Wilkinson & Wilkinson
[2024] FedCFamC2F 1067
•9 August 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Wilkinson & Wilkinson [2024] FedCFamC2F 1067
File number(s): CAC 1145 of 2023 Judgment of: JUDGE MANSFIELD Date of judgment: 9 August 2024 Catchwords: FAMILY LAW – PROPERTY – Final orders – Where both parties sought to retain the land and farming enterprise and to pay out the other – Where both parties have genuine and meritorious cases Legislation: Family Law Act 1975 (Cth) ss 75, 75(2), 75(2)(c), 75(2)(d), 75(2)(e), 75(2)(o), 79, 79(4), 79(4)(a), 79(4)(b), 79(4)(c), 79(4)(d), 79(4)(e), 79(4)(f), 79(4)(g) Cases cited: Aitken & Aitken [2023] FedCFamC1A 69
Dovgan & Dovgan [2021] FamCA 306
Gosper & Gosper (1987) FLC 91-818
Horrigan & Horrigan [2020] FamCAFC 25
Kessey & Kessey (1994) FLC 92-495
Mabb & Mabb & Anor [2020] FamCAFC 18
Pierce & Pierce (1999) FLC 92-844
Stanford & Stanford (2012) 247 CLR 108
Division: Division 2 Family Law Number of paragraphs: 99 Date of last submission/s: 7 May 2024 Date of hearing: 6-7 May 2024 Place: Canberra Counsel for the Applicant: Mr McGregor Solicitor for the Applicant: Alliance Family law Counsel for the Respondent: Mr Sansom SC Solicitor for the Respondent: Parker Coles Curtis ORDERS
CAC 1145 of 2023 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS WILKINSON
Applicant
AND: MR WILKINSON
Respondent
ORDER MADE BY:
JUDGE MANSFIELD
DATE OF ORDER:
9 AUGUST 2024
THE COURT ORDERS THAT:
1.Within 14 days, the husband is to prepare and provide to the wife a draft minute of orders consistent with these Reasons for Judgment.
2.Within 21 days, the parties are to file either:
(a)A joint minute of orders sought (whereafter final orders may be made in chambers); or
(b)Competing minutes of orders sought with short submissions as to the orders, or parts of the orders, that are not agreed.
3.The parties have liberty to request the matter be relisted for resolution of the terms of the final orders sought by way of oral submissions if either of them deem that to be more economical.
4.The matter is otherwise listed for a compliance check on 4 September 2024 at 9:30am and the parties have liberty to attend by video-link.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE MANSFIELD:
In 1934, the respondent husband’s grandfather acquired a farm in B Region, NSW and named it “[C Property].” The husband’s parents subsequently acquired the nearby land known as “[D Property]” and also leased land adjacent to C Property known as “[E Property].” The husband deposed:
[31]. An enormous amount of work was carried out on [C Property], clearing and developing the land to enable stocking rates to increase and productivity to improve. To the best of my knowledge, [C Property] was always primarily stocked with […] sheep and […] cattle.
[…]
[36]. From a very young age, I assisted my family develop and expand the Farming operation/business.[1]
[1] Affidavit of the Husband filed 16 April 2024.
In 1995, at 20 years old, the husband was brought formally into the family business by way of a one third share in a partnership along with each of his parents.
In 1997, the parties met. In 1998, the husband completed his post-graduate studies and returned to the family farms. Towards the end of 2000, the wife completed her studies and obtained an educator’s job in B Region.
In January 2001, the parties commenced cohabitation when the wife moved to C Property to live in a cottage on the property with the husband. The wife was 23 years old and the husband was 26.
Neither party had assets or liabilities of any significance at the time, except for the husband’s interests in the farming enterprise with his parents. The husband had a nominal amount of F Company shares. The wife worked as a fulltime educator.
In early 2001, the husband and his father were invited by the owner to inspect the nearby property known as “[G Property].” The husband deposed:
[34]. “[G Property]” is widely regarded as one of the signature properties of the [B Region]. It is unique due to its high elevations ([…]) requiring specific management and farming expertise to maximise the land’s potential.
[…]
[54]. [G Property] was an intergenerational property with a sound reputation. It had many similarities to [C Property] with regard to elevation and rainfall.
In early 2002, the husband and his parents, by way of their partnership, purchased G Property.
In early 2002, the parties moved to live at G Property. In 2003 they married.
In 2005, the parties’ first child was born (now 19) and the wife reduced her work to part-time or casual.
In mid-2005, the wife was added to the family business by way of being gifted a quarter share in a four-person partnership.
In 2007, the parties’ second child was born (now 16).
In 2010, the C Property was sold, and the husband’s parents retired on the proceeds. With their departure, the C Property Livestock name and brand were transferred to G Property.
