WILMOT & SCHNEIDER
[2009] FMCAfam 932
•30 October 2009
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| WILMOT & SCHNEIDER | [2009] FMCAfam 932 |
| FAMILY LAW – Parenting – neither parent seeking orders as to the living arrangements for the children – whether orders should be made for therapeutic intervention when teenage children and wife are opposed to such orders – wishes of 17 and 16 year old children respected and no parenting orders made. FAMILY LAW – Property – assets managed by husband by husband – should there be “add-backs” – contribution of inheritance – adjustment of section 75(2) factors. |
| Family Law Act 1975, ss.60B, 60CA, 60 CC, 75, 79 |
| Kowaliw & Kowaliw (1981) FLC 91-092 Kennon v Kennon (1997) FLC 92-757 Marker and Marker [1998] FamCA 42 Pierce and Pierce (1999) FLC 92-844 Hickey and Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143 NHC & RCH (2004) FLC 93-204 AJO v GRO (2005) FLC 93-218 |
| Applicant: | MS WILMOT |
| Respondent: | MR SCHNEIDER |
| File Number: | DGC 4199 of 2007 |
| Judgment of: | Bender FM |
| Hearing dates: | 20, 21 & 31 August 2009 |
| Date of Last Submission: | 31 August 2009 |
| Delivered at: | Melbourne |
| Delivered on: | 30 October 2009 |
REPRESENTATION
| Counsel for the Applicant: | Mr Weil |
| Solicitors for the Applicant: | Mirabellas Solicitors |
| Counsel for the Respondent: | Self-represented |
| Solicitors for the Respondent: | Self-represented |
ORDERS
The court having determined that there is to be a division of the parties’ assets, including their respective superannuation entitlements, on the basis the wife receives 60 per cent and the husband receives 40 per cent of those assets, and having given the husband the opportunity to nominate whether he wishes to retain the whole of his superannuation entitlements rather than there being a superannuation splitting order in relation to his superannuation IT IS ORDERED:
All applications in relation to parenting matters be dismissed.
The husband shall advise the court and the wife’s solicitors in writing within 14 days as to whether he seeks to retain all of his superannuation entitlements.
In the event the husband advises the court that he wishes to retain the whole of his superannuation entitlement pursuant to order 2 herein:
(a)the husband shall pay to the wife the sum of $146,000.00 (“the payment”) on or before the 12th day of January 2010 (“the date”);
(b)contemporaneously with the payment:
(i)the wife do all such acts and things and sign all such documents as may be required to transfer to the husband, at the expense of the husband, all of her right, title and interest in the real property situate at and known as Property K, Victoria, being the whole of the land more particularly described in Certificate of Title Volume [8] (“the real property);
(ii)the husband indemnify the wife against all payments and liability pursuant to the mortgage registered No. [U] to Westpac Banking Corporation (“the mortgage”) and all apportionable rates, taxes and outgoings of or with respect to the real property of whatsoever nature and kind;
(c)in the event that the whole of the payment has not been made by the date then the husband sign all documents and do all things necessary to transfer to the wife the real property to be held on trust for sale (“the sale”) and upon completion of the sale, the proceeds of the sale be applied:
(i)firstly, to pay all costs, commissions and expenses of (the said trust transfer and) the sale;
(ii)secondly, to discharge the mortgage and any other encumbrance affecting the real property;
(iii)thirdly, so much of the payment as is then outstanding together with interest thereon at the rate of ten per centum per annum adjusted monthly from the date to the wife; and
(iv)fourthly the balance to the husband;
(d)pending the payment or completion of the sale:
(i)the husband have the sole right to occupy the real property, and during such right of occupation the husband shall pay all instalments pursuant to the mortgage and all rates and taxes and like apportionable outgoings of the real property as they fall due;
(ii)the parties hold their respective interests in the real property upon trust pursuant to these orders; and
(iii)neither party encumber the real property without the consent in writing of the other party;
(e)unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:
(i)each party be solely entitled to the exclusion of the other to all superannuation and other property (including choses-in-action) owned by or in the possession of such party as at the date of these orders (the furniture, personal possessions, and like chattels in the property being deemed to be in the possession of the husband);
(ii)insurance policies remain the sole property of the owner/beneficiary named therein;
(iii)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders;
(iv)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
In the event the court and the wife’s solicitors have not received notification from the husband pursuant to order 2 herein:
(a)the wife’s solicitors shall immediately forward to the trustee of the husband’s superannuation fund a proposed minute of orders whereby the husband’s superannuation entitlement is to be split, with a base amount of $40,600.00 to be allocated to the wife; and
(b)upon the wife’s solicitors providing to the court written proof of procedural fairness having been accorded to the husband’s superannuation fund in accordance with order 4(a) herein, the matter shall be administratively relisted in chambers for final property orders to issue.
AND THE COURT NOTES THAT:
A.In the event the matter is relisted pursuant to order 4(b) herein, the court shall make orders in the following terms:
The husband shall pay to the wife the sum of $105,400.00 (“the payment”) within 60 days of the making of these orders (“the date”).
Contemporaneously with the payment:
(a)the wife do all such acts and things and sign all such documents as may be required to transfer to the husband, at the expense of the husband, all of her right, title and interest in the real property situate at and known as Property K, Victoria, being the whole of the land more particularly described in Certificate of Title Volume [8] (“the real property); and
(b)the husband indemnify the wife against all payments and liability pursuant to the mortgage registered No. [U] to Westpac Banking Corporation (“the mortgage”) and all apportionable rates, taxes and outgoings of or with respect to the real property of whatsoever nature and kind.
In the event that the whole of the payment has not been made by the date then the husband sign all documents and do all things necessary to transfer to the wife the real property to be held on trust for sale (“the sale”) and upon completion of the sale, the proceeds of the sale be applied:
(a)firstly, to pay all costs, commissions and expenses of (the said trust transfer and) the sale;
(b)secondly, to discharge the mortgage and any other encumbrance affecting the real property;
(c)thirdly, so much of the payment as is then outstanding together with interest thereon at the rate of ten per centum per annum adjusted monthly from the date to the wife; and
(d)fourthly, the balance to the husband.
Pending the payment or completion of the sale:
(a)the husband have the sole right to occupy the real property and during such right of occupation the husband shall pay all instalments pursuant to the mortgage and all rates and taxes and like apportionable outgoings of the real property as they fall due;
(b)the parties hold their respective interests in the real property upon trust pursuant to these orders; and
(c)neither party encumber the real property without the consent in writing of the other party.
An order in relation to the splitting of the husband’s superannuation in accordance with the proposed minutes forwarded to the husband’s superannuation fund in accordance with order 4(a) herein.
Unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:
(a)each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) owned by or in the possession of such party as at the date of these orders (the furniture, personal possessions, and like chattels in the property being deemed to be in the possession of the husband);
(b)insurance policies remain the sole property of the owner/beneficiary named therein;
(c)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders; and
(d)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
IT IS NOTED that publication of this judgment under the pseudonym Wilmot & Schneider is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
DGC 4199 of 2007
| MS WILMOT |
Applicant
And
| MR SCHNEIDER |
Respondent
REASONS FOR JUDGMENT
(as corrected)
Introduction
The wife’s initiating application sought orders with respect to both parenting and property matters.
When the final hearing of the matter commenced, the wife sought that all applications for parenting orders be dismissed on the basis that the parties’ daughters [X], aged 17 years, and [Y], aged 15 years, were of an age where they would determine their living arrangements and the parties’ youngest son [Z], aged 13 years, was spending equal time with each of his parents by agreement.
