Y and H
[2007] FCWA 25
•12 FEBRUARY 2007
JURISDICTION:
FAMILY COURT OF WESTERN AUSTRALIA
| ACT: | FAMILY LAW ACT 1975 |
| LOCATION: | PERTH |
| CITATION: | Y and H [2007] FCWA 25 |
| CORAM: | THACKRAY J |
| HEARD: | 21, 22 & 23 AUGUST 2006 |
AND WRITTEN SUBMISSIONS
| DELIVERED: | 12 FEBRUARY 2007 |
| FILE NO/S: | PT 3563 of 2003 |
| BETWEEN: | Y |
Applicant/Husband
AND
H
Respondent/Wife
(Page 2)
Catchwords:
CHILDREN - Best Interests; INJUNCTIONS - Protection of child; SETTLEMENT OF PROPERTY - Property acquired before marriage - future needs; short marriage; young child; husband overseas; child to live in Australia with wife; CHILD SUPPORT - funds set aside as security; SPOUSAL MAINTENANCE - not appropriate.
Legislation:
Family Law Act 1975 s 75(2)
Child Support (Assessment) Act 1989, s 124
Child Support (Assessment) Act 1989, s 128
Child Support (Assessment) Act 1989, s 141
Category: Not Reportable
Representation:
Counsel:
| Applicant: | Mrs E Brownlie |
| Respondent: | Self Represented Litigant |
Solicitors:
| Applicant: | Dwyer Durack |
| Respondent: | Self Represented Litigant |
Case(s) referred to in judgment(s):
Bryant & Bryant (1996) FLC 92-690
Chorn & Hopkins (2004) FLC 93-204
Khoury & Anor v GIO of NSW (1984) 58 ALJR 502
Lenehan & Lenehan (1987) FLC 91-814
(Page 3)
Luckie & Luckie (1989) FLC 92-036
Norbis v Norbis (1986) FLC 91-712
Wilkinson and Wilkinson (2005) FLC 93-222
Zalewski & Zalewski (2005) FLC 93-241
Zyk and Zyk (1995) FLC 92-644
(Page 4)
1 [Mr Y] and [Ms H] were married in June 2002. Although they lived together for only a few weeks, their association led to a miscellany of disputes, which they have been litigating for more than three years. I am required to determine applications concerning:
• settlement of property; • spousal maintenance; • lump sum child support; • child birth expenses; and • parenting issues.
The parties and their relationship
2 [Mr Y], who I will refer to as “the husband”, is 41 years of age. He is an information technology manager. He lives [overseas], where he has spent most of his life.
3 [Ms H], who I will refer to as “the wife”, is 37 years of age. She is a full-time student and mother. She has been living in Perth since she commenced studying at [university ] in 1997. She renounced her [original] citizenship when she became an Australian citizen in 2005.
4 The parties met [overseas] in the middle of 2001 and a romantic relationship developed. They were married [overseas] on 9 June 2002 and went through a further ceremony of marriage in Perth later the same year. The wife now considers that the husband’s only motivation in marrying her was to acquire permanent resident status in Australia. The husband now considers the wife’s only motivation in marrying him was to part him from his money. I find that their motivations in marrying are largely irrelevant.
5 Two days after the wedding [overseas], the wife returned to Perth alone, as planned, to resume her studies. She went back [overseas] in September 2002, and during this visit fell pregnant. The relationship between the parties unravelled over the following months and by early 2003 it was clear their marriage was finished. The parties had spent no more than a few weeks living together.
6 On 4 July 2003, the wife gave birth to a baby girl, [D]. There was a long running dispute concerning paternity, which was only resolved when the husband filed his Papers for the Judge, in which he implicitly acknowledged he was [D]’s father.
| (Page 5) | |
| 7 | The husband has continued to reside [overseas]. The wife is living in an apartment [near the university], which was acquired around the time of the marriage with funds primarily supplied by the husband. |
Financial orders sought
8 The husband originally sought an order requiring the wife to repay all of the money he had advanced to her prior to and during the marriage (nearly $151,000). He also sought an order that the apartment [near the university] be sold and that he receive the entire proceeds of sale. In a minute contained in his Papers for the Judge, he abandoned the proposal for the wife to pay him a lump sum. Instead, he proposed that the proceeds of sale of [the apartment] be distributed in proportions 60% to him and 40% to the wife. He proposed that from his share of the proceeds of sale, he would discharge the child support arrears that have accrued in relation to [D]. He otherwise proposed that both parties retain the assets currently in their name or possession.
9 The wife responded to the husband’s initial application by seeking unspecified amounts by way of property settlement and spousal maintenance. In February 2005, she filed a Reply in which she sought an unspecified lump sum by way of child support. In a Minute of Orders filed in May 2006, the wife proposed that the husband pay to her a (still) unspecified sum by way of property settlement and otherwise proposed that she retain [the apartment]. She proposed she indemnify him in relation to the mortgage. The wife also sought the following payments from the husband:
• $12,689 for legal costs; • $5,132 by way of “child bearing expenses”; • $114,296 for lump sum spousal maintenance; and • $279,597 for lump sum child support.
Child welfare orders sought
10 The husband’s original application was filed shortly prior to the birth of [D] and was served on the wife whilst she was still in the maternity hospital. He initially did not seek any orders relating to [D]. In her amended response filed in January 2004, the wife sought orders for sole parental responsibility for day-to-day and long-term decisions
(Page 6)
concerning [D]’s care, welfare and development. She proposed that the husband have reasonable contact, as agreed between the parties, and she sought an injunction restraining him from removing [D] from Perth.
11 In March 2004, the husband filed a Reply in which he sought a declaration that he was not [D]’s father, but in the event it were found he was, he sought an order that the parties have joint responsibility for [D]’s long-term care, welfare and development. He otherwise proposed that [D] live with the wife and that she have sole responsibility for the child’s day-to-day care, welfare and development. He sought a vague contact order, which I will mention again shortly. In addition, he sought:
• that [D]’s name be changed almost entirely; • an order designed to keep him informed concerning important issues relating to [D]; • an order for the wife to keep him up-to-date with contact details for herself and [D]; and • an injunction restraining the wife from taking [D] out of Western Australia. 12 In August 2004, the husband filed a fresh application seeking an order that [D] live with him. At that stage he had seen her once in her life, for about 15 minutes. That application was discontinued a few months later.
13 In her Minute of Orders filed in May 2006, the wife refined her contact proposals by setting out a variety of orders designed to ensure that the husband would commence having regular, supervised contact with [D].