In mid-2010, upon the departure of the husband's parents from the enterprise, the parties set up a discretionary family trust - the Wilkinson Family Trust of which they are the appointors and trustees. They also established a partnership between the trust and the husband, and continued to trade using the name ‘[Wilkinson Family] Partnership’.
In 2010, the parties’ third child was born (now 14).
Each of the parties took on roles for the successful running of the business and family. The husband worked for the entirety of the marriage in the family farming business. The husband took minimal drawings and most of the partnership income remained in the partnership or was applied to paying down loans. The wife’s income from her work was used to meet living expenses. Wherever the wife was not working she was attending to home duties, farm bookkeeping or working directly in the farming business.
On 1 July 2020, the parties separated. It was a relationship of about 20 years. The wife and children remain living at G Property. The husband moved into a house in Town H owned by his current partner.
By agreement, the parties take relatively minimal drawings from the partnership. Per month, the wife receives $2,500 for herself and the children, supplemented by occasional income from casual work. The husband received $2,000 which increased to $2,250 in January 2024. The parties also operate a joint account for children’s expenses.
The children have not spent any regular time with their father since separation. Initially they would see him occasionally when he attended the house or the farm for work. He has had some involvement with their extra-curricular and other activities but not on any regular basis. They have chosen not to meet the husband’s partner. At some point the wife told the husband he could not attend the house anymore, which had the consequential effect of him no longer being able to access the office and business records.
The children are not willing to go to or stay at their father’s residence if his partner is there. The husband is not able to go the children’s home. There are difficulties aligning times for the husband to be involved in the children’s activities. The husband’s modest drawings do not afford holidays or discretionary spending. There are travel distances between them and their other activities. The husband views these restraints and controls placed on him to be unreasonable and unfair. He says he has a great relationship with each of the children but continually struggles with the limited contact he has.
The wife says she encourages the husband to create opportunities to spend time with the children however he does not do that. She says each of the children have their own smart phones and the husband can contact them at any time.
The co-parenting relationship and the working relationship deteriorated. After an unsuccessful mediation in May 2023, the relationship deteriorated significantly bordering on unworkable except for the reality that it is necessary for the continued operation for the farming business on which they and the children all rely for their livelihood.
Both parties want to obtain sole title to G Property, continue to operate the farming business and pay the other out.
On 4 July 2023, the wife commenced these proceedings.
Both parties deposed that they have made the necessary enquiries and have the capacity to obtain finance to make a settlement payment in support of the orders they seek.
THE WIFE’S CASE
By her Amended Initiating Application filed 15 January 2024, the wife sought orders including that:
(a)She obtain all of the “[G Property]” property;
(b)She pay to the husband a cash settlement of 45% of the pool;
(c)They each retain specified vehicles and chattels and the balance of household goods and furniture to be divided amongst them;
(d)The wife obtain control and sole benefit of the Wilkinson Family Trust;
(e)The Wilkinson Family Partnership be wound up;
(f)All tax returns be lodged and any taxation liabilities be portioned as to 45% to the husband and 55% to the wife;
(g)The wife obtain the business C Property Livestock;
(h)The wife obtain the bore water license.
By her Outline of Case Document, the wife contended:
(a)The contributions ought to be assessed as equal;
(b)There be a 5% adjustment in her favour for future needs;
(c)If she does not obtain the farm, there be a 10% adjustment in her favour;
(d)Overall, if she retains the farm, there be a division as to 55 / 45 in her favour; and
(e)If the husband retains the farm there be a division as to 60 / 40 in her favour.
The wife deposed:
[98]. … [G Property] holds a special place in my heart, a lifetime of memories; I was married in the front garden with all the hopes and dreams of seeing out my life here and raise my three (3) wonderful children here. I have sacrificed my time, family time and time with friends to develop what we have here today. I have spent 22 years working on the farm, in the garden, renovating the house and creating a home full of love. I have never wavered during the separation in my desire to stay on [G Property]. I want to be able to keep the children's family home for them to provide them with a sense of stability and a future in farming on [G Property].[2]
[2] Affidavit of the Wife filed 2 April 2024.
By closing submissions, Counsel for the wife submitted that the wife ought to retain the farm and:
(a)The contributions ought be assessed as to 55% in the wife’s favour to account for the wife’s greater contributions post-separation;
(b)There ought to be an adjustment of 5% in her favour for future needs; and
(c)There ought to be a cash settlement to the husband as to 40% of the net value of the pool without a superannuation splitting order.
THE HUSBAND’S CASE
By his Minute of Orders Sought in his Case Outline Document filed 3 May 2024, the husband sought final orders including that:
(a)He obtain all of the “Farm” property;
(b)He pay to the wife a cash settlement of 32.5% of the pool (including superannuation);
(c)The Wilkinson Family Partnership be wound up;
(d)The husband obtain control and sole benefit of the Wilkinson Family Trust;
(e)All tax returns be lodged and any taxation liabilities be portioned as to 50% to the husband and 50% to the wife; and
(f)There be a split of the wife’s superannuation interests of $56,321 in the husband’s favour.