In relation to property matters, the wife is seeking a division of the parties’ assets, consisting of the former matrimonial home, the proceeds of sale of an investment property in Property M and a redundancy/termination payout received by the husband after separation, so that she receives between 65 to 70% of same.
In relation to parenting matters, the husband is in agreement that there should be no orders specifying the living arrangements for the children. However, he is seeking orders that the parties and the children engage in intensive family counselling, mediation and/or family therapy so that the parties can:
“Negotiate and implement a comprehensive and holistic therapeutic intervention plan that is healing in its function and to resolve interpersonal issues and parenting disputes and develop cooperative and/or parallel parenting practices that reflect a positive energy of mutual respect and demonstrate a focus on the needs of the children”.[1]
[1] Paragraph 4 of page 25 of the husband’s written submissions dated 1 October 2009.
In essence, neither of the parties’ daughters have spent any time with the husband since December 2007 when the husband assaulted the wife’s partner. The husband is seeking orders for therapeutic intervention, in part, to assist in the repair of this relationship.
In relation to property matters, the husband argued that no orders are needed. He argued that he and the wife had agreed to and acted upon a property division with respect to the former matrimonial home in January 2006, a division of the parties’ share of the Property M property on its settlement in March 2007 and that the redundancy/termination payment received by him in 2006 was not part of the property pool as it reflected future earnings and was utilised for the care of himself and the children.
It was the husband’s contention that in these circumstances, there had already been a just and equitable division of the parties’ joint assets and accordingly each should retain that which they currently possess, with the husband to retain the jointly owned former matrimonial home.
Background
The husband is of Germanic background and is aged 54 years, having been born [in] 1956. He is a trained [omitted] with post-graduate qualifications in [omitted]. He has worked in the Alcohol and Drug sector for over 20 years. He is currently employed (as of August 2009) managing residential services for [R].
The wife is 44 years old, having been born [in] 1966. She is employed on a part-time basis as a [omitted].
The parties commenced co-habitation in 1990 and were married [in] September 1995. They separated under the one roof in February 2005 and the wife left the former matrimonial home in January 2006.
The parties have four children, [W], born [in] 1990, aged 19 years (“[W]”) who lives independently of his parents, [X], born [in] 1992, aged 17 years (“[X]”) living with the wife at the time of the final hearing but now possibly living independently, [Y], born [in] 1994, aged 15 years (“[Y]”) who lives with the wife and [Z], born [in] 1996, aged 13 years (“[Z]”) who lives equally with both the husband and the wife.
At the commencement of the parties’ relationship, they were both battling serious drug addiction. They were both successful in overcoming their addictions.
During the marriage, the husband was very involved in his career. He established a very good reputation within his area of professional expertise, being the treatment of drug and alcohol dependency. He worked in excess of 60 hours per week, as well as travelling extensively to share and further expand his knowledge.
The wife very much performed the “traditional” role of the homemaker and parent during the marriage. She was actively involved in her community and in the children’s schools. Towards the end of the marriage, the wife undertook training whereby she qualified as a youth worker in the area of addiction and obtained paid employment in this area.
The parties initially resided in a property purchased for them by the wife’s parents at Property M.
In 1996, the parties purchased the former matrimonial home at Property K (“Property K”). Property K is currently valued at $345,000.00 and encumbered by a mortgage of $124,000.00.
In April 1996, the wife’s parents “sold” Property M to the husband and his brother, Mr S, for $65,000.00 A deposit of $13,500.00 was paid to the wife’s parents and it was agreed the “purchasers” would otherwise continue to meet the Victorian Police Credit Co-Operative loan initially taken out by the wife’s parents to purchase the property.
Mr S claims the $13,500.00 paid to the wife’s parents was from $15,000.00 he lent his brother. This is challenged by the wife, who argues the funds came from their joint savings. The property remained registered in the wife’s parents name until shortly before it’s sale when it was transferred into the husband’s name solely.
After the purchase of the Property M property, the mortgage was paid from rental income received from leasing the property. All rates, insurances and other expenses in relation to Property M were paid by the husband and the wife.
The parties separated under the one roof in February 2005. In January 2006, the wife vacated Property K and moved to Property M where she paid rental in an amount sufficient to meet the mortgage repayments on that property. It is agreed this was an amount less than commercial rental payable on the property. The mortgage was paid out in or about mid 2006.
Upon physical separation, the children remained living with the husband in the former matrimonial home. [Y] and [Z] spent regular time with the wife at Property M when she was not at work.
At the time of “physical separation” in January 2006, the husband’s evidence is that he “amalgamated” all the parties’ debts, including the mortgage in relation to the former matrimonial home and credit cards which were paid out, and the total mortgage at that date was $213,911.00.
In 2006, the husband, who for the previous seven years had been the Chief Executive Officer of [S] (“[S]”), ceased his employment with that body due to a mutual falling out between himself and the Board. In June 2006, the husband, who pursued an unfair dismissal claim, reached agreement with [S] and received a termination payment of $87,000.00.
The husband did not pursue full-time employment from 2006 until August 2009. The husband advised the court when the matter resumed hearing on 31 August 2009 that he had just been employed as the Manager of [R] and would have commenced that employment on that day but for the court case.
In 2007, Property M was sold by the husband for $215,000.00. The net proceeds of sale were paid to the husband. It was his evidence that of the net proceeds of sale received at settlement, he paid his brother $50,000.00, the wife $38,000.00 as well as paying some of her credit card debts and that he otherwise retained the balance.
Upon vacating Property M, the wife moved into rental accommodation in Property F with her partner, Mr J. [X], [Y] and [Z] continued to live in the former matrimonial home with the husband and spent regular time with the wife.
In December 2007, the husband assaulted the wife’s partner, Mr J, in the presence/hearing of [Y] and [Z]. The husband was charged and convicted of intentionally causing injury and was given a six month suspended sentence.
Since the assault on Mr J, neither [X] nor [Y] have chosen to spend time with the husband. [Z] spends equal time with each of his parents by agreement between them.
Children’s matters
The wife’s proposal
As set out earlier in this judgment, the wife is not seeking that any orders be made in relation to parenting matters.
It is her view that the girls [X] and [Y], at 17 and 15 years of age respectively, are old enough to make their own decisions in relation to where they want to live and the time that they wish to spend with each of their parents.
The wife indicated that she and the husband had been able to reach a sensible agreement in relation to the arrangements for [Z], and that he spent some of each week, as well as a weekend in each fortnight with each his parents. This arrangement centres around the wife’s work commitments, and has been amicably in place for nearly two years.
It was the wife’s evidence that she was not preventing the girls from seeing their father and in fact had encouraged them to attend Schneider family gatherings, such as Easter and Christmas.
The wife indicated that in relation to the husband’s proposal for intensive family therapeutic intervention, both girls had indicated to her that they did not wish to participate in such counselling at this time, and that she would respect their wishes in this regard.
In relation to her relationship with the husband, it was the wife’s evidence that for the totality of the relationship he had subjected her to continuous emotional abuse. She indicated that the husband held her in very low regard and would ignore her opinions and views. He would talk at her, not with her and that she had learned very early in the piece to agree with whatever it was that he was seeking or saying in order to keep peace within the household.
The wife was quite adamant that she did not believe any form of family therapy, couples counselling or post parenting programs would enable she and the husband to develop a co-parenting relationship and that she was not prepared to participate in such counselling.