14 In his Papers for the Judge, the husband abandoned his earlier application for a declaration that he was not [D]’s father. He sought an order that the parties have equal parental responsibility for [D] and conceded that an order should be made that the child should live with the wife. He again proposed orders to keep him informed about matters concerning [D]. He did not repeat his application for an injunction restraining the wife from taking [D] out of Western Australia, nor did he seek any orders in relation to [D]’s name.
| (Page 7) | |
| 15 | Notwithstanding that the husband’s Papers for the Judge were filed only a matter of days prior to the trial, he once again failed to particularise the orders he was seeking by way of contact. At the commencement of the hearing, the husband sought leave to amend his application to seek specific orders relating to contact with [D]. The husband had previously been directed to specify the relief he had been seeking and had failed to do so. Furthermore, his affidavit contained no evidence relating to the most basic matters the Court would need to know prior to making the orders he was seeking. In these circumstances, I declined the husband’s application for leave to amend to seek specific orders for contact. |
| 16 | Apart from the other considerations, it seemed appropriate for the parties to attempt to resolve the contact issue by negotiation, given that the husband had recently acknowledged paternity and the wife was offering him contact. I therefore made arrangements for the parties to see a Family Consultant during the trial. I also arranged for the Consultant to provide a brief oral report, as this may be of assistance if the parties need to return to the Court to resolve any outstanding issues concerning contact. |
| 17 | Although I declined to deal with the contact dispute, I informed the parties that I proposed to deal with the balance of the child welfare issues which were properly before the Court. Some of these matters were resolved by orders made during the course of the trial. Included amongst these was an order for [D] to live with the wife and a variety of injunctions sought by the wife in her Minute filed in May 2006. |
| 18 | It was agreed that the parties would provide written submissions after the trial concluded. The final submissions from the husband were received in November 2006. He failed to address any of the child welfare issues. |
Child welfare issues – background
19 [D] was born in Perth in July 2003. The wife mentioned in passing in her supplementary trial affidavit that about a year after her birth, she caused the child’s name to be changed to [DS]. She said there had been an error in the original certificate and claimed she had always called the child [DS], rather than [D]. The wife did not mention this in her first affidavit, sworn in March 2006, and she called the child “[D]” throughout that document. She was also called “[D]”
(Page 8)
during the course of the trial. For convenience, I will continue to refer
to her by this name.20 As noted, above, there was a dispute as to [D]’s paternity. This was not resolved by the testing undertaken in October 2003, even though the results suggested that the probability of the husband being [D]’s father exceeded 99.9%. The husband suspected foul play and wanted a fresh test done [overseas], which the wife ultimately refused. In the meantime, the husband underwent a fertility test [overseas] in November 2003, the results of which indicated he suffers from severe teratospermia. This heightened the husband’s suspicions that he was not the father of [D] and further paternity testing was then undertaken in Australia in March 2006. This was not as conclusive as the first test, but nevertheless the results indicated that the probability of the husband being the father exceeded 96%.
21 Whilst the dispute about paternity raged, the husband had no contact with [D], save for a fleeting interaction in January 2004. As a result of the discussions with the Family Consultant during the trial, arrangements were put in place which have paved the way for the husband to commence having contact.
Parental responsibility
22 Notwithstanding that the husband refused to admit paternity until a matter of days before the trial, and notwithstanding that he had only seen [D] once prior to the trial, the husband maintained his application for equal shared parental responsibility.
23 The amendments made in 2006 to the Family Law Act 1975 require me to apply a presumption that it would be in [D]’s best interests for her parents to have equal shared parental responsibility, unless there are reasonable grounds to believe one of her parents has engaged in abuse of the child or has engaged in family violence. The presumption may be rebutted by evidence that satisfies me it would not be in the best interests of [D] for her parents to have equal shared parental responsibility.
24 There was no suggestion that either parent had engaged in abuse of [D], but each party alleged violence by the other. The violence claimed to have been perpetrated by the wife seemed to be fairly minor. The violence claimed to have been perpetrated by the husband was more serious, but confined to one or two isolated occasions. Had it not been for the amendments to the Act, it would have been entirely
(Page 9)
unnecessary to rake over these hotly disputed and highly emotional issues at trial, but regrettably such is one of the consequences of legislative intervention designed to make matrimonial disputes less adversarial. Although it was necessary for me to hear the evidence, ultimately I find that it is unnecessary for me to make a definitive finding in relation to either set of allegations, save to say that it seemed to me likely that both parties had engaged in some violence towards the other.
25 Having had the opportunity see the parties and their interaction, it became abundantly clear that it would not be in [D]’s best interests for her parents to have equal shared parental responsibility. Neither party made any effort at the hearing to conceal their hatred of each other. It would be completely impossible for them to discuss matters relating to [D], let alone reach agreement in relation to important issues concerning her upbringing. There would also be logistical difficulties given that they live in different countries.
26 In these circumstances, the wife should have sole responsibility for making major long-term decisions concerning [D]’s care, welfare and development, since she is the parent with whom the child will be living most of the time. She also has significant qualifications and experience in dealing with young people and can be relied upon to make appropriate decisions to promote [D]’s welfare.
Injunctions and travel
27 The wife seeks an injunction restraining the husband from removing [D] from Perth without her written consent or an order of the Court. She is greatly concerned that the husband will take [D] [overseas] or other countries that are not signatories to the Hague Convention. The husband did not deny that he has previously made threats to the wife suggesting that he would abduct [D]. Until such time as the Court hears the husband’s application for contact (which will probably include a proposal for [D] to travel [overseas]), I consider it is appropriate that an injunction be granted to ensure that [D] is not removed from Perth.
28 The wife seeks an order that she be at liberty to remove [D] from Australia without seeking the husband’s consent. In my view, this is appropriate. The wife has been accustomed to taking [D] out of the country and it is only reasonable that she and [D] be able to travel [overseas] where her family resides. The wife has renounced her
(Page 10)
[overseas] citizenship and has taken Australian citizenship. I accept
that she intends to make her long-term future in Australia.29 The wife also seeks an order dispensing with the need for the husband’s consent for an Australian passport to be issued for [D]. She currently has an Australian passport, but in due course it will expire. I accept that there is a likelihood the husband would not co-operate in her obtaining a new passport and in those circumstances I am satisfied that the wife should be at liberty to obtain a passport without seeking the husband’s consent.
30 The only other injunction issue which was not resolved at trial was the wife’s request for an order restraining the husband from “causing or permitting any other person from throwing or raising the child suddenly into the air or raise their voice around the child”. I am not satisfied there is any basis for this injunction.
Information concerning child
31 The wife did not oppose orders being made requiring her to inform the husband concerning significant matters affecting [D]’s health and education. She was opposed, however, to the order he sought requiring her to keep him informed “as to the name, address and contact telephone details of all health professionals consulted in relation to the health of the said child and of arrangements made for day care, kindergarten, pre-school and school” and she was also opposed to the orders sought by the husband giving him liberty to contact health professionals and education authorities for information concerning [D]’s progress.
32 The wife’s opposition to these orders is based on her concerns that the husband has previously approached people known to her and made allegations about her. She was, in particular, understandably concerned about the fact that a story had been published in a newspaper [overseas] giving a highly slanted and defamatory version of the breakdown of the parties’ marriage and the subsequent litigation. I am satisfied that the wife has a basis for being concerned about the release of the information sought by the husband. I consider it sufficient, for the time being at least, that she keep the husband informed about significant matters concerning [D]’s health and education, without being required to give the husband details which would allow him to approach schools, doctors and others to make his own enquiries. In time to come, it may be appropriate for this to be
(Page 11)
reviewed, especially if the husband begins to play a significant part in
[D]’s life.33 For similar reasons, the wife is opposed to the order sought by the husband requiring her to keep him informed of her residential address and contact telephone numbers. She is concerned that the husband might approach the neighbours and she also draws attention to her allegations in relation to violence in the relationship. She also claimed that the husband had often telephoned her in the middle of the night. Many of the allegations made by the wife were not denied and, in these circumstances, I am not satisfied that the wife should be obliged to keep the husband informed of her address and contact telephone numbers.