By his Outline of Case Document, the husband contended:
(a)The contributions ought to be assessed as to 55% in his favour;
(b)There be 5-10% adjustment in his favour for future needs;
(c)Overall, a just and equitable division is 40 / 60 in his favour; [but]
(d)The orders he seeks provide for a division of 32.5 / 67.5 in his favour.
At the commencement of the hearing, Counsel for the husband recognised the discrepancy and confirmed that the minute of orders sought should read 40 / 60 per cent in the husband’s favour, and, if the wife is to obtain the farm, there be a further 5 per cent adjustment in his favour.
The husband gave extensive evidence demonstrating his lifelong engagement with his family properties, primary production generally, his qualifications and expertise through study and experience in the establishment and production of award-winning and industry-recognised superior sheep. He deposed:
[31]. … Within my lifetime, I saw and contributed to a significant investment in the continual improvement of these genetics. We had a clear objective of breeding hardy, productive [sheep] that were heavy wool cutters well suited to the high elevations of our unique environment. These livestock were, and still are, highly regarded within the industry today.
[…]
[33]. I grew up farming on the [B Region], just like my father and his father before that. Generations of hard work facilitated the purchase of "[G Property] ". The stock that it produces today are highly sought after with great constitution and hardiness. This is the country that I love and know.
[…]
[48]. All of the livestock on [G Property] are direct descendants of the genetics and breeding decisions carried out over the last 80 plus years, originally at [C Property] and since 2010, on [G Property]. They represent three generations of the [Wilkinson Family] and are irreplaceable.[3]
[3] Affidavit of the Husband filed 16 April 2024.
By closing submissions, Counsel for the husband maintained that the 55 per cent assessment on contributions was appropriate and that the 5 per cent adjustment for future needs was warranted. It was conceded that any taxation liabilities ought to be apportioned accordingly and not 50 / 50.
THE HEARING
The matter came before me for hearing on 6 May 2024. It was set down for hearing for four days. It was heard in two. In my view, the manner in which both parties presented their cases was a credit to them both. Their respective counsel advocated accordingly. In cases such as these where both parties have genuine and meritorious cases and reasonable minds may differ, all too often one or both parties feel it is necessary to descend into hostility in order to gain ground. That did not occur in this case. In my experience, that augurs well for the relationship between the parties, if nothing else as parents, for the very many years on the other side of these proceedings. Needless to say, the credit of neither party is in issue.
ISSUES
The balance sheet and the chronology of events are agreed. The facts are largely agreed. The parties are in dispute as to:
(a)What weight should be accorded to their respective contributions;
(b)What adjustment there should be for future needs; and
(c)Which party retains the farm.
THE LAW
In determining claims for alteration of property interests between married couples, I am required to:
(a)Make findings as to the identity and value of the property (including superannuation interests), liabilities, and financial resources of the parties, or either of them, at the time of the final hearing, and determine the legal and equitable interests of the parties in such property;
(b)Consider, identify and assess the contributions by the parties to the acquisition, conservation and/or improvement of their property, including financial and non- financial contributions and any contributions to the welfare of the family before, during and after the relationship came to an end; and
(c)After consideration of altering the interests in the property pool on the basis of contributions, to consider whether there should be any further adjustment to either of the parties on account of the matters set out in s 79(4)(d)–(g) of the Family Law Act 1975 (“the Act”), including any relevant considerations under s 75(2); and
(d)Ensure that any order made is just and equitable.
THE BALANCE SHEET – IDENTIFYING THE PROPERTY OF THE PARTIES
The balance sheet was agreed which became Exhibit C2 and is at Annexure A to these reasons.
The assets (and paid legal fees as agreed) and liabilities are comprised of:
G Property 5,060,000 All other jointly held assets 1,426,726 Husband's paid legal fees 174,371 Wife's paid legal fees 208,431 House & shed contents Excluded Total Assets 6,869,528 Total Liabilities -43,719 Net Non Superannuation 6,825,809
Each of the parties have a bank account, the modest balance of each attributable to the post-separation period. Those bank accounts have been excluded.
The husband still has the F Company shares which he had prior to the relationship. They are relatively nominal ($11,794) and have been excluded.
“All other jointly held assets” pertain to G Property and include produce and livestock on hand, plant & equipment and bank accounts in joint names or in the partnership name or the trustees’ names.
House and shed contents were estimated at $20,000 but that value is excluded as both parties have proposed orders for these to be distributed as between themselves in specie.
The liabilities pertain to the land or the farming enterprise (and one single expert witness expense) such that they do not need to be itemised.