The wife deposed that the incident where Mr Schneider assaulted her partner, Mr J, had had a deep negative impact upon her, and that coupled with what she described as years of emotional abuse in the relationship was such that she continued to this day to undertake personal counselling to assist her in dealing with that impact. It was her evidence that she continues to suffer the psychological impact of those abuses to the extent that she has currently reduced her working hours as she was not coping.
The husband’s proposal
There is no doubt that the husband loves his children and is devastated by the breakdown of his relationship with his daughters, [X] and [Y]. He is desperate to take positive and active steps to repair that relationship and his training and background, coupled with his personality is such that he fervently believes that the only way forward for his family is for them to engage in the therapeutic interventions sought by him.
In his affidavit material and in his many submissions to this court, the husband continuously made reference to what he termed “the narrative of hate and fear” that had been perpetuated by the wife to the children and to the extended family, such that he had been left ostracised, stranded in his professional life and estranged from his children and his family.
He was strongly of the view that the wife was sabotaging his attempts to reconnect with his children. He likened the situation to a “festering wound” that could not heal without the proper therapeutic intervention that would enable the family to be reunited and allow him to make a contribution as a good parent to the lives of his daughters.
Dr David Harvey
Dr David Harvey, psychologist, prepared a family report in this matter which was released on 22 May 2009. Dr Harvey also gave evidence at the final hearing of this matter.
In his family report at paragraph 21, Dr Harvey describes the husband in the following terms:
“Mr Schneider presents as an articulate and well educated person with strong analytical abilities and a penchant for dissecting events and explaining them in terms that reflect his psychological training. He says he feels a deep sense of betrayal with respect to the way things have turned out in his life including claiming that he spent 17 years as Ms Wilmot’s “counsellor” but she has now rejected him. Despite making positive affirmations about her capacities as a mother and community worker he also claims she is a pathological liar who says only what she thinks people want to hear. He affirms that as partners they were not in the same intellectual loop and that she had not shared his world of ideas even though other aspects of their lives had worked out incredibly well. In certain respects Mr Schneider seemed out of his depth in dealing with a situation that he believed he could analyse but not change all the while believing that despite his failures he had always done his best. Where he had failed it could all be explained, but nevertheless in the end it was not so much his failures as his former wife’s inability to understand where and how she had let him down that seemed to be concerning him the most.”
My observations of the husband during the entirety of the course of this matter before the court accord with those of Dr Harvey. The husband is an erudite and intelligent man who is striving to understand the collapse of his world as he knew it, and particularly his place within his family, within the constraints of his own intelligence, training and experiences.
Whilst acknowledging responsibility for the assault on Mr J, the husband could not acknowledge the impact that this had had on the wife and on the children. His response to the assault was to undertake intensive therapy and it was his evidence that he was satisfied that it was a totally out of character occurrence, and that with the therapy he had undertaken after the assault, that loss of control would not ever occur again. That it had had an intense and ongoing impact on the victims of the assault, being the wife, her partner and the children, to his mind was them “over-playing” the incident. He believes the wife and Mr J are exploiting the assault for financial advantage on the basis that he believes they are making a victims of crime claim.
The husband seemed unable to accept that he may have contributed to the breakdown of his relationship with his daughters. He was not able to look at his own behaviours to see if there was any way in which he may have contributed to his current estrangement from his two daughters.
In his family report, Dr Harvey specifically addressed the husband’s allegations that the wife was deliberately and actively undermining his relationship with his daughters. In paragraph 40 of his report,
Dr Harvey notes that whilst there had been a lot of emphasis on the assault by Mr Schneider on Mr J and of the verbal and emotional abuse inflicted on the wife during the course of the relationship, he stated as follows:
“In terms of the information shared with the writer by the children and by the parents the extent of the effects of the event upon the children’s psyche may well have been overdrawn but nevertheless that one event is not seen by this writer as the sole cause of the difficulties in the relationship between [Y] and her father, or between [X] and her father.”
In paragraph 41, Dr Harvey then went on to note that:
“Overall the writer believes that [X] is taking her mother’s side but her explanations for her position were not the mirror of her mother’s complaints in the way that would be expected if she had been deliberately alienated from her father.”
In relation to [Y], she was observed to interact quite positively with her father during the report writing process. Dr Harvey was of the view that if anyone was influencing [Y], it was [X] rather than the wife.
In cross-examination of Dr Harvey, the husband put to Dr Harvey at length his understanding and explanations for the rift in his family and his belief that the only way for this to heal was for ongoing intensive therapeutic intervention.
Dr Harvey did not agree with the husband’s proposal in this regard.
In his evidence, Dr Harvey responded to the husband’s proposal as to counselling in the following terms:
“In theory what you say is fine, but in practice you are talking about attitude are you not? It is very difficult. You cannot legislate for a change of attitude. You can certainly legislate for a change of behaviours and setting up meetings but you know the thing about counselling is that counselling only works if the people want it to work and if they are prepared to take the lessons that arise from it.”
In relation to the husband’s proposals which had been reduced to writing and forwarded to Dr Harvey for his consideration before he gave his evidence, Dr Harvey made the following observations:
“I got the flavour… that you are trying to control what the children do… It is always a good thing to forgive each other, but these are attitudes and they are going to be coloured by the behaviours of the people towards each other in the past and as I say again my whole impression after meeting with you and your family is that I do not see you looking on yourself as having contributed to the breakdown of your marriage as much as I believe you have done… I think the problem is that you have failed to provide the emotional support that the wife and, I think, the children need… You have a very good intellectual understanding of what has gone on but I do not gather from anything that you have said or written that you understand the emotional impact that you have had on your wife and her attitudes, nor your children.”
Mr Schneider then asked Dr Harvey if, in relation to his opinion that it was [X] that was influencing [Y]’s negative view of him, did he have any advice as to how that could be addressed. To this question, Dr Harvey replied as follows:
“Yes. You can make being with you so good that they will ignore her. The key is how do you treat them, what do you do with them, how are they responding to you when they are with you, because if that’s strong enough, they are not going to take all that much notice of [X]. I think they are now but the key to it is for you to work out with someone how you might be able to make being with you so desirable that they will ignore what [X] says and [X] in turn is likely to think, ‘Well, maybe I am wrong. Maybe I will come with them.’”
Dr Harvey was then asked by me whether he was of the belief that therapeutic intervention would be of assistance, particularly for the relationship between Mr Schneider and [Y]. To this question
Dr Harvey replied as follows:
“I’m not even sure that it needs therapeutic intervention. I think it means that they just spend time together and they appreciate the man for what he is without all the tensions and the carry on and the talk that has been there. I know I am a counsellor and I work in this area, but as I say, counselling can only work if it is going to be something that both parties want.”
After Dr Harvey had given this evidence, the husband again placed before Dr Harvey, at length, his beliefs as to the difficulties of his family, with references to the “litany of hate and fear” perpetuated by the wife and his “poisoned wound” analogy, at which time he asked
Dr Harvey how his family could get rid of that wound. Dr Harvey answered by saying that he had in fact already answered that question. Dr Harvey repeated that there are opportunities for the husband to demonstrate to the children by his behaviours and by his life that those allegations against him which he believes are not true, are in fact not true. Dr Harvey then went on to say:
“You can talk about wounds as much as you like but when the children are with you, do you talk this way? I hope not, because the wounds are not between you and them. The wounds are between you and your wife and you have got to sort those out with her or else come to terms with them and just get on with life. Wake up to where you are and say, ‘This is the future, this is where we are going’ and to the extent that you can work with your children as they develop and you build a relationship with them, that’s what you do… It is a matter of you taking whatever opportunities you can to be with [Y], to talk with her and to interact with her but without rehearsing the history. It is the future that matters. If you say these things about you are wrong, prove it. Be to them what you believe you are – a good man and a caring father.”
