WGOC & GH and Anor

[2006] FamCA 539

JFWGOCGH

FAMILY LAW ACT 1975

IN THE FULL COURT OF

THE FAMILY COURT OF AUSTRALIA

AT BRISBANE

Appeal No. NA 63 of 2005
File No. BRF 1742 of 2000

IN THE MATTER OF:

WGOC

Appellant/Husband

- and -

Respondent/Wife

- and -

EGOC

2^nd Respondent/Cross Appellant

REASONS FOR JUDGMENT

BEFORE:  Finn, Coleman & May JJ
DATE OF HEARING:         20^th & 21^st days of February 2006
DATE OF JUDGMENT:     23^rd day of June 2006

APPEARANCES: Mr Cooke of Queen’s Counsel, Mr Cooper of Counsel, (instructed by Abbott Tout Lawyers, Level 22, 307 Queen Street, Brisbane QLD 4000) appeared on behalf of the appellant husband.

Mr Murphy of Senior Counsel, with Mr Scott-Mackenzie of Counsel (instructed by Butler, McDermott & Egan Solicitors, PO Box 117, Nambour QLD 4560) appeared on behalf of the respondent wife.

Mr Cooper of Counsel, (instructed by Abbott Tout Lawyers, Level 22, 307 Queen Street, Brisbane QLD 4000) appeared on behalf of the 2^nd respondent/cross appellant

Name of Appeal WGOC & GH & EGOC

Appeal Number NA 63/2005

Date of Appeal hearing 20^th & 21^st days of February 2006

Date of Judgment 23^rd day of June 2006

Coram Finn, Coleman, May JJ

Catchwords: Appeal & Cross Appeal against trial Judge’s orders providing for a property (of which the appellant’s brother, the cross appellant, was the registered proprietor) to be sold and the proceeds divided between the appellant husband and respondent wife in shares of 70/30 respectively.

Appeal against trial Judge’s orders providing for the wife to receive 30 per cent of the husband’s superannuation by way of “splitting order”.
Appellant contended that trial Judge erred in finding that the trust (of which the cross appellant was the trustee) which acquired the subject property was not validly constituted or alternatively was validly constituted but that its acquisition of the property was a “sham” and therefore concluding that the husband beneficially owned the property – Open to trial Judge on the evidence to be satisfied that the appellant was the beneficial owner of the property and that its acquisition by the trust was a sham - Sharrment Pty Ltd v Official Trustee (1988) 18 FCR 449, and Wilson v Wilson; Figtree Gardens Caravan Park Pty Ltd; Wilson; Wilson (1994) FLC 92-498 relied upon – Established that appellant was the source of funds for acquisition of the property by the cross appellant on behalf of the trust, therefore within the definition of “sham” as set out in Scott v Commissioner of Taxation (Cth) (No 2) (1966) 40 ALJR 265 – Trial Judge’s decision not successfully challenged either on the evidence before him at trial, or on the evidence which might have been before him, had the cross appellant’s affidavit been admitted into evidence and the cross appellant’s counsel allowed to cross-examine the appellant – Unnecessary to consider whether the trust was validly created.
Contrary to appellant’s claims, trial Judge’s statements did not indicate lack of impartiality – An adverse decision alone does not establish a lack of impartiality - Keating v Morris [2005] QSC 243 applied.
Appellant submitted that trial Judge erred in making an order splitting his superannuation without notice to his current partner and in awarding the respondent 30 per cent of the superannuation – Not established that trial Judge’s decision fell outside the ambit of a permissible exercise of his discretion - Norbis v Norbis (1986) 161 CLR 513 applied.
Appellant’s challenge that trial Judge erred in apportioning the property of the parties in shares of 70 per cent to the husband and 30 per cent to the wife, not made out – Trial Judge’s determination reasonably open to him.

Appeal and cross appeal dismissed

Appellant ordered to pay respondent wife’s costs

By Amended Notice of Appeal filed 2 September 2005 the husband appealed against orders made by Barry J on 1 July 2005 in proceedings between the wife, the husband, and EGOC as trustee for the EOC Trust (“the husband’s brother”).
By Notice of Cross Appeal filed 14 October 2005, the husband’s brother also appealed against the trial Judge’s orders. Both the husband and the husband’s brother sought that the orders made by Barry J on 1 July 2005 be set aside, and that the proceedings be remitted to a judge of the Family Court, other than Barry J, for a re-hearing of the wife’s claims against the husband and the husband’s brother. The wife resisted the husband’s appeal and brother’s cross appeal and sought to maintain the trial Judge’s orders.
The effect of the trial Judge’s orders which is relevant for the purpose of the appeal and cross appeal, was to cause the property, a unit in South East QLD, to be sold and the proceeds of such sale divided between the husband and wife in shares of 70 per cent to the husband and 30 per cent to the wife. The husband’s brother is the registered proprietor of the unit in South East QLD. The trial Judge’s orders also relevantly provided, by way of “splitting order”, for the wife to receive 30 per cent of the husband’s interest in a superannuation fund.

BACKGROUND

The husband was born in 1965 and was 40 years of age at the date of judgment. The wife was born in 1970 and was 35 years of age at the date of judgment. The parties commenced a relationship in 1997, married in 1998, separated under the one roof in August or September 1999 and finally physically separated in March 2000.
There are two children of the marriage, born in 1998 and 2000, the children being aged 6 years and 5 years respectively at the date of judgment. The children have lived primarily with the wife since the separation of the parties and, by virtue of orders made by the trial Judge on 1 July 2005, which are not the subject of appeal, will continue to primarily reside with the wife in the future.
The unit in South East QLD was acquired in 1997 in the name of the husband’s brother. The wife contended that the property had at all material times been owned beneficially by the husband and was “property” in respect of which an order could be made in her favour pursuant to s 79 of the Family Law Act 1975 (Cth) (“the Act”).
The wife’s claim was resisted by both the husband and the husband’s brother who asserted that the property was held by the husband’s brother on trust for the EOC Trust. The beneficiaries of the trust purportedly created by a deed of settlement dated 20 July 1997 included the husband, his brother, his sister (primary beneficiaries) and, amongst others, any children of those primary beneficiaries as secondary beneficiaries. The children of the marriage of the husband and wife in this appeal fell within the definition of “secondary beneficiaries”.
The wife claimed that the funds used to acquire the unit in South East QLD (approximately $355,000.00) had been provided by the husband. Save possibly for a deposit of $30,000.00, and some expenses associated with the acquisition of the property, the husband and the husband’s brother disputed that claim, asserting that at least $322,000.00 of the purchase price of the unit in South East QLD had been provided by the husband’s brother. Other than such interest, if any, as the husband had in the unit in South East QLD, and a superannuation interest of the husband, the parties had no significant tangible assets.
The husband had, by virtue of his being a member of the Australian Parliament for ten years, acquired an interest in the Parliamentary Contributory Superannuation Scheme (“PCSS”), which interest was in the payment phase, such interest being paid on a periodic basis as a pension.

10. Each of the parties had formed new relationships of which there have been children. The husband and his partner Ms HDS, with whom the husband continues to reside, have children born in April 2002 and March 2005. The wife and Mr MN with whom she continues to reside, have a child born of that relationship in September 2003.

JUDGMENT OF THE TRIAL JUDGE

11. Having identified the orders sought by the parties, including orders with respect to their children, the outcome of which assumes no significance in this appeal, the trial Judge made an “Assessment of Witnesses” in the course of which “[b]y and large [he] found the wife a credible witness” (Judgment, paragraph 14).

12. His Honour said of the husband:

23. I formed such a poor view of the husband’s credibility that unless his evidence is corroborated in some reliable manner, I am reluctant to accept it.

13. Whilst the trial Judge gave detailed reasons for his conclusions with respect to credibility, there having been no specific challenge in that regard in this appeal, it is unnecessary to refer to such reasons.

14. His Honour referred to a number of instances of the “Husband’s Non-Compliance with Court Orders” (paragraphs 26-31), and recorded that the husband had:

31. … not given proper disclosure of many documents including the financial statements of various companies with which he is associated, in particular, the bank accounts of such companies nor did he disclose the existence of an account with Colonial First State from which he said cash monies were drawn and deposited to his National Australia Bank account.

15. The trial Judge was critical of the husband’s conduct with respect to the “Inspection of the SE QLD unit” to enable a valuation of the property to be undertaken for the purpose of the proceedings (paragraphs 32 & 33), and to the absence of “disclosure of documents” with respect to rental monies paid during “the brief period that the property was tenanted”.

16. The “Procrastination by Husband” was detailed by the trial Judge, in the course of which he referred to the failure to register the transfer of the SE QLD unit “for about 5 years after the initial date of settlement” (Judgment, paragraph 38). His Honour was “extremely sceptical of the explanations given by the husband” for such delay (Judgment, paragraph 38).

17. Under the heading “S79 Factors” the trial Judge considered “Initial contributions” of each of the parties, finding in that regard that “[a]t the time of commencement of the relationship in 1997 there is no evidence of the wife having any assets of significance” (Judgment, paragraph 86) whilst, at that time, the husband “would have had a substantial equity” in two properties which the husband had acquired (in Cairns and Brisbane) in 1988.

18. The sale of those properties by the National Australia Bank “as mortgagee in possession” in 2002 was found to have realised a net sum of $93,000.00 of which $85,000.00 the husband caused to be paid to his mother (Judgment, paragraph 87).

19. The trial Judge found that there was “no accounting exercise undertaken by the husband to establish exactly how much was said to be owing to his mother and how such sum was calculated” (Judgment, paragraph 87), ultimately concluding that “[w]hilst the husband’s initial contributions were significant, it is apparent this was later dissipated when the bank foreclosed on the two properties” (Judgment, paragraph 88).

20. The “Work History” of each party was detailed. The wife had not “been employed at any time after the marriage” (Judgment, paragraph 89).

21. Reference was made to the husband having been “a member of the Federal Parliament for ten years”, during which period he “also earned some additional income through consultancy work for a Mr PN”.

22. In the period since June 1999 the husband had been associated with “a number of failed business ventures” the losses from which, exceeding $100,000.00, the trial Judge concluded to be “genuine” and not involving “a reckless wasting of assets on the part of the husband” (Judgment, paragraph 90).

23. On such evidence as the husband adduced the trial Judge concluded that, from early September 2003, the husband had been earning approximately $2,876.00 per week although:

91. … No financial statements prepared by an accountant or tax records of LV [a company controlled by the husband] have been produced other than some financial statements prepared by the husband himself.

His Honour was “not satisfied as to the reliability of such financial statements” (Judgment, paragraph 91).

24. His Honour found that:

92. By using the vehicle of LV the husband has been able to significantly reduce his taxable income from what it would have been had he contracted directly with the employer.

25. The wife’s evidence that she needed to be available to care for the children, one of whom had special needs, and would need approximately two years’ further training before qualifying as a counsellor and being able to attempt to obtain some employment was accepted by the trial Judge (Judgment, paragraph 94).

26. His Honour found that at “this point in time, neither party has any real estate nor do the respective partners” (Judgment, paragraph 95).

27. None of the findings of fact thus far referred to has been challenged in this appeal.

28. The trial Judge detailed the contributions of the parties, and the reasons for his conclusion that they favoured the husband over the wife in shares of 85 per cent and 15 per cent respectively. It is unnecessary, save with respect to the husband’s superannuation interest, to refer to those in detail given that the primary focus of the appeal and cross appeal is the assertion that the trial Judge erred in finding that the SE QLD unit was “property” of the husband. As his Honour recorded, and is not in dispute, other than the SE QLD unit and the husband’s superannuation interest, the parties had no “property” of significance. Implicit in the husband’s case was an assertion that the contribution entitlement of the wife, properly being to a fund of minimal or no value, the percentage of such entitlement was immaterial.