34 Given that there is a likelihood of an ongoing contact arrangement between the husband and [D], it will be necessary for the wife, nevertheless, to keep the husband informed of her postal address. The wife appears to have maintained a Post Office box address for some time and, presumably, will do this in the future.
35 Although no order was sought in relation to the wife keeping the husband informed of her email address, the matter was the subject of much comment during the hearing, as the wife was strongly opposed to the husband being able to email her. Her main concern about his previous practice of sending emails was that she claims she does not check her emails. Given the distance the parties live apart, it seems to me that this issue may need to be reconsidered, as email is likely to be the most convenient means of the parties keeping in touch in relation to last-minute logistical arrangements concerning contact.
Property settlement
36 I am required to follow a four-step process in dealing with the parties’ applications for property settlement. Those steps are:
| • | Identify and value the assets and liabilities of the parties; |
| • | Assess the parties’ contributions to the assets; |
| • | Assess a range of factors set out in s 75(2) and s 79(4) of the Act; and |
| • | Consider whether the order proposed is just and equitable. |
| (Page 12) |
The assets and liabilities
41 I find the assets and liabilities of the parties at the time of trial to be as set out in the table below:
| Description | Husband | Wife |
| [The apartment] | $335,000 | ||
| Central Provident Fund [overseas] | $252,216 | ||
| superannuation) | |||
| NTUC (self-managed superannuation | $92,891 | ||
| fund) | |||
| Savings |
| ||
| Shares | $465 | ||
| Child support arrears | $14,410 | ||
| Prudential Insurance Policy surrender | $13,178 | ||
| value | |||
| NTUC Endowment surrender value | $20,507 | ||
| TOTAL ASSETS |
|
Liabilities
| [the apartment] mortgage | $45,260 | $45,260 |
| Child support arrears | $14,410 | |
| Debt to sister | $46,838 | |
| Personal loans | $30,000 | |
| (Page 13) |
TOTAL LIABILITIES $106,508 $75,260
NET ASSETS $275,421 279,699 42 Many of the items in the table above require some explanation.
[The apartment]
43 The parties reached agreement after the trial that the apartment is
worth $335,000. Superannuation
44 I have included the husband’s superannuation entitlements in the list of assets rather than in a separate table, as this was the way in which the husband’s counsel presented the case.
Savings
45 The husband's counsel noted the wife’s savings as being only “nominal” in the Schedule of Assets and Liabilities provided after the trial. The wife gave somewhat confusing evidence in relation to her savings, but to the best of my understanding, she acknowledged she had $5,549 in her UniCredit account at the time of trial (see Exhibit 25).
Child support arrears
46 Although the child support arrears were originally thought to be much larger, I have included the arrears at $14,410 in accordance with the advice contained in Exhibit 15. Although the arrears at the time of trial were $20,173, these included penalties of $5,763, which the Child Support Agency indicated would be waived if the husband cleared the maintenance arrears.
Mortgage
47 The parties originally borrowed $100,000 to assist them to acquire [the apartment]. There were two separate loans (one a fixed interest loan and the other variable). Both parties’ statements of financial circumstances suggested there was still $100,000 owing on the mortgage, which seemed to me to be unlikely, given other evidence that had been provided. I therefore directed the wife after the hearing (with the knowledge of the husband’s solicitors) to provide a copy of the two relevant statements, which indicated that at
(Page 14)
the time of trial there was $55,925 owing on one loan and $34,506 owing on the other. At the time these reasons are delivered I will give the parties the opportunity to comment on why I should therefore not include the mortgage at $90,421 in the table of liabilities.
Husband’s debt to sister
48 Unfortunately, the husband was not adequately cross-examined in relation to the scant evidence he gave concerning a claimed liability to his sister. As best I can make out, the major portion of the liability related to the sister having allegedly discharged a debt the husband claimed he owed his mother. This arose prior to the marriage when the husband allegedly put $35,000 of his mother’s funds towards the payments used to acquire the [the apartment]. To the best of my knowledge, there was no other evidence given by the husband to justify why it is that he now owes his sister as much as he claims. Nevertheless, in the absence of any adequate cross-examination on the issue, I have included it in the table of liabilities.
Wife’s personal loans
49 The wife gave similarly sparse and confusing evidence in relation to the extent of her current liabilities. The husband’s counsel included the wife’s current personal liabilities at $131,400 in the Schedule of Assets and Liabilities she provided in her closing submissions. This is an obvious error, since the wife herself claimed to owe only the $30,000 mentioned in her Statement of Financial Circumstances.
Undisclosed assets
50 The wife believes that the husband has more assets than he has disclosed. She points to the fact that he has been in receipt of a high income and she says he has fairly modest expenses, especially as he has not been paying the child support he was assessed to pay. Although I recognise the husband has in the past mingled his funds with his mother’s funds, and although I entertained some suspicions, I was not persuaded the husband had any assets other than those which he disclosed. Whilst I appreciate that he would normally have been in a position to accumulate funds as the wife’s suspects, regrettably he has spent a very large amount on legal costs and other costs associated with these long running proceedings.
51 Counsel for the husband claimed in her closing submissions that the total expended by the husband on legal costs and the costs of
(Page 15)
travelling to and from [overseas] for court cases was $78,683. I find that the amounts the husband actually paid totalled $88,237 comprised as follows:
| • | Wojtowicz Kelly (after allowing for refund) | $41,612 |
| • | Anderson Kershaw (see exhibit 6) | 7,531 |
| • | Dwyer Durack (less $3,000 remitted to CSA) | 19,389 |
| • | Solicitors [overseas] | 5,705 |
| • | Private investigator | 3,000 |
| • | Travel costs | 11,000 |
52 I do not propose to (and nor was I asked to) add these costs back into the pool of assets, since they were paid entirely with funds the husband earned after the marriage ended: Chorn & Hopkins (2004) FLC 93-204. It follows, however, that in assessing the parties’ post- separation contributions I would need to ignore that part of the husband’s income which was used to meet these very large expenses.
53 The wife’s evidence in relation to the manner in which she had funded legal costs was somewhat confusing. It seems she has paid legal costs of at least $12,689, which appear to have been funded with monies advanced to her by friends. Since the moneys she has borrowed appear to have been used to meet legal costs it would ordinarily be appropriate to “add-back” the amount of costs paid into the pool of assets. I was not asked to do so, but in coming to my decision I will not overlook the fact that portion of the wife’s debts relate to legal costs, for which she alone should bear responsibility, unless an order for costs is made after judgment is delivered.
Property settlement - background
54 In April 2002, the wife made an offer to acquire the [the apartment]. The settlement of the purchase was delayed until August 2002. Upon the property being acquired it was let to a student for
(Page 16)
$200 per week. The wife continued to live elsewhere, but moved into the apartment in January 2003. The husband came to Perth at the time the wife was moving into the property and there was an altercation between them. In late February 2003, the wife moved out of the apartment and arranged for friends to rent it for $320 per week. She initially boarded with a friend but then obtained rental accommodation elsewhere. The wife claimed in her oral evidence that she moved back into [the apartment] in September 2003, although examination of the lease document relating to the property in which she had been living suggests she probably did not move back until November 2003.
