WOLLACOTT & WOLLACOTT
[2014] FamCA 5
•9 January 2014
FAMILY COURT OF AUSTRALIA
| WOLLACOTT & WOLLACOTT | [2014] FamCA 5 |
| FAMILY LAW – PROPERTY – application by the wife through her case guardian for property settlement orders pursuant to s 79 of the Family Law Act 1975 (Cth) – where it is just and equitable that the parties have relief under s 79 – where the parties cohabited for approximately 18 years – where contributions of parties deemed equal– where there are no children of the marriage–– where it is agreed an adjustment should be made in favour of the wife because of the non-contribution aspects of s 79(4) – where the husband is 10 years younger than the wife – where the husband has a substantial earning capacity but supports his current wife and her children – where the wife has been out of paid work for approximately 12 years due to a disastrous injury during her employment in 1996 – where the wife receives modest workers’ compensation payments but has no earning capacity – where an adjustment of 10 per cent in the wife’s favour is appropriate. FAMILY LAW – SPOUSAL MAINTENANCE– application by the wife, through her case guardian for spousal maintenance –where the wife suffers a whole person impairment of 24 per cent – where the wife has no earning capacity – where the quantum and duration of spousal maintenance is in dispute – where the husband was ordered to pay the wife $1250 by way of periodic spousal maintenance for an indefinite period of time. |
| Family Law Act 1975 (Cth) ss 83, 81, 79(1)(2) & (4), 75(2) & 72(1) |
Bevan & Bevan [2013] FamCAFC 116;
Browne and Green (1999) FLC 92-873;
DJM and JLM (1998) FLC 92-816;
Hickey & Hickey & Attorney-General for the Commonwealth of Australia [2003] FamCA 395; (2003) FLC 93-143; (2003) 30 Fam LR 355;
In the Marriage of Omacini (2005) 33 Fam LR 134;
Kowaliw and Kowaliw (1981) FLC 91-092;
Stanfordv Stanford (2012) 87 ALJR 74; 293 ALR 70;
Townsend and Townsend (1995) FLC 92-569;
| APPLICANT: | Ms Wollacott by her Case Guardian Mr B |
| RESPONDENT: | Mr Wollacott |
| FILE NUMBER: | SYC | 5171 | of | 2009 |
| DATE DELIVERED: | 9 January 2014 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Loughnan J |
| HEARING DATE: | 25 & 26 November 2013 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Campton |
| SOLICITOR FOR THE APPLICANT: | Dimocks Family Lawyers |
| COUNSEL FOR THE RESPONDENT: | Mr Lloyd SC |
| SOLICITOR FOR THE RESPONDENT: | Beilby Poulden Costello |
Orders
That the husband pay directly to the wife for her maintenance the sum of $1,250 per week, such payments to be made weekly by direct deposit into the wife’s nominated bank account with the first payment to be made within seven (7) days of the date of making of this Order.
That within two (2) months of the date of these Orders, the husband pay to the solicitor for the wife $185,360 by way of settlement of property.
That within two (2) years of the date of these Orders, the husband do all things and sign all documents necessary to:
(a)transfer to the wife the property known as and located at Unit Y, C Street, Suburb D as contained in Folio Identifier … (“the Unit Y property”); and
(b)discharge the mortgage secured on the Unit Y property.
That within two (2) months of the date of these Orders, the wife will do all things and sign all documents necessary to transfer to the husband the property known as and located at Unit Z, C Street, Suburb D as contained in Folio Identifier … (“the Unit Z property”).
That simultaneously with the transfer referred to in Order 4 above, the husband do all things and sign all documents necessary to discharge the mortgage secured on the Unit Z property and refinance in his own name.
That should the husband fail to comply with Orders 2, 3 or 5 then the parties shall do all acts and things and sign all documents necessary so as to effect the sale of the Unit Z property for the best price reasonably obtainable in the following manner:
(a)List the Unit Z property for sale by auction with such agent as the parties may agree to appoint and in default of agreement as to agent within fourteen (14) days with such agent as the President of the Real Estate Institute of New South Wales shall appoint (“the agent”) the costs of and incidental to such appointment to be borne equally by the parties as and when same fall due; and
(b)Instruct such solicitor as they agree upon to have the conduct of the sale on behalf of both parties or, in the absence of agreement reached within fourteen (14) days hereof, instruct such solicitor as may be appointed by the President for the time being of the Law Society of New South Wales (“the solicitor”), the costs of and incidental to such appointment to be borne equally by the parties as and when same fall due
That on settlement of a sale of the Unit Z property pursuant to these orders, the proceeds of sale be paid in the following manner and priority:
(a)to all costs and expenses of sale;
(b)to discharge the mortgage on the Unit Z property;
(c)to discharge the mortgage on the Unit Y property;
(d)to the solicitor for the wife the sum of $185,650 together with any interest accrued thereon; and
(e)the then balance to the Husband.
That within two (2) months, the wife will do all things and sign all documents necessary to transfer to the husband the property known as and located at E Street, Town F as contained in Folio Identifier … (“the Town F property”).
That simultaneously with the transfer pursuant to Order 8 above, the husband will do all things and sign all documents necessary to discharge the mortgage secured on the Town F property and refinance in his own name.
That should the husband fail to comply with Order 9 then that the parties do all acts and things and sign all documents necessary so as to effect the sale of the real property known as the Town F property the best price reasonably obtainable under similar provisions as those made for the Unit Z property in Order 6 (a) and (b) herein.
That on settlement of a sale of the Town F property pursuant to these orders, the proceeds of sale be paid in the following manner and priority:
(a)all costs and expenses of sale;
(b)the amounts required to discharge the mortgage; and
(c)the then balance to the husband.
That pending sale or transfer of the Unit Z property and the Town F property as provided for in these Orders the husband shall be responsible for mortgage payments, statutory rates and charges, other utilities, insurances, outgoings and expenses in relation to the properties incurred prior to the date of the sale or transfer and shall make all such payments as and when they fall due and hereby indemnifies the wife in respect of all other liabilities incurred prior to the date of the settlement of the sale or transfer as applicable.
That pending the discharge of the mortgage secured on the Unit Y property, the husband shall be responsible for all mortgage payments and any related charges and shall make all such payments as and when they fall due and hereby indemnifies the wife in respect of all other liabilities incurred prior to the date of the discharge.
That within two (2) months, the husband shall sign all documents and take any steps necessary to transfer to the wife his interest in the Town G time share.
That within two (2) months, the parties shall do all things and sign all documents necessary to sell the David Jones securities held in joint names and to divide the net proceeds of sale as to 60 per cent to the wife and 40 per cent to the husband.
That within two (2) months, the wife shall do all things and sign all documents necessary to transfer the car space in the X Apartment Building, contained in Folio Identifier … into the sole name of the husband.
That within two (2) months, the husband will do all things and sign all documents necessary forthwith to transfer to the wife the whole of his right, title and interest in the BMW motor vehicle (“the BMW motor vehicle”), registration number … .
That within two (2) months, the wife will do all things and sign all documents necessary to transfer her shareholding in A Pty Ltd and resign from any office that she holds in the company.
That the husband will indemnify the wife and keep her indemnified against all liability of the wife arising as a consequence of the holding by her of any shares in A Pty Ltd or the holding by her of any office in that company including any taxation liability.
That within two (2) months, the parties will do all things and sign all documents necessary to close the National Australia Bank account held in their joint names and pay the balance to the husband.
That other than as hereinbefore provided, as against the husband, the wife shall be entitled to retain as sole beneficial owner:
(a)her IAG shares;
(b)all funds in bank accounts held in her sole name; and
(c)all household contents and personal belongings currently in her possession or control.
That other than as hereinbefore provided, as against the wife, the husband shall be entitled to retain as sole beneficial owner:
(a)his superannuation entitlements;
(b)his interest in A Pty Ltd;
(c)his interest in H Pty Ltd;
(d)his interest in I Pty Ltd;
(e)all bank accounts held in the sole name of the husband; and
(f)all personal belongings and household contents currently in his possession or control.
That otherwise than as provided for herein, the husband and wife shall each be entitled to retain as sole beneficial owner all personalty and financial resources currently in the name, possession or control including leave entitlements, workers compensation payments, personal effects and life insurance policies.
That the husband and wife shall each otherwise be and remain liable for any debts in their own name at the date of these Orders, and in this respect shall indemnify and keep indemnified the other from any liability in relation thereto.
That in the event that either party refuses or neglects to execute any deed or instrument necessary to give effect to these orders then the Registrar or Deputy Registrar of the Family Court of Australia is appointed pursuant to Section 106A of the Family Law Act 1975 to execute such deed or instrument in the name of such party and to do all acts and things necessary to give validity to the operation of the deed or instrument upon being satisfied by affidavit of such neglect or refusal. A party shall be deemed to be deemed to be in default if that party refuses or neglects to sign any document with seven (7) days of being requested to execute that document, such request being made in writing.