Superannuation interests are comprised of:
Wife's superannuation 206,452 Husband's superannuation 169,734 Total superannuation 376,186
Financial Resources are:
Wife’s expected gift from parents 525,000 Wife’s leave entitlements 16 weeks
With respect to financial resources, the wife’s mother deposed that:
(a)The wife’s parents are graziers from Town J in NSW. They have two sons who work the land with them, and they have one other daughter;
(b)In 2021, the wife’s parents “transferred half of the land and water to [their sons] in separate portions, and $500,000 to [their other daughter].
(c)“We deposited $500,000 in a K Bank Term Deposit in our names, holding this for Ms Wilkinson, and will transfer this sum plus the accumulated interest to her when appropriate, to assist in acquiring G Property in her own right.”
In cross-examination, she gave evidence that:
(a)Their holdings are … or so acres, close to ….
(b)“There have been general discussions with the girls over the years and they always encouraged us to think along the lines that we did not need to leave them anything. They – as long as the boys could hold the properties, they would always think of them as home and they had access to them. They didn’t want to put the boys into a position where they would have to sell to be able to give them anything.”
(c)They did not give $500,000 to the wife in the midst of these proceedings and invested it instead. It is their intention to make it available to the wife in the future. It has earned about $23,000 in interest so far.
(d)Their succession plan will see their sons receive much more than their daughters but that can’t be evened up between them or the sons would have to sell up.
(e)She and her husband have not detailed what is in their wills.
(f)No further funds are available to the wife by way of gift or loan towards the purchase of another property.
On this evidence, I am satisfied that these funds are a financial resource available to the wife in the future.
Secondly, the wife has accrued 16 weeks of leave entitlements prior to trial which will be available to her in the future at her discretion. That is of recognisable value, and I see no reason why it ought not be considered a financial resource of the wife’s.
IS IT JUST AND EQUITABLE TO ADJUST PROPERTY?
In Stanford & Stanford (2012) 247 CLR 108 the High Court observed that it is necessary for me to be satisfied that justice and equity will be achieved as part of the adjustment process pursuant to s 79 of the Act. The requirements identified by the High Court are readily satisfied in this matter having regard to:
(a)The long period of the relationship of the parties and the myriad of contributions made over that period;
(b)The parties’ relationship having broken down and them now living apart;
(c)The concession of each party as to property being adjusted to one another and the inability of the parties to continue to jointly own their property; and
(d)Title to property needing to be changed or adjusted when consideration is given to the contribution and other factors identified below.
CONTRIBUTIONS
G Property and the farming business
Neither party had any assets or liabilities of significance at the commencement of their relationship except for the husband’s one third share in his family’s farming enterprise.
In early 2002, the husband and his parents by way of their partnership purchased G Property for $934,000 and with on-costs this totalled about $985,000. That was funded by the proceeds of the sale of D Property ($150,000) and bank loans secured by C Property ($750,000) with the balance coming from the husband and his parents’ partnership.
In mid-2005, the wife was added to the family business by way of being gifted a quarter share in a four-person partnership. On the retirement of the husband’s parents in 2010, the wife’s interests again increased when the enterprise was restructured so as to be between the husband and the wife only. That enterprise then significantly benefited from the full transfer into it of non-tangible assets.
Some of those assets are still as they originally were, for example the C Property Livestock name and brand. Some are technically different but of the same character, for example the genetic lines. Some have since been turned over or replaced, for example breeding stock and equipment. Along with the land itself, these assets are the significant majority of the property of the marriage and the derivation of them is attributable to the husband and his forebearers to the exclusion of the wife. I emphasise that this pertains to derivation only and not subsequent use or improvement.
In 2019, the parties again benefited from the husband’s parents forgiving a debt to them of $140,000. There is a duly prepared and signed Deed of Forgiveness between the parties and the husband’s parents.
The wife argued in her case that the forgiveness of this debt, and also the portion of the acquisition of G Property that was not borrowed, were gifts to both of the parties and thereby not contributions attributable to the husband. Against this the husband pointed to the proposition in Kessey & Kessey (1994) FLC 92-495, citing Gosper & Gosper (1987) FLC 91-818 that where there has been an advance of money or property by a parent of the parties the circumstances of the advance cannot be recognised as a commercial transaction.[4]
[4] at [160].
However, as was determined by the Full Court in Mabb & Mabb & Anor [2020] FamCAFC 18, the proposition in Kessey is subject to evidence otherwise, with neither party bearing an onus of proof. The husband’s parents were not on evidence in this case. There is not much better evidence than a Deed of Forgiveness. With respect to the Deed of Forgiveness, the proposition in Kessey does not apply, as per Mabb, such that it was a contribution attributable to both parties. With respect to the portion of G Property that was not borrowed, the proposition in Kessey does apply such that it was a contribution attributable to the husband.
The wife also argued in her case that the acquisition of G Property and the restructures of the business interests over time were all commercial transactions, documented and accounted for at arm’s length regardless of the close family relationships. Thereby, they are attributable to the parties equally.