55 In the meantime, [D] had been born and the parties were involved in a dispute as to whether or not the husband was, in fact, her father. In January 2005, the wife became an Australian citizen, having renounced her [overseas] citizenship. She then set about obtaining a payout of the funds standing to her credit in the [overseas] Central Provident Fund. These moneys became available in June 2005 and were disbursed in the manner discussed below.
Contributions
56 This was, of course, an unusual relationship in that the parties lived together at most for a few weeks. The major contributions were those made at the commencement of the relationship and those which have been made since it ended.
Initial contributions – husband
57 I find that at the date of the marriage the husband had the
following:
• [overseas] Central Provident Fund $174,548 • “Living Policy” Life Insurance Policy $10,520 • Savings/Investments, approximately $150,000 • Prudential Insurance Policy value unknown • NTUC Endowment Insurance Policy $15,600 (approx) • Shares $1,800 (approx)
(Page 17)
58 The husband gave evidence in his affidavit that his Prudential Insurance Policy was worth $25,600 at the date of the marriage. In his Statement of Financial Circumstances he claimed that in 2006 the value of this policy was $28,354. In his oral evidence, however, the husband corrected this estimate of the value of the policy and said that it was worth only $13,178. He did not give any evidence correcting the value as at the date of the marriage, but presumably it was not as much as he originally claimed.
59 The husband had no liabilities as at the date of the marriage, save for the fact that included in his savings/investments of $150,000 was $35,000 which he says he held on behalf of his mother. As this money has subsequently been repaid, and as the loan obtained from his sister to discharge the debt is included in the list of liabilities, it is appropriate to note it as a liability as at the date of the marriage.
Initial contributions – wife
60 The wife claimed that at the date of the marriage she had $20,000 in her UniCredit Term Deposit account. Documents provided by the wife (in particular annexure 27 to her first trial affidavit), suggest that her savings as at the date of the marriage were probably a little less than $17,000, but as she was not adequately challenged on the issue, I will proceed on the assumption she had $20,000.
61 I find that at the date of the marriage the wife had the following
assets:
• UniCredit Term Deposit Account $20,000 • [Motor vehicle] $800 (approx) • Furniture $1,000 (approx) • Laptop computer $3,000 (approx) • [overseas] Central Provident Fund $46,000 62 Although she did not mention them as part of her initial contribution, it seems the wife must also have had two insurance policies [overseas]. She surrendered one of these for S$5,573 in November 2003 and the other for S$5,040 in July 2004.
| (Page 18) | |
| 63 | The husband claimed that the wife informed him in about October 2002 that she had debts totalling S$131,400. The wife denied that she had liabilities of this amount or that she told the husband that she did. I suspect the confusion about this arose from the email the wife sent to the husband in October 2002 (Exhibit 19) where she referred to her debt of S$80,000 to [the religious organisation] and later in the same email referred to a debt of S$18,000 to [the religious organisation]. The husband has assumed these are two different liabilities whereas, in fact, it seems probable that the initial reference to S$80,000 was a typographical error in the wife’s letter. |
| 64 | In any event, I am not satisfied that the wife had any legal liabilities at all at the date of the marriage. I accept that [two of her relatives] had given her a total of S$30,000 to assist her with her studies, and the wife had also received a bursary from [the religious organisation] of S$18,000. The wife acknowledged in her oral evidence that she did not, in fact, have a legal obligation to repay any of these amounts, but she said she felt a moral obligation to do so. She therefore repaid a total of S$48,000 to these three benefactors from the monies she received from her Central Provident Fund entitlements in 2005. |
| 65 | The wife also claimed in paragraph 40 of her first trial affidavit that the husband had a variety of assets in 2003, which she said were recorded on annexure “K” to her affidavit. The wife was not cross- examined in relation to these claims, but annexure “K” did not corroborate all of the claims she was making. The claims she made also conflicted with the husband’s own evidence concerning the extent of his assets as at the date of the marriage. Like many other aspects of the presentation of both the husband and the wife’s case, the evidence about this aspect of the matter was unsatisfactory, but ultimately I was not persuaded that the husband had any more assets in 2003 than he acknowledged in his own affidavit. |
| Financial contributions during the relationship | |
| 66 | A significant proportion of the financial contributions made during the relationship came from the funds each party had at the commencement of their association. |
| 67 | The husband transmitted various sums to the wife between 10 April 2002 and 23 January 2003. He says these totalled $151,766. The wife’s records suggest that she, in fact, received $152,422. |
| (Page 19) | |
| Whatever the amount might have been that was paid, I accept that the wife saw it as being appropriate to mingle the funds being paid to her by her fiancé/husband with the funds she had in her own account in Perth. | |
| 68 | It is common ground that the wife used the funds which she had at the time they met and the money the husband sent to her in order to acquire the [the apartment]. Although the property cost $224,000, there was stamp duty and other expenses associated with the purchase. The draft settlement statement indicates that an amount of $232,703 was required in order to acquire the property. The parties borrowed $100,000 from St George Bank and the wife received the $7,000 First Home Owner Grant. The wife had surplus funds in her account after using the mortgage funds and the grant, and she decided to make a lump sum payment of $15,000 in order to reduce the amount owing on the mortgage. |
| 69 | There was much controversy as to what happened to the balance of the money the husband sent to the wife. I am satisfied that a significant portion of the surplus was used to meet costs associated with the parties’ wedding(s). I am satisfied there were some funds left over, which the wife used in order to meet some of the mortgage payments. Whilst the wife did not provide full documentation to establish where all of the money went, she did provide some – which, amongst other things, showed that she had indeed used all of the First Home Owner Grant to assist in acquiring the apartment. |
| 70 | The husband also complained that the wife did not account to him for the rent she had received from the [the apartment]. Whilst the wife may not have given him an “account” in the legal sense, I am satisfied the husband was aware of the amount for which the apartment had been let. The wife either used the rent to meet mortgage payments or to meet the costs of maintaining herself, since the husband was paying no spousal maintenance. |
| 71 | The husband alleged, for the first time, at trial that the wife may have received even more rent from the apartment than first thought. He apparently instructed his counsel to pursue a line of questioning designed to suggest that the wife had not been living in [the apartment] for some years. This allegation caught the wife completely by surprise, particularly as in paragraph 83 of his affidavit the husband said “the wife has occupied the property since 2003”. |
| (Page 20) | |
| 72 | The basis for the husband’s suspicions appears to be the fact that the wife continued to receive a number of items of correspondence addressed to her at the address where she lived for a few months in 2003. I accept the wife’s explanation as to why correspondence continued to be addressed to this residence. I find that the wife did live in [the apartment] for the times she claimed, (save for the possible minor discrepancy mentioned above). |
| 73 | The husband claims that he made some other financial contributions during the marriage. I accept that he paid a deposit of S$2,000 to secure a flat [overseas], which he anticipated would be a home for him and the wife. That payment was forfeited when the arrangement did not proceed. |
| 74 | I also accept that the husband met the expense of flying his mother and the wife’s mother to Perth for the second wedding ceremony. The wife denied he paid a $625 airfare for her to travel to Perth in 2002 to secure her permanent resident status. In the absence of any corroborating evidence, I am unable to find that the husband did, in fact, meet the cost of that airfare. |
| 75 | The wife did not receive income from paid employment at any time during the marriage or since it concluded. For at least part of the time, the wife was in receipt of a scholarship, which she presumably used to meet her everyday living expenses. The wife provided no information to indicate the amount she received from this source. The wife also received unspecified amounts by way of Social Security payments. In addition, the wife received the funds from the two [overseas] insurance policies mentioned above (totalling S$10,610), which I accept she has used to meet reasonable expenses. |