29. Different considerations however apply to the trial Judge’s conclusions with respect to the husband’s superannuation interest and reasons for such conclusions, which are contested by the husband in this appeal. As with the other “property” of the parties, his Honour concluded that the wife’s entitlement in respect of the husband’s superannuation interest should be assessed at 15 per cent (Judgment, paragraph 98), for reasons which his Honour gave (Judgment, sub-paragraphs 98 a – g).

30. In reliance upon a series of matters which he particularised, the trial Judge determined that an adjustment of 15 per cent in the wife’s favour by virtue of s 75(2) factors was appropriate (Judgment, paragraphs 99-109). Save so far as that adjustment impacted upon the husband’s superannuation interest, which it did to the extent of 30 per cent having regard to the contribution finding, the quantum of such adjustment and reasons for it have not been specifically challenged in the appeal, although the extent to which such outcome fell within the scope of a reasonable exercise of discretion was agitated in submissions on behalf of the husband.

31. Under the heading “Husband’s Superannuation Entitlement”, the trial Judge referred to the period of the husband’s membership of the PCSS (from 1990 – 1999) relative to the parties’ cohabitation (early 1997 – March/April 2000), and to the current entitlement of the husband of $59,073.00 per annum (Judgment, paragraph 115).

32. A number of submissions made on behalf of the husband were referred to by the trial Judge, including the submission that Ms HDS was “vested with a reversionary interest and the only reversionary interest” in respect of the husband’s superannuation interest. He concluded that the “appropriate time for determining who has a vested interest in a reversionary interest is at the time of death” (Judgment, paragraph 117), of the husband in this case.

33. For reasons which he gave (Judgment, paragraph 117), the trial Judge rejected the contention of the husband that the failure to join his present partner as a party to the proceedings was fatal to the wife’s application with respect to the husband’s superannuation interest, by virtue of his conclusion with respect to the absence of a relevant interest on the part of Ms HDS, the circumstances surrounding her residence with the husband, and her knowledge of the course of the trial (Judgment, paragraph 117 d).

34. His Honour rejected the submission on behalf of the husband that “the Parliamentary annuity is incapable of alienation” (Judgment, paragraph 117 e), for reasons which he gave. As no part of this appeal relates to such conclusion, it is unnecessary to refer to the trial Judge’s reasons in that regard.

35. By reference to the relevant regulations, the trial Judge found the value of the husband’s superannuation interest, based on the undisputed current annuity of $59,073.77 to be $1,715,437.00. There is no challenge to the accuracy of such calculation, or to the calculations which followed to implement the intention to “make a splitting order of 30% of the husband’s overall pension entitlement” in favour of the wife (Judgment, paragraph 130).

36. The issue of the “Ownership of the SE QLD unit” was extensively addressed by the trial Judge (Judgment, paragraphs 134 – 174).

37. His Honour concluded in that regard that “the Trust which purports to be the registered owner of [the SE QLD unit] was not validly created and does not exist as a legal entity” (Judgment, paragraph 171 c), and, “as an alternative finding, that if the Trust has been validly created it is, in fact, a sham” (Judgment, paragraph 174).

38. For the reasons which he thus detailed (Judgment, paragraph 171), the trial Judge concluded that the husband was the beneficial owner of the SE QLD unit and that, as such, it was “property” of the parties to the marriage.

39. Given, as will be seen, that much of the appeal and cross appeal relate to the trial Judge’s conclusions with respect to the beneficial ownership of the SE QLD unit, and that, in considering the challenges raised by each of the husband and his brother, extensive reference will need to be made to the trial Judge’s reasons, it is unhelpful to set those forth in detail at this stage.

40. His Honour thus found (Judgment, paragraph 181) that the total assets of the parties, other than the husband’s superannuation entitlement, which could “only be received as a periodic payment” totalled $712,431.00. The SE QLD unit represented $660,000.00 of such sum, the remaining $52,431.00 being monies held by the husband in a Heritage Building Society Account, in respect of which $30,600.00 was, his Honour determined, to be paid to the wife by way of arrears of spousal maintenance. The net assets of the parties were thus $681,831.00 (Judgment, paragraph 189).

41. The husband’s appeal against the trial Judge’s order with respect to arrears of spousal maintenance having been abandoned, it is unnecessary to refer further to the reasons for such order.

GROUNDS OF APPEAL CONCERNING THE ACQUISITION OF THE SE QLD UNIT

42. Senior Counsel for the husband first directed his submissions to the challenge to the trial Judge’s conclusions with respect to the beneficial ownership of the SE QLD unit, submitting, in essence, that the trial Judge had erred in concluding that the trust purportedly created by deed of settlement dated 20 July 1997 (the EOC Trust), had not been validly constituted, or had not been “validly created and does not exist as a legal entity”, and erred in concluding that “if the Trust has been validly created it is, in fact, a sham”, and in finding that the husband beneficially owned the SE QLD unit.

43. Senior Counsel articulated these challenges by reference to grounds 7 & 8 of the Amended Notice of Appeal which provided:

7. The finding by the trial judge that the appellant was the beneficial owner of the SE QLD unit was contrary to the evidence and to the weight of the evidence.
8. The finding by the trial judge that the EOC Trust was a sham was contrary to the evidence and the weight of the evidence.

44. Counsel for the husband’s brother, who was also Junior Counsel for the husband on the hearing of the appeal, adopted the submissions of Senior Counsel for the husband in relation to the challenges to the trial Judge’s conclusions with respect to the beneficial ownership of the SE QLD unit, and did not make any submissions in addition to those made by Senior Counsel for the husband.

45. It is convenient to address the various challenges raised by the Amended Notice of Appeal and Notice of Cross Appeal in the sequence appearing in Senior Counsel for the husband’s Supplementary Summary of Argument given that, by adoption, such document represents the outline of the husband’s brother’s contentions, and was responded to sequentially by Senior Counsel for the wife.

46. The grounds of the Notice of Cross Appeal relied upon by the husband’s brother which are relevant for present purposes, appear to find expression in a number of places throughout such grounds of appeal, notably that “His Honour erred in the following”:

2.   In misdirecting himself,
b.   as to his proper role as presiding Judge by ‘entering the arena’ and assuming the role of the wife’s advocate, where the wife was legally represented; which error was an error of Law; and
c.   by taking account of irrelevant considerations and/or failing to take account of or give and/or place any, or any due, weight upon relevant considerations or finding or inferring facts on no evidence, or contrary to uncontroverted evidence:
i.As to the EOC Trust Deed (the Deed);
(a)    by wrongly refusing or failing to enter the Deed as an exhibit; and
(b)   by ‘entering the arena’ and/ or mounting a challenge to the Deed from the bench when the genuineness and veracity of the Deed was not seriously controverted, challenged or impeached by the wife and where no admissible evidence had been introduced in the wife’s case to support such an attack, either at all or, the burden of proof on that issue being hers, to the relevant standard of proof; and
(c)    by having regard to and giving weight to unstamped drafts and incomplete copies of the Deed, which material was irrelevant, and when the best evidence, was in Court; and/or
(d)   by failing to have regard to, or placing no, or no sufficient, weight upon the terms and content of the duly stamped Deed, which evidence was relevant and the best evidence; and
(e)    by denying the effect of the Deed at Law ([sic] equity) without any consideration of the rule of the five certainties of creation of an express written trust and in the absence of evidence before him sufficient to impeach the instrument, or the circumstances of its creation, and/ or which otherwise supported a case of unclean hands against the Cross-Appellant; and
(f)     the Cross-Appellant repeats and relies on the terms of Ground 2 b. (ii) (c) [post]
ii.As to the EOC Family Trust (the Trust),
(a)    by mounting a challenge to the genuineness and veracity of the Trust when the Trust had not been seriously controverted by evidence in the wife’s case; and the Cross Appellant repeats and relies on Ground 2 b. (i) (a). hereof
(b)   by failing to consider, either adequately or at all, or to give any or any sufficient weight to the uncontroverted fact and/or consequential inferences consistent with common experience arising, that the Trust was established during the currency of the parties’ marriage; and, or in the alternative
(c)    by failing to apply the required standard of proof, (either on cogent evidence, or by identifying on the face of the Reasons any fact in the evidence, which by itself or in combination with any other fact or facts, supported a reasonable inference and an independent finding of fact accordingly), to find that the husband had planned measures during the early days of the marriage which were intended, contingently, to defeat the wife in the event of a failure of their marriage and/or that the Cross-appellant was complicit in such a contingency plan and/or that the Trust was a vehicle forming part of such a plan and wholly a sham accordingly; and
(d)   As to the source and ownership of the funds used to purchase the SE QLD unit; and
(e)    By misconceiving or interpreting, without giving any, or any due consideration to any possible alternative explanations, the unchallenged documentary evidence before him contained within Exhibit 351 (message slip of Messrs BP & Co Solicitors [para 168 Reasons]) which evidence, (contained, as it was, in a document of an unimpeached non-party), was in fact not ambiguous or open to interpretation; and
(f)     the error at A hereof occurred where there was neither direct, nor collateral evidence from the author of exhibit 351, supporting His Honour’s, or indeed any, conclusion adverse to the Cross-Appellant; and
(g)    by merely assuming or just supposing that the Appellant husband had received substantial income [amounting to $A323,000 ] from overseas employment through his association with the C Foundation, when there was no evidence or any plausible cogent evidence from any source, including the C Foundation, to support that conclusion; and
(h)    by finding, wrongly and contrary to the terms of document itself, that the Trust account receipt of Messrs BP & Co recorded that monies had been received by that firm from the C Foundation [paragraph 163 Reasons] when no words recording the fact asserted in fact appear on the face of the said exhibit.
(i)   by finding, wrongly and contrary to the unchallenged evidence or preponderance of evidence that the Appellant Husband owned the funds used to purchase the said the SE QLD unit

c.As to the husband being the beneficial owner of the SE QLD unit
i.in consequence of the errors particularized at Grounds 1 and 2 a. – b. hereof, herein His Honour’s finding is unsupported by and/or contrary to the evidence

d.As to EGOC obtaining no benefit from the Trust,
i.by failing to consider or to give any weight at all to the unchallenged facts in evidence that the duly registered legal owner of the said Unit; and
ii.had realized almost a full 100% capital gain on the original purchase price of the unit over the nearly 10 year period it had been held; and
iii.had enjoyed that capital gain without incurring on-going outlays; because
iv.most, if not all, post-purchase outlays liabilities had been paid by others,

3. AND, on the Grounds stated herein, in finding that,
a.the EOC Trust was not validly created; and
b.alternatively, the EOC Trust is and always was a sham; and
c.the funds used to purchase the SE QLD unit belonged to and were provided by the Appellant husband; and
d.the funds used to purchase the SE QLD unit were not the property of the Cross-Appellant; and
e.the Cross-Appellant obtained no benefit from the EOC Family Trust; and
f.that the SE QLD unit is and always was the sole property of the Appellant husband.

SUBMISSIONS CONCERNING ACQUISITION OF THE SE QLD UNIT

47. Numerous submissions were made in relation to the trial Judge’s conclusion with respect to the validity of the EOC trust (Appellant’s Supplementary Summary of Argument, paragraphs 1.1 – 1.12 inclusive).

48. As is apparent from those written submissions, and the matters agitated by Senior Counsel during the course of oral submissions amplifying such submissions, a number of potentially complex issues were thereby raised, most of which were either not raised on behalf of the husband or his brother before the trial Judge or, to the extent that they were, were not raised with the expertise or thoroughness with which this Court has been favoured on appeal.

