WOOLWICH & WOOLWICH - [2014] FamCA 1253

FAMILY COURT OF AUSTRALIA

WOOLWICH & WOOLWICH

[2014] FamCA 1253

FAMILY LAW – PROPERTY – Settlement in relation to marriage – Where the husband and wife cohabited for almost 17 years and raised two children to adulthood – Where the contributions at separation were equal – Where the wife had almost the entirety of the physical care of the children post separation – Where the wife has borne much of the financial burden of the children post separation – Where the wife has paid substantial amounts in mortgage repayments and costs of maintenance on the former matrimonial home since separation – Where the wife’s post separation contributions outweigh the husband’s – Where overall contributions are found to be 55 per cent to the wife and 45 per cent to the husband – Where the husband has a higher capacity to earn income in future – Where the husband failed to make a full and frank disclosure – Where a 5 per cent s 75(2) adjustment is appropriate in favour of the wife – Where an order is made for the wife to receive 60 per cent and the husband to receive 40 per cent of the available property and superannuation.

FAMILY LAW – PRACTICE AND PROCEDURE – Where the husband sought leave to re-open the case to adduce fresh evidence as to the value of the former matrimonial home – Where the husband offered no evidence in admissible form – Where a substantial prejudice would flow to the wife – Where the husband’s application was dismissed.

Family Law Act 1975 (Cth) – s 75(2); s 79

Aheb & Aheb(No 3) [2009] FamCA 524
Black and Kellner (1992) FLC 92-287
Elgin & Elgin(Re-opening) [2012] FamCA 898
Emmett & Emmett [2010] FamCA 56
Gelley & Gelley (1992) FLC 92-290
Reid v Brett (2005) VSC 18 (8 February 2005)
Smith v NSW Bar Association (1992) 176 CLR 256
Stanford v Stanford (2012) FLC 93-518
Summitt & Summitt & Ors(Re-opening) [2009] FamCA 365
Weir and Weir (1993) FLC 92-338

APPLICANT:

Ms Woolwich

RESPONDENT:

Mr Woolwich

FILE NUMBER:

SYC

1583

2010

DATE DELIVERED:

30 October 2014

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Johnston J

HEARING DATE:

4 & 5 November 2013 and 24 October 2014

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Schonell, SC

SOLICITOR FOR THE APPLICANT:

Abrams Turner Whelan Family Lawyers

FOR THE RESPONDENT:

Mr Woolwich in person

Orders

That the husband and the wife forthwith do all things and sign all documents necessary to sell the former matrimonial home at V Road, Suburb B in the State of New South Wales more fully described in Certificate of Title Folio Identifier … by way of public auction on the following terms:
(a)That the property be placed on the market for sale by auction within 100 days of the date of these orders;
(b)That such an auction take place within six weeks from the date of placing the property for sale by public auction or as soon as practicable thereafter;
(c)That the agent be as agreed between the parties or failing agreement for more than seven days, as appointed by the President for the time being of the New South Wales Division of the Australian Property Institute;
(d)That the reserve price for such auction be as agreed between the parties or failing agreement for more than seven days, as determined by the selling agent;
(e)That the parties pay all auction expenses as requested by the selling agent as and when they fall due;
(f)That the parties shall do all things necessary or recommended by the selling agent to properly present the property for sale and to make the property available for inspection by prospective purchasers;
(g)That either party be at liberty to bid for the purchase of the property at the auction; and
(h)That the parties shall attend the auction and, if necessary, negotiate with the highest bidder at the auction if the reserve price is not reached.
That in the event that the property does not reach the reserve price and the parties are unable to negotiate an agreed sale price with the highest bidder at the auction then the parties shall do all things and sign all documents necessary to cause the property to be sold by way of subsequent auction on the following terms:
(a)That the auction take place within six weeks of the date of the last auction;
(b)That the agent be as agreed between the parties or failing agreement for more than seven days, as appointed by the President for the time being of the New South Wales Division of the Australian Property Institute;
(c)That the reserve price for such subsequent auction be an amount that is 5 per cent lower than the previous reserve price;
(d)That the parties pay equally all auction expenses as requested by the selling agent as and when they fall due;
(e)That the parties shall do all things necessary or recommended by the selling agent to properly present the property for sale and to make the property available for inspection by prospective purchasers;
(f)That either party be at liberty to bid for the purchase of the property at the auction;
(g)That the parties shall attend the auction and, if necessary, negotiate with the highest bidder at auction if the reserve price is not reached.
That in the event that a purchaser for the former matrimonial home is not found within six months of the date the property is listed for sale or as otherwise agreed, the parties shall do all things and sign all documents necessary to list the property for sale by public auction at an agreed price.
That in the event that the parties are unable to agree upon an auctioneer, the auctioneer shall be nominated by the Real Estate Agent marketing the property.
That the proceeds of sale of the said former matrimonial home be paid as follows:
(a)To pay agent’s commission and costs of sale including legal costs on sale;
(b)To pay out the joint National Australia Bank (“NAB”) home loan (approximately $219,948) and the husband’s residual debt (approximately $314,011);
(c)To pay all outstanding school fees to C School (approximately $11,539);
(d)To pay the outstanding balance as follows:
(i)67.034 per cent less the amount outstanding to K School (approximately $12,366) to the wife;
(ii)32.966 per cent less the amount outstanding to the NAB (loan account no …84) being the husband’s personal loan for G’s school fees (approximately $78,549) to the husband;
(iii)The amount outstanding to K School is to be paid to K School; and
(iv)The amount outstanding to the NAB on loan account no …84 is to be paid to the NAB.
That upon payment of NAB loan account no …84 the husband is to procure for the wife a release of her guarantee in relation to the said loan.
That within forty-two (42) days the husband and the wife do all acts and things and sign all documents necessary to close any joint bank accounts held by them with the NAB and divide the proceeds thereof equally between them.
That the husband is otherwise entitled to retain sole legal and beneficial ownership to the exclusion of the wife of:
(a) his interests in:‑
(i)O Pty Limited;
(ii)the Woolwich Family Trust;
(iii)A Pty Limited;
(iv)Q Limited;
(v)S Business (US);
(vi)W Services
(b)his interests in overseas real estate at …;
(c) his Telstra shares;
(d)any entitlements under any superannuation fund of which he is or has been a member; and
(e)all other items of property and personalty including motor vehicles, bank accounts, money, shares, jewellery and personal effects presently in his possession, custody or control.
That the wife is otherwise entitled to retain sole legal and beneficial ownership to the exclusion of the husband of:
(a) her Telstra shares;
(b)any entitlements under any insurance policies or superannuation funds in which she has an interest; and
(c)All other items of property and personalty including motor vehicles, bank accounts, money, shares, jewellery and personal effects presently in her possession, custody or control.
That otherwise than as provided above, the husband and the wife shall be and remain liable for any debts in his or her own name at the date of these orders and in this respect shall indemnify and hold harmless the other from any liability in relation thereto.
That in the event that either party refuses or neglects to execute any deed, document or instrument to give effect to these orders within fourteen (14) days of such document being tendered for signature, the Registrar of the Family Court of Australia, Sydney is hereby appointed pursuant to Section 106A of the Family Law Act 1975 (Cth) to execute any such deed, document or instrument in the name of such party and to do all acts and things necessary to give validity to the operation of any such deed, document or instrument and for the purposes of this order a party shall be deemed to have refused or neglected to execute any such deed, document or instrument if the said deed, document or instrument is not returned to the submitting party within fourteen (14) days of the said document being forwarded to the other party's solicitor by document exchange or to the other party by ordinary mail.
That both parties have leave to re-list these proceedings in relation to the implementation of these orders by arrangement with my Associate […].
That all exhibits be released.

IT IS NOTED that publication of this judgment by this Court under the pseudonym WOOLWICH & WOOLWICH 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 1583 of 2010

Ms Woolwich

Applicant

And

Mr Woolwich

Respondent

REASONS FOR JUDGMENT

The parties in these proceedings are Ms Woolwich and Mr Woolwich. For convenience I shall refer to them as “the wife” and “the husband” respectively.
They have been unable to arrive at a settlement of their property dispute and have asked the Court to determine this.

Applications

The wife seeks orders to the following effect:
·The husband discharge the mortgage to National Australia Bank (“NAB”) (for approximately $78 500) securing his personal loan for the child G’s school fees and procure for the wife a release of her guarantee in relation to the said loan;
·The husband transfer to the wife his interest in the former matrimonial home at Suburb B;
·Simultaneously, the wife discharge the remaining two National Australia Bank loans secured by mortgage;
·The husband and the wife close all joint bank accounts with the NAB and divide the proceeds between them equally;
·The husband be declared sole owner of his interests in various specified corporations and the Woolwich Family Trust, his interest in land in Country X, his Telstra shares, his superannuation and all other personal property in his possession and/or control;
·The wife be declared the sole owner of her Telstra shares, superannuation and insurance policies and all other personal property in her possession and/or control;
·Each party indemnify the other from liability for debts in their names respectively;
·An enforcement order; and
·That the husband pay the wife’s costs of these proceedings.
On the other hand the husband seeks an order to the effect that he transfer his interest in the former matrimonial home to the wife upon payment by her to him of a sum of $615 000. He said that this was the amount calculated by him to cause the parties to enjoy the available property and superannuation on the basis of an equal division between them.