At all times, the husband and his parents, and later the wife, together obtained and followed professional advice about how to hold and pass title to property of all types along with annual returns. I have no doubt that the financial statements were proper and in conformity with legislative requirements. I am also of the view that they were also prepared with consideration as to the issues and priorities of the day which were not to capture the market value of the enterprise or maximise its taxable earnings. For the purposes of these proceedings, they are evidence of the historical dealings but are not unequivocal evidence of the value of those historical dealings.
In Kessey, the Court held that it was open to the trial Judge to find that the contribution by the wife's mother had probably had a significant impact on the value of the matrimonial home and that it was not necessary to arrive at precise mathematical valuations of the parties' contributions in property settlement proceedings.
Likewise, it is open to find in this case that the contribution by the husband’s parents had a significant impact on the value of G Property and the farming business and it is not necessary to arrive at precise mathematical valuations along the way. I find accordingly.
It is unequivocal that the G Property property came to be property of the parties by way of the husband. This can be stated in a number of ways: (i) but for the husband’s parents, the parties would not have this property; (ii) the wife made no financial contribution to the acquisition of it, (iii) the wife’s involvement at the time was a consequence of being the husband’s relatively new partner and nothing turned on her presence or involvement at the time. Again, I emphasise that this pertains to derivation only and not subsequent use or improvement.
Contributions during the relationship
Much evidence was led and tested with respect to the extent of the parties respective financial and non-financial and parenting and homemaker contributions. I find that during the period of their cohabitation, the parties made different but equal contributions consistent with their respective and agreed roles.
The husband performed the primary role of working and managing the farming business thereby increasing the value of the land and business and producing income for the family. Their income was supplemented by the wife’s contributions from her work and assisting with the farming business – particularly the administration aspects. The wife performed the primary role between the parties as homemaker and parent. This contribution was supplemented by the husband’s home making and parenting contributions at times when he was not engaged in the farming business. It is clear that the non-financial contributions is what drove the parties advancement in wealth in that their combined efforts decreased debt, increased the value of their assets and advanced the welfare of their family.
Post-separation contributions
The children have continued to live with the mother at G Property. It was uncontroversial that as between the parties, and despite the husband not wanting it to be the case, the wife has had the primary responsibility for their care and wellbeing and I take that into account.
Post-separation, both parties have continued to apply themselves wholly. It seems to me that both parties were driven by the same dual purposes. Primarily, to maximise the demonstration of their claim over the property in favour of the other. Secondly, in order to provide for their day to day needs and to preserve the property. There is no need or use to dissecting and comparing each and every financial and non-financial contribution to the maintenance and preservation of the property.
Overall assessment of contributions
The Full Court in Horrigan & Horrigan [2020] FamCAFC 25 emphasised that the proper approach to the assessment of contributions is:
…well established that an assessment of contributions is not a mathematical exercise, but rather involves the identification and assessment of all of the parties’ respective contributions, in a holistic way across the course of the relationship and in the post separation period to the point of assessment.[5]
[5] at [35].
In Dovgan & Dovgan [2021] FamCA 306, [at 347] Harper J restated the need to holistically assess contributions, and that “all contributions must be weighed collectively and so it is an error to segment or compartmentalise the various contributions and weigh one against the remainder.”
The wife worked hard in her case to try to demonstrate that the value of the initial contribution attributable to the husband was small relative to the length of the marriage and the current shape and state of the property. Counsel for the wife contended that whilst the initial contribution of the property is attributable to the husband and his family, it was a relatively long time ago and it is but one factor that is not to be considered in isolation but along with the myriad of other contributions.
The principles enunciated in Pierce & Pierce (1999) FLC 92-844 are appropriate in this matter, particularly [at 28] where the Full Court said:
“In our opinion it is not so much a matter of erosion of contribution but a question of what weight is to be attached, in all the circumstances, to the initial contribution. It is necessary to weigh the initial contributions by a party with all other relevant contributions of both the husband and the wife. In considering the weight to be attached to the initial contribution, in this case of the husband, regard must be had to the use made by the parties of that contribution. In the present case that use was a substantial contribution to the purchase price of the matrimonial home…”
I have found that the derivation of the land and the farming enterprise is attributable to the husband. This contribution attracts weight when regard is then had to the use of those contributions. Those contributions seeded and enabled the parties’ wealth and the product of those contributions now dominate the balance sheet.
Taking into account all of the matters as to contributions identified in this judgment made by the parties at the commencement of the relationship and the use made of those initial direct contributions, the contributions during the relationship and those made post-separation, I conclude that contributions as to the non-superannuation pool ought be assessed favouring the husband as to 55 per cent and the wife as to 45 per cent. This will be a disparity of 10 per cent between the parties. In dollar terms this equates to $3,754,195 to the husband from the non-superannuation pool and $3,071,614 to the wife – a difference of $682,581.