49. As Senior Counsel for the husband submitted “the SE QLD unit cannot be made the subject of a Court Order unless it is the property of the appellant [husband]” (Appellant’s Supplementary Summary of Argument, paragraph 1.4).

50. Only in the event of the challenge to the trial Judge’s conclusion, that the acquisition of the SE QLD unit by the EOC Trust, if it was “validly created”, was “a sham” (paragraph 174), succeeding does it become necessary to determine whether or not the EOC Trust was “validly created”. In short, if the challenge to the trial Judge’s conclusion that the husband beneficially owned the SE QLD unit fails, it is of little more than academic interest to decide whether or not the EOC Trust was in fact validly created. Conversely, if the challenge to the trial Judge’s conclusion with respect to the “sham” succeeds, that issue assumes practical importance. In our view, it is thus preferable to first consider the challenge to the trial Judge’s conclusion that if “validly created” the acquisition of the SE QLD unit by the EOC Trust was “a sham”.

51. Senior Counsel for the husband acknowledged that it was open to the trial Judge to have “found that the purchase money [for the acquisition of the SE QLD unit] was transferred to the solicitor’s trust account by Cootts & Co on behalf [of] C Foundation” (Appellant’s Supplementary Summary of Argument, paragraph 1.13).

52. The submissions further acknowledge that such funds were “used by EGOC to purchase the unit” (Appellant’s Supplementary Summary of Argument, paragraph 1.14), although it was submitted that:

Once the money became trust money, it could only be dealt with under the terms of the trust, viz for the benefit of specified beneficiaries at the sole discretion of the trustee. Whoever originally was the beneficial owner of the money could no longer get it back or have any control over its use. (Appellant’s Supplementary Summary of Argument, paragraph 1.14)

53. Senior Counsel submitted that for the SE QLD unit:

… to be regarded as property of the husband, it is necessary to prove by proper evidence that the husband has effective control over the trustee. The reported cases show that this can be established if the husband has power to remove a trustee and appoint another or, if the trustee is a company, that he controls the shares in that company. (Appellant’s Supplementary Summary of Argument, paragraph 1.15)

54. It was further submitted that:

By refusing to receive evidence from the trustee, the Judge put himself in the position of deciding a relevant issue with only part of the available evidence, and in so doing, deprived the trustee of natural justice and working an injustice on the appellant. The comment of the Judge [V6, p.872] that “it is not the first time I have to decide cases on a lack of evidence” is instructive. (Appellant’s Supplementary Summary of Argument, paragraph 1.16)

55. As this submission makes clear, an assessment of the challenge to the trial Judge’s conclusions with respect to the beneficial ownership of the SE QLD unit involves an evaluation of a number of other grounds, in particular 1(c) of the Amended Notice of Appeal which provided:

(c)The trial judge permitted the first respondent to rely on material filed late but refused leave to the second respondent to file an affidavit that sought to respond to the first respondent’s allegations that the SE QLD unit was beneficially owned by the appellant;

and the following grounds of the Notice of Cross Appeal:

1. Denying the Cross-Appellant natural justice by wrongly refusing to receive relevant evidence being,
a.a true facsimile copy of the Affidavit of the Cross-Appellant on day one of the Trial
i.the reception of the fax copy was authorized by s. 11 (2) The Electronic Transactions Act of 1999 (Cth) as amended, and that refusal was an error of law; and
ii.where there was no prejudice to any party to the proceedings, either at all, or which could not be adequately remedied, either by the grant of an adjournment, other indulgence and/ or an order for Costs, which error was an error in the exercise of the discretion reposed; and/ or
iii.in the face of an explanation for the delay in complying with procedural Directions previously given in the case, wrongly placed case management principles before the requirements of the justice of the case; which was contrary to law; and

b.the original Affidavit of the Cross-Appellant on day four [4] of the Trial.

2. In misdirecting himself,
…
b.by taking account of irrelevant considerations and/or failing to take account of or give and/or place any, or any due, weight upon relevant considerations or finding or inferring facts on no evidence, or contrary to uncontroverted evidence:
i.As to the EOC Trust Deed (the Deed);
(a) by wrongly refusing or failing to enter the Deed as an exhibit;

56. Those complaints have dual significance, relating to both the challenge to the trial Judge’s conclusions with respect to the beneficial ownership of the SE QLD unit, and to the natural justice complaints made by the husband and his brother. For reasons which are not hard to understand, the course of submissions by Senior Counsel for the husband and the husband’s brother in relation to the beneficial ownership of the SE QLD unit traversed matters which are also relevant to the natural justice complaints raised in the appeal. These issues, at least so far as the receipt of the affidavit evidence sought to be relied upon by the husband’s brother, and the husband’s brother’s application to cross examine the husband, can conveniently be dealt with in the context of other submissions made in support of the challenges to the trial Judge’s conclusions with respect to the beneficial ownership of the SE QLD unit.

57. Senior Counsel for the husband submitted that the husband’s brother, in his capacity as trustee of the EOC Trust “did not want to be in all the case”, understandably, having no interest in the children’s matters which, it is plain from the transcript and the trial Judge’s reasons, occupied a significant part of the 12 days over which the trial proceeded.

58. Reliance was placed upon the written submissions made on behalf of the husband’s brother at trial, particular reference being made to the statements there appearing that:

At the pre-trial conference the second respondent foreshadowed that it would only have a limited participation in the trial. It is unreasonable for the second respondent to incur costs of appearance with respect to matters other than the property issue. The second respondent is not interested in any of the other issues in the trial.

59. Reference was made to a number of exchanges which occurred shortly after the trial commenced. Mr Leong, who then represented the husband’s brother, sought directions from the trial Judge as to when his client was “supposed to appear for cross-examination” and whether that might take place “down in Sydney because he’s currently employed down there” (Transcript of 6 June 2005, page 13).

60. The trial Judge asked (Transcript of 6 June 2005, page 14) whether the husband’s brother had “filed any material”, it being clear that the husband’s brother had not filed material although an unfiled affidavit had been “sworn and served” upon the wife’s legal representatives.

61. The trial Judge asked Counsel for the husband’ brother “Why should I allow it [the affidavit] to be filed? (Transcript of 6 June 2005, page 14). To which the husband’s brother’s Counsel responded that:

from the beginning of the whole proceeding our client has maintained a really strong view that the (indistinct) shouldn’t be involved in these proceedings in the first place and just - - -
His Honour then replied: “[w]ell, all the more why he should have filed his material earlier, I expect”, to which the husband’s brother’s Counsel replied, “[y]es, your Honour”.

62. There followed a discussion about the extent to which the husband’s brother intended “to participate in the trial process”, during which the husband’s brother’s Counsel confirmed that the husband’s brother did not intend to participate in the trial process “[i]f that’s possible”. The trial Judge suggested that the husband’s brother “does not intend to participate, otherwise he’d be here” to which the husband’s brother’s Counsel replied “[y]es” (Transcript of 6 June 2005, page 15).

63. The issue of the affidavit was at that point left on the basis that “you get his affidavit and then come to Court and seek to file it”, to which proposition the husband’s brother’s Counsel appeared to assent. The trial Judge added “I’ll hear submissions as to whether I should file it” (Transcript of 6 June 2005, page 16), to which the husband’s brother’s Counsel agreed.

64. Reliance was also placed upon two exchanges which occurred later in the trial. On 9 June 2005, the fourth day of the trial, the husband’s brother’s Counsel applied for leave to file the affidavit of the husband’s brother, informing the trial Judge that “I finally managed to have the affidavit with the relevant documents available” (Transcript of 9 June 2005, page 98).

65. Counsel for the wife informed the trial Judge that he had “received a copy of the affidavit a very short time ago” and “wouldn’t mind some additional time” to consider the document.

66. The trial Judge informed the husband’s brother’s Counsel that he had “considerable difficulties” with the affidavit, but would do Counsel “the courtesy of reading it, but at this point in time we are in the fourth day of what was set down as a five day trial”, and added:

- - - where your client has not filed a response despite directions to do so. Your client has not filed affidavits despite directions to do so. Your client has been totally non compliant with other directions of this Court; has not sought to appear; has not sought to question any witnesses, the whole circumstances. (Transcript of 9 June 2005, page 99)

67. None of the observations which fell from his Honour was then questioned by the husband’s brother’s Counsel. Counsel for the husband’s brother stated to the trial Judge:

We have consistently and very strictly told him that he has to comply with all of the directions from the order and from this Honourable Court, but he has always consistently say that he shouldn’t be involved in this because this is a (indistinct) and this proceeding shouldn’t be – and furthermore in part the delays due to the timeframe which we’re looking at which is seven or eight years, but according to my client it’s about coming to nine years, and the opportunity and he just want to be sure that his affidavit right and is correspond with the documentations which relates some time ago, and he just – yes, he just want to apologise to the Court and it takes him time to - - - (Transcript of 9 June 2006, page 100)
The question of the affidavit was then adjourned until 10 am the following morning, day 5 of the trial.

68. Reliance was placed upon exchanges which occurred on the fifth day of the trial, during which the trial Judge said:

I don’t propose to allow you leave to file that affidavit … EGOC is a litigant in these proceedings. It’s simply not good enough to come forward – I’m not attributing blame to you, Mr Leong. … the fact is it’s not good enough for a litigant who has failed to comply with directions; who’s not filed a response; who’s not taken part in the litigation process, to come in on the fourth day of the trial and seek to file an affidavit. (Transcript of 10 June 2005, page 139)

69. His Honour added:

… if he wishes to come in at this late stage and appear and make submissions, he’s at liberty to do so or you on his behalf. You’re welcome to stay and make submissions on his behalf at the appropriate time. But it’ll be based on the evidence that’s before me, properly before the Court, not on his version of events, because he hasn’t elected to properly file his material. (Transcript of 10 June 2005, page 139-40)

70. It was thus submitted that the effect of the trial Judge’s order was “to direct the trustee to sell trust property and distribute the proceeds in breach of trust without having given the trustee the opportunity to put in evidence” (Appellant’s Supplementary Summary of Argument, paragraph 1.18). The order was submitted to be an order that the Family Court “has no power to make”. Reliance was placed upon numerous passages in the judgments of the High Court in Ascot Investments v Harper (1981) 148 CLR 337, the effect of which we accept is to establish that:

Except in the case of shams, and companies that are mere puppets of a party to the marriage, the Family Court must take the property of a party to the marriage as it finds it. The Family Court cannot ignore the interests of third parties in the property, nor the existence of conditions or covenants that limit the rights of the party who owns it. (per Gibbs J at 355)

71. It was further submitted that the “alternative finding that the establishment of the EOC Trust was a sham is contrary to the documentary evidence – Contract of Sale, Transfer, Trust Deed” and that there was “no other evidence capable of leading the Judge to that conclusion” (Appellant’s Supplementary Summary of Argument, paragraph 1.19). That contention was sought to be supported by reference to the decision of the Full Court of the Federal Court in Sharrment Pty Ltd v Official Trustee (1988) 18 FCR 449, and of Moss J in Wilson v Wilson; Figtree Gardens Caravan Park Pty Ltd; Wilson; Wilson (1994) FLC 92-498.

72. In Sharrment Lockhart J, with whom Beaumont and Foster JJ agreed, said after reviewing a number of English and Australian authorities, at 454:

A "sham" is therefore, for the purposes of Australian law, something that is intended to be mistaken for something else or that is not really what it purports to be. It is a spurious imitation, a counterfeit, a disguise or a false front. It is not genuine or true, but something made in imitation of something else or made to appear to be something which it is not. It is something which is false or deceptive.