That leave is granted to both parties to restore the proceedings with two (2) months or such further time as the parties may agree, in relation to the wording or implementation of these orders.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Wollacott & Wollacott has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYC 5171 of 2009
| Ms Wollacott by her Case Guardian Mr B |
Applicant
And
| Mr Wollacott |
Respondent
REASONS FOR JUDGMENT
Introduction
These are proceedings in relation to property settlement where Ms Wollacott by her Case Guardian Mr B (“the wife”) seeks an order against Mr Wollacott (“the husband”) for property settlement under s 79 of the Family Law Act 1975 (Cth) (“the Act”). The wife also seeks an order pursuant to s 72 of the Act for spousal maintenance.
Applications
The orders sought by the wife in her Minute of Order[1] included with her Case Outline are to the following effect:
1.That the husband pay to the wife $1,500 per week by way of spousal maintenance;
2.The transfer to the wife, free of encumbrance, Unit Y, C Street, Suburb D;
3.That the husband pay to the wife $400,000;
4.That the wife transfer to the husband, Unit Z, C Street, Suburb D and that the husband discharge the mortgage secured on that property and in default of the requirement to discharge the mortgage or to pay the $400,000, that the property be sold and that the $400,000 be paid and the mortgage be discharged; and
5.That the wife transfer to the husband, the property at Town F.
[1] Exhibit 5
The husband sought orders in terms of his Amended Response to Initiating Application filed 12 November 2013. The main effect of the orders sought was as follows:
1.That the interim spousal maintenance cease;
2.The transfer to the wife of Unit Y, C Street, Suburb D and that he discharge the mortgage thereon over three years;
3.The transfer to the husband, subject to encumbrances, Unit Z, C Street, Suburb D, a property at Town F and a car space at the X Apartment Building;
4.That the wife transfer to the husband, her interest in the husband’s companies or businesses and that she be indemnified in relation to her company loan account;
5.That the wife pay to the husband an amount representing 50 per cent of various drawings, transfers and payments made by or to the wife; and
6.That the parties otherwise retain what they have.
Documents Read
The parties relied on the following documents:
Documents relied on by the wife
·Affidavit of Mr B as Case Guardian for wife sworn and filed 22 October 2013;
·Affidavit of Dr J sworn and filed 21 October 2013; and
·Affidavit of wife sworn 2 November 2009 and filed 3 November 2009.
Documents relied on by the husband
·Amended Response to Initiating Application filed 12 November 2013
·Affidavit of husband sworn and filed 12 November 2013;
·Affidavit of Ms O sworn 8 November 2013 and filed 11 November 2013;
·Statement of Financial Circumstances of husband filed 12 November 2013; and
·Financial Questionnaire of husband filed 24 February 2010.
The Hearing
The case was listed for final hearing over three days commencing on 25 November 2013. Once the hearing commenced it was decided that it could be contained within two days.
On 26 November 2013 judgment was reserved.
Short History
The wife was born in 1953 and as at the date of the hearing was 59 years of age. The husband was born in 1962 and was 51 years of age. The parties were married in May 1992 and separated in December 2008. The parties lived together for about 18 years. The husband and wife were divorced by the Federal Magistrates Court (as the Federal Circuit Court was then known) with effect from November 2009. There are no children of the relationship.
Background Facts
In May 1979, Mr B was born. Mr B is a child of the wife’s prior relationship.
The parties met in December 1988.
On 5 July 1990 the parties commenced cohabitation.
At the time of cohabitation, the wife was employed as a full time healthcare worker and was earning approximately $50,000 net per annum. The husband was undertaking his professional training and working in that field. The husband was earning approximately $100,000 per annum.
During 1990, the wife received the sum of $250,000 by way of property settlement with her ex-husband. Those funds were used to acquire the interests of the husband’s former wife in real property at Suburb L (“the Suburb L property”). The wife alleged she used the balance of the property settlement to purchase a motor vehicle for $40,000 and to fund the honeymoon of the parties.
The husband and wife commenced living in the Suburb L property towards the end of 1990.
The parties were married in May 1992. The husband paid for most of the outgoings related to the ceremony and the wife contributed 40-50 per cent of the honeymoon cost.
The parties renovated the Suburb L property at a cost of $140,000. The renovations required further borrowing and a new mortgage was taken out. The husband paid the majority of the mortgage repayments.
In 1996, the wife suffered a fall on her way home from completing a night shift. The wife subsequently suffered a seizure, a subdural haematoma and post traumatic epilepsy. She also suffered fractures to her feet and underwent eight operations and procedures due to the injury. The wife was thereafter diagnosed as suffering from Trigeminal Neuralgia.
In 1998 the parties relocated to Canada to enable the husband to continue his speciality training. The husband did not earn income while in Canada and the parties borrowed $100,000 to meet their living expenses while in Canada.
In late December 1998 the husband began his private professional practice. He joined an existing practice and made a good will payment of $75,000 for which his company A Pty Ltd obtained a loan. The husband and wife were appointed as the two directors of the company with an equal share allotment of $1.00 each.
In May 2000, the parties jointly purchased a unit in the X Apartment Building – Unit W, C Street, Suburb D for $937,000 (“the Unit W property”). The parties obtained a mortgage facility of $1,170,000 from the National Australia Bank (“NAB”) to complete the purchase. The mortgage funds also discharged the Commonwealth Bank mortgage secured upon the Suburb L property of $105,000 and provided $175,000 in funding for the husband’s professional business.
In December 2000 the parties sold the Suburb L property for $435,000. The proceeds of sale were used to decrease the bank mortgage secured on the Unit W property.
In November 2001 the parties jointly purchased a car space at the X Apartment Building for $44,000.
The husband alleged that in 2001 he received $309,000 and 413 shares in NRMA/IAG by way of bequest from the estate of his late father. The wife alleged the amount received was only $100,000. The husband asserted that this amount was used exclusively to decrease the mortgage on the Unit W property. It is not possible to make a finding about that dispute.
In February 2003 the parties purchased Unit Z, C Street, Suburb D (“the Unit Z property”) in the wife’s name, for $2,175,000. Prior to the parties moving into the Unit Z property, renovations costing approximately $460,000 were undertaken.
In May 2003 the parties sold the Unit W property for $1,100,000.
On 30 September 2004, A Pty Ltd secured a $200,000 investment loan through NAB in order to purchase a 10 per cent holding in the company M Pty Ltd.
In October 2004 the wife received a Workers’ Compensation payment of $95,650 and an additional sum of unpaid wages of $40,000 from her work injury in 1996. The payments were applied as a part payment on the acquisition of the parties of the Unit Z property.
In February 2005 the parties purchased Unit Y, C Street, Suburb D (“the Unit Y property”) for $1,100,000. The parties refurbished the apartment at a cost of $469,000.
In May 2006 the parties purchased a holiday house at E Street, Town F (“the Town F property”) for $600,000. The property was acquired as tenants in common with the shares allocated as 99 out of 100 shares in the name of the husband and 1 out of 100 shares in the name of the wife. The purchase was funded by a mortgage from the National Australia Bank. The husband asserted that the property was renovated at a cost of $528,000.
On 26 June 2007 A Pty Ltd paid $175,000 to purchase a 5 per cent shareholding in the company N Pty Ltd.
On 25 August 2008 the wife moved out of the Unit Z property where the parties had been residing together, to the renovated Unit Y property.
On 19 December 2008 the parties separated.
On 30 December 2008 the husband became engaged to Ms O.
On 28 August 2009 the husband commenced proceedings for a divorce.
In January 2009 the husband commenced cohabitation with Ms O.
In June 2009 the husband purchased Unit V, C Street, Suburb D (“the Unit V property”) for $1,250,000. He obtained funding from the NAB in the sum of $1,292,000.00 to make the purchase. The wife guaranteed the husband’s performance under the loan and permitted the Unit Z property to collaterally secure the loan. The husband’s fiancée, Ms O, occupied the property with her children each alternate week.
On 14 October 2009 the wife surrendered part of her AMP Flexible Lifetime Superannuation policy to obtain the sum of $12,000 to assist with her living expenses.
On 12 November 2009 the wife filed an application for property and divorce orders. Walker FM, as Her Honour was then known, ordered the husband pay to the wife $20,000 and that the husband pay the wife’s costs of $2,000. The matter was transferred to this Court.
On 13 November 2009 the husband was ordered to pay an interim part property settlement of $5,000.
On 17 November 2009 orders were made to the following effect:
(a)Husband to pay the wife $700 per week spouse maintenance, the mortgage and outgoings on the [Unit Y] property, medical insurance premiums, costs in relation to the wife’s BMW motor vehicle, $20,000 by way of interim property settlement in addition to sums payable pursuant to orders made 12 November 2009 within 3 months. Husband to pay wife’s outstanding Visa card of $22,673. Husband to pay wife a further sum of $2,200; and
(b)Husband to pay mortgage instalments to NAB secured on the [Unit V] property, the [Unit Z] property and the [Town F] property.
On 26 November 2009 the husband was ordered to pay a further interim part property payment of $15,000.
On 12 December 2009 the husband married Ms O.
On 23 March 2010 the wife cashed in the remaining portion of her AMP Flexible Lifetime Superannuation policy in the sum of $58,411.65. The wife used this money to fund her legal expenses and later gifted $10,000.00 to her sister Ms P.
On 1 April 2010 the company H Pty Ltd was registered with the husband as sole director and shareholder. H Pty Ltd took over all the liabilities previously performed by A Pty Ltd.
