may fairly be considered rebutted, still [the destroyer of evidence] has to suffer. He is in the position that he is without the corroboration which might have been expected in his case.”
[68] Allen v Tobias (1958) 98 CLR 367.
I simply note that in the course of Ward J’s helpful and detailed consideration of the case law and principles regarding ‘spoliation of evidence’ (‘spoliation’ is taken from the maxim omnia praesumuntur contra spoliatorem – ‘all things are presumed against a wrongdoer’), in the course of which her Honour adverted to the ‘divergence in judicial opinion in relation to the nature of the inference to be drawn,’ and whether mala fides was necessary, or the presumption was sufficient, she did not consider (a) the High Court decision of McHale v Watson (noted briefly below), (b) the further High Court, albeit dissenting, judgment of Barwick CJ in Katsilis v Broken Hill Pty Co Ltd,[69] or (c) Kenny J’s decision in the Research in Motion case, to which I have earlier referred. I do not suggest that her Honour’s exclusion of these cases from the discussion in Austin v Hornby somehow fatally wounds her discourse on principle. I simply note that, respectfully, they are properly part of the jurisprudential terrain. In any event, from these [unconsidered by her Honour] cases it is important to record the following.
[69] (1978) 52 ALJR 189.
First, the only member of the High Court in Katsilis to consider principles in relation to the ‘spoliation of evidence’ was Barwick CJ. His Honour discussed The Ophelia.[70] As noted in Cross on Evidence, Barwick CJ suggested that using the word “presumption” (as the Privy Council did in relation to the destruction of evidence and “the strongest possible presumption arises…”) might put the matter too high.[71] Indeed, as the learned author of Cross further observes (in the same place): “Care needs to be taken in admitting evidence of admissions by conduct. … In particular a mechanical application of the rules without regard to the probative value of the evidence must be avoided.”[72]
[70] See ALJR at p.197.
[71] See Cross on Evidence (Eighth Australian Edition) at [33435].
[72] In the discussion in Cross, at [33435] p.1179, reference is made to the decision of Windeyer J in McHale v Watson (1964) 111 CLR 384. In that case, his Honour discussed briefly The Ophelia and the presumption. But as his Honour noted there, at p.399, getting rid of evidence may have no malevolent intent and rather more simply be just as easily explained, not by the desire to suppress evidence, but to be an instinctive reaction to get rid of something offensive.
Secondly, in Research In Motion Ltd v Samsung Electronics Australia Pty Ltd, Kenny J examined in detail the principal cases to which I have referred, namely The Ophelia and Allen v Tobias.[73] In my respectful view, her Honour resolved the dilemma arising from the divergent judicial opinion to which Ward J referred in Austin v Hornby. It is sufficient for current purposes to observe the following from Kenny J’s judgment.
[73] Like Ward J in Austin v Hornby, Kenny J in Research in Motion did not consider either of the High Court cases to which I have referred, McHale or Kasilis.
In relation to the Privy Council’s decision in The Ophelia, Kenny J noted, at [29], that it was, essentially, “a case on the law of prize.”[74] Next, her Honour noted that the case made plain that ‘spoliation’ was an evidentiary matter only. Such an observation accords with the caution expressed in Cross on Evidence, noted above (at [117]), concerning the need to have proper regard to the probative value of all the evidence. At [30], Kenny J did not see the case as authority “for the broad principle that … every destruction of documents [or other evidence] attracts an adverse inference.” In more detail, she said (also at [30]):
… I doubt that Sir Arthur Channell intended to say that, in any litigation, where it can be shown that one party destroyed a document, then it must be presumed that that document supported the opposing party. Such a proposition would be unreasonable.
[74] A not dissimilar comment was made in the joint judgment (Dixon CJ, McTiernan & Williams JJ) in Allen v Tobias (1958) 98 CLR 367 at p.375: “It is a far cry from the municipal warfare of the present case to a case in Prize….”
Kenny J next considered various definitions of “spoliation” and then said, at [31]:
For the purposes of the doctrine of spoliation, there is a distinction between: (1) the deliberate destruction of documents with the intention of destroying evidence; and (2) the deliberate destruction of documents where there is no such intention. That is, there must be something reprehensible about the destroying party’s conduct for the doctrine of spoliation to apply. … It is only in the first situation that there may arise a presumption adverse to the destroying party. In the second situation, the destroying party suffers a detriment, but only in the sense that he has thereby lost corroboration.