In relation to [X], he suggested:
“Forget all this wound talk. She is your daughter. She is not to blame for all these things that have happened. Look after her not yourself and your own worries and your own fears.”
Tellingly, the husband’s response to this suggestion from Dr Harvey was the following:
“I hear you Dr Harvey. Unfortunately, the poison in the festering wound cannot be forgotten about and, you know, I put it to you that the poison is being actively maintained.”
Best interests of the child
Part VII of the Family Law Act 1975 (“the Act”) deals with children. Section 60B of the Act sets out the objects and underlying principles of Part VII of the Act as follows (omitting for present purposes s.60B(3) which deals with Aboriginals and Torres Strait Islanders):
1.The objects of this Part are to ensure that the best interests of children are met by:
(a)ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with the best interests of the child; and
(b)protecting children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence; and
(c)ensuring that children receive adequate and proper parenting to help them achieve their full potential; and
(d)ensuring that parents fulfil their duties, and meet their responsibilities, concerning the care, welfare and development of their children.
2.The principles underlying these objects are that (except when it is or would be contrary to a child’s best interests):
(a)children have the right to know and be cared for by both their parents, regardless of whether their parents are married, separated, have never married or have never lived together; and
(b)children have a right to spend time on a regular basis with, and communicate on a regular basis with, both their parents and other people significant to their care, welfare and development (such as grandparents and other relatives); and
(c)parents jointly share duties and responsibilities concerning the care, welfare and development of their children; and
(d)parents should agree about the future parenting of their children; and
(e)children have a right to enjoy their culture (including the right to enjoy that culture with other people who share that culture).
Section 60ca of the Act provides that:
In deciding whether to make a particular parenting order in relation to a child, a court must regard the best interests of the child as the paramount consideration.
In this matter, neither party is asking the court to make orders in relation to either parental responsibility or the arrangements that should be put in place in relation to where and with whom the children live and spend time.
Both parents agree that there should be no orders made in relation to the time that [X] and [Y] spend with their father or with whom they live.
Both parties also agree that they have been able to put in place sensible and appropriate arrangements for their son [Z], and that those arrangements will continue into the future.
Accordingly, the only issue for the court to determine is whether it would be in the children’s best interests for this court to make orders that require this family to engage in intensive family therapy in order for [X] and [Y]’s relationship with the husband to have an opportunity to repair and move forward.
Section 60CC of the Act sets out those matter which the court must consider when determining what is in the children’s best interests.
Section 60CC(2) of the Act sets out the primary considerations which the court must take into account when determining the children’s best interests and they are as follows:
Section 60cc 2(a) the benefit to the child of having a meaningful relationship with both of the child’s parents
Section 60cc 2(b) the need to protect the child from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence
There is no doubt that at this time, neither [X] nor [Y] have a meaningful relationship with their father.
I am satisfied that this is a decision they have made for themselves and that it does not arise because of any overt interference in that relationship by the wife.
The question for the court is whether orders in the terms as sought by the husband are the best way forward for the children in terms of helping them re-establish their relationship with their father.
Section 60CC(3) of the Act sets out the additional considerations to be taken into account and I will consider those aspects of that section relevant to this determination.
Section 60cc 3(a) any views expressed by the child and any factors (such as the child’s maturity or level of understanding) that the court thinks are relevant to the weight it should give to the child’s views
[X] is 17 years of age and may even be living independently at this time from both her parents.
It was the wife’s evidence, which I accept, that neither [X] nor [Y] wish to engage in any therapeutic counselling at this time.
[X] is on the cusp of adulthood and the court must give real weight to her opinions and life decisions. It is for this reason that it is most unusual for this court to make orders in relation to near adults of [X]’s age, and particularly so in circumstances where those orders are contrary to the wishes and views expressed by such young adult.
[Y] is 15 years of age. Subsequent to the assault on Mr J, it was the parties’ evidence that [Y] experienced some real difficulties. She failed to attend school, she engaged in binge drinking, she attracted the attention of the police and, to use an old-fashioned term, generally “fell off the rails”.
However, in recent times, [Y] has re-engaged in schooling, and is currently attending [school omitted] which is a secondary school that assists children who have had difficulty fitting into mainstream schools. She is currently in Year 10 and is reported to be doing very well. She is intending to attend [omitted] School next year where she hopes to complete Year 11 and 12 before progressing to tertiary education.
Like her sister, [Y] has expressed a strong view that at this time she does not wish to engage in therapeutic counselling with her father or the family generally.
[Y] is a young woman who has had a troubled time arising from the breakdown of her parents’ relationship, but one who seems to be getting herself back on track and moving ahead with her life.
It is my view that it is incumbent upon the court to respect her views and give them great weight.
Of the remaining additional factors, pursuant to section 60CC(3) of the Act, it is section 60CC(3)(c) and section 60CC(3)(i) that are of relevance to these parties. Those sections provide as follows:
Section 60cc 3(c) the willingness and ability of each of the child’s parents to facilitate, and encourage, a close and continuing relationship between the child and the other parent
Section 60cc 3(i) the attitude to the child, and to the responsibilities of parenthood, demonstrated by each of the child’s parents
The husband believes, with absolute certainty, that the responsibility for the breakdown of the relationship between himself and his daughters rests solely with the attitudes and behaviours of the wife.
As set out previously in this judgment, he speaks continuously of the “narrative of hate and fear” perpetuated by the wife against him to the children and his sense that the wife has sabotaged his attempts to reconnect with his daughters.
The husband does not accept that he has in any way contributed to the breakdown of his relationship with his daughters. He has no insight into how his behaviours impact on his relationships and seems incapable of accepting that there are alternative ways of dealing with the issue, other than those which are being proposed by him.
The husband’s immediate rejection of Dr Harvey’s advice to him was very much indicative of this. It is quite apparent that the wife wishes to have very little to do with her former husband at this time. She continues to deal with the impact of the marital relationship, as well as the impact of the assault by the husband upon her current partner.
Having said that, I am satisfied that the wife is not undermining the girls’ relationship with their father. She has encouraged the girls to attend Schneider family gatherings and that she and the husband have been able to put in place a sensible and equitable arrangement for [Z] flies in the face of someone who is deliberately trying to undermine the relationship.
Conclusion
In light of all these factors, I am of the view that it will not be in the best interests of [X] and [Y], or for that matter the wife, to make orders in the terms that are being sought by the husband.
As noted by Dr Harvey, therapeutic intervention is only effective in circumstances where all participants willingly and actively believe that this is the best way forward for the family. At this time, neither the wife nor [X] nor [Y] wish to engage in interventions of this type, and in those circumstances there is a real risk that any possibility of a reconciliation between the husband and [X] and [Y] would be completely sabotaged if they were forced to undergo a process to which they are currently resistant.
It can only be hoped that the husband will take on board the suggestions of Dr Harvey and look to himself and his behaviours and be open to adjusting them in order to make himself more available to his children.
Accordingly, in relation to parenting matters, the court will make no orders.