ADJUSTMENT TO THE CONTRIBUTION FINDINGS
The applicant wife is 46 years old and the respondent husband is 48. Both parties are young enough, fit, resourceful, intelligent and capable. They are physically and mentally capable of appropriate and gainful employment.
There is sufficient property in the pool to provide for both parties to support themselves adequately and maintain a reasonable standard of living.
The children are not young at 19, 16 and 14. There is little evidence as to where they will end up going and what they will end up doing other than remaining with their mother for now. That is something the wife will need to consider and provide for. I have no reason not to consider that the husband will continue to support the wife in her care of the children, including any child support, and to support the children’s welfare directly wherever he is permitted to do so and wherever he can. As much as the husband does not want it to be the case, the wife has and will retain primary care, control and responsibility for the children and for that warrants provision pursuant to s 79(4)(e) and s 75(2)(c), (d) and (e) of the Act.
Against that is the reality of the financial resources available to the wife. Not so much the 16 weeks of leave, but the funds her parents have provisioned for her. I am satisfied that they will be used as intended which is towards the purchase of a property as opposed to expenditure towards the children. Nevertheless, it will free up other funds of the wife that would otherwise have had to be expended on acquisition of property.
Expressed as a percentage of the net superannuation pool, it is over 7 per cent. That well exceeds any percentage that I would have arrived at in the wife’s favour pursuant to s 79(4)(e).
I do not find any grounds that warrant an adjustment of 5 per cent in his favour as contended for by the husband.
Both parties wanted an adjustment in their favour in the event they were not to retain G Property on the basis that they would need to purchase property and start another farming business elsewhere. I decline to exercise my discretion to make any adjustment on that basis because:
(a)Understandably so but nevertheless, there was no evidence from either of them as to any such alternative properties or businesses. Any adjustment for that reason would be erroneously arbitrary; and
(b)The matters in s 75(2), including s 75(2)(o) of the Act, do not provide for such an adjustment which has a damages or compensatory character about it.
Having considered the matters contained in s 79(4)(d)-(g) of the Act, there ought to be no adjustment to the contributions finding.
SUPERANNUATION INTERESTS
The combined value of the non-superannuation and superannuation pool is $7,201,995. The combined family law value of the parties’ superannuation interests is $376,186 which represents only 5 per cent. That is relatively nominal but nevertheless requires consideration and determination. The wife’s portion at $206,452 is 55 per cent. The husband’s portion at $169,734 is 45 per cent. Understandably, the parties’ superannuation interests received some but not much attention at trial.
The wife advocated for each party to retain their present entitlements. The husband sought a splitting order to reflect the same division of the non-superannuation pool for the same reasons.
Applying all of the same facts and findings to the party’s superannuation entitlements, I conclude that their interests ought to be equalised. The husband’s greater contributions to the derivation of the land and farming business do not apply to the accrual of the parties’ superannuation interests which are of a different character. The parties’ interests are wholly attributable to the period of their relationship and the relatively shorter post-separation period to which they have equally contributed.
JUSTICE & EQUITY
With respect to G Property and the farming business there were three potential outcomes. Firstly, what the applicant wife wanted which was to obtain the farm and to pay out the husband. Secondly, what the respondent husband wanted which was to obtain the farm and to pay out the wife. Thirdly, what neither party wanted which was for the farm to be sold, including to either of them at arm’s length, with the proceeds divided between them. It was uncontroversial that there would be capital gains tax implications to the detriment of both parties and I am satisfied that it is not necessary for the farm to be sold.
In support of the wife retaining the property:
(a)The husband and wife had formed their relationship and had started cohabitation prior to the purchase of G Property. Their partnership structure has been operating for almost 14 years.
(b)It is not an intergenerational property. The majority of the money used to obtain G Property came from borrowings which have been repaid from the joint efforts of the parties during the relationship.
(c)From the time the property was purchased, the wife has worked the farm to the best of her ability along with being primarily responsible for home duties including the children, her work as an educator and the bookkeeping of the farming business.
(d)The wife has demonstrated capacity to wholly manage the farm business either by doing the work herself or identifying what needs to be done and obtaining the resources or people to get it done.
(e)She has a strong and genuine desire to stay on the farm and for it to become an intergenerational property.
(f)The children have lived all of their lives on the farm. They are likely to remain in the care or control of the mother. If the mother has to move, then the children will not be living on the farm either.
In support of the husband retaining the property:
(a)The acquisition of G Property is attributable to the husband and his parents.
(b)There is a greater connection to the district in which G Property is located with the husband than the wife. Not because of what either of them has done since owning the property, but just as the wife hails from Town J, the husband hails from B Region.