73. Under the heading “Particular elements of ‘sham’ transactions” Lockhart J said at 454-5:

… there is some authority which assists in recognising the significance of particular elements of the transaction.
First, the fact that the transaction involved a round robin of cheques does not necessarily establish that the transaction is a sham, even when no party has funds to meet the cheques: Perpetual Trustee Co Ltd v Barnett (1969) 90 WN (Pt 1) (NSW) 637.
Secondly, the artificiality of the transaction does not give rise to its characterisation as a sham or to the characterisation of the constituent documents as a sham so long as each document "had the effect that it purported to have", and so long as none of the documents purported "to do something different from what the parties had agreed to do": Inland Revenue Commissioners v Littlewoods Mail Order Stores Ltd [1963] AC 135 at 155 per Lord Reid.
Thirdly, the complexity of the transaction does not in itself establish its character as a sham. In Coppleson's case Hunt J of the Supreme Court of New South Wales considered a gift to a hospital of redeemable preference shares instead of cash. His Honour observed (at 100; 4023) that the fact that "the transaction became complex and elaborate rather than simple and straightforward does not seem to me to affect its true nature if in legal form it is a gift and if the parties thereto intended it to be operative according to its tenor".
Fourthly, a purported disposal of property, and by analogy a purported creation of a debt, may be a sham where donor and donee (or lender and debtor) do not intend to give effect to the transaction, it being agreed between them that there will be no change in the legal and beneficial ownership of the property. The fact that Mr Wynyard continued to act as though The Chase was in his control may give rise to an inference that the transactions which led to its being purchased in the name of Seyta with funds apparently the funds of Seyta were a sham.
Fifthly, the fact that the transactions of 1979 may have been intended by Mr Wynyard to present a shield against creditors does not, absent the transactions being set aside under the relevant provisions of the Bankruptcy Act, characterise them as a sham. The transactions may in themselves be legally effective although intended to achieve an inacceptable purpose...

74. In Wilson Moss J said at 81,188:

The leading authorities as to the circumstances which may justify labelling a particular transaction as ``a sham'' are collected in the decision of the Full Court of the Federal Court in Sharrment Pty Ltd v Official Trustee in Bankruptcy (1988) 18 FCR 449. From that case and the authorities therein collected, and so far as relevant to the circumstances of the present case, the following propositions emerge as requiring careful consideration before a transaction can be characterised as a ``sham'' (an expression itself infected with ambiguity and uncertainty (at 453)):—
(a) Before a transaction can be so characterised, it is necessary to find both a common intention among participants to the transaction and a disjunction between the appearance and reality of the transaction (at 452) — the question is: Did the parties who entered into the ostensible transaction mean it to be a facade, concealing their real transaction? (at 453) — Were the acts done or documents executed by the parties which are intended by them to give to third parties or to the Court the appearance of creating between the parties legal rights and obligations different from the actual legal rights and obligations (if any) which the parties intend to create? (at 454);
(b) It does not establish that a transaction is ``a sham'' simply to show that it involved a round robin of cheques, even when no party has funds to meet the cheques, or that the transaction contained artificial elements (at 454) or that it was done for an ulterior purpose (at 455);
(c) Where (as is the case here) the transactions were between parties who were not ``at arm's length'' the fact that there may be an absence of a commercial basis for the arrangement does not mean that the arrangements were not genuine (at 468);
(d) To draw an inference from the surrounding circumstances that a particular transaction is ``a sham'' is to reach a strong finding, and one which cannot be made if another inference is at least equally open (at 461).

75. In oral submissions, Senior Counsel for the husband submitted that a number of the findings relied upon by the trial Judge were irrelevant to “the sham issue”, and that, notwithstanding any of the unusual aspects of the creation of the EOC Trust, the trust had been validly created according to the laws of trusts.

76. Reference was made to the trial Judge’s findings in relation to paragraphs 144 and 145 of the trial Judge’s judgment, wherein he recorded:

144. F339 purports to be the minutes of a meeting of the Trustee for the EOC Trust held in Brisbane. The minutes show that EGOC was present as Chairman. The husband says that EGOC attended by phone (presumably from London or California). The meeting was held, according to the husband, in the office of his accountant in Brisbane on the date noted, namely 20 July 1997. The resolution was in the following terms:
a.Resolved that the Trustee(s) accept the Trusteeship of the Discretionary Trust and accept the sum of $10 (Ten dollars) from the settlor to be held under the terms of the Trust and that the Trustee(s) sign the Trust Deeds.
b.Bank Account – Resolved that the Trustee(s) take appropriate steps to establish a banking account for the Discretionary Trust.

The document is signed as a correct record by WGOC for his brother EGOC.

and found:

145. The effect of the husband’s evidence is that he attended on Sunday 20 July 1997 at his accountant’s office, in company with a staff member, for the sole purpose of having a telephone linkup with his brother who was overseas, for the purpose of establishing the Trust prior to the execution of the Contract of Sale. In effect, EGOC was holding a meeting with himself with the others as bystanders. I make the following observations and findings:
a.I find it highly unlikely any such meeting was held at the accountant’s office on a Sunday as claimed.
b.I find it highly unlikely EGOC attended the meeting by phone.
c.I find it highly unlikely a Power of Attorney document whereby EGOC gave a limited Power of Attorney to WGOC ever existed.

77. No challenge to any of the findings of fact there made has been mounted in this appeal. As with other findings of fact made by the trial Judge, the husband’s case was essentially that such matters were incapable of supporting the trial Judge’s conclusion that the acquisition of the SE QLD unit by the EOC Trust was a “sham”.

78. Reference was made to the trial Judge’s finding that “[t]here is no evidence before the Court whereby EGOC claims the Trust is the beneficial owner of the SE QLD unit” (Judgment, paragraph 149), it being submitted that such matter could not be relied upon by the trial Judge, essentially for the reasons appearing in the following paragraph where his Honour said:

150. I accept an attempt was made to file a brief affidavit by the second respondent on the fourth day of the hearing as noted in paragraph 136. A copy of this affidavit has been retained with the Court papers.

79. It was submitted by Senior Counsel for the husband that the fact that the money to purchase the SE QLD unit was paid to the trust by the husband’s brother was determinative of questions relating to the trust, and fatal to the “sham” claim by the wife. The actual owner of that money was in our view determinative of the issue, not simply who caused it to be paid. The trial Judge’s finding that “[i]t was never made clear why the unit could not simply have been purchased in EGOC’s name or why the Trust needed to be created at all” (Judgment, paragraph 162), was said to be irrelevant to the issues before him. We consider that such matters, though not decisive of the issue, or suggested to be by the trial Judge, were matters properly able to be considered in the context of the “sham” issue.

80. Senior Counsel submitted that the trial Judge erred in concluding that the “husband is the beneficial owner” of the SE QLD unit (paragraph 171) and in particular erred in recording that:

b.EGOC has been joined in these proceedings. He has not complied with directions to file material. He has not sought to take an active part in the proceedings, notwithstanding the significance of the wife’s claims to his interest. Insofar as the legal representatives for EGOC said that he did not wish to be involved in a protracted hearing involving children’s issues as well, no application was ever made to have a discrete hearing on this issue, either as part of the Trial or as a separate hearing. (Judgment, paragraph 171)

81. The trial Judge was submitted to have erred in suggesting that neither the trust nor the husband’s brother had ever “received any benefit” from “ownership” of the SE QLD unit, as the trust would gain the considerable benefit of the increase in value of the SE QLD unit, from $355,000.00 in 1997 to $660,000.00 in 2005.

82. It was thus submitted that, on the evidence before him, the trial Judge could not, either by reference to the judgment of the High Court in Ascot Investments or the Full Court of the Federal Court in Sharrment, have been satisfied that the acquisition by the husband’s brother of the SE QLD unit as trustee for the EOC Trust was a sham.

83. The trial Judge’s conclusions in relation to the sham issue were asserted to have been further tainted by reason of his rejection on the fourth day of the trial of the affidavit of the husband’s brother. The passages relevant for that purpose were identified earlier in Senior Counsel’s submissions (Appellant’s Supplementary Summary of Argument, paragraph 1.17) and have been re-produced earlier in these reasons.

84. During the course of his oral submissions, Senior Counsel for the husband also referred the Court to the transcript in relation to the application on behalf of the husband’s brother to cross examine the husband, which application the trial Judge refused for reasons which he then gave. Those reasons were published during the hearing of the appeal.

85. It is common ground that the numerous annexures to the husband’s brother’s affidavit sworn 2 June 2005 (Exhibit 1 in the appeal) were, prior to the attempt to rely upon that affidavit, all already in evidence in Exhibit 6, which comprised two substantial volumes of documents. It was not suggested in the appeal that receiving the husband’s brother’s affidavit would have placed before the trial Judge any document not already in evidence. It was submitted however, that, by refusing to allow the husband’s brother to rely upon his affidavit, in circumstances constituting a denial of natural justice, the trial Judge denied himself the opportunity to have relevant evidence in relation to the trust issues. To better evaluate this assertion it is necessary to consider what the husband’s brother said in his affidavit.

86. The affidavit of the husband’s brother asserted:

1.   I am the trustee of the EOC Trust and duly authorized to swear this affidavit.
2.   I appointed Mr WGOC as my power of attorney as I was residing out of the Country. ~~Attached hereto and marked annexure “EOC 1” is a true copy of the Power of Attorney~~.
3.   On or about 20 July 1997 I instructed WGOC, my brother, to execute on my behalf and as my power of attorney the Trust Deed for the EOC Trust. Attached hereto and marked annexure “EOC 2” is a true copy of the Trust Deed of the EOC Trust.
4.   The EOC Trust is a Discretionary Trust of which the named primary beneficiaries are my self, my brother WGOC and my sister AJOC.
5.   In or about July 1997, the EOC Trust entered into a contract to purchase the property situated at [South East QLD] (“the Property”) from VM. Attached hereto and marked annexure “EOC 3” is a true copy of the contract.
6.   I caused the EOC Trust to buy the Property because I considered it a good investment.
7.   As the vendor was pressuring for an immediate deposit and transfer of funds held by me offshore could not occur in time to meet the vendor’s demands, my brother paid the $15,000 deposit from his funds. I am not aware of his bank account details. It was agreed that this amount to stand as a loan to the trust.
8.   On or about 15 August 1997 I caused the sum of $320,217.42 (“the Purchase Funds”) to be deposited into the Trust Account of Brown and Fowler Solicitors with respect to the purchaser of the property. Attached hereto and marked annexure “EOC 4” is a true copy of the Trust Account Receipt.
9.   The Purchase Funds were my funds, which I caused to be sent to the Trust Account of BP & Co Solicitors prior to the contract being completed. The funds were transferred from Coutts and Co in Hong Kong.
10. I derived the Purchase Funds from dealing in securities. That is by the acquisition and sale of shares in an oversubscribed primary issue. By this means I was able to derive substantial profit from the difference between the issue price and the price that they were paying in the secondary market before open trading started. I was able to make this profit without any capital investment. These profits were held in offshore accounts and transferred to the BP & Co trust account whilst I was a non resident. These profits were received by me shortly before the purchase of the unit.
11. Attached hereto and marked annexure “EOC 5” is a bundle of documents relating to the purchase and settlement of the purchase of the Property.
12. The outgoings for the Property have been paid in lieu of rent by my brother WGOC whilst he occupied the apartment and also by AF whilst she occupied the apartment. The rates on the unit are not substantial. The last rates statement was for $746.33, and preceeding [sic] years would have been for approximately this amount or less. Thus, in the last eight years, the rates paid on the unit would amount to approximately $6,000. I had arranged with my brother that he would take care of all administrative matters dealing with the unit as I was out of the country for a number of years.
13. The EOC Trust has not lodged any Tax Returns nor maintained any bank account because it has not earned taxable income. The money was held in offshore accounts prior to the transfer being made to BP & Co and as I was a non resident in 1997 no tax return was required to be made.
14. The trust has not made any distributions to beneficiaries.
15. All the facts and circumstances herein deposed to are within my own knowledge except for those deposed to from information only and my means of knowledge and sources of information appear on the face of this my affidavit.