On 9 September 2010 the husband exchanged contracts to purchase Q Street, Suburb R (“the Suburb R property”). He paid an initial deposit of $80,000 and obtained a deposit bond for $317,500. His contribution to the deposit was raised by an unsecured overdraft of $50,000.
On 10 September 2010 the husband entered into a deed of release with the Vendor of the failed purchase of the Suburb R property. The deed supports a construction that the loss occasioned by the husband on the failed acquisition was not less than $475,326. The husband alleged the loss was only $447,500.
On 2 August 2011 Watts J transferred the proceedings to the then Federal Magistrates Court.
On 10 September 2012 the wife loaned $41,994.65 to Mr S, the Concierge at the X Apartment Building.
In January 2012 Ms O and her children moved out of the Unit V property and moved to live with the husband at the Unit Z property.
In September 2012 the wife gifted $10,000 to her sister Ms P.
On 16 October 2012 FM Monahan, as His Honour was then known, vacated the hearing listed to commence for three days on 22 October 2012 and transferred the proceedings back to this Court.
On 30 January 2013, the wife’s son, Mr B, was appointed Case Guardian for the wife.
On 12 March 2013, orders were made for single expert evidence as to real property and directions were made as to disclosure and administering interrogatories.
On 13 May 2013 the husband was ordered to pay within two months, the wife’s costs of $11,042.16 being the costs of and incidental to an application for financial management raised in the husband’s Response filed 16 August 2012. Directions were made for trial.
On 8 August 2013 the husband was ordered to pay to the wife $100,000 from the proceeds of sale of the Unit V property.
On 12 August 2013 the parties sold the Unit V property for $1,350,000. The mortgage encumbering the property was $1,256,299.32 and the net proceeds of the sale were $75,454.50.
On 6 September 2013 orders were made to the effect that:
(a)The husband pay wife $75,000 as part compliance with orders of 8 August 2013, the husband cause statutory accounts for [H] Pty. Limited and [A] Pty. Limited to be served within 14 days, Mr [T] update his valuation of the husband’s business interests.
(b)The husband disclose within 14 days further statutory accounts and income tax returns for 30 June 2011 and 2012, documents and information relating to work undertaken by him at [institution] not yet invoiced for the years ended 30 June 2011 to 30 June 2013, within 28 days disclose bank accounts for period 1 January 2012 to date, directions for trial. It was noted that the wife’s treating Psychiatrist will provide a report as to the wife’s health.
(c)The husband’s oral Application for wife to attend upon a nominated Neurologist for assessment in aid of an enquiry as to the wife’s rights under the NSW Workers Compensation Legislation, was adjourned.
The husband made a concession for the purposes of the proceedings that the wife has no capacity for employment at the present time or in the future.
On 5 November 2013 it was ordered that the:
(a)Time within which the husband’s affidavits were to be filed be extended to 4pm Tuesday 12 November 2013;
(b)The husband shall not file any further evidence beyond that date without leave of the Court; and
(c)The husband shall provide a balance sheet to the wife’s Solicitors by 4pm Tuesday 12 November 2013.
It was noted that the wife would ask the Court to draw inferences against the husband arising from his alleged failure to comply with Orders 3, 4 and 6 made 6 September 2013 as to disclosure.
Credit and Submissions
The Evidence Of The Witnesses
In this case the resolution of the factual disputes that remained at the commencement of the trial, proved difficult. The wife’s evidence could not be tested by cross-examination. She did not attend the hearing and was not available for cross-examination. That placed both parties at a considerable disadvantage.
The result is that as to some issues, no findings are possible.
The Law
The Approach In Proceedings Under Section 79
In the context of these proceedings s 79 of the Family Law Act relevantly provides:
FAMILY LAW ACT 1975 - SECTION 79
Alteration of property interests
(1)In property settlement proceedings, the court may make such order as it considers appropriate:
(a) in the case of proceedings with respect to the property of the parties to the marriage or either of them - altering the interests of the parties to the marriage in the property; or
….
including:
(c) an order for a settlement of property in substitution for any interest in the property; and
(d) an order requiring:
(i)either or both of the parties to the marriage; …
….
to make, for the benefit of either or both of the parties to the marriage or a child of the marriage, such settlement or transfer of property as the court determines.
….
(2) 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.
(4) In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(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 application of s 79 has been the subject of extensive judicial interpretation and comment. In Hickey & Hickey & Attorney-General for the Commonwealth of Australia [2003] FamCA 395; (2003) FLC 93-143; (2003) 30 Fam LR 355 the Full Court said:
39.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: Lee Steere and Lee Steere (1985) FLC 91-626; Ferraro and Ferraro (1993) FLC 92-335; Davut and Raif (1994) FLC 92-503; Prpic and Prpic (1995) FLC 92-574; Clauson and Clauson (1995) FLC 92-595; Townsend and Townsend (1995) FLC 92-569; Biltoft and Biltoft (1995) FLC 92-614; McLay and McLay (1996) FLC 92-667; JEJ and DDF (2001) FLC 93-075 and Phillips and Phillips (2002) FLC 93-104.
In Hickey the Court was not asked to address the preliminary aspect of the requirement created by s 79(2) as to whether any order should be made. Similarly, the proceedings before me do not involve any controversy about that issue. As was observed in Stanford v Stanford (2012) 87 ALJR 74; 293 ALR 70 that preliminary, just and equitable requirement is often readily satisfied. Here, after a long marriage, the parties’ relationship has broken down and they live apart. The title to real estate needs to be changed to effect even the agreed aspects of a division of their property. Both parties have invoked s 79, seeking orders for settlement of property. In effect they agree that orders are necessary. I note the exhortation in s 81 to as far as practicable: “make such orders as will finally determine the financial relationships between the parties to the marriage and avoid further proceedings between them”. It is just and equitable that the parties have relief under s 79.
I turn to the task of identifying just and equitable orders that will alter the interests of the parties in property. There is no mention of steps or stages in s 79, let alone of the sequence set out in (a) – (d) below. Despite the guidance in Hickey, the Full Court has regularly noted that the “three-step” or “four-step” approach merely illuminates the path to the ultimate result.[2]
[2] Norman & Norman [2010] FamCAFC 66 at [60]; Bevan & Bevan [2013] FamCAFC 116.
I will address the following matters:
(a)Make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing;
(b)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;
(c)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; and
(d)Consider the effect of those findings and determinations and resolve what order is just and equitable in all the circumstances of the case.
The property of the parties
In determining what order is appropriate, it is necessary to make a finding as to the property of the parties. That involves identifying assets, liabilities and financial resources and their values.
The parties settled a joint balance sheet. Many potential disputes were apparently resolved between the parties. As the final document was tendered the balance sheet items in respect of which there was a value agreed or in contention were as follows:
Owner Description Wife’s value Husband’s value 1 Wife [Unit Z, C Street, Suburb D] 3,150,000 3,150,000 2 Joint [Unit Y, C Street, Suburb D] 1,625,000 1,625,000 3 Joint Car space – the [X Apartment Building] 75,000 75,000 4 Joint [E Street, Town F] 625,000 625,000 5 Husband [A] Pty Ltd 546,034 273,017 6 Wife [A] Pty Ltd 273,017 8 Husband [I Pty Ltd] 4,898 4,898 9 Joint NAB savings account 834 834 10 Wife IAG shares (691) 4,063 4,063 11 Husband IAG shares (1719, of which 413 were inherited from [husband’s] father’s estate) 10,107 10,107 12 Husband BMW … motor vehicle
Regn. No. …
In wife’s possession
15,300 15,300 13 Joint
A Pty Ltd
Audi … motor vehicle Regn. No. … 47,400 47,400 14 Husband Nissan … motor vehicle Regn. No. … 94,500 94,500 15 Joint Time share interest- [Town G] – Fiji 14,800 14,800 16 Joint David Jones Limited shares (2000) 5,600 5,600 18 Husband AMP shares (1,181) 5,609 5,609 19 Husband CBA account 232 232 20 Husband Loan to [Ms O] 209,981 143,413 21 Wife NAB account …89 10,355 10,355 22 Wife Loan to [Mr S] 0 45,441 Total 6442,913* 6,423,586 *I note that by my arithmetic the wife’s value column totals $6,444,713.
Addbacks
Owner Description Wife’s value Husband’s value 28 Wife Payment of visa card on behalf of the wife – paid 15.12.09 by the Husband per order 6 of 17 November 2009 0 22,673 30 Wife Payment to wife by Husband as per order 7 of 17 November 2009 (box storage) 0 2,200 32 Wife Payments to wife by husband for two overseas trips (Hawaii and around the world) and other outstanding credit card bills (see wife’s credit cards), estimate 0 33,500 35 Husband Failed property transaction being the aborted purchase of [Q Street, Suburb R] (not conceded by husband) 447,500 297,500
36 Husband Advance payment of $75,000.00 + $5,000.00 +$2,000 (23 September, 2013) for costs of Wife (re Court order of 8 August, 2013) including $2,000 paid on 23.11.13 0 82,000 41 Wife Wife’s gift to sister, [Ms P] – September, 2012 10,000 10,000 42 Wife Paid legal fees 165,618 165,618 43 Husband Paid legal fees 232,313 232,313 Total 846,431* 825,807 *I note that by my arithmetic the wife’s value column totals $855,431 and the husband’s value column totals $845,804.