(c)Consistent with their roles in the relationship, the husband has been the primary grazier at all times, assisted by the wife. His skillset and knowledge is wider and higher than the wife’s with respect to tasks and management decisions – subject to keeping books and records which he says can be outsourced.
(d)The husband’s skills and earning capacity are not readily transferrable. As deposed by the husband:
[170]. If I am divested of the farm, I will be without my main source of income. Due to the unique nature of [G Property], situated at […] metres in elevation, I am not able to purchase a comparable farming property. My experience gained through a lifetime of working and managing a high elevation grazing business has developed a specific skillset. My capacity to earn an income will be severely restricted. I would not able to earn the same income that I earn now through the business if I was working elsewhere.
[171]. There are no employment opportunities for me in the region doing the work I do, unless I am doing it in my own business at [G Property]. Farm management roles are very rare.[6]
(e)Without being able to work the farm, the husband’s income earning capacity would be significantly reduced.
(f)The wife is more likely to be able to succeed in another endeavour. She is better resourced. Her skills are wider and transferable. She has proven herself to be adept at learning and applying new skills.
(g)As much as he would welcome it, the farm is unlikely to become an intergenerational farm where only one of the children has demonstrated a partial interest in working the farm.
[6] Affidavit of the Husband filed 16 April 2024.
Submissions were sought of each party as to any applicable jurisprudence identifying an equitable principle or just reasoning process so as to prefer the factors contended by one party over the other in circumstances where both parties established and promoted objectively legitimate foundations for preferring their respective positions. No such jurisprudence, equitable principle or just reasoning was identified by either party.
Both counsel submitted that:
(a)G Property and interests in the farming enterprise were to be considered together and determined as one;
(b)Disposition of the farm was its own issue and not consequential to assessment of contributions or adjustments in favour of one party or the other; and
(c)The determination of who obtains the farm must be just and equitable.
It was inherent that the husband could run the farm competently and profitably. The wife spent considerable effort in her evidence demonstrating her capacity to run the farm competently and profitably. The husband spent considerable effort in his evidence demonstrating that he would be better at running the farm without the wife compared to the other way around. I am not persuaded that these arguments much assist either party. The test referable to s 75(2) of the Act is that the running of the farm be appropriate and gainful to which I am satisfied as to both party’s capabilities. That one or the other of them may or may not be able to do it better than the other is not explicitly within the s 79 ambit.
Also not explicitly within the s 79 ambit is whatever the children’s attitude towards the property and future within the farming business may or may not be. Presently, the prospects are poor and it is more of a hope or aspiration of both parents to which it seems they would both welcome. I am satisfied that the children will be adequately provided for by the parents in any event.
Counsel for the wife submitted that it was open to take into account moral considerations such as the circumstances that it was the husband who left the property and it was the wife that remained with the children in the only home they’ve known and in which they want to stay. I am not so persuaded. Moral considerations do not come within the s 79 ambit nor do they come within the ambit of ‘just and reasonable’ in a no fault jurisdiction.
Counsel for the husband cited Stanford [at 36] and I agree that the excerpt is particularly apt to this case:
The expression “just and equitable” is a qualitative description of a conclusion reached after examination of a range of potentially competing considerations. It does not admit of exhaustive definition. It is not possible to chart its metes and bounds. And while the power given by s 79 is not “to be exercised in accordance with fixed rules”, nevertheless, three fundamental propositions must not be obscured.
Counsel for the father went on to submit that determination as to the disposition of the farm goes beyond the matters in s 79 (and s 75(2)) of the Act and calls for common sense.
Having examined the competing considerations, taken into account the matters listed in sub-section 79(4) and also by application of common sense, I conclude that it is just and equitable that the husband obtain the farm.
Together with my determination as to contributions (s 79(4)(a)-(c)) and future needs (s 79(4)(d)-(g) of the Act, in all the circumstances, I am satisfied that is a just and equitable result.
THE ORDERS
The effect of my findings and the final orders that are required, include that:
(a)The wife’s interests in G Property and the entities comprising the farming enterprise are to be transferred to the husband.
(b)The husband is to pay to the wife a settlement sum of $2,863,183 being her 45 per cent interest from the non-superannuation pool at $3,071,614 less the benefit already received by way of paid legal fees of $208,431.
(c)The wife, and probably the children, will need some time to move out of G Property and there will need to be a handover of the aspects of the business that the wife has had responsibility for.
(d)The wife’s superannuation interests are to be split as to $18,359 such that the parties superannuation interests are equalised at $188,093 each.
Other aspects that need to be provided for in the final orders include:
(a)Division of the contents of the house and shed as between the parties. Both parties proposed orders to attend to this amongst themselves but in the event of disagreement they each sought to have first choice to an alternate choice regime. As primary homemaker, the wife is to have first choice in the event it is necessary.