87. As is clear from the version of the affidavit produced on the first day of the trial (Exhibit 2 in the appeal), the only difference between the affidavit sought to be relied upon on the fourth day of the trial and the earlier affidavit was the deletion of the second sentence of paragraph 2 of the affidavit, a line having been drawn through that sentence on the second version of the affidavit. The first affidavit (Exhibit 2) was sworn on 2 June 2005, the same day as was Exhibit 1. No explanation for either the assertion that a copy of the power of attorney was annexed to the first affidavit, or for the retraction of that assertion in the second affidavit was ever offered.

88. To the extent that there was any foundation for concluding that the trust’s acquisition of the SE QLD unit constituted a “sham”, which was not conceded, it was thus submitted that the affidavit of the husband’s brother would have potentially removed any such foundation and, if accepted, would have precluded a positive finding in relation to any sham.

89. In his submissions in reply, Senior Counsel for the husband re-iterated that, the trust having been validly created, the SE QLD unit undoubtedly having been registered in the name of the husband’s brother as trustee for the trust, the wife bore the onus of establishing that the trust was not the beneficial owner of the property and that the husband was. It was submitted that the trial Judge had, in effect, “reversed the onus” which the wife bore in relation to that issue, and that only by thus reversing the onus of proof, could his Honour have concluded as he did with respect to the sham. Finally, it was submitted that the wife’s evidence could not be used to “upset the balance of public documents” and that, on the evidence the wife could not establish that the transaction had been a sham.

90. In his submissions, Senior Counsel for the wife accepted that the test emerging from the decision of the Full Court of the Federal Court in Sharrment was the appropriate test for determining whether, in the circumstances, the wife had established that the acquisition by the EOC Trust of the SE QLD unit was a sham.

91. Senior Counsel for the wife placed considerable reliance upon the fact that none of the findings relied upon in relation to the “sham” issue had been challenged in this appeal.

92. To the extent that the husband or his brother had been precluded from presenting evidence by virtue of the trial Judge’s refusal to receive the husband’s brother’s affidavit of 2 September 2005 (Exhibit 1) it was submitted that the annexures to the affidavit were already before the trial Judge and that, as such, rejection of the affidavit did not prejudice the case of either the husband or his brother insofar as such cases were reliant upon those annexures.

93. So far as the text of the affidavit was concerned, it was submitted that the only matters of which the husband’s brother was capable of deposing in a form that was admissible was the assertion by him that:

10. I derived the Purchase Funds from dealing in securities. That is by the acquisition and sale of shares in an oversubscribed primary issue. By this means I was able to derive substantial profit from the difference between the issue price and the price that they were paying in the secondary market before open trading started. I was able to make this profit without any capital investment. These profits were held in offshore accounts and transferred to the BP & Co trust account whilst I was a non resident. These profits were received by me shortly before the purchase of the unit.

94. The other matters referred to in the affidavit were submitted to be either, if established, established by documentation already in evidence, or, in the case of matters which were not thus established, not established by other documentation, and no more than allegations.

95. It was submitted that the absence of documentation evidencing any of the matters referred to in paragraph 10 of the affidavit was significant, particularly as the issue had been identified, in the circumstances to which Counsel referred, during the course of directions proceedings before the trial Judge three years earlier, on 4 July 2002.

96. Reliance was placed upon statements made by the solicitor for the husband’s brother during the course of the trial, albeit in the context of the application, on his behalf, to cross examine the husband. The exchange in question with Counsel then representing the husband’s brother revealed:

HIS HONOUR: Thank you. Mr Heard, I suggested to Mr Leong yesterday that there’s one critical piece of evidence that’s not available to the Court, and that is, the source of the funds from Kurtz and Co, which I understand is Merchant Bankers in London. All we know is that money was telegraphically transferred in July or August 1997. It arrived in a solicitor’s trust account on the Gold Coast. It would be so easy for your client to confirm, for example, that he had an account at Kurtz and Co at that time. It may well be that he could have obtained bank records going back to that period of time. These proceedings have been in process for quite a few years.
He may have his own records to show that he had that sort of money, cash, in an account somewhere at that point in time. To my knowledge, no such evidence has been adduced on his behalf. I invited Mr Leong yesterday afternoon to adduce that evidence.
MR HEARD: Your Honour, we have requested that of our client in relation to those records and he doesn’t have any copies of those records and he can’t recall the person at Kurtz and Co that he had dealings with with respect to the accounts.
HIS HONOUR: Any attempt been made to go to Kurtz and Co and say, “Have you got records going back to 1997?”
MR HEARD: Not by this firm, no, your Honour.
HIS HONOUR: Well, there should be some evidence somewhere that he had an account there.
MR HEARD: It could well be that the transaction being eight years ago that no such records may exist.
HIS HONOUR: But at least one could have asked. There’s no evidence before the Court that such request was ever made. Thank you, Mr Heard. (Transcript of 16 June 2005, page 373)

97. To the extent that the trial Judge was, by rejecting the husband’s brother’s affidavit, technically deprived of actual evidence “whereby EGOC claims the trust as the beneficial owner of [the SE QLD unit]” (Judgment, paragraph 149), it was submitted that there is no doubt that his Honour recognised that such was the claim of both the husband and his brother. It was thus submitted that, beyond the trial Judge having a sworn assertion by the husband’s brother, unsupported by any documentation or evidence of attempts to obtain such documentation that he held the SE QLD unit as trustee of the EOC Trust, the rejection of the husband’s brother’s affidavit had no impact upon the evidentiary foundation for the case of either the husband or his brother.

98. In reliance upon the evidence which the husband’s brother sought to adduce, as that emerged from his affidavit, it was submitted that, particularly in the light of the exchange with Counsel for the husband’s brother which we have set out above, cross examination of the husband by his brother could not possibly have advanced the latter’s case. There was submitted to have been no conflict in the evidence relied upon by the husband and that relied upon by his brother.

99. It was thus submitted that, whether or not it was a breach of natural justice, refusing the husband’s brother the opportunity to cross examine the husband did not in any way adversely impact upon the case sought to be presented by the husband’s brother.

Senior Counsel for the wife relied upon the absence of any challenge to the trial Judge’s credit findings, the terms of which we have set out earlier in these reasons. It was submitted that the trial Judge was entitled not only to accept the evidence of the wife and reject that of the husband, but also to rely upon the omission by the husband of “vital matters” in relation to the source of funds for the acquisition of the SE QLD unit.
On behalf of the wife it was conceded that a conclusion that the EOC Trust had been validly created did not necessarily mean that its acquisition of the SE QLD unit could not be or was not “a sham”.
In support of his submissions that the trial Judge’s conclusions as to the validity of the trust and the sham issue had been open to him, Senior Counsel for the wife relied upon a number of aspects of the evidence, including that of the wife in her affidavit filed 8 June 2004 wherein she deposed:
124.     I enquired of the Husband how he was paying for the unit. He advised me that was “secret mens’ [sic] business”. He did say that it did involve his brother, and it was being purchased in the name of a Trust.
125.     He did tell me that it was somehow being purchased in the name of a Trust, however that he was buying it by way of cash. He at all times lead me to believe that he was buying the unit himself as our residence. It was to be our home.
126.     The Husband’s mother acted for us in the conveyance. She had a Real Estate Licence and/or was finalising her real estate business at the time. I believe she prepared the necessary documents for the transfer to be undertaken.
127.     I believe that I have seen at least three Transfers in relation to the purchase of the unit, because of the particular way in which the Husband wanted to purchase the unit. As I understand it, and have been informed by the Husband, it was originally purchased with the name of the Husband as the Purchaser. Thereafter, the Husband’s brother’s name was on the Transfer. Then I believe that the Transfer went missing, and a third Transfer was required. It was in the name of EGOC as Trustee for the EOC Trust. I understand that the Husband signed the Contract for purchase of the property, as Power of Attorney for his brother. Annexed hereto and marked with the letter “M” is a true copy of that Transfer. I am uncertain as to how these Transfers came to be signed.

That evidence “was not challenged” by the husband (First Respondent’s Summary of Argument, paragraph 89), and clearly accepted by the trial Judge.