Property matters
Much of the parties’ history is set out in great detail earlier in this judgment and I am not proposing to repeat that history under this heading.
It is now well over four and a half years since the parties separated, and since that time the husband has had the control of the majority of the parties’ financial assets.
Both parties’ evidence at times had a lack of specificity as to the details surrounding their financial arrangements and there was a marked absence of complete source documents.
However, the issues I identified as between the parties in relation to property matters are as follows:
a)What constitutes the property pool, and in particular:
i)Did the husband’s brother, Mr S, have any interest in the Property M property, and if so, to what extent?
ii)Should the proceeds of sale of the Property M property and the [S] redundancy payment received and retained by the husband and subsequently utilised by him be added back into the property pool?
b)What are the respective contributions of the parties, in particular:
i)What credit, if any, should the husband be given for the funds received by the family from his late mother’s estate?
ii)What weight, if any, should be given to the wife having the full responsibility for the care of the parties’ daughters [X] and [Y]?
c)Should there be a weighting in the wife’s favour in relation to the section 75(2) factors, and in particular a comparison of the parties’ income earning capacities, the impact upon the wife of her earning capacity arising from her current health issues and her responsibilities for the care of the girls in the absence of any, to date, child support paid to her by the husband?
d)Should there be a superannuation splitting order?
The legislation
Section 79 of the Family Law Act1975 (“the Act”) defines the
Court’s powers in determining applications for property settlement.
Sub-section 79(2) of the Act provides that:
The Court shall not make an Order under this Section unless it is satisfied that, in all the circumstances, it is just and equitable to make the Order.
Section 79(4) of the Act sets out the matters the Court must take into account when considering what orders should be made for the alteration of the interest of the parties in property. Those matters are:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
The four-step approach
In Hickey and Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143 at [39], the Full Court of the Family Court described the preferred four-step approach in property matters as follows:
The case law reveals that there is a preferred approach to the determination of an application brought pursuant to the provisions of s.79. That approach involves four inter-related steps. Firstly, the Court should make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing. Secondly, the Court should identify and assess the contributions of the parties within the meaning of ss.79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties. Thirdly, the Court should identify and assess the relevant matters referred to in ss.79(4)(d), (e), (f) and (g), ("the other factors") including, because of s.79(4)(e), the matters referred to in s.75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established at step two. Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case ….
Assets and liabilities
The former matrimonial home
The parties agreed that the current value of the former matrimonial home is currently $345,000.00 and it is encumbered by way of a mortgage to the Westpac Bank in the sum of $124,000.00, leaving equity of $221,000.00.
In relation to the mortgage, I note that when this matter came before the court on 22 December 2008, both parties were given liberty to draw down $10,000.00 against the mortgage over the former matrimonial home. No evidence was led by either party as to whether they did this.
It was the husband’s evidence that in January 2006, at the time of the parties’ physical separation, he approached the Westpac Bank with a view to formally restructuring the home loan so that it consolidated all the parties’ debts and enabled them to pay out their then existing credit card liabilities. It was his evidence that the parties owed some $22,700.00 in credit card debts to the Westpac Bank and to Hong Kong Credit. It was the husband’s evidence, confirmed by correspondence he produced from the bank, that this consolidation meant that the amount owing on the mortgage at that time was $213,911.00.
The husband was cross-examined at some length as to his management of the funds at this time and as to various amounts that were drawn down by him as against the mortgage. His explanations in relation to this were somewhat vague and unfortunately neither party placed before the court by way of evidence documentation that assisted the court in determining the manner in which the husband conducted his financial affairs at this time.
It was the husband’s evidence that at the time of the parties’ physical separation in January 2006, he and the wife had agreed that there was an equity in the matrimonial home of some $110,000.00 at that time. This figure represented the bank’s valuation of $320,000.00, less the mortgage of $210,000.00. The husband said the parties agreed that each of them would be entitled to a 50 per cent share of the equity, being $55,000.00. It was then the husband’s evidence that the wife had agreed to leave her share in the matrimonial home in the property in order to provide security for the children.
When questioned as to the agreements or discussions that she had with the husband in relation to these matters at the time of separation, it was the wife’s evidence that she had no recollection of the husband’s version of events, namely that the mortgage was reconstructed, credit cards paid out, that the house was valued by the bank at that time at $320,000.00, that they had agreed to equally divide the assets and be entitled to $55,000.00 each and that she had agreed to leave her “entitlements” in the property for the benefit of the children at that time.
It was the wife’s evidence that there has been no property settlement, partial or otherwise, between the parties since the time of separation.
The M Property
I have set out in paragraphs 15, 16 and 24 of this judgment, a brief history in relation to the Property M property. It is not my intention to repeat it here.
In the husband’s affidavit sworn and filed on 31 March 2009, the husband set out in some detail his explanation in relation to the dealings with this property.
Annexed to that affidavit was a document headed “Contract of Sale” dated 21 April 1996 between the wife’s parents, Mr and Mrs W, and the husband and his brother, Mr S. The purchase price was $65,000.00 and the terms and conditions comprised of a payment of a $13,500.00 deposit and the agreement of the Messrs S and Schneider to continue to pay the mortgage of $280.00 per fortnight to the Victorian Police Credit Co-Operative until the mortgage was fully paid out. The contract provided that upon discharge of the mortgage that the transfer of title would occur.
Further annexed to the husband’s affidavit was a document that purported to set out the expenses that the husband incurred in preparing the property for sale in 2007. In summary, those expenses were:
Government fees and charges (relating to the transfer of the property from the wife’s parents to the husband) $7390.00 Sale related expenses (including commission and legal costs) $6,784.04 Building renovations prior to sale $7,455.00 Property cleanup (prior to sale) $7,265.50 Total expenses $28,894.54
In relation to the amounts claimed for building renovations and property cleanup, the husband provided no source documents to evidence same. In the wife’s trial affidavit filed 29 May 2009, she deposed that she had no knowledge of any alleged renovations on the property completed by the husband and/or his brother, or of any amounts expended in the cleanup of the property. However, the husband’s evidence in this regard was not challenged by the wife’s counsel during his cross-examination at the final hearing.
It was the husband’s evidence that upon settlement of the sale of the Property M property and after the deduction of the $28,894.54 of expenses, the net proceeds of sale was $185,215.46.
It was his evidence that after discussions with his brother, it was agreed that the husband would retain $5,215.46 which would be deemed to be maintenance and management expenses incurred by the husband during the ten year period of their ownership of the property, leaving a sum of $180,000.00.
It was common ground that after the purchase of Property M, the husband and the wife received all rental monies, and from those monies they made all necessary mortgage payments, rates payments, insurances, maintenance payments and any other expenses associated with the property. In the event of any shortfall between the rental and those expenses, they were met by the husband and wife. It was agreed that the husband’s brother, Mr S, made no contributions to these expenses.
It was the husband’s evidence that, as Property M was owned jointly by he and his brother, the remaining $180,000.00 was to be divided equally between the husband and the wife as to $90,000.00 and to Mr S the remaining $90,000.00.
The husband gave evidence that he gave his brother a cheque for $50,000.00 and that the balance of the monies were deposited into the mortgage account in relation to the former matrimonial home.
It was the husband’s evidence, supported by the evidence of Mr S, that the further $40,000.00 allegedly payable to Mr S was retained by the husband to assist him in reducing the mortgage on the matrimonial home and to manage his financial affairs. Both the husband and his brother agreed that there was no formal agreement as to when these funds were to be repaid and that Mr S had never made any demands for these monies.