Liabilities
Owner Description Wife’s value Husband’s value 44 Wife Mortgage over [Unit Z, C Street, Suburb D] @ 16.10.13 (interest only loan) 2,541,650 2,541,650 45 Joint Mortgage over [Unit Y, C Street, Suburb D] @ 16.10.13 188,653 188,653 46 Joint Mortgage over [E Street, Town F] @ 16.10.13 600,000 600,000 47 Husband Loan account with [H Pty Ltd] 110 110 49 Wife Levies [Unit Z, C Street, Suburb D] $8,608.81 pq estimate, due 31.10.13 0 8,609 50 Joint Levies [Unit Y, C Street, Suburb D] $3,826.13 pq estimate, due 31.1.14 0 3,826
51 Wife Levies: [Town F] due 31.1.14 0 1,715 52 Joint Levies: car space due 31.1.14 0 261 53 Joint Residual lease Audi … motor vehicle company as at 15.10.13 (guaranteed by husband) 49,000 49,000 54 Husband Residual lease Nissan … motor vehicle as at 15.10.13 84,432 84,432 55 Husband [H] Pty Ltd … 110 110 56 Husband Debt to [A] Pty Ltd … 22,567 22,567 57 Wife Debt to [A] Pty Ltd … 22,567 22,567 58 Husband NAB platinum mastercard @ 22.11.13 (copy coming) 0 38,818 59 Husband AMEX platinum credit card 0 72,818 60 Husband AMEX platinum debit card 0 132 62 Husband CBA mastercard @ 22.11.13 0 39,353 63 Wife Coles Myer mastercard – 3.10.13 12,973 0 64 Wife Qantas Platinum card – NAB visa …33 – 11.10.13 25,894 0 65 Wife NAB Qantas card …02- 2.10.13 219 0 Total 3,566,175* 3,654,621* *I note that by my arithmetic the wife’s value totals $3,548,175 and the husband’s value totals $3,674,621.
Superannuation
Owner Description Wife’s value Husband’s value 66 Husband AMP Super $211,069 $211,069
As to the issues about the balance sheet:
Item 20: A loan owed by the husband’s current wife to him
The husband lent money to his current wife, Ms O. Ms O and the husband give contradictory evidence about the quantum of the debt. It is the evidence of Ms O that a document[3] was jointly prepared by the husband and her setting out the balance of the loan owed by her to him. That document puts the balance of the loan at $209,981. The husband does not cavil with the genesis of the document but asserts that Ms O only owes him $143,413. He put a copy of the same document into evidence but with some of the items crossed out. His marked document is exhibit 7. This strange state of affairs is not explained in the evidence. Neither witness resiled from their testimony and there was no attempt in the husband’s case to resolve the controversy.
[3] Annexure A to the affidavit of Ms O sworn 8 November 2013
It may not matter. There is no contest about the advance, only about the characterisation of the advance as gift or loan. Presumably, either the husband is owed $209,981 or he has forgiven $66,568 and is owed $143,413.
The parties’ counsel each contended that it was the responsibility of the other party to resolve the matter. In my view it falls to the husband to make his case. The evidence in his case is ambiguous. It is not for me to go through the items on the two versions of the document and make an independent assessment of whether each item warranted the agreement made between the husband and Ms O that it would be the subject of a loan, one to the other. In any event it would not be fair to the wife to resolve the ambiguity in the husband’s case, to her disadvantage.
The husband advanced $209,981 for the benefit of Ms O and her children. In the absence of other evidence, I take it that when the document annexed to Ms O’s affidavit was prepared by the husband and Ms O, the husband agreed that the entire advance was by way of loan. Obviously, he subsequently changed his mind. If there is another explanation, it must come from the husband and it does not.
In this case the debtor acknowledges a debt owed to the husband of $209,981. I find that the husband has an asset in the form of a loan made by him to Ms O in the sum of $209,981.
Item 22: A loan to Mr S, being an advance made by the wife to the concierge at the X Apartment Building
There is no issue that the advance was made. There is little doubt that the loan is not recoverable. It is not just a matter of the wife having difficulty in recovering the debt. Senior counsel for the husband indicated that the husband is not interested in having that loan transferred or assigned to him so that he could recover the debt.
The wife told Mr B that Mr S ran errands for her and checked on her welfare from time to time. The wife advanced him moneys for his rent and for HCF contributions.
On any view this was an imprudent disbursement made by the wife alone. She did not seek or obtain the consent of the husband to the disbursement. The wife is responsible for the loan. Put another way it was a disposition of joint funds other than by way of normal living expenses and the husband should not be out of pocket because of that disposition. He would be out of pocket if the loan is not included in the balance sheet as an asset in the hands of the wife.
I find that the wife is owed $45,441 by Mr S.
Addbacks
The Full Court has identified circumstances whereby provision can be made in the balance sheet in property settlement proceedings for assets that no longer exist. The same logic would apply to the exclusion from the balance sheet of liabilities that exist at the date of the hearing.
In the Marriage of Omacini (2005) 33 Fam LR 134 the Full Court noted:
30.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. In DJM and JLM (1998) FLC 92-816 the Full Court said at 85,262:
“11.6 For reasons set out in Farnell, s 117 provides that each party to proceedings under the Family Law Act shall bear their own costs unless the Court otherwise orders. Failing to add back monies expended by parties on costs frequently has the effect of defeating the policy of s 117 by permitting the pool of available assets for distribution between the parties to be diminished by any monies that either of the parties have managed to spend on their costs up to the date of trial. We are of the view that the normal approach ought be to add costs already paid back into the pool. Whilst there may be cases where that approach is inappropriate, the reasons why it is not taken ought normally be spelt out.”
(b) Where there has been a premature distribution of matrimonial assets. In Townsend and Townsend (1995) FLC 92-569 Nicholson CJ as he then was with whom Fogarty and Jordan JJ agreed, said at 81,654:
“In my view, what occurred in this case, as I said during the course of argument was, in fact, a premature distribution of a proportion of the matrimonial assets. What the husband did was to distribute to himself an asset in which the wife had a legitimate interest. In such circumstances I consider that it would be unjust in the extreme to simply treat such conduct by the husband as a matter to which regard should be had under section 75(2). It seems to me that the husband has had the benefit of that money. Had he retained, for example, the taxi licence instead of selling it, that would have been brought into account as an item of property which would have been dealt with in the same way as the remaining items of property in this case. Accordingly, I am of the view that the correct way in which to deal with the husband’s receipt of those moneys is to bring them into the pool of assets on a notional basis and make a distribution accordingly.”
(c)In the circumstances outlined by Baker J in Kowaliw and Kowaliw (1981) FLC 91-092 at 76,644:
“As a statement of general principle, I am firmly of the view that financial losses incurred by parties or either of them in the course of a marriage whether such losses result from a joint or several liability, should be shared by them (although not necessarily equally) except in the following circumstances:
(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.
Conduct of the kind referred to in para. (a) and (b) above having economic consequences is clearly in my view relevant under sec.75(2)(o) to applications for settlement of property instituted under the provisions of sec.79.”
31.As the Full Court said in Browne and Green (1999) FLC 92-873 at 86,360:
“44. We agree with her Honour that the principles stated by Baker J in Kowaliw certainly do not constitute any form of fixed code. They are no more than guidelines for use in the exercise of the discretionary jurisdiction conferred by s 79 of the Family Law Act 1975. Nevertheless, they have over the considerable period of time since they were enunciated, become a well accepted guideline in this jurisdiction – a guideline the use of which assists in the achievement of the important goal of consistency within the jurisdiction.”
I note that the third Omacini ‘category’ does not seem to endorse the add-back approach as well as the first two. Indeed Baker J referred to the implications for waste under s 75(2)(o).
It has been suggested[4] that the discussion about the Court’s task in property settlement proceedings by the High Court in Stanford calls the add-back approach into question. There was no significant attention paid to this issue in submissions. The parties have included some items in their agreed balance sheet as add-backs. I take it that the parties concede that add-backs are an acceptable approach. In any event the Full Court advice remains.
[4] Per Finn J in Bevan & Bevan [2013] FamCAFC 116 at 160
As to the disputed issues:
Items 28, 30 and 32: Were advances made by the husband for the benefit of the wife after separation
Item 28: An advance made pursuant to Order 6 made on 17 November 2009
Order 3(6) made on 17 November 2009 reads as follows:
6.That within 28 days of these Orders, the husband pay or cause to be paid all amounts outstanding in respect of the wife’s NAB Visa account (together with any interest that has accrued) presently $22,673 with the designation that such payment to be reserved to the Trial Judge.
The starting point is that the assets and liabilities and their value are identified at the date of trial. As I have noted, the Full Court has previously endorsed the concept of some assets being added back to the balance sheet making up the net pool of assets for division, even though they no longer exist. That approach is not taken, for example for normal living expenses.
Here, it is not possible to identify the purposes of the expenditure represented by the balance of the wife’s visa account on 17 November 2009. I will not add back this amount.
Item 30: Was an advance made for the cost of constructing a storage box at one of the many garages at the X Apartment Building
There are two car spaces attached to each of the X Apartment Building properties. I understand the evidence would be that there are now storage boxes at those garages. The wife will retain the garages allocated to her apartment and I understand that they have storage boxes. It is asserted in the husband’s case, without complaint, that the cost was incurred at the wife’s request. In any event it is appropriate on that basis, that the cost of establishing a storage box be allocated to her.