Further reliance was placed upon the fact that “[a] number of copies of the Trust Deed were received in evidence” (Exhibit 6, F2 – F26, F42 – F67, and F312-337), the fact that the original trust deed was produced to the Court by the solicitor for the husband’s brother for the first time during final addresses (Judgment, paragraph 138), and the fact that there were “significant differences between the copies of the Trust Deed” which differences the trial Judge identified correctly in his reasons for judgment (Judgment, paragraph 139). It was further submitted that “[n]o sensible explanation was ever given by the appellant [husband] for those differences” (First Respondent’s Summary of Argument, paragraph 90).
Reliance was placed upon the failure to produce the power of attorney pursuant to which the husband executed the trust deed on behalf of his brother, a matter to which the trial Judge referred (Judgment, paragraph 140). It was submitted to be significant that the power of attorney appeared to have been available for annexure to the first affidavit sworn on 2 June but not available for that purpose when, on the same day, the affidavit was re-sworn.
Considerable reliance was placed upon the unchallenged findings of fact which the trial Judge chronicled in his reasons for judgment in relation to the trust issues. Rather than set out the text of those paragraphs (146-171) at this stage, we will, necessarily, refer extensively to those paragraphs when considering the competing submissions in relation to these challenges.
In addition to the trial Judge’s general findings with respect to credit (paragraph 14 with respect to the wife and paragraph 23 with respect to the husband), Senior Counsel for the wife relied upon a number of specific issues involving credit in support of the trial Judge’s conclusions with respect to the EOC Trust and the sham issues.
In paragraph 31 the trial Judge recorded that:
31. It is quite apparent the husband has not given proper disclosure of many documents including the financial statements of various companies with which he is associated, in particular, the bank accounts of such companies nor did he disclose the existence of an account with Colonial First State from which he said cash monies were drawn and deposited to his National Australia Bank account.
In paragraph 33 the trial Judge recorded that:
33. There has been no disclosure of documents by either EGOC or the husband to indicate where rental monies were paid for the brief period that the property was tenanted. I presume rental monies were paid..
In paragraph 38 the trial Judge recorded that:
38. There is evidence the transfer of the SE QLD unit was not registered for about 5 years after the initial date of settlement. I am unable to say why the delay took place other than to observe I am extremely sceptical of the explanations given by the husband. I do not find it a fruitful exercise to analyse in depth the history of this aspect as it involves the husband’s dealings with persons who are not party to this litigation.
It was submitted that none of the findings of fact underpinning any of those observations have been challenged in the appeal, and that each was directly relevant to the “sham” issue.
Senior Counsel for the wife referred to the sequence of events leading up to the “creation” of the EOC Trust and the acquisition of the SE QLD unit, all of which it was submitted the trial Judge had considered in the context of the trust and sham issues, and had been entitled to rely upon.
It was submitted that the trial Judge had been entitled, particularly in relation to the sham issue, to have regard not only to the evidence of what had occurred, but to the evidence of the absence of events or circumstances which could reasonably be expected to have occurred or existed had the trust been, as was submitted on behalf of the husband and his brother, the beneficial owner of the SE QLD unit. These omissions included the failure to register the transfer of the SE QLD unit for five years after the property had been purchased, the absence of any trust bank account, tax returns, financial statements or any other records, save the minutes of a meeting, which it is clear from the terms of the trust deed did not need to be held in any event, said to have occurred on 20 July 1997 (a Sunday) at the husband’s accountant’s house.
It was submitted to be significant that there was no evidence of any record of how the $15,000.00 initial deposit for the purchase of the SE QLD unit had been treated by the trust, how the $322,000.00 allegedly provided to the trust by the husband’s brother had been treated by the trust, how any rental monies received had been treated by the trust or how any outgoings paid by the husband had been treated by the trust.
The unexplained need for the existence of four transfer documents was submitted to be a matter upon which the trial Judge was entitled to rely, particularly as the husband’s mother had handled the conveyancing transaction whereby the SE QLD unit was acquired. It was submitted that the failure of the husband’s mother to give evidence, or for any explanation in relation to her failure to do so, was a matter upon which the trial Judge was entitled to rely.
The absence of any evidence establishing any nexus between the husband’s brother and the C Foundation, by which the $322,000.00 receipt was facilitated to complete the purchase of the SE QLD unit, was asserted to be a matter upon which the trial Judge was entitled to rely, as was the undisputed fact that the husband on the other hand had a demonstrated prior connection with the C Foundation.
The husband’s movement of approximately $30,000.00 from the C Foundation to the Westpac Bank at Parramatta, thence to the husband’s bank account in Austria, and back to Australia, was also said to be a matter upon which the trial Judge was entitled to rely.
During the course of submissions by learned Senior Counsel for the husband, the transcript of proceedings before Barry J on 4 July 2002 was tendered as evidence in the appeal (Exhibit 3). The tender of the transcript was not objected to by Senior Counsel for the husband.
Whilst the transcript was relied upon by Senior Counsel for the husband in relation to grounds yet to be addressed, Senior Counsel for the wife relied upon portions of the transcript in the context of the “sham” issue, to emphasise his assertion that the husband, and through him his brother, had for at least three years been “on notice” that an issue of importance in the trial of the proceedings related to the funding of the purchase of the SE QLD unit.
There was no suggestion by Senior Counsel for the wife that the onus of proof ever ceased to rest upon or remain with the wife in relation to the trust and sham issues. Given that the relevant real property register reflected the husband’s brother as the registered proprietor of the SE QLD unit as trustee of the EOC Trust, such concession was appropriate.
The thrust of submissions made by Senior Counsel for the wife however was that, whilst the wife bore the onus of proof, the circumstances surrounding the acquisition of the SE QLD unit having been under the control of the husband, the husband was in a position to adduce evidence relevant to the issue or, if he failed to do so or to explain such failure, risked the trial Judge drawing adverse inferences by virtue of such failures.
It was thus submitted that in a number of exchanges on 4 July 2002, the trial Judge made quite clear that how the husband’s brother provided “$330,000 cash” would be a matter of importance at the eventual trial of the proceedings (Transcript of 4 July 2002, page 28).
What the wife was asserting to have been the basis upon which the SE QLD unit was acquired was submitted to be clear from the transcript of 4 July 2002 (page 29). Her subsequent affidavit evidence, as submitted by her Senior Counsel in the appeal, was consistent with that assertion. During the course of the proceedings on 4 July 2002 (Transcript, page 30) it was revealed by the husband that his mother had acted on the sale of the property. It also then became apparent that the wife’s case was that the SE QLD unit had been bought by her husband albeit “it went through EGOC” (Transcript, page 29).
The husband then asserted that:
… the contract of sale and all the settlement details in every single document the wife has wanted in relation to this has already been discovered to her, and it is contained in the affidavit material. (Transcript of 4 July 2002, page 30).
The trial Judge asked the husband, who has qualifications in law, “You know what a sham transaction is, I take it?” which the husband confirmed he did, and suggested to his Honour:
The receipt shows that the money came from EGOC; he was not an unemployed surfer at the time, he was in fact working in London in an investment bank and he was doing fixed interest transactions and share transaction. (Transcript of 4 July 2002, page 31)

The discourse then proceeded to other matters.

It was submitted by Senior Counsel for the wife that, quite apart from the inadequacies in the evidence presented by or on his behalf, the husband had, three years prior to the trial of the proceedings, been left in no doubt by the trial Judge that the funding of the acquisition of the SE QLD unit would be a matter of significance at trial or, as his Honour expressed it “one of the great mysteries” which would require consideration at trial (Transcript of 4 July 2002, page 28).

DISCUSSION AND CONCLUSION IN RELATION TO ACQUISITION OF THE SE QLD UNIT

It is convenient to deal first with the question of whether the acquisition of the SE QLD unit by the husband’s brother on behalf of the EOC Trust was a sham. If the challenge to the trial Judge’s conclusion that such acquisition was a sham and that the husband beneficially owned the SE QLD unit fails, it matters not whether the EOC Trust itself was validly created. Within the context of the sham, it is convenient to consider the trial Judge’s conclusions, first in the light of the evidence which was before him and, if it be necessary to do so, in the light of what the evidence would or might have established had the trial Judge allowed the husband’s brother to rely upon his affidavit (Exhibit 1) of June 2005 and/or allowed Counsel for the husband’s brother to cross examine the husband.
As noted earlier, there is no challenge to any finding of fact relied upon by the trial Judge in support of his conclusion with respect to the sham question. Nor is it suggested that, save for the husband’s brother’s affidavit, any fact or any relevant finding was not referred to or made by his Honour in the course of coming to such conclusion. To the extent that it was submitted, on behalf of the husband, that the circumstances surrounding the creation of the trust or matters other than strictly relating to the financing of the acquisition of the SE QLD unit could not be relevant to the sham issue, we are not persuaded that such was the case. In determining whether or not the acquisition of the SE QLD unit by the EOC Trust was a sham, regard could be had to all of the circumstances surrounding that acquisition although, clearly, ultimately the most potentially significant fact or circumstance was the funding of the acquisition. If, notwithstanding unexplained or unusual events surrounding the acquisition of the property, the acquisition of the SE QLD unit was actually funded by sources other than the husband, those anomalies would be insufficient to render the acquisition a sham.
His Honour recorded that “a significant dispute between the parties is whether the husband has any interest in” the SE QLD unit (Judgment, paragraph 134). He was clearly aware that the registered owner of the property was the husband’s brother. He was also aware of the terms of the trust deed pursuant to which the EOC Trust was purportedly created.
The trial Judge recorded that the husband’s brother had been “joined as a second respondent in the proceedings” (Judgment, paragraph 135). It is abundantly apparent that the only possible interest the husband’s brother had in the proceedings was as trustee of the EOC Trust. The trial Judge was thus clearly aware that the issue was whether, as the “documents of public record” as Senior Counsel for the husband described them, suggesting that the husband’s brother, as trustee of the EOC Trust, beneficially owned the SE QLD unit, should be accepted or, as was asserted on behalf of the wife, it should be held that, notwithstanding the vesting of the legal title to the SE QLD unit in the husband’s brother as trustee of the trust, the husband beneficially owned the SE QLD unit.
His Honour recorded that:
135. … Various directions were made over a period of time for him [the husband’s brother] to file material. At all relevant times he was legally represented. At no stage was any response filed by the second respondent nor prior to the hearing did the second respondent file any affidavit material. Legal representatives for the second respondent appeared at the commencement of the hearing and were informed they could participate in the Trial process notwithstanding the fact that no material had been filed by the second respondent. This offer was not taken up though at various times during the course of the hearing, particularly during the lengthy cross-examination of the husband, the second respondent’s legal representatives remained in the public gallery of the Court.

We have earlier detailed the circumstances in which the husband’s brother’s affidavit was rejected.

None of the statements made by the trial Judge to which we have referred establishes an absence of impartiality on the part of the trial Judge. It remains only to consider the complaint that the trial Judge was “[c]ontemplating an accountant’s investigation” (Appellant’s Supplementary Summary of Argument, paragraph 3.4).
The trial Judge’s observations were open to him in reliance upon the evidence which he had seen and heard over a period of days prior to making such observation. His Honour did not in fact “appoint an accountant to investigate these matters”(Transcript of 20 June 2005, page 577) and no transcript suggesting that he did so has been identified. It cannot be assumed that the course proposed by the trial Judge would necessarily have been adverse to the husband. Had an accountant investigated and discovered the truth in relation to the source of funds to acquire the SE QLD unit, that evidence may have proved what the husband and his brother failed to prove. Far from indicating anything which advances the husband’s case in this regard, it is significant that at that late stage in the trial, the trial Judge clearly maintained an open mind in relation to a fundamental issue in the case.
Senior Counsel for the wife submitted that none of the passages to which the Court has been referred by Senior Counsel for the husband indicated any absence of impartiality on the part of the trial Judge and that interventions by the trial Judge were innocuous. It was submitted that:
The Trial Judge did no more and no less than ask questions that were appropriate to an illumination of the facts and issues in the context of achieving justice and equity. Any question or intervention by the Trial Judge was, with respect, both appropriate and measured. He asked questions of a number of witnesses. The questions, very clearly, did no more than elicit information the Trial Judge – with respect, correctly – thought relevant. (Respondent’s Summary of Argument, paragraph 6.3)
It was further submitted that:
Trial judges are entitled to ask questions. Trial judges are entitled to pursue obfuscation or sophistry or inconsistencies in the evidence because their ultimate task is to do justice and equity. That is precisely what the Trial Judge did in this case. (Respondent’s Summary of Argument, paragraph 6.4)
The law relevant to this issue is not in doubt. In Johnson v Johnson (2000) 201 CLR 488, Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ restated the principles relevant for present purposes and said at 493:
… two things need to be remembered: the observer is taken to be reasonable; and the person being observed is "a professional judge whose training, tradition and oath or affirmation require [the judge] to discard the irrelevant, the immaterial and the prejudicial".
…
At the trial level, modern judges, responding to a need for more active case management, intervene in the conduct of cases to an extent that may surprise a person who came to court expecting a judge to remain, until the moment of pronouncement of judgment, as inscrutable as the Sphinx. … Judges are not expected to wait until the end of a case before they start thinking about the issues, or to sit mute while evidence is advanced and arguments are presented. On the contrary, they will often form tentative opinions on matters in issue, and counsel are usually assisted by hearing those opinions, and being given an opportunity to deal with them. (footnotes omitted)
Recently, in the presently unreported decision of Keating v Morris [2005] QSC 243, Moynihan J, having referred to the judgment of Gleeson CJ, McHugh, Gummow and Hayne JJ in Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 suggested the test for present purposes to be:
[43] … whether the court is satisfied that the circumstances are such as to give rise, in the mind of a fair minded and informed member of the public, or party, to a reasonable apprehension that the decision maker’s mind is so prejudiced by conclusions already formed that the conclusion will not be altered irrespective of the evidence or arguments put forward.

and that:

[44] The relevant consideration is that the decision will not be seen to be impartial rather than that it will be adverse to a party.

Nothing to which the Court has been referred on behalf of the husband persuades us that, applying the appropriate test, the trial Judge’s statements, individually or collectively, at the time or in hindsight, indicated any absence of impartiality. As Moynihan J observed in Keating v Morris, an adverse decision does not, without more, establish a lack of impartiality. The adverse decisions made by the trial Judge in this case have not been shown to have been erroneous or indicative of an absence of impartiality.
We accordingly do not consider this challenge to have merit.