(b)Completion of tax returns and regularisation of all other books and records with:
(i)The costs to be met by the husband (noting that the first $4,000 has been accounted for as a liability in the balance sheet); and
(ii)Any benefits or liabilities arising are to be apportioned as to 55 / 45 as between the husband and wife respectively.
The Full Court in Aitken & Aitken [2023] FedCFamC1A 69 held [at 36] that trial judges should not delegate to parties the responsibility to agree upon the nature and form of orders required to give effect to views expressed by a trial judge in reasons for judgment, unless in limited or exceptional circumstances, and that this is particularly the case where a party asserts that they lack the capacity to comply with such orders.
Each party prepared comprehensive orders sought in their case, providing fertile ground from which final orders can be harvested. My attempt to do so however would still require arbitrary specification as to some aspects, in particular time frames. There may also be some other housekeeping aspects to attend to arising between final hearing and judgment. For example, a new financial year has begun in that time. Now with the benefit of judgment, it is appropriate that the parties have the opportunity to propose, and ideally agree, on the particulars of the final orders. Despite the appeal division of the Court disavowing the practice of ordering parties to bring in terms to give effect to judgments, it is appropriate in this case. The parties are not required to agree on the nature of the orders nor the form of orders in large part. Their responsibility is only with respect to some particulars. I am satisfied that neither party lacks the capacity to comply with such orders.
I certify that the preceding ninety-nine (99) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Mansfield. Associate:
Dated: 9 August 2024
ANNEXURE A – EXHIBIT C2
WILKINSON BALANCE SHEET CAC 1145/2023
Property interests, superannuation and financial resources
Description Ownership Applicant’s value Respondent’s value ASSETS L Street, Town M - as per single expert valuation by N Company Mr O dated 18.03.24 Husband Agreed $5,060,000 CBA Bank account ending …86 – as at 7 May 2024 Husband Agreed $2,060 P Bank Ms Wilkinson (account ending …77) - as at 7 May 2024 Wife Agreed $7,414 P Bank Mr & Ms Wilkinson (…|10 Term Deposit) account ending …60 as at 5 April 2024 Joint Agreed $10,000
Wilkinson Family Trust (operates the Wilkinson Family Partnership)
- Produce on hand (including wool, grain, hay and consumables animal health, …) as per agreement between the parties = $140,975
- Plant and equipment per list at Annexure A to Husband’s Affidavit (agreed between the parties) = $540,049
- Livestock (sheep and cattle) as at 12 April 2024 = $695,080 (per Mr Q’s appraisal)Joint Agreed $1,376,104 General household contents & shed contents – to be divided between the parties as per Orders sought in each parties’ minute Joint Agreed $20,000 Partnership between Mr Wilkinson and the trust, trades as 'The Wilkinson Family Partnership'
- S Bank Farm Management Deposit Account in husband’s name as at 31 March 2024 = $20,000
- S Bank Farm Management Deposit Account in Wife’s name as at 31 March 2024 = $20,000
K Bank account – as at 30 April 2024 = $622Joint Agreed $40,622 Husband's 1,837 F Company Shares as at $6.42 – as at 15 April 2024 Husband Agreed $11,794 Assets subtotal
$Agreed $6,527,994
LIABILITIES Costs of winding up partnership Joint Agreed $4,000 S Bank account ending …80 – as at 30 April 2024 Wilkinson Family Partnership Agreed $23,641 Rates Instalment Notice due May 2024 Wilkinson Family Partnership Agreed $1,296 Partnership bills Wilkinson Family Partnership Agreed $2,336 GST Due 28 May 2024 (January to March) Wilkinson Family Partnership Agreed $6,946 Payment of Single Expert Report to Mr R Wilkinson Family Partnership Agreed $5,500 Liabilities subtotal $Agreed $43,719
ADDBACKS Description Ownership Applicant’s value Respondent’s value Wife’s total paid Legal fees from partnership – as at 7 May 2024 Wife Agree $208,431 Husband’s total paid Legal fees from partnership – as at 7 May 2024 Husband Agree $174,371 Addbacks subtotal
$382,802
SUPERANNUATION Name of Fund Type of interest Member Applicant’s value Respondent’s value Ms Wilkinson's Super Fund 1 – as at 29 April 2024 Accumulation interest Wife Agreed $206,452 Mr Wilkinson’s Super Fund 2 – as at 9 April 2024 Accumulation interest Mr Wilkinson Agreed $169,734 Superannuation subtotal
$Agreed $376,186 TOTAL (assets – liabilities + addbacks) $Agreed $6,867,077 TOTAL (assets – liabilities + addback + superannuation) $Agreed $7,243,263
FINANCIAL RESOURCES Description Ownership Applicant’s value Respondent’s value Wife’s expected gift from parents as well as general ability to be financed by her parents Wife $525,000+ Wife’s leave entitlements – as at 30 April 2024 Wife Amount to 16 paid weeks leave plus sick leave entitlements
0
5
1