Trial

I regret that it is now twelve months since this trial concluded. I appreciate that the length of this delay will have been a concern to the parties and might well have added to their uncertainty about being able to make financial commitments. I apologise for this delay which has come about because of the responsibility for hearing so many cases in this very busy court.

Leave to Re-Open

Approximately four months after the conclusion of the trial the husband sent an email to my Associate asking whether she might be able to indicate when judgment might be likely to be delivered. My Associate informed the husband that she was not in a position to be able to inform the parties about when judgment would be handed down. The husband sent an email a couple of days later, on 17 March 2014, which was as follows, omitting formal parts:
The majority of the property valuation is the joint ownership home in [Suburb B]. The valuation considered was prepared in April 2012 and dated the 1st of May 2012. Given that this valuation is almost 2 years old and that Sydney real estate prices have grown by over 35% in that time period, may I suggest that an updated valuation be prepared at my sole cost for the judge?
The wife’s solicitor indicated that they had received the correspondence about this matter from the husband and the solicitor indicated that the wife did not consent to any re-opening of the evidence at trial.
Although the husband did not file an Application in a Case seeking leave to re-open his case, I regarded his email communication as such an application. The parties were informed that I would hear such application at 10.00 am on 24 October 2014, which I did. The husband’s application was by submissions only, he not having adduced any evidence in proper form to support his application. The submissions were to the following effect.
The major asset of the parties, mainly the Suburb B former matrimonial home had been valued in April 2012. The husband asserted that the property now has a value 25 per cent higher than the valuation. Whereas the parties agreed on a value at the time of the hearing for the property being $1 825 000 the husband asserted that the property now has a value of $2 273 178. He said that this was based on an estimate prepared by an entity which he referred to as RP Data.
Ms Slattery, the wife’s solicitor, in opposing the leave sought by the husband made submissions to the following effect.
The valuation of the property which was before the Court at the time of trial was an agreed valuation. It was based on a report by a registered valuer, Mr L. The husband indicated at the time of trial he agreed to this valuation and at no time during the hearing did he indicate that he was unhappy with Mr L’s valuation. Indeed, the husband’s own financial statement estimated the value of his 50 per cent interest in the property at $912 500 which is half of Mr L’s valuation.
The husband has not placed any evidence in proper form before the Court to support his contention that the value of the property has increased. So far as his reference to RP Data is concerned, the person who prepared such estimate did not engage in any inspection of the property and in any event the evidence is not in proper form.
If the husband wanted to update Mr L’s valuation he had ample opportunity to do that at the time of trial.
Learned solicitor for the wife referred to the decision of this Court in Elgin & Elgin(Re-opening) [2012] FamCA 898 in which Forrest J set out the relevant principles for an application of this nature (see page 5). His Honour referred to various matters relevant to the exercise of the Court’s discretion in this regard including the following:
(a)whether the further evidence is so material that the interests of justice require its admission;
(b)whether the further evidence, if accepted, would most probably affect the result of the case;
(c)whether the further evidence could not by reasonable diligence have been discovered earlier; and
(d)whether no prejudice will ensure to the other party by reason of the late admission of the further evidence.
Learned solicitor said in respect of these matters that, as indicated above, there is no further evidence in proper form adduced by the husband. Learned solicitor also submitted that if leave to re-open was granted to the husband in fact that would cause a prejudice to the wife. This is because, firstly, the parties separated some seven and a half years ago and the wife is most anxious for the litigation to be concluded. Secondly, her legal costs are in excess of $288 000 and would only increase if the leave sought by the husband was granted. Learned solicitor noted that amongst the relevant considerations referred to by his Honour was the public interest in the timely conclusion of the litigation. Learned solicitor said it is now four years since these proceedings commenced. It was submitted that it would be unfair to limit on re-opening, evidence of valuation of only one of the assets of the parties and that the only fair thing to do would be permit new evidence of the various assets. So learned solicitor asked rhetorically where would it stop.
Finally, it is well-established that in family law property proceedings the Court takes the property as it finds it and that this is where the evidence in these proceedings should remain.
The granting of leave to re-open a case is discretionary.[1] The High Court in Smith v NSW Bar Association (1992) 176 CLR 256 held that in cases where reasons for judgment have not been delivered, the primary consideration should be embarrassment or prejudice to the other side (at 26-267).
[1] Gelley & Gelley (1992) FLC 92-290; Summitt & Summitt & Ors(Re-opening) [2009] FamCA 365; Aheb & Aheb(No 3) [2009] FamCA 524; Emmett & Emmett [2010] FamCA 56; Elgin & Elgin(Re-opening) [2012] FamCA 898
Habersberger J said in Reid v Brett (2005) VSC 18 (8 February 2005) as follows at paragraph 41:
The criteria governing the exercise of the discretionary power to re-open a case to admit further evidence where the hearing has concluded but judgment has not been delivered have been said to be as follows:
(a)the further evidence is so material that the interests of justice require its admission;
(b)the further evidence, if accepted, would most probably affect the result of the case;
(c)the further evidence could not by reasonable diligence have been discovered earlier; and
(d)no prejudice would ensue to the other party by reason of the late admission of the further evidence.
In the present case, as indicated above, the husband has not offered any evidence in admissible form. But even if the husband was able to offer evidence of valuation of the former matrimonial home significantly different from the agreed value of that property at trial, would this probably affect the result of the case and be so material that the interests of justice would require its admission? In my view, it would not. This is because I have the view that it will be necessary for the parties to sell the former matrimonial home and to pay the proceeds to one another in the proportions as set out in these Reasons.
So far as prejudice to the wife is concerned, in the event that leave was granted to the husband to adduce new evidence of value, in my view a substantial prejudice would flow to the wife. She would face a situation where the Court had permitted new evidence in respect of only one of the relevant items of property and superannuation in the absence of new evidence about all the other relevant items of property, superannuation and liabilities. In my view this would be most unfair and there would be a strong case for the Court to require new evidence of valuation of all the relevant items of property, superannuation and the liabilities. As was submitted on behalf of the wife, this would involve a re-hearing at least to some extent which would involve considerable cost to the wife. The prejudice to her would be exacerbated by the fact that she would have her legal costs increased whereas in all likelihood the husband would remain self-represented and not sustain any additional legal cost. Another element of prejudice would be that against the background of long delay in these proceedings there would be further delay.

For these reasons, in my view, it is not appropriate for this Court to exercise its discretion in favour of granting leave to the husband to re-open his case and present new evidence of value of the former matrimonial home. I made an order dismissing the husband’s application for leave to re-open his case on 24 October 2014.

Background

The husband, 57 years and the wife, 53 years met in 1990. They commenced cohabiting in September 1990. They married in 1993 and they separated on 29 July 2007. They were divorced on 8 October 2010. There are two children of the marriage, J born in 1994 who is 20 years of age and G born in 1995 who is 18 years of age.
The husband, who was born in the United States of America (“US”), was married previously and he has two adult children N born in 1985 and E born in 1989. Both reside in the US.
At the commencement of cohabitation the wife owned a yacht and savings of approximately $150 000. The husband owned a block of land in the US, a one-half interest in his parents’ home in the US, land in