THE HUSBAND’S CONTRAVENTION APPLICATIONS

Ground 1(e) of the husband’s Amended Notice of Appeal complained:
1. The trial miscarried and the appellant was deprived of a fair trial by one or more of the following:-
…
(e)The trial judge refused to hear, and refused to determine, the appellant’s application for contravention filed 24 March 2005;
In his Supplementary Summary of Argument, under the heading “CONTRAVENTION APPLICATION”, Senior Counsel for the husband referred to the contravention application apparently taken out by the husband (a copy of which appears at Appeal Book vol 3, page 364) alleging “10 contraventions by the [wife] of the order of Justice Warnick dated 6 September 2001” (Appellant’s Supplementary Summary of Argument, paragraph 2.1).
Senior Counsel for the husband submitted that:
The need to deal with this outstanding contravention application was raised with the Judge on the first day of the trial. The Judge referred to the seriousness of non-compliance with Court orders but preferred to deal with the application at the end of the hearing [Transcript, V6, pp.818-819]. In the event, the judge did not decide the contravention application before giving judgment in the matter. The application remains extant. (Appellant’s Supplementary Summary of Argument, paragraph 2.2)
It was further submitted that:
The Judge found the first respondent to be a credible witness [Reasons, V1, page 40, para 14]. The alleged contraventions were relevant to any assessment of the credit of the first respondent [Transcript of hearing on 4 July 2002, p.4 1.16-44]. (Appellant’s Supplementary Summary of Argument, paragraph 2.3)
Finally, it was asserted that:
The Judge’s treatment of alleged contraventions by the first respondent is to be contrasted with his criticism of the appellant for failing to comply with court orders [Reasons, V1, p.44-5, paras 26-31]. (Appellant’s Supplementary Summary of Argument, paragraph 2.4)
Senior Counsel for the wife submitted that the trial Judge “did not refuse to hear the application” and that, even if he had, “any such refusal had no impact on the trial process, findings or ultimate orders adverse to” the husband or his brother (First Respondent’s Summary of Argument, paragraph 56).
We have not been referred to any request at the commencement of the trial or at any time thereafter that the trial Judge deal with the husband’s contravention applications. Such references as we have been taken to, suggest that the husband agreed to, or at least acquiesced in, the trial Judge’s deferral of the hearing of the contravention applications. It is clear that such applications remain on foot and able to be prosecuted by the husband in the future. Nothing the trial Judge did in any way adversely impacts upon the potential success of those applications. Indeed, on our reading of the transcript of the trial, the contravention applications appear to have been somewhat overtaken by the substantive proceedings.
So far as any possible prejudice arising from the trial Judge’s failure to deal with the contravention applications is concerned, the wife, the respondent to such applications, would appear potentially to have been at greatest risk given that she was able to be cross examined about events without the protection of s 128 of the Evidence Act 1995 (Cth) in circumstances where her answers could potentially have been relied upon by the husband in the prosecution of his contravention applications at a later time. Nothing to which we have been referred suggests that the wife at any time during the trial sought, or was offered the protection afforded by the section.
Had the trial Judge determined the contravention applications prior to commencing the parties’ substantive claims, notwithstanding that neither party asked him to do so, it is almost certain, given that a credit finding would have been necessary to determine those applications, that the trial of the substantive proceedings would then have been adjourned to another judge at another time, with further delay and expense to both parties. The issues involved, and duration of the trial in which they were agitated, more than vindicated the trial Judge’s decision to determine the substantive proceedings before embarking upon a hearing of the contravention applications.
Nothing to which we have been referred establishes that the trial Judge’s actions with respect to the husband’s contravention applications had either of the effects complained of in the two grounds of appeal which address that topic.
We thus find this challenge lacks substance.

THE SUPERANNUATION ORDERS

Grounds 4, 5, and 6 of the Amended Notice of Appeal provided:
4.   The trial judge erred in making an order splitting the appellant’s parliamentary superannuation without notice to the appellant’s current partner who was a person with an interest in that superannuation and affected by the order.
5.   The trial judge erred in law in making an order in relation to the parliamentary superannuation having regard to the basis on which it accrued.
6.   The trial judge was wrong, on the facts as found, to make an adjustment of property rights 30/70 in favour of the first respondent having regard to the shortness of the marriage and the other relevant findings made.
As the summary of argument of Senior Counsel for the husband makes clear, these challenges raise two issues, the first being that the assertion that the trial Judge “erred in law” in not causing the husband’s current partner to be given notice of the proceedings before the making of a splitting order (Appellant’s Supplementary Summary of Argument, paragraph 3.1), the second being that “[a] split[ting] order of 30% in favour of the applicant [wife] is excessive” (Appellant’s Supplementary Summary of Argument, paragraph 3.5).
Nothing in the Supplementary Summary of Argument of Senior Counsel for the husband sought to add to the previous written submissions made in that regard, nor did Senior Counsel’s oral submissions in relation to the first of these challenges.
On behalf of the wife, Senior Counsel made a number of written submissions (paragraph 73-83) in relation to these grounds, and asserted that:
Ground 4 appears to assume that a court cannot make a splitting order in respect of a party’s superannuation interest without giving notice to a person “interested” in it. No principle of law, and nothing in either the Act or the PCS Act, supports such a proposition. (First Respondent’s Summary of Argument, paragraph 79)
It was further submitted by Senior Counsel for the wife that:
A “reversionary interest” is specifically excluded from the definition of a “superannuation interest”. No splitting order can be made in respect of a reversionary interest. Part VIIIB of the Act provides for trustees to be accorded procedural fairness because orders bind trustees. The Part makes no such provision for the holders of reversionary interests, precisely because they are not affected by any splitting order made by the Court: they derive their interest (if any) from the member’s interest at his death. After a splitting order is made in respect of the member’s interest, their position is unaltered – they still take (if at all) by reference to the interest which the member has at his death. (First Respondent’s Summary of Argument, paragraph 83)
Senior Counsel for the wife submitted during the hearing of the appeal that the husband’s present partner had no entitlement to notice of the proceedings before the trial Judge but that, if she did, the circumstances detailed by the trial Judge, the accuracy of which was not challenged, established that the husband’s present partner had every opportunity to seek to intervene in or otherwise be heard during the proceedings in relation to any claims she had.
The expression “contingent interest” in the husband’s superannuation annuity, appearing in Senior Counsel for the husband’s written submissions, is not a term which finds expression in the relevant provisions of the Act. To the extent that the husband’s present partner had any relevant “interest”, that would in our view have been at best a reversionary interest within the terms of the legislation which could not “vest” until the death of the husband, given that s 90MF of the Act provides that:
For the purposes of this Part, a person’s interest in an eligible superannuation plan is a reversionary interest at any time while the person’s entitlement to benefits in respect of the interest is conditional on the death of another person who is still living.
The issue was more fully agitated at trial than on the hearing of the appeal, and the trial Judge addressed the submission of the husband in that regard (Judgment, paragraph 117 d and following).
For reasons which the trial Judge gave, the “reversionary interest” of the husband’s present partner may never vest. Nothing to which we have been referred, either in the legislation or any case decided in relation to it, establishes the entitlement of the husband’s present wife to notice of the proceedings or, had she been given such notice and sought to do so, to intervene in the proceedings. Nor has a basis upon which the husband’s present partner may have successfully argued that the splitting order proposed by the trial Judge ought not have been made been established.
In reality, as Senior Counsel for the wife suggested, only on the basis that the making of a “splitting order” potentially reduced the benefits which she may receive, either during the husband’s lifetime pursuant to the provisions of a law of the Commonwealth or State, or upon the husband’s death pursuant to the terms of the PCSS, could the husband’s present partner have productively participated in the proceedings before the trial Judge. Nothing to which we have been referred establishes a basis upon which the husband’s present partner could have succeeded in either of those endeavours. Any absence of notice to the husband’s present partner, or opportunity to intervene in the proceedings thus could not vitiate any orders made by the trial Judge in relation to the husband’s superannuation interest.
The submissions made by Senior Counsel for the husband during the hearing of the appeal suggest that the real thrust of these challenges was to the quantum of the splitting order, rather than any impediment to its making. As we have noted, the written Summary of Argument was somewhat cryptic in that regard, identifying only as a basis for the splitting order being “excessive” that the wife “did not contribute anything to the appellant’s superannuation fund” (Appellant’s Summary of Argument, paragraph 3.5). The Supplementary Summary of Argument did not seek to further advance this aspect of the appeal.
In his oral submissions however, Senior Counsel for the husband submitted that the husband’s entitlement to his benefits under the PCSS had accumulated prior to the commencement of cohabitation, the husband having by that time served in three Parliaments (the other basis of eligibility being having served in the Parliament for 9 years).
Other than the submission that the trial Judge should have taken into account that the wife was receiving approximately $1,390.00 per month by way of child support from the husband’s superannuation annuity, no specific matter was raised in support of the assertion that the splitting order made by the trial Judge was excessively generous to the wife.
It was submitted during the course of the hearing of the appeal, though not to the trial Judge, that an order for a limited time, possibly two to three years, should have been ordered by way of splitting order. It was submitted that nothing in the legislation precluded so doing.
Unsurprisingly, Senior Counsel for the wife’s written submissions did not address this aspect of the husband’s complaint in detail. In oral submissions however, Senior Counsel for the wife disputed that the trial Judge could have made a splitting order “limited in time” under the Act, even if one had been sought, which it clearly had not. Whilst we have reservations as to whether a “splitting order” for a limited period could be ordered under the legislation, we do not need to address that issue. Were the appeal to be allowed and a re-hearing ordered, as both parties acknowledge would be the almost inevitable outcome of allowing the appeal, that issue could be fully agitated.
It was submitted by Senior Counsel for the wife that no error had been demonstrated in the trial Judge’s reasoning in relation to the “splitting order” which he made. Reliance was placed upon the fact that the order was based on the “unchallenged findings of the trial Judge” including the husband’s financial contributions to date. It was submitted that no error in the process adopted by the trial Judge had been demonstrated.
Objectively, the only basis upon which it could be asserted that the splitting order made by the trial Judge was excessively favourable to the wife could in the circumstances of this case be in reliance upon the concluding sentences of the judgment of the High Court in House v The King (1936) 55 CLR 499 at 504-505 explaining that:
The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.
Essentially, the submissions made on the husband’s behalf that the award was plainly and manifestly excessive appear to rely substantially on the fact that his entitlement to the pension had accrued prior to the parties’ separation and, at least inferentially, that the “overlap” between the parties’ cohabitation and the husband’s membership of the fund was so small relative to the total time that he had been a member of the fund as to warrant appellate intervention.
It is to be remembered that the “splitting order” made by the trial Judge was necessarily made by way of order for settlement of property. His Honour found the wife to have a contribution entitlement to the fund of 15 per cent. Nothing to which we have been referred establishes that the findings of fact of the trial Judge in relation to the contribution entitlement were not open to him. Nor has it been established that the adjustment in the wife’s favour of 15 per cent was not reasonably open to his Honour.