Item 32: Is a payment made by the husband to the wife for two overseas trips and for payment of other outstanding credit card debts
The husband paid $33,200, which represented expenses incurred by the wife associated with two overseas trips and some other expenditure.
The husband gives evidence that in April 2008 he transferred 100,000 frequent flyer points to the wife which, together with her own points, enabled her to buy a round the world airline ticket booked for September 2008. It is the husband’s evidence that at that time the parties enjoyed an amicable relationship. He deposed that he had agreed to assist the wife with the cost of an overseas trip as he had undertaken a work related overseas trip the year before. In about August 2009 the wife booked up $7,000 on the husband’s credit card for a holiday to Hawaii.
Amounts should not be added back unless that is clearly appropriate. The husband has not identified the detail of the expenditure included in this item. He gives evidence of an arrangement made by the parties about the husband contributing towards an overseas trip for the wife. There is no evidence about the detail of that arrangement. There is no evidence as to the costs of either trip or the use to which the balance of the $33,200 was put by the wife. The only identified amount is $7,000 for tickets to Hawaii for the wife.
The ‘living expenses’ for the parties include items that might not always be seen as the necessities of life. For example, they include in the husband’s credit card expenses, $36,000 for clothing purchased on one day.
I am not confident that this item should be added back and will not do so.
Item 35: The loss suffered as a result of the aborted purchase of a property at Q Street, Suburb R
This is a significant issue in the case.
The husband signed a contract to purchase the Suburb R property. Ultimately he was not able to complete the purchase and defaulted on the contract. On 10 September 2010 the husband entered into a deed of release[5] with the vendor of the Suburb R property. It is asserted in the wife’s case that the deed supports a construction that the loss occasioned by the husband on the failed acquisition was not less than $475,326. The deed provided for payments totalling $445,000. The husband alleged the loss was $447,500. I do not understand how the deed supports a finding that the loss was $475,326. I find that the loss was $447,500.
[5] Annexure L to the affidavit of Mr B sworn 22 October 2013
The issue has complicated treatment in the husband’s Amended Response[6] but I gather that the husband opposes the loss being added back to the pool of assets as an asset in his hands. If there is to be an add-back, he claims that the whole amount should not be added back. It is the husband’s evidence that of that sum, $297,500 was added to the facilities already owed by the parties and the balance of the loss was borne by him out of his wages. It is submitted on behalf of the wife that the full amount should be sheeted home to the husband.
[6] Paragraph 17(b) of the orders sought
In my view the treatment of this issue should depend on whether the decision to engage in the purchase was a decision of the husband alone or whether it was a decision with which the wife agreed and joined. The purchase or attempted purchase was after separation and that means that the husband was obliged to secure the wife’s agreement if she is to be affected by the transaction.
As at August 2008, the wife moved into the jointly owned Unit Y property and the husband remained in the Unit Z property which was and is held in the wife’s name. In June 2009 the husband purchased the Unit V property in his name. The husband’s fiancée, Ms O, occupied that property with her children each alternate week. It is the husband’s case that those living arrangements proved unsatisfactory and the husband wanted to live elsewhere.
The relevant evidence in the wife’s case on the matter is at paragraphs 51 and 52 of the affidavit of Mr B. It simply confirms the bare facts and is of no assistance with this issue. It is the unchallenged evidence of the husband that in April and May 2010 he had a number of meetings with the wife. He told her that he proposed finding new accommodation and finalising the parties’ property settlement. The Unit V and Unit Z properties were marketed for sale. Ultimately the National Australia Bank would not provide the necessary mortgage, according to the husband “despite both [the wife] (who at this stage was co-operating with the financial negotiation with the view to property settlement) and I uniting to progress the matter.”
With the failure of the Suburb R purchase, the Unit V and Unit Z properties were withdrawn from sale.
Taken together, the evidence supports a finding that the wife was aware of and co-operated with the proposed purchase. The Unit Z property is in the wife’s sole name. Her consent was necessary, as the husband’s plan involved selling the Unit Z property to fund the new purchase.
The wife seeks that the loss be added back to the credit of the husband. She cannot make that case. There will be no add back.
Item 36: It is asserted on behalf of the husband that he has advanced $82,000 to the wife for the costs of the wife pursuant to an order made on 8 August 2013
This item is controversial because it is the wife’s case that this amount is included in item 42 where she brings to account $165,618 of paid legal fees. The evidence in the wife’s case has it that her fees were paid, from, among other sources, moneys received from the husband by way of interim payments and from the sale of the Unit V property.
It would be double counting to include this item and to add back the wife’s paid costs. I will not include this item.
Item 42: This item reflects the wife’s paid legal costs
The figure in the balance sheet is agreed at $165,618. The evidence from the wife’s costs memorandum puts the figure at $174,980, with $10,000 of that sum having been borrowed from the case guardian. The $10,000 debt is not brought to account in the balance sheet. Therefore the proper amount to add back would seem to be $164,980. I do not know why the figures are different. I will include the agreed figure.
Liabilities
Items 49, 50, 51 and 52: The husband seeks that certain advances be brought to account as advances on behalf of the wife for apartment levies, debts in relation to the Town F property and the fees for a car space in the X Apartment Building
All of the debts except item 49 are debts that are due on 31 January 2014. Item 49 has already fallen due. On balance these items should be included as relevant liabilities. Given the likely timing of this judgment, there is little doubt that the expenses will be incurred.
I will include these items as relevant joint debts but will link them with the disposition of the respective assets.
Items 58, 59, 60 and 62: Are credit card debts which the husband seeks to be included and the wife opposes
The argument is whether any part of those debts has been brought to account somewhere else in the balance sheet. The submissions were largely on the basis that there were debts in respect of which the company was liable and by inference either the company has paid the debt or the debt is one which is taken into account in the value of the company in the balance sheet.
A similar argument is made in relation to items 63, 64 and 65 where the wife seeks her credit card debts be brought to account. There is no argument that they might be company debts but presumably there is a dispute in relation to ongoing expenses.
The primary position is that the assets and liabilities at the date of the hearing are those that define the relevant property. There is no challenge to the existence of these liabilities. The wife seeks to make a case that some of the expenses should be ignored. She has not made that case.
Items 63, 64 and 65: Are credit card debts which the wife seeks to be included and the husband opposes
These expenses were incurred. The husband has not established a basis for ignoring them.
I find that the relevant balance sheet is as follows:
Owner Description Value 1 Wife Unit Z, C Street, Suburb D (occupied by the husband) 3,150,000 2 Joint Unit Y, C Street, Suburb D (occupied by the wife) 1,625,000 3 Joint Car space – the X Apartment Building 75,000 4 Joint E Street, Town F 625,000 5 Husband A Pty Ltd 546,034 6 Wife A Pty Ltd 8 Husband I Pty Ltd 4,898 9 Joint NAB savings account 834 10 Wife IAG shares (691) 4,063 11 Husband IAG shares (1719, of which 413 were inherited from the husband’s father’s estate) 10,107 12 Husband BMW motor vehicle Regn. No. …
(used by the wife)
15,300 13 Joint
A Pty Ltd
Audi motor vehicle Regn. No. … 47,400
14 Husband Nissan motor vehicle Regn. No. … 94,500 15 Joint Time share interest- Town G – Fiji 14,800 16 Joint David Jones Limited shares (2000) 5,600 18 Husband AMP shares (1,181) 5,609 19 Husband CBA account 232 20 Husband Loan to Ms O 209,981 21 Wife NAB account …89 10,355 22 Wife Loan to Mr S 45,441 30 Wife Payment to wife by Husband as per order 7 of 17 November 2009 (box storage) 2,200 41 Wife Wife’s gift to sister, Ms P – September, 2012 10,000 42 Wife Paid legal fees 165,618 43 Husband Paid legal fees 232,313 Total 6,900,285
Liabilities
Owner Description Value 44 Wife Mortgage over Unit Z, C Street, Suburb D @ 16.10.13 (interest only loan) 2,541,650 45 Joint Mortgage over Unit Y, C Street, Suburb D @ 16.10.13 188,653 46 Joint Mortgage over E Street, Town F @ 16.10.13 600,000 47 Husband Loan account with H Pty Ltd 110 49 Wife Levies Unit Z, C Street, Suburb D $8,608.81 pq estimate, due 31.10.13 8,609 50 Joint Levies Unit Y, C Street, Suburb D $3,826.13 pq estimate, due 31.1.14 3,826 51 Wife Levies: Town F due 31.1.14 1,715 52 Joint Levies: car space due 31.1.14 261 53 Joint Residual lease Audi motor vehicle company as at 15.10.13 (guaranteed by husband) 49,000 54 Husband Residual lease Nissan motor vehicle as at 15.10.13 84,432 55 Husband H Pty Ltd 110 56 Husband Debt to A Pty Ltd 22,567 57 Wife Debt to A Pty Ltd 22,567 58 Husband NAB platinum mastercard @ 22.11.13 (copy coming) 38,818 59 Husband AMEX platinum credit card 72,818 60 Husband AMEX platinum debit card 132 62 Husband CBA mastercard @ 22.11.13 39,353 63 Wife Coles Myer mastercard – 3.10.13 12,973 64 Wife Qantas Platinum card – NAB visa …33 – 11.10.13 25,894 65 Wife NAB Qantas card …02- 2.10.13 219 Total 3,713,707
Superannuation
The husband has a superannuation interest as follows:
66 Husband AMP Super $211,069
Net Assets
Therefore the net assets of the parties have a value of $3,397,647 ($6,900,285 + $211,069 - $3,713,707). Of the net assets, $211,069 is in the form of superannuation and $3,186,578 is in the form of non superannuation assets.