Her Honour’s second category of [non-reprehensible] destruction accords with the comments of Windeyer J in McHale’s case, and the comments in Cross on Evidence, to both of which I have previously referred.
Kenny J then turned to the High Court’s decision in Allen v Tobias. Her Honour concluded, at [33], that
Allen demonstrated that what was at issue was the deliberate destruction of documents with the intention of destroying evidence in anticipated litigation. As in Ophelia, this was a proper occasion in which to apply the doctrine of spoliation as an evidentiary presumption. Further, in the High Court, their Honours did not rely on this doctrine alone, but also on the further reason that the statute cast the burden of proof on the defendant to disprove the disqualifying facts.
In conclusion, Kenny J said, at [34]:[75]
For the purposes of this doctrine [of spoliation], it is not enough to show that the respondent destroyed documents deliberately. Rather, the applicants must show that the respondent deliberately destroyed documents with the intention of destroying evidence.
[75] See also the discussion by Ryan J in RLA Polymers Pty Ltd v Nexus Adhesives Pty Ltd (2011) 280 ALR 125 (a breach of confidence case), where, at [87], his Honour considered, without deciding, the import of Barwick CJ’s comments in Kasilis, Kenny J’s comments, at [30] – [34], in Research in Motion, and comments by Rares J to the opposite effect in MCT Dairies Inc v Probiotec Ltd [2009] FCA 1385 at [36]. Rares J did not consider Kenny J’s comments in Research in Motion. As previously indicated, in my respectful view Kenny J’s analysis is the more apposite.
Having regard to the state of the evidence in the current matter, and relying on the conclusion reached by Kenny J, whose analysis I respectfully adopt, and which, in my respectful view, does not detract from the analysis of Ward J in Austin v Hornby but rather enhances it with the distinction set out at [34] in the Research in Motion decision, Mr Callander has not established that the ‘trashing’ of the hard drive was calculated and intended to destroy evidence. Moreover, Ms Waterfield denied categorically that such was her intention, and explained that her action was one of vengeance or spite and was not calculated to destroy evidence.[76]
[76] Among other places, see T 74 – 75 (25th October 2011).
Further, (a) all of the books of account for Property K remained available to Mr Callander (indeed, there was never any suggestion of Ms Waterfield seeking to remove or to destroy them), (b) the item (the hard drive) destroyed was Ms Waterfield’s personal property, (c) relevant evidence in relation to Ms Waterfield’s financial circumstances was either provided by her and or by Mr Callander, (d) no explanation was sought by Mr Callander (or offered by Ms Waterfield) why the hard drive was destroyed at the time it was, namely a few months before the trial and many months after separation, and (e) Mr Callander (and his family) were well aware of the removed hard drive. However, no evidence was led to indicate that he (or they) sought access to it at any stage, which is also to say that they had ample opportunity to seek access to it but did not do so.
The reality is that the hard drive was not destroyed until many months after separation, and remained in existence until approximately May 2011. If there was anything genuinely damaging to Ms Waterfield’s case, one would have thought that the hard drive would have been destroyed as soon as she removed it from her computer in late December 2009. Why wait more than fourteen months to destroy the hard drive if it contained material that was damaging to her case? Indeed, in each of the cases earlier referred to, almost invariably the destruction of evidence occurred in circumstances that rightly aroused suspicion. And in none of the cases was other primary evidence available which may be relied upon, as is the case here, where there is evidence available that otherwise satisfactorily deals with the issues in dispute. Here, all the primary records (cashbooks and the like) of Property K remained undisturbed (and no allegation was made against Ms Waterfield of any attempt on her part to remove or to destroy them), and relevant records in relation to Ms Waterfield’s financial circumstances were provided by her or by Mr Callander.[77]
[77] See, for example, the evidence of Mr Callander where he acknowledged that none of the Property K records were taken by Ms Waterfield, and that she had also left at the farm all her own credit card statements. T 111 (8th March 2012). In my view, this evidence is relevant to both the ready availability of the Property K primary records, and the lack of concealment of Ms Waterfield’s own records. I ask again: if someone had something to hide, why leave a substantial part of one’s own records readily available for all and sundry?