| 76 | The wife claimed that she contributed $33,340 towards [the apartment] property (excluding strata, water rates and other maintenance) up to March 2006. This included $7,000 from the First Home Owner Grant and $9,990 the wife drew from her own term deposit. The balance said to have been contributed appears to have been periodical payments towards the mortgage. (During the course of the hearing I asked the parties to provide me with an agreed schedule of the payments made on the mortgage in order that I could obtain a better understanding of how the mortgage payments hade been paid, but this was never forthcoming.) In the absence of |
| (Page 21) | |
| adequate cross-examination, I intend to proceed on the basis that the wife’s estimate of her expenditure on the property is correct. | |
| 77 | The husband has been working on a full-time basis in well-paid employment [overseas] since the date of the marriage. As a result of being employed, his Central Provident Fund entitlement has increased significantly since the parties were married. The husband has made no contribution to the mortgage or other outgoings on the property since the marriage ended. |
| 78 | The wife claimed at a number of places in the course of her written and oral evidence that she had paid all of the other mortgage payments on the property; however other evidence suggested that some of the mortgage payments were made by way of transfer from one of the mortgage accounts to the other (bearing in mind there had been one substantial capital reduction made on the mortgage). In any event, while I accept that the wife has been making payments on the mortgage during part of the time since the relationship ended, she has had the benefit of occupation of the property and when she was not occupying it she had the benefit of the rent. |
| Non-financial contributions including contributions to the family | |
| 79 | The most significant non-financial contribution the wife has made relates to [D]. She has been solely responsible for the child’s care since she was born. The husband has made no contribution, as he has had no contact with her. |
| 80 | As the parties scarcely lived together, neither of them made any domestic contribution of any significance to the other. I accept that both parties spent some time looking for property both in Perth and [overseas], but I am not satisfied that either of their efforts was particularly substantial or exceeded the contributions of the other. |
| 81 | The wife has looked after [the apartment], but has had the benefit of living in it for most of the time since it was acquired. |
Assessment of contributions
82 The wife asserted that contributions were made in proportions 60:40 in favour of the husband prior to the separation and 95:5 in her favour after the separation. The husband’s Papers for the Judge did not comply with the requirement of the Practice Directions that contributions be expressed as “a percentage of the net value of the
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assets from the commencement of cohabitation to the date of final
separation and to the date of hearing”.83 The question I need to determine before proceeding further is whether to adopt a global approach or an asset-by-asset approach to the assessment of contributions. The authorities indicate that the global approach is generally to be preferred in the ordinary run of cases, but either approach is permissible, depending upon the circumstances:
Norbis v Norbis (1986) FLC 91-712, Lenehan & Lenehan (1987) FLC
91-814 and Zyk and Zyk (1995) FLC 92-644.84 As the Full Court (Nicholson CJ, Fogarty & Baker JJ) said in Zyk & Zyk (supra at 82,509):
“The global approach enables the Court to assess the contributions aspect of the s. 79 exercise in an overall way by considering the parties' contributions to their property as a whole although factoring into that exercise the circumstance, if it be so, that they may have made varying contributions to the total property at trial or which formed part of the history of their property during the marriage. It is the generally preferred and the generally adopted approach. It enables a broad approach to be taken to the varying contributions of the parties over the years of their marriage and in particular it usually has the advantage of more easily dealing with and giving proper recognition to paras. (b) and (c) contributions. However, where the contributions to the components of the total property are disparate, caution needs to be exercised in this approach and the overall conclusion tested against the requirement that the orders be “just and equitable”. Lenehan is an example of a case where difficulties arose for that reason.
The asset by asset approach enables the Court to assess separately the parties' contributions to particular assets or groups of assets. It is the less preferred approach largely because it can at times be an artificial exercise and also because it can create difficulties in the proper evaluation of paras. (b) and (c) contributions. But there are a number of circumstances where it may be appropriate to do so, for example an inheritance received post separation, or where the financial relationship of the parties during the marriage was such that they treated some property as
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exclusively the property of one party to which the other party made no, at least no para. (a), contributions to it. It may be convenient in cases like that to treat that property separately rather than assess the overall contributions of the parties to the totality of their property.
However, the trial Judge has a discretion as to which course to adopt and does so having regard to what appears more suitable to the circumstances of the particular case.”
85 I also respectfully agree with Finn J who has suggested that the asset-by-asset approach can “be very useful” where, as in the present case, there has been a substantial delay from separation to hearing: Zalewski & Zalewski (2005) FLC 93-241. Support for the asse-by- asset approach in the unusual circumstances of the present case can also be found in the advice given in Wilkinson and Wilkinson (2005) FLC 93-222, where the Full Court (Bryant CJ, Finn, Coleman, Warnick and O'Ryan JJ) said at [26]:-
“… it may well be useful for an asset by asset approach to be employed in cases where the parties have significant superannuation interests, particularly where there has been a relatively long period of time between separation and trial, or in a case where a significant portion of a party’s superannuation interest or of other assets has been acquired prior to the parties’ cohabitation. In such circumstances, the asset by asset approach is likely to facilitate the evaluation of the parties’ direct and indirect contributions to the acquisition, conservation and improvement of their assets (including their superannuation interests)”.
86 In reality, [the apartment] property is the only significant asset to which both parties made a contribution. The husband has made no contribution to anything else the wife owns and she has made no contribution to anything he owns. In particular, she has made no contribution to the husband’s substantial interest in the [overseas] Central Provident Fund. He had a large entitlement in that fund at the time he met the wife and he has increased his entitlement significantly as a result of the work he has done since the relationship ended. Provided that in doing so I take account of the wife’s contribution to the care of [D], I consider that I need only assess the parties’
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contributions to the equity in [the apartment] and otherwise leave
them with the assets and liabilities they each have.87 The overwhelming financial contribution to [the apartment] was made by the husband. The wife seemed to be arguing that he should not be given all the credit for this contribution, on the basis that the acquisition of the apartment in her name was the husband’s “gift to the marriage”. She suggested that his conduct in giving her the money to buy the property was part of the [particular] cultural tradition. Regardless of how the wife may wish to perceive the payment made by the husband, I consider that the entire payment made by the husband to the wife should be treated as his contribution within the meaning of s 79 of the Act. In any event, I consider it more likely than not that the property was registered in the wife’s name alone because the husband, who had plans to come and live in Australia, wanted to be able to take advantage again of the First Home Owner Grant in acquiring another property.
88 In total, the husband provided over $151,000. Most of this was used for the acquisition of [the apartment] property and in meeting expenses associated with it; however, I have found that some of the money was also used to meet expenses associated with the parties’ wedding. The wife has also made a financial contribution in the form of the $33,340 mentioned above. On the other hand, the wife received the benefit of the rent received for the property during the two periods in which she was not living in it and she has also had the advantage of living in the property for most of the time since it was acquired.
89 As I have indicated above, the contributions the parties made during the course of the relationship itself are of little consequence since the association was so short. The only other significant contribution to take into account therefore is the wife’s care of [D] since she was born. I accept that the wife has provided not only all of [D]’s physical care but also provided for her financially, save for the two child support payments the husband has made. I do not, however, intend to take into account the failure of the husband to provide financially for [D]. I do so for two reasons. First, the wife has supported [D] courtesy of the taxpayer to some extent. Secondly, the husband owes the wife a substantial amount by way of child support arrears and he will have to make good those arrears out of his property settlement entitlement.