Financial Resources
There is no evidence that either party has access to a financial resource.
Contributions
It is agreed that contributions were equal. That conclusion is available on the agreed facts.
The parties lived together for about 18 years. They both had income from paid employment or in the wife’s case, by way of workers’ compensation, for most of the marriage. The wife brought to the marriage the proceeds of a property settlement of the order of $250,000 which enabled the parties to purchase the interest of the husband’s first wife in a property at Suburb L. She also contributed lump sum workers’ compensation. The husband received an inheritance. The husband’s earnings far exceeded those of the wife. The evidence about any homemaker contributions is scant. I take it that until her accident the main homemaker contribution was made by the wife. Thereafter the husband took up much of that role.
The Other Matters In Section 79
As to the impact of the non contribution aspects of s 79(4), including s 75(2), it is agreed that there should be an adjustment in favour of the wife.
The other factors in s 79(4) are:
Section 79(4)(d)
Pursuant to s 79(4)(d) I am required to take into account the effect of any proposed orders on the earning capacities of the husband and wife. It is agreed that the wife has no capacity for paid employment. It is not likely that either of the parties will be in a position to earn a significant amount of income from invested funds. Most of their assets are tied up in property.
Section 79(4)(e) - Section 75(2) Factors
The following matters in s 75(2) have some relevance:
(a) the age and state of health of each of the husband and wife;
At the time of the hearing the wife was 59 years of age, turning 60 in December 2013. Dr U is a forensic psychiatrist. He examined the wife on behalf of the husband and provided a report dated 20 November 2013 (exhibit 4) in these proceedings. He was not called for cross-examination.
Dr U noted that the wife was exposed to domestic violence as a child and that she was sexually abused by her father. She suffered an episode of depression following the breakdown of her first marriage and she consulted 2 psychiatrists at that time. Dr U considered that the wife had since recovered from that episode.
In 1996, the wife suffered a fall on her way home from completing a night shift. She suffered fractures to her feet and underwent eight operations and procedures due to the injury. The wife developed a range of physical problems after the fall (epilepsy, trigeminal neuralgia and migraines). She also developed a large number of psychiatric and psychological problems. She had admissions to a private psychiatric hospital, was diagnosed with a Major Depressive Disorder and suffered a number of chronic cognitive problems. All of those problems resulted from the 1996 injury. In addition, these proceedings resulted in her developing an Adjustment Disorder. Dr U considers in the terms of the relevant occupational guidelines that the wife suffers a whole person impairment of 24 per cent.
The wife obtained a forensic report (exhibit 3) from Dr AA Neurologist at BB Medical Practice on 12 May 2004. Dr AA concluded his report with:
It is no doubt that the injury and its sequelae have led to significant physical, psychological and economic loss and impaired her enjoyment of the amenities of life in general and her relationships with others, including her partner.
The husband is 51 years of age. No medical evidence was submitted in respect of the husband. As with the wife, the husband identifies these proceedings as creating difficulties for him. He deposed:
This case has provided the most difficult time in my life for me not only emotionally and mentally but also physically and financially.
That statement was not challenged in cross-examination and I accept it. The background facts also suggest that although not directly suffering the trauma and sequelae of the wife’s 1996 injury, in addition to the financial and physical impact, they must have taken a very significant toll on the husband personally and on the parties’ relationship.
(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment;
The wife’s financial circumstances are revealed in the affidavit of her son and case guardian, Mr B, sworn 22 October 2013. The wife’s income is $1,337.84 a week made up of $700 per week by way of interim spousal maintenance, $607.84 in workers’ compensation payments and $30 from a lease of one of the car spaces attached to the Unit Y property.
As at the date of Mr B’s affidavit the wife also benefited from direct payments made by the husband, whether under the terms of orders made on 17 September 2009 or otherwise. He pays all of the outgoings on the Unit Y property – mortgage payments; council, water and sewerage rates; strata levies; electricity accounts; all routine maintenance and home and contents insurance premiums. The husband also pays the mortgage instalments on the Unit V and Unit Z properties and the Town F property. The husband pays the annual service fees; lease payments and registration and insurance costs associated with the BMW motor vehicle used by the wife. He also pays the wife’s private health insurance premiums and the fees associated with a storage unit.
Without complaint from the husband[7], Mr B says at paragraph 28 of his affidavit that the husband’s weekly payments on behalf of the wife include:
Health insurance $41.51
Car expenses $73.27
Outgoings on the Unit Y $370.19Property (excluding mortgage)
[7] In his affidavit of November 2013, the husband did cavil with other aspects of Mr B’s October 2013 affidavit
The wife’s weekly expenditure includes the following minimum payments on credit cards:
NAB Visa card $149.00
Mastercard $66.00NAB Qantas card $2.00
As to her living expenses, Mr B deposes that the wife has the following living expenses:
(a) Food $41.02 (b) Coles supermarket $118.63 (c) Household supplies $21.38 (g) Telephone $41.17 (h) Petrol $2.05 (j) Fares, car parking $14.65 (k) Clothes and shoes $28.44 (l) Medical dental and optical and chemist $124.66 (m) Entertainment/ hobbies $88.22 (r) Dry cleaning $16.62 (s) Books, magazines, DVDs, CDs $59.34 (t) Gifts/Donations $39.30 (u)
Hairdressing/Toiletries
$28.37
(v)
Other necessary commitments being pet cat expenses
$121.95
(w)
Travel
$10.84
(x)
Myer
$20.06
(y)
David Jones
$8.55
(z)
Furniture
$30.77
(aa)
Interest and bank fees
$99.60
(bb)
Stationery and office supplies
$6.78
Total $922.40
It is Mr B’s evidence that in addition, the wife draws $509 per week in cash which she applies as to $100 to a cleaner; an IT contractor Mr CC who is paid $50 per visit and to incidental expenses such as attending the movies and taking refreshments with friends.
It should be noted that unless they are caught up under another item, no provision is disclosed for holidays or repairs to furniture or appliances. At $2.05 per week for petrol, the wife does not make much use of her car.
The evidence about the wife’s assets and liabilities is set out earlier in these reasons.
It is an agreed fact that the wife has no income earning capacity by way of physical exertion. Dr U considers in the terms of the relevant occupational guidelines that the wife suffers a whole person impairment of 24 per cent. In his opinion:
5.Considering her age, the chronicity of her various problems and their nature and intensity and their propensity to recur, I think it is improbable that this woman will be able to work again, certainly not in any consistent or reliable fashion.
The husband could not provide a definitive estimate of his income. His main sources of income are income as a contracted professional at a Sydney institution and his income from his private professional practice, earned through H Pty Ltd. For his Financial Statement sworn 12 November 2013 he estimated a total weekly income of $12,621 made up of unknown salary or wages (it is not clear to me what income he intended to thereby refer), $24 in dividends on shares in public companies, $1,597 from the institution and $11,000 from his company. The income from the institution was calculated by averaging three years of payslips. The income estimated for the company was provided by the husband’s accountant, relying on the income for the year ended 30 June 2012 and BAS (s)tatements for three quarters of the 2012-2013 financial year. During cross-examination the husband said that he thought the 2012 income from the institution had been down on the 2011 level at about $90,000 and $94,000 respectively.
Some of the imprecision in the husband’s income estimate was explained by him in terms of his 2012-2013 tax not having been assessed and in part that is because the husband said he has not had the time to do the calculations he needs to do so that his accountant can complete the work. He estimated that it will require him to spend 60 – 70 hours to complete the necessary accounts work. There is four months of the husband’s work at the institution not yet invoiced from the 2012-2013 financial year.
It was put to the husband that he had not completed the necessary work, in breach of an order made on 6 September 2013, in order to obtain forensic advantage. He rejected that assertion and I accept his assurance.
According to the husband’s Financial Statement, he spends $11,318 per week. That is not a reliable figure, if only because there is no provision for tax.
The evidence about his assets and liabilities is addressed above.
The husband sought to put some doubt on his future earning capacity but no relevant expert evidence was called. Given the evidence about the impact of these proceedings on him, the husband’s earning capacity could well increase in the future.
(d) commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain;
(e) the responsibilities of either party to support any other person;
This issue will be dealt with in more detail in relation to the wife’s claim for spousal maintenance.
For present purposes - the wife has no dependents. As to her own support, I refer to the evidence set out above.
Apart from a potential income tax impost, the husband spends $11,318 per week.
The husband has the legal responsibility of supporting himself, his ex-wife and Ms O. The person with primary responsibility, with Ms O, for supporting her children, is her ex-husband.