The husband and Mr S were cross-examined at length in relation to the circumstances of the payment of the $50,000.00. At the time of that payment, Mr S was an undischarged bankrupt and he conceded that at no time did he disclose to the trustee in bankruptcy that he had an interest in the Property M property or that he received a payment of $50,000.00 from his brother. The funds received by Mr S were placed into the account of his then partner, and his evidence was unclear as to the status of those funds at this time.
In his evidence-in-chief, the husband stated that he paid the wife the sum of $45,000.00 from the proceeds of sale of the Property M property, representing her 50 per cent share of their share of the proceeds of the sale. It was his evidence that those monies were made up of:
a)payment in July 2007 of some $22,995.69;
b)payment in December 2007 of $15,000.00, which was utilised by the wife towards the deposit on the purchase of a property by herself and her partner, Mr J; and
c)some additional payments by the husband of various credit card accounts in the sum of approximately $7,000.00
which totalled a payment of $45,000.00.
In the husband’s affidavit of 31 March 2009, it is interesting to note that it was his evidence at that time that the payment to the wife had been $37,995.69 only, and there was no mention of the payment of any outstanding credit card bills on the wife’s behalf.
In the wife’s evidence that she agreed the husband paid her some $22,000.00, but indicated that he had told her it was a loan and that in fact she had repaid something in the vicinity of $1000.00 back to the husband in relation to that amount. She conceded that she had made no other repayments to him in relation to that amount. She also agreed that she received $15,000.00 towards the deposit on the property purchased by herself and Mr J. It was the wife’s evidence that she had no recollection of the husband ever making credit card payments on her behalf.
I am satisfied that the wife received $37,995.69 (hereinafter rounded to $38,000.00) from the proceeds of sale of Property M. I am not satisfied any further monies were received by her from Property M.
[S] termination payment
As set out in paragraph 22 of this judgment, the husband received a redundancy payment from his previous employer [S] of an amount of $87,000.00.
It was the husband’s evidence that this money too was placed into the mortgage account in relation to the former matrimonial home.
It was the husband’s evidence that from the period of his redundancy in May 2006 until August 2009, his only employment was some part-time lecturing at university and that his generated income was somewhere in the vicinity of $16,000.00 to $17,000.00 per annum, together with Centrelink payments. It was his evidence that from January 2006 until December 2007, he was engaged in the primary care of the parties’ children and that he was not actively seeking employment.
The husband offered no explanation as to why he did not actively seek employment after December 2007 when the children moved to live primarily in the care of the wife, noting of course that he had shared care of [Z] from that time onwards.
It was the husband’s evidence that during the period the children were primarily in his care, he utilised the redundancy payment to meet his and the children’s day to day living expenses, and that this was an appropriate utilisation of these funds as the redundancy payment was in real terms the wages he would have received if he had not been dismissed by his employer in May 2006.
Parties’ Superannuation
The wife’s current superannuation entitlement with HESTA is $14,000.00 and the husband’s current superannuation entitlement with HealthSuper is $77,000.00.
Should the [S] payout and the proceeds of sale of Property M be added back to the property pool?
It was submitted on behalf of the wife that the [S] termination payment should be added back into the pool as the amount received by the husband was a reflection of his years of service and that those years of service took place during the course of the marriage.
It was further submitted on behalf of the wife that the husband’s evidence that he had spent the redundancy payment on his and the children’s cost of living was not credible, particularly in circumstances where the husband made no efforts to obtain gainful employment.
In relation to the redundancy payment, correspondence from the solicitors representing [S] was tendered into evidence. Paragraph 5 of this correspondence, dated 28 February 2006, reads as follows:
“In an endeavour to resolve this matter expeditiously and to avoid the trouble and expense of litigation, we are instructed to offer to resolve the issue of termination pay on the basis that you are to be granted your accrued entitlements (ie. annual leave) plus 6 months pay in lieu of notice.”
The question of the circumstances in which there should be an add-back to the property pool has been well litigated.
In NHC & RCH (2004) FLC 93-204, the Full Court quoted favourably from paragraph 2.11 of Marker and Marker [1998] FamCA 42 where Baker, Kay and Chisholm JJ said:
“There seems to be no appropriate basis for notionally adding back monies that existed at separation but which have been subsequently spent on meeting reasonably incurred necessary living expenses. Neither the Family Law Act nor the case law require that parties go into a state of suspended economic animation once their marriage breaks down pending the resolution of their financial arrangement. Parties are entitled to continue to provide for their own support.”
In AJO v GRO (2005) FLC 93-218, the Full Court of Holden, Warnick and La Poer Trench JJ held in paragraph 30 the following:
“To date, three clear categories of cases have emerged where the Court has determined that it is appropriate to notionally add back to the pool of assets, that is, assets that no longer exist. They are:
(a)Where the parties have expended money on legal fees;
(b)Where there has been a premature distribution of matrimonial assets; and
(c)In the circumstances outlined by Baker J in Kowaliw & Kowaliw (1981) FLC 91-092 at 76,644:
(a)where one of the parties has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets, or
(b)where one of the parties has acted recklessly, negligently or wantonly with matrimonial assets, the overall effect of which has reduced or minimised their value.
In AJO v GRO, the Full Court made a finding that the trial judge had erred in adding back a number of expenses in circumstances where she had made no enquiries or findings as to the reasonableness or recklessness of that expenditure.
Whilst the husband was cross-examined briefly on withdrawals made by him after the receipt of his redundancy payment, there was no evidence placed before the court that the husband had expended the monies, other than in the normal course of meeting the reasonable living expenses of himself and his children.
In these circumstances, I am satisfied that the husband’s [S] redundancy payment, expended by him on reasonable living expenses subsequent to its receipt, should not be added back to the pool.
In relation to the Property M property, it was the wife’s submission that the husband’s brother, Mr S, had no interest in that property and therefore has no entitlement to a share of the proceeds of sale.
However, in the wife’s trial affidavit sworn 28 May 2009 and filed
29 May 2009, at paragraph 36(b) the wife deposes as follows:
“I agree that the Property M property was purchased by the husband and his brother, Mr S, from my parents for the amount of $65,000.00.”
It was the evidence of Mr S that he provided the funds that made the initial $13,500.00 down payment to the wife’s parents for the purchase of the property. He conceded however under cross-examination that he had made no other financial contributions to the upkeep and maintenance of the property and that its management subsequent to purchase had been undertaken by his brother. He also conceded that he had not assisted his brother in the property’s preparation for sale and that it was his brother who had the entire conduct of that transaction.
Mr S also conceded that whilst he claimed that he was still owed $40,000.00 by his brother from the proceeds of sale of Property M, he had no intention of pursuing his brother in relation to that amount in the immediate or foreseeable future.
As set out earlier in this judgment, at or around the time of the physical separation of the parties, the mortgage on the former matrimonial home was reconstructed and the amount outstanding in relation to that mortgage was $214,00.00. The net proceeds from the sale of Property M were placed in the mortgage account on the former matrimonial home, reducing it accordingly from the parties mortgage account and from that account the husband’s brother was paid $50,000.00 and the wife was paid $38,000.00.