In Norbis v Norbis (1986) 161 CLR 513 Brennan J said at 539 – 540:
The difficulties in the way of developing guidelines beset an appellate review of the exercise of discretion under s.79. Unless the primary judge reveals an error in his reasoning, the Full Court can intervene only if the order made is not just and equitable. How does the Full Court arrive at that conclusion? In Bellenden (formerly Satterthwaite) v. Satterthwaite [1948] 1 All ER 343 at p.345 Asquith LJ. stated the rationale of an appellate court’s approach:
“…It is, of course, not enough for the wife to establish that this court might, or would, have made a different order. We are here concerned with a judicial discretion, and it is of the essence of such a discretion that on the same evidence two different minds might reach widely different decisions without either being appealable. It is only where the decision exceeds the generous ambit within which reasonable disagreement is possible, and is, in fact, plainly wrong, that an appellate body is entitled to interfere.”
The “generous ambit within which reasonable disagreement is possible” is wide indeed when there are a number of factors to be taken into account and the comparative weight to be attributed to those factors is not clearly indicated by uniform standards and values of the community. The generous ambit of reasonable disagreement marks the area of immunity from appellate interference.
The trial Judge in this case exercised a broad discretion, albeit he was obliged to exercise such discretion judicially. Nothing to which this Court has been referred suggests that the exercise of that discretion miscarried in ways that would enliven appellate intervention. It has not been established that his Honour made any material mistake of fact in relation to any aspect of the application for a “splitting order”, nor that he acted upon any extraneous or irrelevant consideration or failed to have regard to any relevant fact or circumstance. There was always, on the facts of this case, the potential for differing conclusions in relation to the application for a splitting order. Nothing to which this Court has been referred establishes that the trial Judge’s decision fell outside the ambit of a permissible exercise of his discretion. Complaints with respect to the splitting order thus lack merit.

THE ORDERS FOR SETTLEMENT OF PROPERTY GENERALLY

It remains to consider whether the trial Judge erred, assuming that he was correct in concluding that the SE QLD unit was the property of the husband, in apportioning the “property of the parties” as to 30 per cent to the wife and 70 per cent to the husband, as asserted by ground 6.
In written submissions (Appellant’s Summary of Argument, paragraph 4) it was submitted that the trial Judge “over-compensated” the wife “in view of her lack of financial contribution and the fact that she now has another partner who can earn income” and that a “split of 70/30 in favour of the appellant [husband] is in the circumstances unreasonable”. The challenge was not further advanced in written submissions by Senior Counsel for the husband nor was the matter further agitated in oral submissions, the thrust of the husband’s case being that the SE QLD unit was wrongly treated as his property by the trial Judge.
Understandably, Senior Counsel for the wife did not expand upon his written submissions in relation to ground 6 during the course of the hearing of the appeal. In his written submissions Senior Council for the wife submitted:
The principles applicable to an appeal from a discretionary judgment are well-established. For an appeal to succeed, the Full Court must be satisfied that some error of fact or law, or a miscarriage of justice, occurred in the proceeding. Disagreement only on a matter of weight, or a preference for a different result, usually does not justify the reversal of a discretionary judgment. (First Respondent’s Summary of Argument, paragraph 84)
Reliance was placed upon the fact that Senior Counsel for the husband “asserts no error; he simply asserts that the first respondent [wife] should have received less”. It was thus submitted that it had not been demonstrated that the trial Judge’s assessment fell beyond the “‘generous ambit of the discretion’ within which reasonable disagreement is possible but not appealable” (First Respondent’s Summary of Argument, paragraph 86).
Notwithstanding the nature of the challenge to the trial Judge’s conclusion with respect to the division of the assets of the parties, we propose referring briefly to the reasons his Honour gave for such division with particular reference to the two matters identified by Senior Counsel for the husband in his written Summary of Argument.
His Honour found that, whilst at the date of commencement of cohabitation the husband “would have had a substantial equity” in the two properties which he had acquired some 9 years earlier (Judgment, paragraph 87), when sold by the mortgagee in possession in 2002 those properties produced the sum of $93,000.00. $85,000.00 of that sum the husband paid to his mother. The trial Judge concluded (paragraph 88) that “[w]hilst the husband’s initial contributions were significant, it is apparent this was later dissipated when the bank foreclosed on the two properties”, a finding which has not been challenged.
The “Work History” of each of the parties which the trial Judge detailed has not been suggested to reveal any errors on his Honour’s part. Relevant in that context were his Honour’s findings that the wife had part time employment from the commencement of cohabitation to the date of marriage but not thereafter (paragraph 89), that the husband had been “a member of the Federal Parliament for ten years” during which period he was also earning “some additional income through consultancy work for Mr PN” and that, since 30 June 1999, in circumstances which did not justify criticism of him, the husband had been “associated with a number of failed business ventures” losses from one of which exceeded $100,000.00 (Judgment, paragraph 90).
On such evidence as the husband provided, the trial Judge found his capacity for remuneration to be “$2,876.00 per week” (Judgment, paragraph 91) and that:
92. By using the vehicle of LV the husband has been able to significantly reduce his taxable income from what it would have been had he contracted directly with the employer.
None of these findings of fact has been challenged. Nor has the trial Judge’s conclusion with respect to the wife’s limited earning capacity (Judgment, paragraphs 93 & 94).
The trial Judge expressly referred to the fact that the wife had re-partnered, her new partner having no “real estate” (Judgment, paragraph 95).
We have not been directed to any evidence which established that the income of the wife’s present partner was such as to reduce the adjustment able to be given to the wife by reason of the husband having a greater earning capacity than she had. We wonder in any event to what extent that could have impacted to the wife’s detriment on the evaluation of her contributions.
His Honour expressly recorded that the wife “made no direct financial contribution prior to, during or subsequent to separation” and that the husband “made a significant initial contribution, earned a high income and acquired a valuable interest in the Parliamentary Superannuation Scheme” (Judgment, paragraph 96). He also found the husband to have earned “considerable fees as a consultant” during “his period of office as a [member of Parliament]”.
The trial Judge relied upon the wife having “had the care of the children at all times since separation, though the husband has had extensive contact since July 2002” (Judgment, paragraph 96 c). He also recorded that:
d.Despite widespread criticism of various aspects of the wife’s parenting, there is no complaint by the husband as to her physical parenting of the children or her housekeeping ability. (Judgment, paragraph 96)

Reference was made to the fact that the elder child of the marriage had been “diagnosed with Downs Syndrome” which had “added significantly to the wife’s duties as the primary carer” (Judgment, paragraph 96 e).

The husband’s frequent absences on Parliamentary duties during cohabitation was found by the trial Judge to have “placed a burden on the wife in the terms of the care of the child from the time of his birth in October 1998 until June 1999” (Judgment, paragraph 96 f).
His Honour also accepted that the wife had been “dedicated in taking the older child for therapy at a Sunshine Coast therapy centre, as well as attending with the child to his medical, educational and personal needs” (Judgment, paragraph 96 g).The wife was found to have made the greater contribution to the welfare of the family (Judgment, paragraph 96 h).
The trial Judge considered the “Effect of Any Proposed Order Upon the Earning Capacity of Either Party to the Marriage” (Judgment, paragraphs 96 i & 97). None of the matters therein referred to has been shown to be without foundation.
His Honour thus concluded, for the reasons he gave in summary form (paragraph 98) that a contribution entitlement of 85 per cent to the husband and 15 per cent to the wife was appropriate. The findings of fact underpinning the seven matters which his Honour discussed “in summary form” have not been successfully challenged.
There was no challenge to the trial Judge’s findings as to the extent of the wife’s financial contributions. Those findings can be comfortably accommodated within the conclusion his Honour reached as to the contribution entitlements of the parties.
Nothing to which we have been referred persuades us that the trial Judge’s conclusions with respect to contributions fell outside the ambit of a reasonable exercise of discretion or failed to accommodate the wife’s “lack of financial contribution” (Appellant’s Summary of Argument, paragraph 4.2).
Under the heading “Section 75(2) Factors”, his Honour referred to a number of matters, the most significant for present purposes in the light of the challenge mounted by Senior Counsel for the husband being the reference to the income of her present partner Mr MN of “$170 per week for Austudy” (Judgment, paragraph 103). Also relevant was the trial Judge’s finding that “within a short period of time he [Mr MN] would be able to earn a reasonable income either as a counsellor or in some other capacity” (Judgment, paragraph 104).
None of the findings of fact relied upon by the trial Judge for the purpose of determining a s 75(2) adjustment has been successfully challenged in this appeal. Nor has it been established that any of those matters was not relevant for the purpose of determining such adjustment. No other matters to which the trial Judge did not refer have been demonstrated to have been relevant for that purpose.
His Honour identified the “main factors for making a considerable weighting in the wife’s favour on account of future needs involves the future care of the 2 children, particularly, the older child” (Judgment, paragraph 105). He concluded that a 15 per cent adjustment pursuant to s 75(2) was in the circumstances warranted and (paragraph 109) re-iterated “in summary form” the reasons for so concluding. Each of the six matters there referred to had an evidentiary foundation, and was relevant to be taken into consideration. In our view, the facts and circumstances relied upon by the trial Judge in concluding that a 15 per cent s 75(2) adjustment was warranted amply supported such conclusion.
We find no error in any aspect of the trial Judge’s determination that a division of 70 per cent to the husband and 30 per cent to the wife of the total assets of the parties, including superannuation interests, was other than reasonably open to him. This challenge thus fails.

CONCLUSION

No ground of appeal agitated on behalf of the husband or his brother having been successful, the appeal and cross appeal will be dismissed.

COSTS

Senior Counsel for the wife sought the costs against the husband in the event of the appeal and cross appeal being unsuccessful.
Senior Counsel for the husband frankly conceded that, if Senior Counsel for the wife “won the appeal hands down” it would not be possible to resist an order for costs being made against the husband. Translating that expression into the terminology of s 117 of the Act, the husband has been “wholly unsuccessful” in the appeal, as has his brother with the cross appeal, albeit the cross appeal did not add to either the grounds to be addressed by Senior Counsel for the wife or the duration of the hearing of the appeal.
As the High Court has made clear, the issue of costs is discretionary, albeit that discretion is exercisable within the legislative constraints of s 117 of the Act.
We are of the opinion that circumstances justify an order for costs of the appeal being made against the husband in favour of the wife. Our reasons for doing so are essentially that the appeal has been wholly unsuccessful. Nothing in the financial circumstances of the parties would disincline us from making an order for costs in favour of the wife, nor would any conduct of the wife in relation to the appeal.

APPEAL AGAINST ORDER OF 4 MAY 2006 WITH RESPECT TO COSTS

Subsequent to the hearing of the appeal against the property settlement order, the husband filed a Notice of Appeal on 31 May 2006 against an order made by Barry J on 4 May 2006 requiring the husband to pay the wife's costs of and incidental to the trial before his Honour. In a letter written to the Appeals Registrar on 31 May 2006, it was suggested by the husband's legal representatives that the appeal against the costs order be determined by the Full Court after delivery of judgment in the substantive appeal, either by written submissions or by a further hearing.
We consider it convenient to determine this further appeal by way of written submissions, which is the common practice of this Court in relation to an appeal against a costs order which requires determination following the determination of an appeal against substantive orders. We will therefore make the standard directions for such written submissions in relation to the appeal against the costs order of 4 May 2006.

ORDERS

The orders of the Court will thus be:
1.   That the appeal and cross appeal be dismissed.
2.   That the appellant pay the wife's costs of and incidental to the appeal including the costs ordered on 24 August 2005 and 14 October 2005 as agreed or to be assessed.
3.   That the appellant husband have 28 days in which to make written submissions with respect to the Notice of Appeal filed 31 May 2006 by filing such submissions at the Brisbane Registry of the Family Court and serving them on the other parties.
4.   That the other parties have a further 28 days in which to make written submissions in answer thereto by filing such submissions at the Brisbane Registry of the Family Court and serving them on the other parties.
5.   That the appellant husband have a further 14 days in which to make written submissions in answer thereto by filing such submissions at the Brisbane Registry of the Family Court and serving them on the other parties.

I certify that the preceding
263 paragraphs
are a true copy of the reasons
for judgment delivered by this
Honourable Court.
A.C.
Associate
Date: 22/06/2006

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