Country X, savings of approximately $100 000, some furniture and personal effects. The wife was employed as an executive level manager with U Company in Sydney and the husband was the Director of Operations for P Company.
The husband resigned from P Company and commenced as Director of Operations for H Company based in Sydney.
In 1991 the wife sold her yacht and received approximately $110 000 from the proceeds of sale. These funds were used to fund the parties’ wedding, to assist in the purchase of the parties’ first home and living expenses.
In 1991 the husband purchased a yacht for approximately $180 000.
In 1991 the husband’s parents were experiencing difficulty retaining their home in the US. The wife asserted that they transferred a one-quarter interest in their home to each of the husband and the wife. The husband denied this. He said he had a one-half legal interest in this property at the commencement of the parties’ cohabitation. I accept this. But I also accept the wife’s assertion that from approximately 1991 the parties commenced to pay half the mortgage payments over that property.
In 1992 the wife was appointed as an executive level manager at CS Corporation. The husband’s contract was terminated and he established a business, RR Pty Limited. The husband sold the business to T Corporation and it was subsequently called Z Pty Limited. The husband remained as President for the Asia-Pacific region.
In November 1992 the parties purchased the property at Suburb Y for $367 000. They contributed approximately $228 000 towards the purchase of the property including stamp duty and legal costs. The wife used proceeds from the sale of her yacht and savings. The husband sold his yacht and used the proceeds towards the purchase. The balance of the purchase was funded by way of a loan from a credit union on mortgage.
Between 1992 and 1994 the parties undertook renovations to the Y property which cost approximately $500 000. This sum was funded from the parties’ joint savings and borrowings.
As indicated above, in early 1993 the parties married.
In February 1993 the husband established the company RT Pty Limited.
As indicated above, in 1994 the parties’ first child J was born. The wife took maternity leave during the period following J’s birth.
In late 1994 the wife was made redundant from CS Corporation and received a payout of $30 000.
As also indicated above, in 1995 the parties’ younger child G was born. The wife remained at home to care for the children.
In 1996 the wife returned to CS Corporation on a part time basis and undertook some contract work in the financial planning sector.
Between 1995 and 1997 the husband developed various business interests. He sold land in the US and shares owned by him to fund his businesses.
In January 1997 the husband resigned from T Corporation. He established a company, M Pty Limited.
In March 1997 the parties sold the Y property for $851 000 and used the proceeds of sale to purchase the property at Suburb F for $660 000. Approximately $230 000 remained from the sale of the Y property and this amount was used to reduce the parties’ debt and to invest in the husband’s businesses.
In November 1997 the husband was appointed as managing director of SS Company in Melbourne.
In 1998 the family moved to Melbourne and resided in rented accommodation. The wife obtained part time employment in TA Group in Melbourne.
In March 1999 the parties purchased 27 acres of land on the Mornington Peninsula for $330 000. This was funded entirely by a loan from the NAB. The parties commenced designing a house for the property but building never eventuated.
In October 1999 the husband resigned from SS Company.
In approximately June 1999 the parties sold the F property for $863 000 and purchased a townhouse at Suburb PP in Melbourne for approximately $650 000. They borrowed $589 000 from the NAB. They lived in Suburb PP until 2002.
In August 1999 the parties transferred the Mornington Peninsula property to the sole name of the wife to reduce their capital gains tax exposure.
In August 2000 the husband commenced employment with a company called FF Business as Chief Operating Officer and then Chief Executive Officer. This company provided specialist IT services. The husband purchased shares in FF Business, borrowing $394 500 from the NAB secured against the PP property to fund this purchase.
On 30 March 2000 the parties sold the Mornington Peninsula property for $475 000. The entire net proceeds of sale were put towards the reduction of the NAB debt.
In 2000 the wife resigned from TA Group to work on the bookwork and accounts in the husband’s business.
In July 2000 the parties purchased an apartment in Queensland in the husband’s name for $220 500. The purchase was funded by an NAB loan.
In June 2001 the parties moved to New York for the husband’s employment with the intention of living there. But they only stayed for four weeks then returned to Melbourne.
In October 2001 the wife commenced full time employment as an executive level manager at U Company.
In January 2002 the parties moved back to Sydney. The husband decided to move the head office of FF Business there. They resided in rental accommodation and leased their Melbourne property.
In 2002 the wife commenced studying for a Diploma in Financial Planning. In October 2002 she began working as a financial planner in her own business.
In September 2003 the parties purchased the property at Suburb B for $1.5 million. The majority of the funds were borrowed from the NAB, their mortgage being a total of $1.479 million, secured against the B and Queensland properties.
In September 2003 the parties sold the PP property for $850 000. The entire net proceeds of sale were used to discharge the mortgage over this property.
In 2004 FF Business was sold to a global corporation. The husband sold his shares in FF for $880 000. The sum of $670 000 from the proceeds of sale of the shares was used to reduce the loan over the Suburb B home.
In July 2004 the parties purchased a business in Town R in the husband’s name for $520 000. The entire purchase amount was borrowed from the NAB.
In 2005 the husband commenced working as Chief Executive Officer with ABC, a software development company.
On 16 November 2005 the parties sold the Queensland property for $325 000. The net proceeds of sale were used to reduce the NAB debt and pay credit cards. $15 000 was deposited into the parties’ joint NAB account.
In 2006 the wife sold her financial planning business for $35 500 and thereafter worked on the R business until separation.
In February 2006 ABC was sold and the husband left the company. The husband received a total payout of $1 283 051.65, which was deposited into an ANZ account in his sole name. The disbursement of these funds is an area of considerable dispute between the parties and I shall refer to it again below.
In May 2006 the husband established BB Company, a digital marketing agency. He was its Chief Executive Officer.
In July 2006 the husband established the company O Pty Limited. He is its sole director and shareholder.
In August 2006 the husband established the Woolwich Family Trust. He is the appointor, the principal and a discretionary beneficiary of the Trust. O Pty Limited is the trustee. The wife was unaware of the establishment of the Trust at the time.
In September 2006 the husband’s father died in the US.
On 9 October 2006 the sum of $34 043.61 was transferred from the Bank of America in the US into a bank account in the husband’s sole name. The wife has no knowledge about how the husband has dealt with those funds.
In October 2006 the parties established the company D Pty Limited. They were each directors, the sole shareholder being O Pty Limited.
In December 2006 BB Limited became listed on the Australian Stock Exchange. 7 480 000 ordinary shares were issued in the name of O Pty Limited.
On 27 June 2007 the wife received a letter from the husband’s solicitor advising her that the marriage was over. The letter was accompanied by a balance sheet setting out the husband’s understanding of the parties’ assets and liabilities. This indicated that the parties’ net worth was $20 718 247 at the time. I note that the balance sheet attributed a value of $17 800 000 to the BB Limited shares based on a value per share of $2.39. I note also that following the global financial crisis there was a massive depreciation of the shares. I shall refer to this again below.
As indicated above, on 29 July 2007 the parties separated.
In August 2007 the husband purchased an apartment at a complex in Suburb YY for $1 400 000. The husband did not consult the wife about this purchase. He subsequently carried out renovations to the apartment and moved in. All the funds required for the purchase were borrowed from the Australia New Zealand Bank (“ANZ”).
On 21 November 2007 the wife received approximately US$43 000 from the husband’s father’s estate. The wife used these funds to pay living expenses and legal costs.
In November 2007 the husband received approximately US$78 000 from his father's estate, together with 218 shares in W Services Inc, a family company established by his father. The major asset of this company was a property in Arizona occupied by the husband’s brother.
On 30 January 2008 the husband resigned from BB Limited and received a termination payment of $137 614 gross ($109 322.92 net). At the time the husband, through O Pty Limited, owned 7 480 000 shares in BB.
Between February 2008 and February 2009 the husband was unemployed. I accept that he had difficulty obtaining employment during the period following the global financial crisis. During this period he established, or invested his time in, various companies.
In 2008 the husband travelled overseas five times.
In February 2008, 1 756 504 BB shares owned by O Pty Limited were sold by the ANZ Bank. This sale produced $748 356.06 which was used to pay out the husband’s ANZ margin loan facility. Between April 2008 and July 2009 the husband, through O Pty Limited, sold more of his BB shares and received total sale proceeds of $341 481. I shall refer to these matters again below.
In September 2008, A Pty Limited was incorporated and the husband was appointed as Chair of the Board.
In November 2008 the wife applied to the Child Support Agency for an assessment of child support. On 4 December 2008 the husband was assessed to pay $550.92 per week child support increasing to $603.43 per week from 5 December 2008.
In January 2009 the parties borrowed $100 000 as a line of credit to fund their living costs.
On 4 April 2009 the husband was appointed as a Director of A Pty Limited.
In April 2009 the husband sold the YY property for $1 450 000. Of the net proceeds of sale of $447 769.72, $100 438 was used to pay out the line of credit. I shall refer to this and how the balance was disbursed below.
In late April 2009 the husband commenced to reside at the R property and the wife began receiving the Centrelink Newstart Allowance.
In June 2009 the wife received approval from the Department of Education to commence work as a teacher, having trained for such a position 28 years previously. But she only obtained three days’ work thereafter as a teacher.
In July 2009 BB Company was privatised.
On 30 September 2009 the Child Support Agency began to collect child support.
In November 2009 A Pty Limited was incorporated.
In December 2009 the husband was appointed as a Director of A Pty Limited.
In December 2009 the husband was employed as Chief Executive Officer of NN Corporation in New Zealand on an annual salary of NZ$300 000. He moved to New Zealand in January 2010.
On 1 February 2010 the wife obtained a temporary marketing contract.
On 19 February 2010 the wife established the company KK Pty Limited. The wife was its sole director and secretary. The wife contracted her marketing services through this company.
On 15 March 2010 the wife commenced proceedings in this Court seeking interim and final orders.
In March 2010 the wife’s mother died.
By May 2010 the NAB offset account was depleted. The wife began to pay all mortgage repayments to the NAB with no contribution from the husband. The wife paid all council and water rates and maintenance payments on the home. The child support was in arrears. The husband ceased making any contribution to the children’s private school fees.
On 10 May 2010 Interim Orders were made which permitted the wife to take items of furniture from the R property.
On 4 June 2010 the R property was sold for $550 000 and the entire net proceeds of sale were paid to the NAB. This reduced the parties’ indebtedness to NAB to $574 368.
On 7 June 2010 the wife received the first child support payment.
On 1 July 2010 interim orders were made which allowed the wife to withdraw the balance standing to the credit of an ANZ joint account ($1600) which was used by her towards living expenses.
On 20 July 2010 interim orders were made for the husband to pay to the wife the sum of $435 per week. These monies were to be used to pay interest on the NAB account no …25. The husband only made three payments. Further orders were made which required the husband to transfer his Audi motor vehicle to the wife. The wife subsequently sold the vehicle for $15 000 and utilised the proceeds of sale to pay school fees and the NAB debt.
The wife was also permitted by order of this Court to sell wine. She sold approximately 60 cases for $60 per case. The balance of the wine became unsaleable through deterioration.
On 31 August 2010 the wife obtained full-time employment as a Manager at XYZ Company. The wife ceased contracting her services through KK Pty Limited.
On 8 October 2010 the parties’ divorce became final.
In December 2010 J was awarded a bursary and a scholarship which allowed him to remain at C School.
On 18 November 2011 the husband resigned from NN Corporation following a disagreement with some directors. The husband received a termination payment of $125 455 net.
By 4 December 2011 the husband was in child support arrears in the amount of $31 832.
On 23 December 2011 the husband established Q Limited in New Zealand with himself as sole director and shareholder.
From late 2011 the husband provided consultancy to the company A Pty Limited. In March 2012 he became its Chief Executive Officer. The husband continues working in this position which is located in Melbourne.
In January 2012 the wife received $85 413.83 from her late mother’s estate. These funds were used to pay legal fees, living costs, a holiday and school fees.
In September 2012 there was $60 359.08 outstanding in fees at K School. The School advised that the child G could not return to school unless the fees were paid. With the wife’s agreement the husband redrew $60 350.08 against the home loan, with the wife as guarantor, and paid the outstanding school fees. I accept that the husband had agreed to pay the repayments on this loan but he only repaid a small part thereof. When the next account for G’s school fees arrived the wife paid 50 per cent thereof and the husband paid none.
In December 2012 J completed school at C School.
In January 2013 a Social Security Appeals Tribunal decision was made which required the husband to pay the wife 60 per cent of the school fees for K School, in addition to child support.
In February 2013 J commenced university.