In the totality of the evidence, and in the light of the cases to which I have referred, I am disinclined to draw an adverse inference against Ms Waterfield of the kind sought by Mr Callander in relation to the destruction of the hard drive from her computer. That said, such action may be taken into account to some appropriate degree on the question of credit and or in relation to s.75(2)(o). At the very least, whether it was in another state of pique at Mr Callander (or perhaps his family), or for whatever other reason that was never explained or explored in any detail (by either side), the destruction of the hard drive was, to speak in colloquial terms, ‘not a good look.’ However, in the light of the principles articulated by Kenny J in Research in Motion, and having regard to the state of all the evidence in relation to “spoliation” there is no basis, as I have said, for the evidentiary doctrine to apply to this aspect of the case, specifically because (a) there was ample other (and primary) evidence to establish the true financial position of both parties, (b) Mr Callander (and his protective family) knew of, and had ample opportunity over many months to seek access to, the hard drive and did not do so, and (c) if there was anything incriminating on the hard drive, it is extremely unlikely that Ms Waterfield would have waited 14 months or so after separation before destroying it.
I move to the remaining steps in the determination of property applications, beginning next with the contributions of the parties.
Contributions
The balance sheet to which I have earlier referred details the respective assets of each of the parties. In part by reference to that document and also in the light of the evidence at trial (documentary and oral), the financial contributions of the parties at the commencement of the relationship may be summarised as follows.
First, Mr Callander had assets, thus: Property K, the investment property at Property N, stock, plant and equipment, CBA shares, and significant savings. I refer otherwise in detail to the material set out in paragraphs 11 and 14 of Mr Callander’s trial affidavit. In the same places he sets out his liabilities, being various farm creditors listed, a loan from (omitted) Bank, and some modest credit card debts.[78]
[78] See also Exhibit N, being a letter from Mr Callander’s accountant to his solicitor which sets out various financial details in relation to Property K.
Secondly, at the commencement of the relationship, Ms Waterfield had a property in (omitted) (owned with her son), superannuation, various shares (CBA, (omitted), (omitted)), modest savings, and a motor vehicle.
In sum, there was little or no dispute that Mr Callander brought significantly greater financial contributions into the relationship. That said, Ms Waterfield’s financial contributions, which she essentially kept for her benefit, were not insignificant.
During the marriage, there is no dispute regarding income – for the benefit of both parties - coming solely from Property K. There was also no dispute that Ms Waterfield laboured in an exemplary way in relation to what might be described as traditional home-making responsibilities. Indeed, Mr Callander was almost lavish, indeed effusive, in his praise of her attendance to all manner of such things, including on behalf of his wider family.[79] Although in submissions such concessions were not as fulsome as Mr Callander’s evidence, I accept Mr Callander’s evidence in this regard.
[79] Among other places, see T 79 - 81 (8th March 2012). Descriptions like “great”, “absolutely superb”, and “magnificent” featured prominently in Mr Callander’s evidence in relation to Ms Waterfield’s contributions in such things, including her ‘rejuvenating the garden.’
The contest came more in relation to (a) Ms Waterfield’s administrative work at Property K, and (b) and any other contributions around the farm. In relation to the former, in my view, there is no doubt that Ms Waterfield did a significant amount of administrative work at and for Property K. It may not have been quite an ‘everyday, all day’ exercise, but it was nonetheless substantial, especially given Mr Callander’s professed antipathy to bookwork. Both Mr Callander and Ms Waterfield confirmed that such was the work at Property K that she would not have been able to work outside the farm if she so desired.
In relation to any ‘extra’ labour by Ms Waterfield at the farm in addition to that of home-maker and her administrative responsibilities, Ms Waterfield testified to a range of extra things, such as assisting in mustering, drafting and raising (omitted) (about once per week), assisting (omitted) (when necessary) attending (omitted) sales (with Mr Callander), and sometimes transporting hay. For his part, Mr Callander did not deny that Ms Waterfield assisted in some of these matters, but not with the frequency or to the degree she asserted. I suspect that the truth resides somewhere in the middle between the two positions, but perhaps a tad more in favour of Mr Callander’s account.
There was no dispute that Ms Waterfield attended various meetings, such as in relation to the Property N property, on behalf of Mr Callander.
There is little dispute that each of the parties cared for the other during the relationship, each in their distinctive ways – Mr Callander, in large measure, as the [financial] provider, and Ms Waterfield as homemaker. Although it was submitted by Mr Callander’s learned Counsel that “each of the parties made contributions to the other’s welfare during the marriage including when each of them was ill”, given that Mr Callander had a significant heart event that required surgery and hospitalisation and a period of recuperation where Ms Waterfield attended on him, in relation to such contributions they must favour Ms Waterfield.