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| 90 | In assessing the contributions, I also need to take into account the fact that the property has increased in value significantly during the time the parties have owned it. The wife repeatedly claimed that the husband was trying to make a “profit” out of the marriage by taking advantage of the unprecedented increase in the value of property in Perth, but it seems she is quite prepared to take her share of the same “profit”. Although the husband made the greater capital contribution, in many respects it would be reasonable to see the acquisition of the apartment as a joint endeavour, in that: |
| • | they decided together to acquire property in Perth; |
| • | both parties assumed responsibility for the mortgage; |
| • | each of them contributed what they had to the property; and |
| • | the wife has maintained the property for most of the time they have owned it. |
95 In these circumstances, I consider it would be reasonable if the parties were to share equally in the increase in the value of the property.
96 After taking account of the significant disparity in the financial contributions; the wife’s contribution to the physical care of [D]; and the significant increase in the value of the property (which I consider should be shared equally), I have determined that the wife’s contribution should be assessed as being worth 40% of the equity in [the apartment] property.
Adjustment for Section 75(2) and other factors
97 I turn now to consider the adjustment to be made on account of the matters set out in s 75(2).
the age and state of health of each of the parties;
98 Both parties are still comparatively young. Apart from the fact that the circumstances surrounding the breakdown of the marriage and its aftermath appear to have had a quite serious effect on the
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psychological and emotional health of both parties, they appear to be
in good health.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;
99 I have set out above the property and financial resources of each of the parties. The husband’s income tends to vary, depending upon performance bonuses, but he has a proven capacity to earn an income in excess of S$110,000 (i.e. in the region of A$90,000). At the time of trial he said his take home pay was about S$6,000 per month (about A$5,000 per month) and it would appear that in most years the husband’s gross income is in the range of S$85,000 to S$92,000. He appears to be an intelligent and resourceful person and it appears likely that he would continue to earn a well above average income in the future.
100 The wife is also an intelligent and resourceful person. She was a qualified [school] teacher [overseas] before coming to Australia to study. She has [a range of tertiary qualifications] in [her area of expertise]. In 2006 she enrolled in a Masters [program]. She has not had any work since 2002 when she was working as a [part-time tutor] for two hours per week.
101 Whilst the wife has the physical and mental capacity to engage in employment, there was no evidence to indicate the likely level of income she would receive if she obtained work. At one stage in cross- examination, Counsel for the husband suggested that her income earning capacity exceeded $45,000 per annum. Notwithstanding the fact that the wife has been a student since 1997 and has obtained a number of impressive qualifications, the impression I gained was that she has a capacity to earn an income only slightly above average.
whether either party has the care or control of a child of the
marriage who has not attained the age of 18 years;
102 The s 75(2) factor primarily relied upon by the wife is the fact she has the care of [D], who is only 3½ years of age.
103 Although the wife placed much reliance on the claim that [D] is a sickly child, the evidence she provided to support this claim was less than satisfactory. It is true that [D] from time to time has had various ailments, but there was no evidence to show that she is presently any
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more inclined to become ill than any other child. I nevertheless accept that when she does fall ill, arrangements will need to be made for her to be collected from day-care/school and somebody has to be available to look after her. There is no evidence that the wife has anybody available to assist her on such occasions, since she has no family in Perth.
104 Although the husband claimed in his Papers for the Judge that the wife shares a home with her mother, who could assist in the care of the child, I find that this is not the case. There have been some occasions when the wife’s mother has come from [overseas] to assist the wife, but these have been relatively isolated. I consider there is at least a reasonable possibility that the wife was telling the truth in saying that her mother will not be able to come to Perth in the future to assist her.
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;
105 The parties each have the normal costs of supporting themselves
and [D].
the responsibilities of either party to support any other person
106 The husband claimed to be providing substantial financial assistance to his mother. I had doubts whether the extent of his contribution was as large as he claimed. The husband did not rely on this factor in his Papers for the Judge, although his counsel submitted in her closing submissions that the factor was relied on. Whilst, I accept the husband does make some payments to his mother, the evidence did not satisfy me that he had a “responsibility” to support her, since I did not consider there was sufficient evidence about her overall financial circumstances. For example, there was evidence that the husband was previously holding money belonging to her, which he used to help pay for the [the apartment]. The money has since been repaid by his sister on his behalf. Does his mother still have this money? Does she have other money or assets?
the eligibility of either party for a pension, allowance or benefit
under:(Page 28)
(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;
107 Whilst she remains unemployed, the wife has an entitlement to Social Security. At the time she made her Statement of Financial Circumstances, she was receiving $354 a week by way of parenting payments and family tax benefit.
108 The wife has no entitlement to superannuation in Australia or [overseas], as she has scarcely ever worked in Australia and has cashed in her [overseas] superannuation entitlements.
109 The husband has a substantial superannuation entitlement.
where the parties have separated or divorced, a standard of
living that in all the circumstances is reasonable;
110 The husband will be able to enjoy a good standard of living as he has a high income earning capacity, even after taking account of his child support obligations. The wife will have a lower income, but will have entitlements to social security and child support, which will assist her to enjoy a modest standard of living.
111 The husband suggests the wife has been enjoying a higher standard of living than is appropriate because of what he claims to be her extensive foreign travel in the period since the marriage ended. It is true that the wife has had a number of trips overseas. The way in which these were funded was not made entirely clear, although indications were that she had received some family support and one of the trips was heavily subsidised by the university. In any event, given that the wife comes from [overseas], and has no family here, it is not unreasonable that she should be able to travel home from time to time. Although there was a suggestion that a male friend of the wife might have been funding some of the trips, there was insufficient evidence to establish this.
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the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income;
112 The wife is currently undertaking further studies in counselling. She says she is continuing with further studies, having already obtained a PhD, in order to make herself employable. Her area of expertise was [with young people] and it would seem that her plans were to work in the [correctional services area]. She feels that her skills and qualifications to date are too specialised and that it would be of assistance to her in her future work if she had counselling skills. Continuing with her studies also gives her an interest whilst she is unable to obtain full-time employment because of having to care for [D].
113 I accept there is a possibility that the continuation of these studies will ultimately assist the wife to obtain suitable full-time employment, but I was not persuaded it was likely to result in her obtaining any better paid employment that she could obtain with her current qualifications.
the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant;
114 If the husband were to lose his entire entitlement in [the apartment] property as the wife proposes, he would have no capital with which to repay the debt I accept he has to his sister. He would, however, be able to discharge the liability over time.
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;
115 Neither party has made any contribution to the income or earning capacity of the other, and neither has made any contribution to the property and financial resources of the other party, save as identified above.
the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;
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116 The marriage was of very short duration; however, the wife properly submits that it has had a very significant impact on her earning capacity. She was previously a qualified [school teacher] and, were it not for the fact that she now has [D], it would be reasonable to expect that she would be able to obtain moderately well paid full-time employment. I accept that she has been unable to work over the last few years and will be unable to work over the next few because of her responsibilities to [D].