Credit

The wife

The wife was forthright and responsive in her answers to questions in cross-examination.
It appeared to me that the wife had some confusion about holding a legal interest in the property owned by the husband’s parents in the US. But in most other respects I regard her evidence to be reliable.
The wife was a much more forthright and cooperative witness than I found the husband to be. Accordingly, generally where their evidence is in conflict I would prefer that of the wife over that of the husband.

The husband

The husband was not responsive to questions on all occasions. At times he was quite argumentative with counsel, somewhat pedantic, always in a manner which appeared to me was probably perceived by him to favour his case.
I regard the husband as not having been very forthcoming and considerably less cooperative than one would expect of the person who would have had a detailed knowledge of relevant financial matters. On occasions he would make a somewhat literal interpretation of the question rather than accepting the thrust of it. This will be seen below.
For these reasons and the reasons set out more fully below, I am not able to find the husband to have been a reliable witness.

The ABC Funds

There is an issue between the parties about whether the husband has disbursed the entirety of $1 283 051 net proceeds of sale of his shares in ABC Corporation. These funds were initially deposited into the husband’s ANZ Access Advantage Account No …52 in April 2006.
The wife is concerned about this matter because (while the parties were still living together) the bank statements for this account were sent to a private post office box which she was unable to access. The wife said that when she suggested to the husband that the money be used to pay the home loan and for renovations thereto he replied that he did not trust either her or the Bank and did not propose to pay off the home loan.
The wife said that she does not know what the husband has done with this money. She said that at the time of separation there was only $128 749.72 remaining in the husband’s ANZ Bank accounts.
The wife formally raised this matter with the husband in her Request for Answers to Specific Questions in March 2012. The husband was required by an order made in January 2012 to provide his answers within 21 days. The husband responded five months later in his affidavit sworn on 10 August 2012.
His explanation for taking five months to answer was that he needed to recover “5 years of history” to be able to answer this question.
The questions relating to the ABC money received by the husband contained in the wife’s Request for Answers to Specific Questions commenced with the following question:
Do you acknowledge that you received $1,122,000 from your sale of shares in [ABC] in or about March 2006?
The husband’s answer in his affidavit sworn 10 August 2012 was as follows:
No I do not acknowledge that I received $1,122,000 from my sale of shares.
The husband was taken to this answer during his cross-examination. He said that the money he received was for (share) options, that the question asked him to acknowledge that he received the money from the sale of shares (rather than share options) and that he did not receive the money from the sale of shares. He said he was not trying to be clever.
I must say I have a different view. It would have been a simple matter for the husband to have given the answer he gave during cross-examination namely, that he received the money in return for options. After all, he has a duty to make a full and frank disclosure. In my view he was obfuscating.

During cross-examination the husband agreed that total deposits to the parties’ joint account and to the R business account during the period between receipt of the share sale proceeds in 2006 and separation in June 2007 did not exceed $600 000. Learned counsel for the wife suggested that this would have left approximately $700 000 within the husband’s control ($1 283 051 - $600 000 = $683 051) which has not been explained.
The husband disagreed. The husband said during cross-examination that he used approximately $300 000 to pay tax, part was used to pay for a family holiday and the balance was used to pay living expenses.
I must say that even giving the husband the benefit of the doubt and accepting that he did pay approximately $300 000 towards tax, in my view he has not given a complete explanation about the disposition of these funds.
I find this troubling, bearing in mind the husband’s somewhat less than cooperative approach.

BB Share Sale

There is an issue about how the husband has disbursed the net proceeds of sale of his BB shares.
In the wife’s Request for Answers to Specific Questions dated 1 March 2012 the wife asked various questions about money received by the husband from BB Company including from the sale of BB shares. In his affidavit sworn on 10 August 2012 the husband acknowledged that he had received an eligible termination payment from BB Company of $137 614 and that he had received $500 000 from the sale of BB shares. Yet during his cross-examination he agreed that he had made a mistake and that the truthful answer would have been more like $800 000 to $900 000.
The income tax return for the Woolwich Family Trust records that the sale of BB shares produced only $341 000 for the financial year ending 30 June 2008. This does not accord with the husband’s acceptance that in fact the sale produced more like $800 000 to $900 000. The husband said that the Trust would have to lodge an amended income tax return.
A large part of the shares was sold in February 2008 by the ANZ Bank exercising its power to do so having taken security over the shares at the time of advancing funds for the purchase of the husband’s Suburb YY apartment. The sale of these shares by the ANZ Bank realised $748 356 which was used to pay out the husband’s margin loan, as I have said above.
During his cross-examination the husband said that the Trust received more than $1M from the sale of BB shares.
As learned senior counsel for the wife submitted, it is the husband who is the person in the best position to be able to inform the wife and the Court what the true position is about the net proceeds of sale of these shares. Yet he has failed to be precise about this and to support his assertions by appropriate documents. So the Court does not know what the true position is about this which I find a further troubling aspect of the proceedings.
By the end of the 2009 financial year all shares in BB Company had been sold.

Post-Separation Financial Matters

As indicated above, the parties separated on 29 July 2007. The following month the husband purchased the YY apartment using the ANZ margin loan to fund the $1.4M purchase. He undertook renovations to the apartment which cost approximately $113 000.
The husband had also received an income tax refund for the financial year ending 30 June 2007 of approximately $90 640.
As also indicated above, in November 2008 the wife received the approximately US$43 000 inheritance from the estate of the husband’s late father and the husband received approximately US$78 000 therefrom.
In January 2008 the husband received $109 322 net by way of a termination payment from BB Company.
By January 2008 the joint account became overdrawn. The wife then deposited $10 000 from her inheritance to the account.
In February 2008 the ANZ Bank sold BB shares over which they held security for approximately $748 000 and applied this to reduce the margin loan over the husband’s YY apartment
Also in February 2008 the husband became unemployed and he remained unemployed for approximately 22 months.
Learned senior counsel for the wife suggested to the husband that in 2008 he paid $175 500 to the joint account for the benefit of the wife. The husband disagreed. Yet in re-examination the husband said that in 2008 he paid $173 500 to the joint account. In addition, the husband said he paid $47 644 for private school fees that calendar year, $12 627 for the wife’s car expenses, $1069 for children’s expenses and $1282 miscellaneous expenses. This is an additional $62 622.
Learned senior counsel for the wife submitted that out of the $175 500 paid to the joint account that calendar year the wife used $105 375 to pay all mortgages, the husband’s life insurance premiums and the family Medibank Private health insurance. I accept this. It was submitted that this meant that only $70 000 out of $558 000 which was available to the husband that year went to the benefit of the wife and the children. I do not accept this and prefer the husband’s assertions about the other expenditure on the wife and children during 2008 referred to above.
In November 2008 the wife applied for a child support assessment and an assessment was made as indicated above. But the husband did not pay. By February 2009 the husband ceased depositing money to the joint account.
In early 2009 the husband informed the wife that they had no money and she agreed that they should borrow $100 000 more on the mortgage. They did this as a line of credit to provide each of them with funds pending the sale of the YY apartment.
The wife was unemployed and applied for Centrelink benefits. As indicated above the husband’s YY apartment was sold in April 2009. From the net proceeds of sale of $447 769 the line of credit was paid out leaving a balance of $347 331. The parties agreed that they would each receive $26 000 and the balance of $287 498 was deposited to a joint bank account (the “NAB offset account”). They also arranged for these funds to be paid $7000 per month to the wife’s account and $5000 per month to the husband’s account. In addition, the mortgage repayments and all insurance premiums (health insurance, life insurance and the husband’s income protection insurance) would be paid by direct debit from the offset account. But no provision was made for payment of the children’s private school fees.
By May 2010 all funds in the offset account were depleted.
As indicated above, the husband had moved to New Zealand in January 2010 and commenced working as chief executive officer for NN Corporation. He was in receipt of an annual salary of NZ$300 000.
I have referred above to the remaining history of this post separation period.