It is a nice question as to what of his expenses are necessary for the husband to support himself and others. The husband spends $500 per week on holidays, $300 for himself, $120 for the children of Ms O and $80 for another adult, presumably Ms O. During cross-examination he was taken to many entries in his credit card statements for restaurant meals. In addition to the expenses addressed in Annexure A to the affidavit of Ms O sworn 8 November 2013, he paid $36,845 towards Ms O’s legal fees for her family law proceedings. On 25 March 2013 the husband spent $36,455 on suits and other clothing for himself at Tom Ford Retail in the USA. Items not immediately available were collected on the following days: shoes for about $1,000 and on 28 March 2013 $1,995 was paid for further items.
The husband estimates Ms O’s income at $370 per week. During her cross-examination she did not cavil with an estimate put to her of $20,000 per annum. However, Ms O estimates that she could earn $60,000 per annum if she worked on a full time basis. Her oldest child lives mainly with Ms O’s ex-husband and the other two children live week-about between their parents. Ms O’s ex-husband has not provided periodic support to Ms O for his children since 2007. I gather that he makes payments from time to time. He paid $12,000 in 2012. Ms O intends to continue to provide a private school education for her children. She and the husband gave evidence that he will no longer contribute to that expense. If her ex-husband does not contribute then Ms O plans to return to full-time work to meet the fees.
Whatever happens it is likely that the husband will continue to provide financial support to Ms O. That is to say, if Ms O’s income increases, it is likely that it will be fully committed to school fees.
(f) subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia, and the rate of any such pension, allowance or benefit being paid to either party;
The wife has fully drawn her superannuation interest. The husband has the interest described in the balance sheet above.
(g) where the parties have separated or the marriage has been dissolved, a standard of living that in all the circumstances is reasonable;
The parties have lived in comfortable, if not luxurious accommodation and each enjoyed some overseas travel before and after separation. They drive modern, imported motor vehicles. The husband regularly eats at expensive restaurants and dresses well.
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party;
The evidence suggests that the parties supported each other. The wife travelled to Canada in aid of the husband furthering his qualifications. The husband supported the wife after the 1996 accident, leading to her return to work, albeit temporary.
(k) the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;
The husband studied during the marriage and thereby his earning capacity increased. The deterioration in the wife’s earning capacity related directly to the 1996 injury rather than to the duration of the marriage.
(m) if either party is cohabiting with another person — the financial circumstances relating to the cohabitation;
I have set out above what there is of that evidence. The wife lives alone. The husband lives with Ms O and for some of the time, with her children.
(o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account;
Much of the thrust of the submissions made on behalf of the wife was critical of the husband. The explicit criticism was that he deliberately failed in his obligations of financial disclosure. I do not make that finding. These proceedings are not conducted in a vacuum. The husband is the only significant source of the parties’ income. The husband had a lot on his plate. True it is, he may have been able to hurry along the process of his accountant preparing the financial accounts for him and for the company and thereby made it easier for the Court to understand his current financial circumstances. However, he was not challenged on his evidence as to the time involved in him undertaking his necessary and preliminary part of the preparation of those accounts.
If not explicit, there was an implicit criticism of the husband in relation to his lack of support of the wife. It has been revealed on occasions in his conduct of these proceedings, that the husband has been angry and frustrated with the process and with the conduct of the wife. Taken as a whole, however, in my view the agreed facts reveal that husband has been very supportive of the wife since her accident in 1996, during the marriage and since. That accident had devastating consequences for the wife but as a result, it also had a very significant and ongoing impact on the husband. There is nothing in the relevant conduct of either party to these proceedings that warrants any significant criticism. Indeed it is remarkable and to their credit that they have managed as well as they have done. In particular, despite the breakdown of their marriage, the husband has provided very substantial financial support to the wife since 2009.
Section 79(4)(f)
Beyond those referred to above, there are no relevant orders made under the Family Law Act 1975.
Section 79(4)(g)
There is no child support assessment.
Conclusion
It is agreed that there should be an adjustment in favour of the wife.
The most important matters arising from the remaining elements of s 79, which include the s 75(2) factors referred to above, are:
·The husband is 10 years younger than the wife; and
·The husband has a very substantial earning capacity but he will continue to support Ms O. The wife receives modest workers’ compensation payments but has no earning capacity.
It is argued for the wife that the adjustment should be 15 per cent creating a 30 per cent differential between the parties. It is submitted that the dollar value of such an adjustment represents only a short period in terms of the very significant earning capacity of the husband.
It is argued for the husband that the adjustment should be 5 per cent creating a differential of 10 per cent between the parties. It is argued that that is an important amount of money in the context of this case and the fact of the husband’s greater earning capacity should not determine the quantum of the adjustment.
A substantial adjustment is warranted.
Although through a comment from his counsel during submissions he questioned the necessity for the wife to live at the X Apartment Building, the husband and the wife have each sought orders and have thereby placed a priority on the wife remaining in the Unit Y property. The case guardian deposes to reasons why that was appropriate and he was not challenged. In the context of this settlement, $1,800,000 of the assets will be committed to ensuring that the wife retains that property, free of encumbrance.
The net assets of the parties have a value of $3,397,647. An adjustment of 10 per cent represents about $339,765 and would create a difference in the property settlement of the parties, of twice that sum. Accepting that some of the assets do not exist, the husband’s superannuation is not readily accessible by him and that the parties have debts not included in the balance sheet for these proceedings, such as legal fees, a division in the proportions 60 per cent to the wife and 40 per cent to the husband would leave the wife with $2,038,588.20 and the husband with $1,359,058.80. In my view that would represent a just and equitable division of property.
As to the terms of the orders, the parties agree that the wife will retain the Unit Y property, the BMW motor vehicle she drives and the Town G timeshare. Subject to the wife being released from the borrowings secured thereon, the husband will retain the Unit Z and Town F properties and his company.
Each of the parties seeks an order that the husband discharge the mortgage on the Unit Y property.
The disputed orders relate to the following:
Additional Car Space At The X Apartment Building
Each of the parties seeks to retain the additional car space. This dispute was not the subject of significant submissions, let alone evidence. There are two car spaces allocated for each of the Unit Y and Unit Z properties. The parties own a fifth car space.
The wife leases out one of the car spaces allocated to the Unit Y property. For reasons that are not adequately identified in the evidence but may have to do with the convenience of driving into a car space, the wife does not use the other car space that is allocated to her apartment, but she uses the fifth car space. I understand that the fifth car space is next to one of the car spaces for the Unit Z property occupied by the husband and Ms O. The result is that the two women park their cars next to each other. It may be that that arrangement has not been entirely successful. Importantly, the husband says that the fifth car space is security for one of the facilities for which he is and will continue to be responsible.
The simplest course is that the fifth car space be retained by the husband and that the wife make arrangements to use the remaining car space which is linked to the Unit Y property.
The implication from the fact that the wife spends $2.05 per week for petrol, is that she does not often move her motor vehicle from its parking space.
I will provide for the car space to be transferred to the husband.
David Jones Shares
Neither of the parties wants to retain the 2000 David Jones shares. They have an agreed value of $5,600. I will order that the shares be sold and that the net proceeds be divided in the proportions of the overall settlement.
Of the pool of assets identified by me, the wife has the benefit of and would like to retain:
| Owner | Description | Value | |
| 2 | Joint | Unit Y, C Street, Suburb D (occupied by the wife) | 1,625,000 |
| 10 | Wife | IAG shares (691) | 4,063 |
| 12 | Husband | BMW motor vehicle Regn. No. … (used by the wife) | 15,300 |
| 15 | Joint | Time share interest- Town G – Fiji | 14,800 |
| 21 | Wife | NAB account …89 | 10,355 |
| 22 | Wife | Loan to Mr S | 45,441 |
| 30 | Wife | Payment to wife by Husband as per order 7 of 17 November 2009 (box storage) | 2,200 |
| 41 | Wife | Wife’s gift to sister, Ms P – September, 2012 | 10,000 |
| 42 | Wife | Paid legal fees | 165,618 |
| 50 | Joint | Levies Unit Y, C Street, Suburb D $3,826.13 pq estimate, due 31.1.14 | -3,826 |
| 63 | Wife | Coles Myer mastercard – 3.10.13 | -12,973 |
| 64 | Wife | Qantas Platinum card – NAB visa …33 – 11.10.13 | -25,894 |
| 65 | Wife | NAB Qantas card …02- 2.10.13 | -219 |
| Total | 1,849,865 | ||
The wife will receive 60 per cent of the net proceeds of sale of the David Jones Shares. They have a value of $3,360 for the purposes of these calculations. In order to bring her to 60 per cent of the net pool the wife should receive an extra $185,363.20 ($2,038,588.20 - $3,360 - $1,849,865). I will round that sum to $185,360.