117 The marriage has had no impact on the husband’s earning
capacity.
the need to protect a party who wishes to continue that party’s
role as a parent;
118 The wife says that [D], having been denied the company of her father, should not be denied the company of her mother. She therefore plans to remain out of the workforce for another four years. Apart from any other considerations, she says that at the present time [D] is in day-care and would need to be in full-time day-care if she went out to work. She says day-care at present costs her only $2 a day because it is subsidised as she is a student. If she were to commence working on a full-time basis she said that day-care would cost her $1,000 per month and it would simply not be worth her while engaging in paid employment.
119 Whilst the husband endeavoured to portray the wife as a “professional student”, I accept that her plans have always included obtaining full-time employment, but her plans have been put on hold as a result of falling pregnant with [D]. The wife spoke with genuine emotion of her frustration about the fact that her peers have now moved on to obtain post-graduate employment in universities whilst she is reliant on Social Security. I accept that she has a genuine desire to spend at least the next four years attending to her responsibilities to [D]. On the other hand, [D] will shortly be able to attend kindergarten and pre-primary and the wife would then be in a position to look for some work, even if not within her area of expertise, in order to help make ends meet.
if either party is cohabiting with another person—the financial
circumstances relating to the cohabitation;
(Page 31)120 Neither party is
cohabitating with any other person, save that the husband is
sharing accommodation with his mother and sister [overseas].
the terms of any order made or proposed to be made under
section 79 in relation to:(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party;
121 I have indicated above that based on contributions alone, the wife would receive 40% of the equity in the [the apartment] property.
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;
122 The husband made one payment of $7,960 by way of child support in April 2004 and paid a further $3,000 just before trial, making a total of only $10,960 in 3½ years. At the time of trial, the wife had not been receiving periodic payments of child support, but she had an entitlement to payments at the rate of $752 per month.
any fact or circumstance which, in the opinion of the court, the
justice of the case requires to be taken into account;
123 I consider it reasonable to take into account the fact that the wife has voluntarily disposed of her entitlement in the [overseas] Central Provident Fund. The wife became entitled to the benefit of the monies held in that fund when she relinquished her [overseas] citizenship. She used S$48,000 of that money to pay what were, at most, moral obligations. At the time she made the payment, the wife was pursuing her current applications for property settlement and spousal maintenance and she knew she would be unlikely to return to the workforce for a number of years. Whilst it is commendable for the wife to have fulfilled what she regarded as her moral obligations, the fact remains that those who advanced the funds did not require repayment. The wife could have attended to her moral obligations at a later stage when she resumed full-time employment.
124 Although the evidence was unclear, it seems that after discharging these obligations to her benefactors, the wife had about
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S$12,000 remaining from her superannuation, some of which she gave to her parents.
the terms of any financial agreement that is binding on the
parties.
125 There was no binding financial agreement.
Assessment of section 75(2) factors
126 I consider the most important of the factors discussed above is the obligation the wife has to accommodate and maintain [D], and the impact the care of the child has had, and will continue to have, on the wife’s income earning capacity.
127 Although I accept there is a significant difference in the income earning capacities of the parties, it needs to be recognised that the husband had his earning capacity prior to meeting the wife and that the marriage was of exceptionally short duration. The husband’s income earning capacity will be taken into account in assessment of child support and I do not consider the fact that he is a relatively high income earner of itself to be of great significance for the purposes of the s 75(2) adjustment.
128 Both parties failed to comply with their obligation to quantify the adjustment they considered should be made on account of the s 75(2) factors. The husband's case was presented in a global fashion on the basis that it would be reasonable for the wife to receive 40% of the net proceeds of sale of [the apartment]. Given the very young age of the child and the impact her care has on the wife’s income earning capacity, I consider that an amount equivalent to the value of 25% of the net equity in [the apartment] would be an appropriate adjustment on account of s 75(2) factors. In dollar terms this amounts to $97,792. The net effect, after consideration of contributions and the s 75(2) adjustment, is that the wife would receive 65% of the equity in the apartment and the husband would receive 35%.
Just and equitable?
129 The final stage of the process of property adjustment is to step back and consider whether the overall outcome is just and equitable having regard to the findings made concerning contributions and the s 75 (2) adjustment.
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| 130 | I have found that the husband made the overwhelming financial contribution but that the wife has made a significant contribution in the form of the care she has provided single-handed to the child of the marriage. I have also found that it would be reasonable for the parties to share equally in the windfall achieved as a result of the spectacular growth in the Perth property market during the time in which they have held the property. |
| 131 | Although the husband will recognise that 35% of the value of the property represents significantly less than what he contributed in financial terms, he needs to appreciate that the wife is being compensated to some extent for the otherwise unquantifiable contribution she has made to the welfare of [D] and for the future impact the care of the child will have on the wife’s financial position. It also must be appreciated that the s 75 (2) adjustment has been made by reference only to the value of [the apartment], which is only a portion of the combined wealth of the parties. The husband’s superannuation entitlements in particular have appreciated significantly in value since the wife began assuming for responsibility for the care of his child. |
| 132 | In these circumstances, I am satisfied that the proposed division of the equity in the apartment, 65% to the wife and 35% to the husband, is just and equitable. |
Lump sum child support
133 I turn now to the wife’s application relating to child support. The application simply sought a lump sum payment. There was no application for a departure order from the current child support assessment, which is based on the income the husband is earning [overseas]. (The wife did submit that the husband was manipulating his income to reduce his child support obligation, but if this is so, the appropriate course is for the wife to utilise the Child Support Agency’s internal review processes.) In effect, in seeking payment of child support in a lump sum, the wife is seeking security for future child support payments, but she wants to receive all of the money now rather than on a periodic basis.
134 The wife is understandably concerned that the husband is unlikely to make periodic child support payments in the future. She points to the fact that he denied paternity almost up until the time of the trial and that he paid only two lump sum payments of child
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support (the latter of which was arranged in order to ensure he was
free to leave Australia after the trial).135 The wife gave hearsay evidence suggesting that the Australian Child Support Agency has serious doubts whether or not the reciprocal enforcement arrangements with [the overseas country] would result in the wife receiving any future benefits if the husband failed to honour his obligations to make periodic payments. Given that the evidence was hearsay it has little, if any, value in these proceedings, particularly as it appeared to be contradicted to some extent by Exhibit 15, which was a letter from the Child Support Agency which said:
“As [overseas] is a reciprocal jurisdiction, should [Mr Y] not maintain this agreement to clear all outstanding arrears and pay the monthly ongoing liability, we can refer the case to the [overseas] Central Authority for enforcement.”
136 On the other hand, if the reciprocal enforcement arrangements are working well, it is difficult to understand why the case has not been referred [overseas] for enforcement in the years since [D] was born. The inference is that either the arrangements are not working or that the wife preferred to pursue the husband’s interest in the apartment to cover her child support entitlements.
137 Although there is at least a legal/theoretical possibility that the child support payments could be enforced [overseas], this would of course be dependent on the husband continuing to work [overseas]. The evidence suggested that the husband’s skills were transferable to other countries and that the husband did, in fact, have connections in other countries, including nearby [countries].