The Applicable Law

Sub-section 79(1) of the Family Law Act 1975 (Cth) (“the Act”) provides to the effect that in property settlement proceedings the Court may make such order as it considers appropriate altering the interests of the parties to the marriage in the property.
Sub-section 79(2) 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.
Sub-section 79(4) sets out various matters which must be taken into account in considering what order (if any) should be made under the section. These matters include direct and indirect contributions, financial and otherwise by or on behalf of a party or a child to the acquisition, conservation or improvement of any property of the parties, contributions by a party to the welfare of their family including as a homemaker or parent, relevant matters referred to in s 75(2) and the other matters referred to in s 79(4).
The operation of s 79 was the subject of consideration by the High Court in the case of Stanford v Stanford (2012) FLC 93-518.
In Stanford the majority said (at page 86,640) in referring to ss 79(2) and 79(4) as follows:
35.… the requirements of the two sub-sections are not to be conflated. In every case in which a property settlement order under s 79 is sought, it is necessary to satisfy the court that, in all the circumstances, it is just and equitable to make the order.
36.The expression “just and equitable” is a qualitative description of a conclusion reached after examination of a range of potentially competing considerations. … while the power given by s 79 is not “to be exercised in accordance with fixed rules”, nevertheless, three fundamental propositions must not be obscured.
The High Court said that the first of these propositions is for the court to identify, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property.
The second is that although s 79 confers a broad power on the court, it is not a power that is to be exercised according to an unguided judicial discretion. It must be exercised in accordance with legal principles, including the principles which the Act itself lays down.
The High Court said that the third fundamental proposition is that the question of whether the order is “just and equitable” is not to be answered by beginning from the assumption that one or other party has the right to have the property of the parties divided between them or has the right to an interest in marital property which is fixed by reference to the various matters set out in s 79(4). To conclude that making an order is “just and equitable” only because of and by reference to various matters in s 79(4), without a separate consideration of s 79(2) would be to “conflate” the statutory requirements and ignore the principles laid down by the Act.
And the High Court majority went on to say (at page 86,642) as follows:
41.… The fundamental propositions that have been identified require that a court have a principled reason for interfering with the existing legal and equitable interests of the parties to the marriage and whatever may have been their stated or unstated assumptions and agreements about property interests during the continuance of the marriage.

Sub-Section 79(2)

The High Court majority also said the following (at page 86,642):
42.In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order.
In my view, this is the situation in the present case. It is clear that the former matrimonial home at Suburb B was purchased as a home for the parties and obviously for their common use. Clearly they are no longer living in their marital relationship and are now unable to enjoy the common use of this property and various other items of joint property.
In these circumstances, in my view, it is just and equitable that their interests in property be altered by appropriate order.

The Parties’ Existing Legal and Equitable Interests in Property

The parties agreed that they have interests in property and superannuation as follows:

Assets

  $

1.         Joint property at Suburb B

1,825,000

2.         Joint NAB Account …70

25

3.         Husband’s NAB account …25

518

4.         Husband’s ANZ account …22

216

5.         Husband’s ANZ account …52

320

6.         Husband’s BNZ account …00

154

7.         Husband’s BNZ Q Limited

117

8.         Husband’s Citibank account

397

9.         Husbands’ Citibank Insured Money Market

219

10.      Husband’s E-Trade account

482

11.      Husband’s 400 Telstra shares @ $5.16 per share

2,064

12.      Husband’s Land Rover

0

13.      Husband’s motorcycle

0

14.      Wife’s NAB account …02

41

15.      Wife’s NAB Account …79

110

16.      Wife’s NAB Account …38

142

17.      Wife’s ANZ Account …21

1,415

18.      Wife’s ANZ Account …48

17

19.      Wife’s AMP Account

2,196

20.      Wife’s 400 Telstra shares

2,064

21.      Wife’s Volkswagen

0

22.      Wife’s Honda

0

23.      Wife’s funds held in Abrams Turner Whelan Trust account

41,000

^{_____________}

$1,876,497

The following interests were in dispute.

Land in the Country X

There was no issue that the husband owns land in the Country X. But there was no evidence in proper form about this. The husband conceded that this has a value of $5000 and I accept this as an admission against interest.

House and land in Arizona

There was no issue that the husband owns an interest in a property in Arizona, US. This property is owned by the W Services Inc. The husband owns 218 of the 500 issued shares which is a 43.6 per cent interest. The property is occupied by the husband’s brother.
The husband asserted that this property has an agreed value of $20 000. He said that he was going to tender a valuation during the trial but did not. On the other hand the wife obtained a valuation by Mr SM, a residential real estate appraiser certified by the State of Arizona. Mr SM prepared a report on this property and expressed the opinion that the property has a value of $135 000. The husband did not seek to cross-examine Mr SM. As indicated above, the husband’s interest in the property is 43.6 per cent. This share of the property in money terms would be $58 860. I accept this valuation as the best evidence available to the Court in respect of this interest.

Woolwich Family Trust

As indicated above, in August 2006 the husband established a discretionary trust called the Woolwich Family Trust. He is the appointor. The trustee is the company O Pty Limited of which the husband is the sole shareholder and director.
Ms JJ was appointed as single expert and she prepared a valuation of the Trust dated 31 July 2013. This included the Trust’s interests in the companies A Pty Limited, A Unit Trust, I Pty Limited and D Pty Limited.
Ms JJ opined that A Pty Limited would have only a nominal value for various reasons stated in her report including the fact that it was dependent on month to month financing from existing investors and the fact that it required further funding to continue operations.
Ms JJ reported that D Pty Limited was created to distribute products, is dormant and has no assets. She attributed a nil value to this company.
Ms JJ also reported that I Pty Limited owns a website which hosts web content. Its modest revenue of approximately $25 000 per annum does not cover costs. Ms JJ valued the Trust’s interest in this company as nil.
In my view, on this basis the Trust’s interests in D Pty Limited and I Pty Limited are nil and its interests in the A entities (now called ACN … Pty Limited) have a nominal value.

Conclusion about value of the assets

The agreed assets have a total value of $1 876 497.
Those in dispute referred to above have a total value, in my view, of $63 860.
Accordingly, in my view, the assets, leaving aside superannuation, have a total value of $1 940 357 ($1 876 497 + $63 860 = $1 940 357).

Liabilities

The following liabilities were agreed:

$

1.         Joint NAB home loan

219,948

2.         Husband’s NAB residual debt

314,011

3.         Husband’s school fee personal loan for G (NAB)

78,549

^___________

$612,508

The husband asserted that he has credit card liabilities to a total of $143 646. I accept this.
The wife has credit card liabilities to a total of $107 042. She also has an outstanding personal loan of $45 949 which she used to pay legal fees.
This is a total of $152 991.
There is not a significant difference between the personal liabilities of the husband on the one hand and those of the wife on the other hand. It was submitted on behalf of the wife that at the time the parties separated the husband did not have any credit card debts and therefore the liabilities should not be set-off against the parties’ assets. It was further submitted that since separation the wife struggled to make ends meet and therefore the Court might allow the liabilities of the wife to be set off against assets but disallow the husband’s liabilities to be similarly treated. I am not persuaded by this submission and propose to take all these personal liabilities into account as against the property and superannuation.
In relation to the parties’ joint liability for outstanding school fees, the sum of $12 366 is owing to K School and $11 539 to C School. The parties have a joint liability for these debts.
In relation to the K School fees arrears, the husband’s assessment of child support includes a component which accounts for a 60 per cent share of the fees. The husband’s evidence was that he has been paying this to the wife but she has not paid the K School fees, the inference being that she has retained that part of the child support paid by the husband which should have been paid by her to K School. I accept this evidence.
I propose therefore to make an order that the outstanding Ka School fees shall be paid by the wife from her share of the property.
The outstanding C School fees shall be paid from the net proceeds of sale of the home.
In relation to the $78 549 owing to the NAB arising from the husband’s loan to pay the earlier outstanding K School fees ($60 359), this will be the husband’s sole responsibility. At the time of the loan he indicated to the wife, to the Bank and to the School that this would be his responsibility. Given the parties’ respective financial circumstances at the relevant time, as referred to above, and currently in my view it is appropriate for this responsibility to be directed to the husband. I shall remove this from the liabilities to be set-off against assets and superannuation.
The alleged liability which remains for consideration is home maintenance and swimming pool fencing costs which the wife said are $14 408. While I accept that this work will be required, I regard the costs to be future costs and do not propose to include this item in the liabilities which will be set off against assets for the purposes of these proceedings.
Total liabilities are therefore:

$

1.         Joint NAB home loan

219,948

2.         Husband’s NAB residual debt

314,011

3.         Husband’s credit cards

143,646

4.         Wife’s credit cards and personal loan

152,991

5.         C School fees

11,539

^{_____________}

$842,135

As indicated above the K School fees ($12 366) will be paid from the wife’s property and the husband’s NAB personal loan for G’s school fees ($78 549) will be paid from the husband’s property.

Net Assets

On this basis the net (non-superannuation) assets have a value of $1 098 222 ($1 940 357 - $842 135 = $1 098 222).

Superannuation

The parties agreed that their superannuation is as follows:

$

1.         Husband’s Asgard

109,648

2.         Husband’s BT Lifetime

14,838

3.         Husband’s MLC

30,458

4.         Husband’s AON

24,150

5.         Husband’s Kiwisaver

29,925

6.         Husband’s US Social Security / 401K

64,369

7.         Wife’s AMP

173,222

^{_____________}

$446,610

Accordingly, the net assets and superannuation have a total value of $1 544 832 ($1 098 222 + $446 610 = $1 544 832).

Contributions Before Separation

As indicated above, each of the parties owned property at the commencement of their cohabitation. One cannot be precise about the value of such because there was no evidence in admissible form about this at the time. But taking a broad view, the wife’s evidence is that she had savings of approximately $150 000 and a yacht which she sold subsequently and received approximately $110 000. This is a total of $260 000.
On the other hand, the husband’s evidence is that he had approximately $100 000 in savings, his interests in real estate, some furniture and personal effects.
The husband asserted that $75 000 of his savings was in a bank account in the Channel Islands. There was an issue about this. Learned senior counsel for the wife submitted that it was unlikely that the husband had such funds because he had made no mention of any such money in the US marital settlement and separation agreement dated 23 May 1990 which settled financial matters between him and his former wife.
The husband did not put material before the Court to support his assertions about the existence of this account. Given the poor view generally I have about the husband’s evidence I do not accept his assertions about the existence of a Channel Islands account.
The husband had the land in the Country X which as indicated above I accept now has a value of $5000. The US land was sold in approximately 1995 or 1996. As indicated above in 2007 the parties inherited between them approximately $121 000 from the estate of the husband’s late father. I am satisfied that the husband had this interest in his parents’ property at the time of commencement of cohabitation.
Accordingly, it is clear that each of the parties owned property at the time cohabitation commenced. Doing the best I can in difficult circumstances I find that the wife owned property at that time with a value somewhat greater than that of the husband. But I am far from clear about the quantum of the difference.
It was submitted by the husband that his interest in the land in the Country X and in the US company W Services Inc which owns the Arizona land and improvements occupied by his brother should be quarantined and not brought into account.
But it is clear from the High Court’s decision in the case of Stanford (above) that the Court is to identify and value the legal and equitable interests of the parties in all their property.
The husband submitted that the wife has not demonstrated any contribution to these assets. What the Court is required to do is to consider and assess the entirety of the parties’ contributions over the period of their cohabitation as well as their post separation contributions. Relevant contributions include not only direct contributions but also indirect contributions including to the welfare of their family unit and as homemaker and parents. Accordingly, in my view, it is not available as a matter of law for these assets of the husband to be, in effect, quarantined from the requirement to assess contributions as directed by the legislation. In my view, therefore, the Court is required to identify these assets as assets in which the husband has a legal interest and to bring them into the pool of available property in respect of which the Court is to assess contributions.
Having said this, I propose to assess the parties’ contributions to the property and superannuation on a global basis.
As indicated above, the parties’ first home at Suburb Y was funded in part from the net proceeds of sale of their respective yachts and a credit union loan. The parties renovated the property.
They subsequently purchased homes at Suburb F, Melbourne and Suburb B as well as investment properties at the Mornington Peninsula, Queensland and Town R. In addition the husband purchased the YY apartment after separation.
I have also referred above to the various businesses and companies and to the family trust, established by the husband or with which he has been involved in a significant way.
The parties cohabited for almost 17 years and have raised their two children to adulthood.
I have referred to their respective employment histories. There can be no question that the overwhelming financial contributions have been made by the husband. The parties arranged their affairs to prioritise the husband’s opportunities for advancement in his career. This has involved numerous changes of residence for the parties and the children. To her credit, the wife has undertaken employment opportunities where she has been able to, given the priority of the husband’s employment and the demands of raising the children which clearly was the wife’s priority.
Each of the parties received inheritances as referred to above. I am satisfied that the wife’s inheritances were applied in the manner referred to above. How the husband has used his inheritances is less clear to me. But I accept that at least a part has been spent on living costs.
Both parties have undertaken significant administrative work involved in arranging finance to purchase various properties and instructing real estate agents not only in relation to the purchase of various properties and establishing businesses but also in relation to renting various properties.
From approximately 2005 until after the parties’ separation the wife managed the R business.
I am satisfied that the wife has made a greater contribution to the welfare of the family and as homemaker and parent than has the husband. As I have said, the parties arranged their family responsibilities to enable the husband to devote his time primarily to his income-producing work. To his credit the husband conceded that the wife undertook more of the day to day parenting. But he too was involved in the care of the children. The husband set out in detail in his affidavit his involvement in the care of the children and I accept this.
Taking into account all the relevant evidence about the parties’ contributions, I have a picture of a husband and a wife who each brought property to the marriage, and who each applied themselves with commitment and energy to their various responsibilities as income earners and as parents over the period of their cohabitation and marriage, at least to the time of their separation. Accordingly, I regard their contributions to have been equal from the commencement of their cohabitation until separation.

Contributions Since Separation

At separation (29 July 2007) the wife remained living in the former matrimonial home with the children. She was endeavouring to manage the R business and its rental cottage. The husband ceased depositing money to the R business account and there was insufficient money to pay contractors who therefore ceased working at the business.
Within a short time of separation the husband purchased his YY apartment for $1.4M. He subsequently undertook renovations which cost approximately $113 145.
In November 2007 the wife received approximately $US43 000 from the husband’s father’s estate and used this to pay living expenses and legal costs. At this time the husband received approximately $US78 000 from his father’s estate.
On 30 January 2008 the husband resigned from BB Company and received $109 322 net as his termination payment. He had earlier received an income tax refund for the 2007 financial year of $90 640.
The husband also received money from the sale of BB shares as referred to elsewhere in these Reasons.
Despite receipt of such funds, the husband did not deposit sufficient funds into the NAB joint offset account to cover automatic withdrawal of mortgage payments and the mortgage fell into arrears.
On 21 January 2008 the wife deposited $10 000 from her inheritance to the account to enable mortgage payments to be withdrawn by the NAB.
During 2008 the wife tried to obtain employment in the financial services industry but she was unsuccessful.
During 2008 and 2009 the husband was working as a consultant to various companies including A Pty Limited but not receiving an income.
In November 2008, as indicated above, the husband was assessed to pay child support but he did not pay.
In January 2009 the husband informed the wife that they did not have any money. He stopped depositing any money into the joint offset account. The wife agreed to the parties drawing down $100 000 on the mortgage to fund the parties’ living costs.
Then the husband sold the YY property. The approximately $100 000 draw down was repaid and the balance was dealt with by each of the parties to pay living costs as referred to elsewhere in these Reasons.
In April 2009 the husband moved to the R property to live and the wife applied for Centrelink benefits.
In September 2009 the wife sought to have the Child Support Agency take enforcement action. By this time there were substantial child support arrears but these remained unpaid.
In December 2009 or January 2010 the husband commenced working as Chief Executive Officer of NN Corporation in New Zealand. As indicated above his salary was NZ$300 000. He continued to receive $5000 per month from the joint offset account.
The wife commenced to earn modest income from her marketing work.
By May 2010 all funds in the joint offset account were depleted.
In June 2010 the wife received her first child support payment, the Child Support Agency having made arrangements for this to be deducted from the husband’s salary payments in New Zealand.
The R business was sold in June 2010 and all of the net proceeds were applied to reduce the outstanding mortgage balance to $574 368.
On 20 July 2010 this Court ordered the husband to pay $435 per week to the wife to be used to pay interest only on the mortgage. But the husband paid only three payments. Apart from these payments, the wife has paid from her own sources all repayments on the mortgage since the joint offset account was depleted in May 2010. The wife has also paid all costs of maintenance on the former matrimonial home since that time as well as health insurance costs for herself and the children. The wife has had to sell assets and incur significant credit card liabilities to fund the mortgage and other costs including those of the children.
Also from May 2010 the husband stopped paying the children’s private school fees. As indicated above J was able to complete his secondary education at C School by gaining a scholarship. But there remained outstanding fees to the School and the wife entered into a payment plan in relation to the arrears. The husband made one payment of $2000 towards these arrears.
In August 2010 the wife commenced her full-time employment with XYZ Company.
By September 2012 G’s fees at K School were outstanding in excess of $60 000. The wife had paid approximately $25 000 towards G’s school fees. The school fees arrears became the subject of contest between the parties in proceedings in the Child Support Agency. Eventually the parties agreed that the husband would draw down $60 359 on the mortgage and that the husband would be responsible for repayment of this particular loan. I am satisfied that the husband assumed responsibility for this loan and note that he informed the School that he would be “exclusively responsible” for repayment of this loan. The money was paid to the school. Unfortunately the husband has only repaid part of this loan and it is in arrears in the amount of $78 549.
There were also difficulties in payment of K School fees after this time. As indicated above, pursuant to a decision of the Social Security Appeals Tribunal the husband was to pay 60 per cent of such fees, this being included in the periodic child support payments he is obliged to pay. The wife is required to make the actual payments to the School.
The clear view which I have about the parties’ contributions since separation is that those by the wife have been much greater than those by the husband. The wife has had almost the entirety of the physical care of the children. But in addition, since the joint offset funds ran out in May 2010 the wife has had to bear more than what I would regard as her fair share of the financial burden of the children and preservation of the former matrimonial home.
Accordingly, this has to be considered in the overall finding about contributions. I find the parties’ contributions overall to have been 55 per cent by the wife and 45 per cent by the husband.