That will leave the husband with the benefit of:
| Owner | Description | Value | |
| 1 | Wife | Unit Z, C Street, Suburb D (occupied by the husband) | 3,150,000 |
| 3 | Joint | Car space – the X Apartment Building | 75,000 |
| 4 | Joint | E Street, Town F | 625,000 |
| 5 | Husband | A Pty Ltd | 546,034 |
| 8 | Husband | I Pty Ltd | 4,898 |
| 9 | Joint | NAB savings account | 834 |
| 11 | Husband | IAG shares (1719, of which 413 were inherited from the husband’s father’s estate) | 10,107 |
| 13 | Joint A Pty Ltd | Audi motor vehicle Regn. No. … | 47,400 |
| 14 | Husband | Nissan motor vehicle Regn. No. … | 94,500 |
| 18 | Husband | AMP shares (1,181) | 5,609 |
| 19 | Husband | CBA account | 232 |
| 20 | Husband | Loan to Ms O | 209,981 |
| 43 | Husband | Paid legal fees | 232,313 |
| 66 | Husband | AMP Super | 211,069 |
| 44 | Wife | Mortgage over Unit Z, C Street, Suburb D @ 16.10.13 (interest only loan) | -2,541,650 |
| 45 | Joint | Mortgage over Unit Y, C Street, Suburb D @ 16.10.13 | -188,653 |
| 46 | Joint | Mortgage over E Street, Town F @ 16.10.13 | -600,000 |
| 47 | Husband | Loan account with H Pty Ltd | -110 |
| 49 | Wife | Levies Unit Z, C Street, Suburb D $8,608.81 pq estimate, due 31.10.13 | -8,609 |
| 51 | Wife | Levies: Town F due 31.1.14 | -1,715 |
| 52 | Joint | Levies: car space due 31.1.14 | -261 |
| 53 | Joint | Residual lease Audi motor vehicle company as at 15.10.13 (guaranteed by husband) | -49,000 |
| 54 | Husband | Residual lease Nissan motor vehicle as at 15.10.13 | -84,432 |
| 55 | Husband | H Pty Ltd | -110 |
| 56 | Husband | Debt to A Pty Ltd | -22,567 |
| 57 | Wife | Debt to A Pty Ltd | -22,567 |
| 58 | Husband | NAB platinum mastercard @ 22.11.13 (copy coming) | -38,818 |
| 59 | Husband | AMEX platinum credit card | -72,818 |
| 60 | Husband | AMEX platinum debit card | -132 |
| 62 | Husband | CBA mastercard @ 22.11.13 | -39,353 |
| Payment to the wife | -$185,360 | ||
| Total | $1,356,822.00 | ||
The husband will also receive 40 per cent of the net proceeds of sale of the David Jones shares. They have a value of $2,240 for the purposes of these calculations.
Conclusion Under Section 79
This was a marriage that spanned 18 years and during that period and since, very significant contributions were made by each of the parties. They acquired substantial assets and developed a substantial earning capacity in the husband. The wife suffered a disastrous injury in 1996 and among other things, that impacted on her earning capacity. However, the parties shared the work of the marriage in different ways and overall, their contributions were equal. It is agreed that an adjustment in favour of the wife is warranted and in my view a 10 per cent adjustment is required. In my view the orders I have foreshadowed will reflect a just and equitable division of their property. The orders are necessarily complicated and there are issues about when certain payments are made about which I have made arbitrary decisions. I will give the parties the opportunity to restore the proceedings, subject to any agreed changes, for the purpose only of addressing the wording of the orders.
There is an issue about when the husband must discharge the mortgage on the Unit Y property. He proposes that the mortgage be discharged within three years. The wife seeks that the mortgage be discharged straight away. There will be a spouse maintenance order in these proceedings and therefore the aspiration of separating the parties’ finances will not be achieved in this case. Provided the wife is not out of pocket, the husband should be allowed time to make the necessary arrangements. I accept that that time will come at the cost of the wife not being able to sell or encumber the property for that period. I will allow the husband two years to discharge the mortgage. Obviously the husband will need to meet the mortgage instalments and any associated costs, pending the discharge.
As to the timing of the payment of the cash component of the property settlement, the payment should be made as soon as practicable. I have provided for a payment of $185,360 from the husband to the wife. Excluding the joint debts that will remain the sole responsibility of the husband, the debts of the wife included in the balance sheet amount to $43,173. Depending on the arrangements with her lawyers in respect of the three day hearing being reduced to two, the wife will have an obligation of the order of $75,000 to $90,000 in unpaid legal fees.
The husband has other options, such as selling the Town F property. In any event it is really a matter of convenience to him that he delays the payments of capital. The orders will allow him time in relation to the discharge of the Unit Y property mortgage. The cash adjustment should be made now. The wife owes most of the payment to others and should be put in a position to clear those debts. I will order that the payment be made within two months.
Spousal Maintenance
The Law
Section 72(1) of the Family Law Act says relevantly:
(1) A party to a marriage is liable to maintain the other party, to the extent that the first-mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately whether:
(a) by reason of having the care and control of a child of the marriage who has not attained the age of 18 years;
(b) by reason of age or physical or mental incapacity for appropriate gainful employment; or
(c) for any other adequate reason;
having regard to any relevant matter referred to in subsection 75(2).
Subsection 74(1) provides as follows:
Power of court in spousal maintenance proceedings
(1)In proceedings with respect to the maintenance of a party to a marriage, the court may make such order as it considers proper for the provision of maintenance in accordance with this Part.
Subsection 80(1) relevantly provides:
(1) The court, in exercising its powers under this Part, may do any or all of the following:
(a) order payment of a lump sum, whether in one amount or by instalments;
(b) order payment of a weekly, monthly, yearly or other periodic sum;
……
The issue to be determined by me is the extent of the needs of the wife and the reasonable capacity of the husband to provide support. In deciding that issue, the court is to have regard to relevant matters referred to in s 75(2).
The doctors say that at the moment the wife does not need home care. It is submitted on behalf of the husband that s 60AA of the Workers’ Compensation Act 1987 (NSW) suggests that if a time comes when she does require home care, the wife will be entitled to it under the NSW legislation.
The Exercise Of Discretion
As to spousal maintenance, despite the orders formally sought by the husband, it is agreed that there should be an order for periodic support. There is however a dispute as to the duration and quantum of the order. I rely on the findings made above in relation to s 75(2).
As to the quantum, the wife seeks $1,500 per week and it was submitted on behalf of the husband that “something of the order of $900 to $1,000 per week should be more than ample”. I will take the liberty of reading “more than ample” down to “appropriate”. The former phrase has no relevance in the enquiry about spousal maintenance and I have reason to be confident that learned senior counsel for the husband was seeking to make relevant submissions.
As a result of the property settlement order foreshadowed above, the wife will have a modest balance of liquid funds. Depending on what has happened since the trial, the wife should be able to clear all of the debts for which she will have responsibility. I have provided for a payment of $185,360 from the husband to the wife. She also has $10,000 in the bank. As is discussed above, her debts are likely to be of the order of $118,000 – $138,000.
The evidence about the wife’s income and expenses is that, apart from the interim maintenance, the income and outgoings associated with the wife that are likely to continue are as follows:
The wife’s income will be $637.84 a week made up of $607.84 in workers’ compensation payments and $30 from a lease of one of the car spaces attached to the Unit Y property. The ongoing expenses are:
Expense Amount The expenses met directly by the husband by way of health insurance, car expenses and outgoings on the Unit Y property $484.46 Minimum credit card payments $217 Living expenses $922.40 Cash drawings applied to cleaning, IT support and incidental expenses $509 Total $2132.86
Therefore the wife will have a weekly shortfall of $1,495.02. The wife could not be tested on the expenses that raise obvious questions such as her cat expenses and the application of her weekly cash drawings. It is likely that some economy could be achieved in the wife’s expenses. As her credit card payments, even though the current debts might be paid out, the weekly expenses include only the minimum repayments. The minimum repayment levels will be reduced by the discharge of the credit card balances.
As with the wife’s expenses, there is some imprecision in the evidence about the husband’s income. There is evidence that notwithstanding an apparent shortfall in his weekly budget, he has chosen and has been able to maintain lifestyle expenditure on restaurants and clothes. Just as the question was briefly raised about the wife being able to live in the X Apartment Building indefinitely, there is a question about whether, given all of the calls on his finances, the Town F property, for example, is a reasonable investment at this time for the husband.
I am left to make a decision which balances the wife’s needs against the husband’s reasonable capacity to provide support. In my view that balance is struck at $1,250 per week.
As to the duration, the wife seeks an indefinite order. It is submitted on behalf of the husband that several approaches could be taken. An award could be made but limited to the time until the property orders are given effect and the husband has discharged all of his obligations under those orders. Another approach would be to make an order to some specified date. No date was suggested on behalf of the husband. Otherwise an order could be made until further order.
As I mentioned during submissions and as I thought was accepted on behalf of the husband, section 83 of the Act does the work of providing for variation of maintenance where there are changes in circumstances. The wife’s capacities are unlikely to improve. There is no logic in making an order for a limited period, let alone to a specific date. I will make an indefinite order.
For obvious reasons I would normally be inclined to make an order for the rate of maintenance to move with the CPI. That was not sought by the wife nor raised in submissions. In those circumstances I will not make that provision.
Conclusion On Periodic Maintenance
It is conceded that the wife has established a need for maintenance. The husband has a capacity to pay. I have found a shortfall in the wife’s weekly budget of the order of $1,500 per week. In my view it would be appropriate for the husband to pay the wife $1,250 by way of periodic spousal maintenance.
I certify that the preceding one hundred and ninety eight (198) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Loughnan delivered on 9 January 2014.
Associate:
Date: 9 January 2014
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Equity & Trusts
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