There is also little doubt that since separation Mr Callander has maintained Property K, and that Ms Waterfield has not contributed to its upkeep and the business it conducts in any respect.
While it is undoubtedly true that while Ms Waterfield was ‘accommodated’ at Property K during the marriage, it is also the fact (admittedly with the benefit of hindsight) that because she was not in paid employment during the marriage, she was not able to contribute to any superannuation.
In any event, considered in its totality, the contributions to the marriage must favour Mr Callander to a very significant degree. However, I would not put it quite as high as learned Counsel for Mr Callander submitted, which was 90% to Mr Callander and 10% to Ms Waterfield. Without putting too fine a line on percentages in my view the figure would be somewhat closer to 80% or thereabouts.
Section 75(2) Factors
I have already noted the age differential between the parties, with Mr Callander now aged 71 and Ms Waterfield now aged 62.
Mr Callander continues to work the farm and business at Property K, but as he acknowledged in his oral evidence, he is not getting any younger and the demands of life on the land also do not diminish. That said, his financial resources are significant, both in terms of the capital asset of the farm, and of the income stream from stock sales, accepting that running costs come out of it. And with the sale of the Property N property, the rental income will now cease. There was no suggestion that he would likely buy another investment property, for example, using the proceeds of sale of the Property N investment. In any event, Mr Callander will now have a significant sum of money available to him following the sale of the Property N property.
Ms Waterfield, as previously noted, has returned to her profession as a (omitted) and earns approximately $607 per week. She has shares as set out in the balance sheet and her superannuation.
In short, Mr Callander is in a vastly superior financial position to Ms Waterfield who will be working, I expect, to support herself for quite some years to come.
I take Ms Waterfield’s health to be appreciably better than that of Mr Callander for reasons noted earlier.[80]
[80] In her trial affidavit, par.87, Ms Waterfield deposed to having high blood pressure and annexed notes from her local pharmacy in relation to this.
While the relationship was not long, for the reasons also earlier given, it was not short either. Accordingly, the jurisprudence in relation to ‘short marriage’ cases, in my view, is not apposite.
In my view, the matters I have mentioned are the only ones relevant under s.75(2), save that I should, as I have indicated, pursuant to s.75(2)(o) take some account of Ms Waterfield’s disposal of the hard drive from her computer. While persons are generally at liberty to do with their property what they wish, where, as here, there is litigation on foot, to ensure that there is not even a hint of someone disposing of possible evidence, nothing should be destroyed before a case is concluded.
In all of the circumstances of the relationship, in my view, a very modest adjustment in favour of Mr Callander should be made in relation to these matters.
Conclusion: Just & Equitable Order
It has been often said that the focus of the Court needs ultimately to be on the “order” and whether it is just and equitable rather than simply or primarily on any particular percentage division.[81] It is important, therefore, to pause, reflect and determine what is the just and equitable order appropriate to the facts and circumstances of this case.
[81] See, for example, the comments of the Full Court (Ellis, Finn & Mushin JJ) in In the Marriage of Russell (1999) 25 Fam LR 629 at [80].
Bearing this admonition in mind, and having due regard to the totality of the evidence, including what the parties brought into the relationship, what they currently have in terms of assets (set out in the balance sheet), and having regard to the duration of the relationship, in my view, the just and equitable order to be made is that Mr Callander should pay Ms Waterfield the sum of $105,000. In the absence of agreement, that sum should be paid within 45 days of the date of this judgment. Otherwise, the orders 2, 3 and 4 in those sought by Ms Waterfield, which largely mirror similar orders sought by Mr Callander, shall be made. I should also note that but for the matters I have referred to in relation to s.75(2)(o) it is more likely than not that the payment to Ms Waterfield would have been somewhat higher than I have ordered. It may not have been much higher, but higher it would most likely have been.
I have previously indicated that, absent limited submissions in writing (not in excess of 2 pages) within 7 days, the provisions of s.117 of the Act shall apply, in which case each party should bear their own costs.
I certify that the preceding one-hundred and fifty-one (151) paragraphs are a true copy of the reasons for judgment of Neville FM
Date: 9 July 2012
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