Sub-section 75(2) Matters

The wife is 53 years of age and in reasonable health. She receives a yearly salary, including bonus, of $134 970 which is $2596 per week. In addition, the wife receives superannuation and a car allowance of $546 per week. She also receives the Family Assistance payment of $10 per week and child support paid by the husband for G of $706 per week.
As indicated above, the wife is employed by XYZ Company as a manager. On current indications the wife could be expected to continue in her present position, or a similar position, for the foreseeable future.
On the other hand , the husband is 57 years of age and he is also in reasonable health. He says that his weekly income is $4020.40 being his salary received as Chief Executive Officer of A Pty Limited. But the husband has also received part of a bonus and he expects to receive additional bonuses. Unfortunately, I am not confident about what the quantum of the husband’s income is because of the poor view which I have about the reliability of his evidence.
The husband also has his interest in the company previously known as A through the Woolwich Family Trust. As I have said above, the single expert was unable to find this to have other than a nominal value. But clearly it has some value to the husband in the sense that it provides him with an income.
I have referred above to the property of the parties and to their superannuation.
I also take into account the fact that the husband has paid approximately $77 000 legal costs to his former solicitors. The wife has incurred a liability for legal costs in excess of $288 000 and there is a $41 000 credit in her solicitors’ trust account as indicated above.
As indicated above, the parties arranged their family responsibilities to prioritise the husband’s opportunity for earning income. The wife took maternity leave and otherwise remained out of paid employment to attend to the children’s needs as primary parent. She also resigned from her own employment on occasions to enable the husband to pursue his employment opportunities as a family priority.
In these and all other relevant circumstances I have the clear view that the husband has a considerably higher capacity to earn income than does the wife. This was clearly the case during the marriage and it continues to be so. But given their difference in age, the husband would appear to have fewer years remaining over which to earn income than the wife. Despite this, I still regard him to have a stronger income-earning capacity than the wife, particularly because I have no confidence that his income is limited to what he asserted during these proceedings.
The most significant s 75(2) matter is the fact that I have the clear view that the husband has failed to make a full and frank disclosure. The authorities are very clear about the fundamental importance of this in family law litigation.
The wife contends that husband said to her on 9 September 2007 “I'm going to get you. I’ll make sure that all of the assets are depleted if you challenge what I did with the money. I'll be okay because I can build it all up again”. The wife also asserts that on 14 September 2007 he said “the gloves are on now and I'm going to make sure all our money is depleted”. The husband denied these assertions but I prefer the wife’s account. It is consistent with the husband’s manner in the witness stand and the general manner in which he has conducted these proceedings.
It is clear that the husband failed to make any reference in his financial statement to five bank (or similar) accounts as well as to his Etrade account. The husband failed to disclose a part bonus of $9153 received by him in October 2013. He made no previous reference to what emerged during his cross-examination which was that he would be receiving over the next few months $40 000 bonus. He produced relevant minutes of Board meetings of A Pty Ltd setting out resolutions concerning payment of bonuses to other officers of the company. Yet he failed to produce any minute of a Board meeting at which his own bonus was discussed or resolved. The wife is highly suspicious about this and so am I.
Also, on the last day of the hearing it emerged that the husband had been issued share options in A ty Ltd.
In my view, the husband has fallen a long way short of his obligation to make a full and frank disclosure.
He has also failed to comply with Court orders for production of relevant documents. Orders were made on 31 January 2012 that within 14 days both parties would provide the other with specified documents which included bank and credit card statements for all accounts from July 2010 as well as tax returns.
A further order was made on 4 March 2012 which required production of similar material. This was followed by production by the husband of a considerable number of documents that by no means was a complete production.
It is the case that the husband provided some answers to the wife’s Request for Answers to Specific Questions albeit many months late. I do not regard the husband to have made a full response.
It is also true that on 3 October 2013, just a few weeks before the hearing, the husband provided the wife’s solicitor with a USB computer memory stick containing numerous bank statements and other documents not disclosed previously. Amongst this material was a list of items of property which had been at the R business and which had been sold. The husband had been ordered on 20 July 2010 to provide such a list to the wife within seven days. He failed to do so. Also amongst this material was reference to the husband having received an income tax refund of $32 000 in 2013. This was as a consequence of the husband declaring losses incurred by the parties’ R business. The husband had failed to include any reference to this $32 000 in his court documents.
In my view, the husband has been uncooperative, non-compliant with Court orders, very late in providing basic documentary material to the wife’s lawyers (and then such material has been incomplete) and he has been dishonest. An example of his dishonesty is the manner of preparing not only his own income tax returns but also the 2009 income tax return for the Trust. In this regard, the husband declared his losses with respect to his YY apartment as tax losses in his income tax returns yet this property was his residence. The husband’s explanation was that this was the manner in which his accountant had prepared the tax return. In my view it is the husband who has to take responsibility for what is in his tax return.
I have also referred above to the erroneous position set out in the income tax return for the Woolwich Family Trust concerning sale of BB shares during the financial year ending 30 June 2008. The revenue produced by the sale of the shares was grossly understated.
In my view, these matters reflect poorly on the husband.
The wife submits that the husband has not adequately explained how the ABC funds have been disbursed nor what happened to all the money received by him from the sale of his YY apartment. In my view there is some force in this submission. The husband’s response has been to say that the complete story is contained in all the bank statements and other documents which he has produced, the inference being that all the wife and her lawyers had to do was to trawl through the mass of documents and the complete explanation for all money spent by the husband would be there.