If one is to do some fundamental mathematics at this time, the figures revealed are quite interesting:
Mortgage on the former matrimonial home at the time of separation $214,000.00 Less net proceeds of sale of Property M <$180,000.00> Payment to Mr S $50,000.00 Payment to the wife $38,000.00 Current mortgage balance $122,000,00
The current mortgage balance is $124,000.00. If the proceeds of sale of Property M, less the payments to Mr S and the wife had not been offset against the mortgage, the equity in the former matrimonial home would be some $100,000.00 less than it is. To add-back the net proceeds of sale of the Property M property without acknowledging it’s impact on the reduction in the mortgage on the matrimonial home would, it appears to me, to be “double dipping”.
The court must then determine the status of the payment to the husband’s brother of $50,000.00, and in addition whether there is a further liability to him in relation to the $40,000.00 as alleged by he and his brother.
It is apparent that, despite the submissions made on her behalf at the conclusion of the hearing of this matter, that the wife considered that the husband’s brother had an interest in the Property M property. This is reflected in her trial affidavit.
Whilst the brothers themselves may have considered that was an equal share, it is apparent that other than that initial contribution, Mr S had little input into the ongoing maintenance and preservation of that property. I am satisfied that the payment to him of $50,000.00 is an equitable recognition of his interest in the property, and it is a matter as between himself and his brother as to whether he pursues him for any further funds.
In relation to the distribution of the $38,000.000 to the wife, if she had not received these funds, the equity in the former matrimonial home would be greater by that amount. Accordingly I am of the view that amount should form part of the matrimonial asset pool.
In all these circumstances accordingly, it is not my intention to add-back the net proceeds of sale of the Property M property, save and except the monies received by the wife as set out in the preceding paragraph..
In these circumstances, I find the property pool to be as follows:
Former matrimonial home
Less mortgage
Equity$345,000.00
<$124,000.00>
$201,000.00
Monies received by the wife from proceeds of sale of the Property M property $38,000.00 Husband’s superannuation $77,000.00 Wife’s superannuation $14,000.00 Total $330,000.00
Contributions
Neither party had any assets of significant value at the commencement of the relationship.
From 1993, the wife’s parents provided accommodation for the parties by way of the Property M property. The husband’s evidence was that the parties paid rent to the wife’s parents in relation to the property. The wife refutes this claim and says that they were able to live there rent-free for the first three years of their life together.
It was the husband’s evidence that in early 1996, he inherited approximately $79,000.00 upon the death of his mother. It was his evidence that the inheritance from his mother enabled the parties to purchase the former matrimonial home. This is not disputed by the wife.
It was the husband’s evidence that in 2000 he inherited a small cash sum of just under $14,000.00 which the parties utilised to reduce credit card debts. The wife did not dispute this evidence.
As noted earlier in this judgment, the parties had something of a traditional structure in relation to their roles during the course of their relationship. The husband pursued his professional career, working long hours and involving himself in a great deal of travel. The wife was primarily engaged in home duties and was primarily responsible for the rearing of the parties’ four children.
It was the husband’s evidence that after the purchase of the matrimonial home, he and his brother, Mr S, undertook considerable renovation to the property which enabled it to be large enough to accommodate the parties and their four children. It was his evidence that his brother, a trained [tradesman], provided all his labour free, at considerable saving to the parties.
It was submitted on behalf of the wife that the parties’ contributions prior to separation should be deemed to be equal. There was no submissions made on the wife’s behalf as to whether or in what way the inheritances and the renovation works from the husband’s family should be dealt with.
The husband, who was self-represented, made no submissions as to what, if any, loading on a percentage basis should be adjusted in his favour as a result of what he claims to be his greater contributions in this regard.
Subsequent to separation, the circumstances of the parties and the arrangements for the children have been somewhat shambolic. It is common ground that initially the children remained living with the husband and that they spent time with the wife on a regular basis, subject to her work commitments and the limited accommodation available initially at the Property M property.
During this period, the wife indicates that she paid child support, though this is refuted by the husband. No independent evidence was led as to any payment of child support during this period.
It is also common ground that since at least December 2007 and the assault on the wife’s partner, Mr J, the girls have lived solely with the wife and have not spent any time with the husband. The parties’ youngest son, [Z], has been spending equal time with both his parents. Since that time the husband has not paid any child support to the wife in relation to the children. The parties have an older son, [W], who is 19 years of age. He lives independently of his parents.
It was the husband’s evidence that subsequent to separation he had performed some maintenance and renovation works on the former matrimonial home. He was, however, unable to provide any independent proof of the amounts expended by him and whether those renovations impacted on the value of the property.
It was submitted on behalf of the wife that the parties’ contributions post separation should be deemed as equal. In light of the circumstances set out in this judgment, I agree with that submission.
This leaves the court with the question as to whether there should be a finding that the husband’s contribution in relation to the matrimonial assets because of his inheritances and renovation works are such that he should be seen to have made a greater contribution than that of the wife.
When considering the impact of a greater contribution by one of the parties through pre-cohabitation assets or by way of gifts or inheritances received by one of the parties during the course of the relationship, the court will consider the timing of that contribution and the manner in which it has been utilised. Where there has been a greater contribution, the court has found that with the passage of time, that greater contribution is eroded by the subsequent contributions of both the parties to the marriage and to their assets. In Pierce and Pierce (1999) FLC 92-844, the Full Court held as follows:
“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 the other relevant contributions of both the husband and the wife.”
There is no doubt that the inheritance received by the husband from his mother assisted the parties in being able to purchase the matrimonial home. However, in the years since that time, the contributions that both parties have made to their family are such that that initial contribution has to some extent been overborne by the passage of time.
In these circumstances, I find that there should be an adjustment in relation to contributions in the favour of the husband in the amount of five per cent.
Section 75(2) factors
The wife is 44 years of age. It is the wife’s evidence that she is currently suffering from exhaustion, stress and high anxiety levels, for which she is seeking treatment from her psychologist, Ms M.
It was the wife’s evidence that she has reduced her working hours from 36 hours per week to 24 hours per week as a result of her exhaustion and on the recommendation of her treating psychologist. It was her evidence that she wasn’t sure how long she would continue to work at the reduced hours.
The wife is currently engaged as [omitted]. She indicated this work is very stressful.
When the wife is engaged in full-time employment, she earns $65,000.00 per annum.
The wife lives with her partner, Mr J, who is also employed as a [omitted]. In her statement of financial circumstances filed in this matter on 29 May 2009, the wife deposes that Mr J earns approximately $40,000.00 per annum.
The wife and her partner live in a property that they are purchasing at Property B. This property was purchased for $280,000.00 and is encumbered by a mortgage in the sum of $260,000.00.
The wife has the full-time care of the parties’ teenage daughters, though it is unclear as to whether the eldest daughter, [X], aged 17 is currently living with the wife or is living independently. Whatever the circumstances, it would appear that the wife is financially supporting [X]. The parties’ youngest son, [Z], resides on an equal shared basis with both his parents. The wife does not receive child support from the husband in relation to the children.
The husband is aged 54 years and deposes in his affidavit sworn on
31 March 2009 at paragraph 45 to having suffered two heart attacks in November 2000, and having been diagnosed with coronary heart disease. He contends that Australian statistics indicate that for this condition there is an average life expectancy of 18 years following the heart attack. The husband produced no independent medical evidence from his treating cardiologist as to the current status of his health and whether he continues to be impacted upon by his stated heart condition.
As set out earlier in this judgment, the husband has extensive qualifications in the field of treatment of those suffering from drug and alcohol addictions. Annexed to his affidavit filed on 25 May 2009, the husband attached his curriculum vitae as well as a number of references from leading professionals in this field. It is apparent from that documentation that the husband has extensive experience and is highly regarded in the field.
After he ceased his employment as Chief Executive Officer of [S], the husband did not engage in paid employment (save for some part time lecturing for which he earned approximately $17,000.00) from May 2006 until August 2009 when he advised the court that he was due to start work that week as the Manager of [R]. It was his evidence that he will be paid $65,000.00 per annum in his new position. He provided no independent documentary evidence confirming that that was his salary.
Prior to ceasing his employment as Chief Executive Officer of [S], the husband was generating an income of approximately $130,000.00 per annum.
It was the husband’s evidence that he did not seek employment while the children were residing predominantly in his care in 2006 and 2007, as he was engaged in the role of the primary carer of his children. He offered no explanation as to why he did not seek employment after the children moved to live with the wife.
As set out earlier in this judgment, during the period that the husband chose not to return to full-time paid employment, he had the benefit of the termination payment received by him when he left [S]. Whilst I have determined that it is not appropriate that this amount be added back into the property pool, I am of the view that it is a relevant factor pursuant to section 75(2) of the Act, in that he had the advantage of those funds and the ability to stay at home, an opportunity that was not afforded to the wife during this period. In other words, this was a resource not available to the wife.
It was the husband’s submission that he and the wife had agreed to a property division in January 2006 at the time of their physical separation. He argued that they had equally divided their entitlement to the net proceeds of the sale of the Property M property, and that the wife had agreed to leave her share of the former matrimonial home in the property to provide a “safeguard” so that the children would always have a home to come to.
Further, it is the husband’s strongly held belief that the wife and her partner, Mr J, both of whom previously had drug and alcohol addiction problems, have relapsed and that they are again both using drugs. He based this belief on the spending patterns of the wife as exhibited by her bank statements in recent times and on his claims that the child [Z] had told him that Mr J is often affected by alcohol. In these circumstances, the husband believes that the wife and Mr J are going to “implode” and that he needs to retain the former matrimonial home so the children will have somewhere to come when the wife and her partner’s lives come tumbling down.
It was the husband’s evidence that his brother, Mr S, has been diagnosed with multiple sclerosis. He indicated that he had promised his brother that when his condition worsened to the extent he was no longer able to care for himself that he would move in with him in the matrimonial home and he would be his carer.
It was the husband’s submission that there had been a just and equitable resolution of property matters at the time of the parties “agreement” in 2006 and the subsequent payout to the wife of her share of the proceeds of sale of Property M. Therefore in those circumstances there was no need for the court to make any further adjustment of property as between the parties on the basis he retains the former matrimonial home, its contents and his superannuation entitlements and the wife retain the assets in her possession and her superannuation entitlements.
It was submitted on behalf of the wife that the husband has a far greater earning capacity than the wife and that if he were to obtain employment at his full capacity, he would be able to earn well in excess of $100,000.00 per annum.
It was further submitted that at this time, the wife’s health is such that she is only able to work on a part-time basis and that this situation will continue for some time into the future.
It was further submitted that the mental health issues from which the wife is currently suffering can be attributed to the marriage, the psychological abuse to which she was subjected to by the husband during that period, to its breakdown and then the subsequent assault on Mr J by the husband. However, the wife’s counsel fell short of positing an argument of the type set out in Kennon v Kennon (1997) FLC 92-757, in that it was not being argued that because of the husband’s conduct, the wife’s contributions to the marriage were made significantly more arduous than they would otherwise have been.
Finally it was submitted on behalf of the wife that she has the care of the children, in particular the girls, and will continue to do so into the future. She has and will have the financial burden of ensuring the children are housed, educated, cared for, clothed and fed in circumstances where the husband, at least to date, is paying no child support to assist her in this role.
On this basis it was argued that there should be an adjustment in the wife’s favour of 15 to 20 per cent.
I am satisfied that the husband does have a greater earning capacity than the wife. I am also satisfied that the wife has the significantly greater responsibility for the care of the parties’ children under the age of 18 years.
In these circumstances, it is appropriate that there be an adjustment in the wife’s favour of 15 per cent.
Superannuation
The wife is not seeking any kind of superannuation splitting order. She is proposing that the husband retain the totality of his superannuation, and that there be an overall adjustment of the parties’ realisable assets that would reflect the retention by the husband of his superannuation.
As it is the husband’s position that there be no adjustment as to property between the parties and that they each retain the property that is currently in their control, he made no submissions in relation to the parties’ superannuation entitlements and how they should be dealt with.
I have determined that there should be a division of the matrimonial assets between the parties on the basis that the wife receives 60 per cent of same and the husband receives 40 per cent of same.
If I were to approach the matter as has been submitted by the wife, she would receive assets to the value of $198,000.00. Accordingly, she would retain the $38,000.00 already received by her from Property M, her $14,000.00 of superannuation entitlements and the husband would be required to pay her $146,000.00 if he wished to retain the former matrimonial home. The husband would retain equity in the former matrimonial home of $75,000.00, his superannuation entitlements of $77,000.00. He would be required to service a mortgage of $270,000.00. On the husband’s current income of $65,000.00 per annum, it is unlikely that he would be able to service a mortgage of that magnitude.
An alternate approach to the division of the matrimonial assets would be to divide the assets of the parties on a 60:40 basis, but to make a superannuation splitting order.
If such an order were to be made, the husband would pay the wife the sum of $105,400.00 and there would be a superannuation splitting order whereby the amount of $40,600.00 of the husband’s superannuation be determined as the base amount to be dealt with in the wife’s favour.
Such an order would then result in the husband retaining equity in the matrimonial home of $115,600.00 and leave him with a mortgage commitment of $229,400.00, such a mortgage I believe would be within the husband’s capacity to service.
Conclusion
The husband’s proposal as to what is an equitable outcome in this proceeding is in reality that he retain something like 85 per cent of the joint matrimonial assets. Clearly this is not an equitable or proper outcome in this matter.
Having determined that the appropriate outcome is that there be a division of the assets between the parties so that the wife retains 60 per cent of same, the only issue to be determined is whether there should be orders in accordance with that proposed by the wife or whether there should be orders that involve a superannuation splitting order to balance the parties’ current superannuation entitlements.
On balance, I believe that the just and equitable outcome in this matter is that there be a 60:40 division of the matrimonial assets between the parties that includes an order for a superannuation split. Such order cannot be made until such time as procedural fairness is accorded to the husband’s superannuation fund. In those circumstances it is directed that the wife’s solicitors prepare an order that makes provision for a superannuation split in the terms as determined by me and provide it to the husband’s superannuation fund as a matter of urgency. Upon the wife’s solicitors providing proof of the husband’s superannuation fund having been afforded procedural fairness, the matter shall be relisted and final orders pronounced in the terms as determined by me in these reasons for judgment.
However, as the husband has not been given an opportunity to advise the court whether he seeks to retain all his superannuation entitlements, I believe it is reasonable that he be given an opportunity to do so. Thus, in the event the husband seeks to retain the whole of his superannuation entitlements and pay to the wife an amount of $146,000.00, it will be ordered that he advise the court and the wife’s solicitors in writing within fourteen days that he seeks orders in those terms and if such notification is received, orders shall be made in those terms.
I certify that the preceding one hundred and ninety-six (196) paragraphs are a true copy of the reasons for judgment of Bender FM
Associate: Sarah Hession
Date: 30 October 2009
CORRECTION
In notation A (1), the figure of $115,600.00 has been amended to read $105,400.00.
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