In my view, it is quite unreasonable for the husband to take this approach to his duty of disclosure. His financial affairs are complicated and he is the person in the best position to explain these matters by reference to appropriate documents. In my view, he has not done so adequately.
It was suggested to the husband during cross-examination that he had made it as difficult as possible for the wife to ascertain the true state of his financial affairs. In effect the husband conceded this with his response “I think it has been mutual”. I must say I do not agree with this inference that the wife has not been co-operative nor fulfilled her disclosure obligations.
The fundamental importance in family law property proceedings for each of the parties to make a full and frank disclosure of their financial circumstances has been consistently emphasised by this Court over the many years of its operation.
For example, in Weir and Weir (1993) FLC 92-338 the Full Court said as follows at page 79,593:
This Court has pointed out in a line of cases leading up to the recent decision of the Full Court in Black and Kellner (1992) FLC 92-287, that it is the duty of a party involved in property proceedings in this jurisdiction to make a full disclosure of their financial affairs. See also Giunti and Giunti (1986) FLC 91-759, and Mezzacappa and Mezzacappa (1987) 11 FamLR 957; (1987) FLC 91-853.
The Full Court went on to say at page 79,594:
… where there is clear evidence of non-disclosure as there was here, the Court should not be unduly cautious about making findings in favour of the other party. It has been said by one commentator (O’Ryan and Broadfoot, 5^th National Family Law Conference Handbook, p 249) the failure to disclose undermines the whole process of adjudication of proceedings for a settlement of property in that the court is unable to identify the property of the parties, to properly assess contribution, or to properly assess s 75(2) factors.
Similarly, in Black and Kellner (1992) FLC 92-287 the Full Court said as follows at page 79,133:
The Full Court in Oriolo and Oriolo [(1985) FLC 91-653] referred with approval to the remarks of Smithers J in the case of In the Marriage of Briese [(1986) FLC 91-713] and it is perhaps worth reiterating a portion of his Honour’s statement at FamLR 662; FLC 75,181 where he said, after referring to the decision of the House of Lords in Livesey v Jenkins [1985] All ER 106:
“I believe that the conclusion of the House of Lords in the case of Livesey v Jenkins is apposite, namely that in financial proceedings between spouses each party must make a full and frank disclosure of all material facts. In that case it was made clear that full and frank disclosure was required as a matter of principle in the light of the fact that it was the duty of the court, taking into account a number of designated criteria, to make a decision which basically involved the exercise of discretion. This is quite different from common law litigation between strangers, in which such a general duty does not exist, and obligations would only exist in so far as statute or court rules required.
“In my view it is fundamental to the whole operation of the Family Law Act in financial cases that there is an obligation of the nature to which I have referred”.
As I have said, the husband has failed to make a full and frank disclosure.
I place significant importance on this failure to fully disclose and I have not lost sight of the fact that I have assessed contributions in favour of the wife. I also note that I propose to require the husband to bear responsibility for the $78 549 NAB loan for G’s school fees.
In all the circumstances I consider it appropriate in order to achieve a just and equitable order, to make an adjustment in favour of the wife taking account of relevant s 75(2) matters. The adjustment will be 5 per cent.
The result will be that the wife will have 60 per cent of the available property and superannuation and the husband will have 40 per cent thereof. This is a differential of 20 per cent in favour of the wife.

Conclusion and Fourth Step

The wife is to have 60 per cent of the property and superannuation available for division between the parties. This is property and superannuation with a value of $926 899 (60 per cent of $1 544 832 = $926 899).
The wife has the following property and superannuation:

$

1.         50 per cent joint NAB account …70

12

2.         NAB account …02

41

3.         NAB Account …79

110

4.         NAB Account …38

142

5.         ANZ Account …21

1,415

6.         ANZ Account …48

17

7.         AMP Account

2,196

8.         400 Telstra shares

2,064

9.         Money in solicitors’ trust account

41,000

10.      AMP superannuation

173,222

^{_____________}

$220,219

The wife has credit card liabilities and her outstanding personal loan with the total of $152 991 plus 50 per cent of the outstanding C School fees which is $5769 (50 per cent of $11 539 = $5769.50). This is $158 760.
Accordingly, the wife has net property and superannuation with a value of $61 459 ($220 219 - $158 760 = $61 459).
To achieve property and superannuation with a value of $926 899 the wife will require an additional $865 440 ($926 899 - $61 459 = $865 440). This can only come from the former matrimonial home.
The wife will have to pay the outstanding fees ($12 366) to K School from her property.
On the other hand, the husband is to have 40 per cent of the available property and superannuation which is $617 933 (40 per cent of $1 544 832 = $617 933).
The husband has the following:

$

1.         50 per cent joint NAB Account …70

13

2.         NAB account …25

518

3.         ANZ account …22

216

4.         ANZ account …52

320

5.         BNZ account …00

154

6.         BNZ Q Limited

117

7.         Citibank account …

397

8.         Citibank Insured Money Market …

219

9.         E-Trade account …

482

10.      400 Telstra shares @ $5.16 per share

2,064

11.      Land in Country X

5,000

12.      Property in Arizona

58,860

13.      Superannuation and US Social Security

273,388

^{_____________}

$341,748

But the husband has credit card liabilities of $143 646 as well as 50 per cent of the outstanding C school fees of $11 539 which is $5770. The husband has total credit card and C School fee liabilities of $149 416 ($143 646 + $5770 = $149 416).
The husband also has the $78 549 liability arising from his loan to pay G’s outstanding school fees but as I have said, he will be required to pay this from his share of the assets. So I do not include this in the liabilities for this part of the exercise.
Accordingly, the husband has net property and superannuation with a value of $192 332 ($341 748 - $149 416 = $192 332).
To achieve property and superannuation with a value of $617 933 the husband will require a further $425 601 ($617 933 - $192 332 = $425 601). This will come from the former matrimonial home.
The former matrimonial home has an agreed value of $1 825 000. The outstanding mortgage adjusted to subtract therefrom the $78 549 which will be the sole responsibility of the husband, is $533 959. On this basis therefore, the equity for present purposes is $1 291 041 ($1 825 000 - $533 959 = $1 291 041).
On a sale of the home, disregarding sale and legal costs on sale, the net proceeds would be $1 291 041. If the wife was to be paid $865 440 from this there would remain $425 601.
The wife is desirous of paying the husband for his interest in the home. This would require her to pay him $425 601 and re-finance the mortgage in the amount of $533 959, a total of $960 796. There is no evidence before the Court that the wife has capacity to borrow such an amount. The wife would also have her other liabilities as referred to above.
In my view, the appropriate course is to require the former matrimonial home to be sold and for the net proceeds to be paid to the parties in accordance with these Reasons.
The wife is to have $865 440 which is 67.034 per cent of $1 291 041. The husband is to have $425 601 which is 32.966 per cent of $1 291 041. The husband is also to pay $78 549 to the NAB from this amount.
The wife would have her property and superannuation and approximately $865 440 from the sale of the home. But she has liabilities to pay. After paying her liabilities ($152 991 + $12 366 = $165 357) the wife would have $700 083 ($865 440 - $165 357 = $700 083). She could use this as a deposit on a home for herself, to pay rent or otherwise apply the money as she might see fit.
On the other hand the husband would have his property and superannuation and approximately $425 601 less the $78 549 he will pay to the NAB. He also has his other liabilities. Accordingly, he would have $197 636 ($425 601 - $78 549 - $143 646 = $203 406) in addition to his other property and superannuation.
He could use this towards purchase of a home, apply it to rent or otherwise use the funds as he might consider appropriate.
In my view, for the reasons set out above, the orders I propose will be just and equitable.

I certify that the preceding two hundred and ninety-four (294) paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Johnston delivered on 30 October 2014.

Associate:

Date: 30 October 2014

Assets	$
1. Joint property at Suburb B	1,825,000
2. Joint NAB Account …70	25
3. Husband’s NAB account …25	518
4. Husband’s ANZ account …22	216
5. Husband’s ANZ account …52	320
6. Husband’s BNZ account …00	154
7. Husband’s BNZ Q Limited	117
8. Husband’s Citibank account	397
9. Husbands’ Citibank Insured Money Market	219
10. Husband’s E-Trade account	482
11. Husband’s 400 Telstra shares @ $5.16 per share	2,064
12. Husband’s Land Rover	0
13. Husband’s motorcycle	0
14. Wife’s NAB account …02	41
15. Wife’s NAB Account …79	110
16. Wife’s NAB Account …38	142
17. Wife’s ANZ Account …21	1,415
18. Wife’s ANZ Account …48	17
19. Wife’s AMP Account	2,196
20. Wife’s 400 Telstra shares	2,064
21. Wife’s Volkswagen	0
22. Wife’s Honda	0
23. Wife’s funds held in Abrams Turner Whelan Trust account	41,000
^{_____________}
$1,876,497

$
1. Joint NAB home loan	219,948
2. Husband’s NAB residual debt	314,011
3. Husband’s school fee personal loan for G (NAB)	78,549
^___________
$612,508

$
1. Husband’s Asgard	109,648
2. Husband’s BT Lifetime	14,838
3. Husband’s MLC	30,458
4. Husband’s AON	24,150
5. Husband’s Kiwisaver	29,925
6. Husband’s US Social Security / 401K	64,369
7. Wife’s AMP	173,222
^{_____________}
$446,610

$
1. 50 per cent joint NAB account …70	12
2. NAB account …02	41
3. NAB Account …79	110
4. NAB Account …38	142
5. ANZ Account …21	1,415
6. ANZ Account …48	17
7. AMP Account	2,196
8. 400 Telstra shares	2,064
9. Money in solicitors’ trust account	41,000
10. AMP superannuation	173,222
^{_____________}
$220,219

$
1. 50 per cent joint NAB Account …70	13
2. NAB account …25	518
3. ANZ account …22	216
4. ANZ account …52	320
5. BNZ account …00	154
6. BNZ Q Limited	117
7. Citibank account …	397
8. Citibank Insured Money Market …	219
9. E-Trade account …	482
10. 400 Telstra shares @ $5.16 per share	2,064
11. Land in Country X	5,000
12. Property in Arizona	58,860
13. Superannuation and US Social Security	273,388
^{_____________}
$341,748