138 In defending his failure to pay child support as directed, the husband relied upon the reasonable doubts he says he had concerning paternity. Although there was an early report confirming paternity, I can understand the husband’s doubts in view of the condition from which he suffers and in view of the slight doubts about paternity expressed in the second set of results. On the other hand, I do not consider the husband was justified in relying on the fact that the wife refused to answer him when he questioned her about the child’s paternity. I accept that she felt insulted by his question, particularly as she felt that she had already made clear that he was the father. I also
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had serious doubts whether the husband thought the wife was
involved with other men in the way he claimed in his evidence.139 In considering whether or not it is appropriate to put in place a security arrangement for the payment of future child support, I cannot ignore the fact that the degree of bitterness between the parties is at the fairly extreme end of the spectrum. The husband considers that he has been tricked and defrauded by the wife. Whilst I may be doing the husband a disservice, he did not convince me that he is a person who can be relied upon to make periodical payments of child support in the future. I note also that whilst the proceedings were underway, the husband approached the bank from which the parties borrowed the funds needed to acquire [the apartment] property and attempted (unsuccessfully) to draw down the remaining credit of $17,000 on the account, without giving any warning to the wife.
140 The husband also did not deny the wife’s claim that he failed to comply with an order made on 3 December 2004 requiring him to sign documents authorising the transfer of funds from one of the mortgage accounts to the other, resulting in the wife having to make application for an officer of the Court to sign the documents on 12 January 2005.
141 Because of the fact the husband lives overseas and may be able to move to a jurisdiction where there are no reciprocal child support enforcement arrangements with Australia, I am not prepared to accept, for the time being at least, that the husband is likely to make periodical payments. I therefore consider that there is a basis for funds being held in Australia in order to secure the ongoing payment of child support.
142 The question then arises as to what form these security arrangements should take. Understandably, the wife’s anxiety is to remain in possession of [the apartment], as this has been her home and that of the child since near the time of the child’s birth. On the other hand, the authorities are clear that it is generally not appropriate to make lump sum awards of child support because of the impossibility of predicting future events that could have a significant impact on matters associated with the maintenance of the children. Luckie & Luckie (1989) FLC 92-036
143 The appropriate form of order usually is for funds to be set aside in an interest bearing investment to be deducted on a periodical basis in accordance with the current child support assessment. This is
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somewhat unsatisfactory from the point of view of the payer, since the interest to be paid on the account is likely to be fairly nominal. The payer would almost certainly be able to put the funds to better use in other forms of investment such as shares or real estate. In these circumstances, I would be prepared to give favourable consideration to any reasonable proposal the husband might wish to make that would allow his share of the proceeds of sale of the apartment to be placed in a more attractive investment, provided it is within the jurisdiction of this court or under the control of a trustee acceptable to the wife.
144 I should also note that I accept the submission made on behalf of the husband that any order that gave the wife immediate access to the husband’s capital by way of an order for lump sum child support would fall foul of s 128 of the Child Support (Assessment) Act 1989, which limits the effectiveness of lump sum payments when the payee is in receipt of a pension, as the wife is likely to be for some time. The husband would still have to pay 75% of the current assessment, even if the entire proceeds of sale of the apartment were to be allotted to the wife by way of child support.
145 If the property sells for the agreed price, the husband will have available to him an amount in the region of $85,000, less his share of agent’s commission and other costs of sale. From this will need to be paid the child support arrears of $14,410. The husband is currently obliged to pay about $9,000 per annum by way of child support. The husband’s share of the proceeds is therefore likely to be sufficient to cover somewhere less than eight years of child support payments at the current level of payment, ignoring any income the investment might earn – and ignoring the possibility the husband could perhaps obtain a reduction in his child support payments if he begins to incur substantial expense in exercising regular contact with [D].
146 Whilst I consider there is justification for the whole of the husband’s share of the proceeds of sale of the apartment being held as security for child support, I also recognise that I could be doing him an injustice in not being prepared to accept at face value his assurance he will regularly pay child support. Although he has a poor track record with the payment of child support, he now accepts that he is the father of [D] and this may make some difference to his attitude. I also recognise that it is likely the husband will want to continue to live and work [overseas] where his family resides and where he has been
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working for a long time. Accordingly, even if the husband defaulted on his obligations, there remains the hope that the reciprocal enforcement arrangements with [overseas countries] would be utilised to ensure payments were made. I should also say I gained the impression the husband may still have in mind moving to Australia to live and in that event he would want to have a clean slate as far as child support payments are concerned.
147 In these circumstances, I propose to make an order that will achieve a number of objectives. First, it will permit the husband to receive a lump sum (albeit not a large one) to meet some of his more pressing commitments. Secondly, it will secure a significant lump sum for the benefit of the child. Thirdly, it will give the husband the opportunity to show that he can be relied upon to make periodical child support payments.
148 The order I have in mind will allow the husband to receive $10,000 from the proceeds of sale of the property, but will otherwise require him to pay 30% of his child support assessment from time to time in the form of periodical payments. The balance of the husband’s share of the proceeds of sale of the apartment (after payment of the child support arrears and the $10,000 lump sum payment) will be invested in an interest bearing account, on which there will be need to be an authority to permit the payment to the Child Support Agency of the remaining 70% of the child support payments as they are assessed from time to time.
149 In the event the husband defaults on his obligation to make the regular payment equivalent to 30% of his child support obligation, I would expect the wife to seek to activate the reciprocal arrangements with [overseas countries] with a view to enforcing the husband’s obligations. If this fails to achieve the desired result, the wife would then be at liberty to seek to have the arrears paid from the corpus in the monies in the investment account.
150 I would consider such an order to be just and equitable because it goes someway towards securing the child support payments and will allow the husband an opportunity to rebuild his capital base. He will be able to do so because he will be relieved of his obligation to pay the majority of his child support payments on a periodical basis. The husband has shown that his income is sufficient to meet all of his reasonable needs plus fund quite expensive litigation. Now that the
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litigation has concluded, his surplus funds can be utilised to rebuild
his capital.151 I acknowledge that the jurisdictional basis for making an order along the lines I propose is not entirely clear. I accept that s 124 of the Child Support (Assessment) Act 1989 does not provide the necessary jurisdiction and that probably s 141 is the only provision of that legislation which could be used to support the making of such an order. That section, of course, is expressly an ancillary provision of the Act and not an independent head of power (Bryant & Bryant (1996) FLC 92-690 at 83,167). Nevertheless, I consider that in dealing with (albeit dismissing) the wife’s application for lump sum child support, I am exercising powers under the Child Support (Assessment) Act 1989 within the meaning of s 141 and hence can make an alternative form of order. It would, of course, be entirely unsatisfactory if the relevant legislation did not provide a means such as this of securing child support payments.
In adopting what might be argued to be a liberal interpretation of the ambit of s 141, I have kept in mind that the Child Support (Assessment) Act 1989 was remedial legislation, expressly designed “to ensure that children receive a proper level of financial support from their parents”. Remedial legislation is to be given a beneficial construction: Khoury & Anor v GIO of NSW (1984) 58 ALJR 502.
Spousal maintenance
152 The wife is also seeking a lump sum payment by way of spousal maintenance. She did not seek periodical payments in the alternative, but I consider it would be open to me to make such an order if I considered spousal maintenance should be paid.
153 The husband has an obligation to support the wife only to the extent that she is not reasonably able to support herself. He has this obligation regardless of the fact that their marriage was short-lived, although s 75(2)(k) does direct me, in considering such an application, to take into account the duration of the marriage.
154 In assessing whether or not it is appropriate to order spousal maintenance, it is necessary to remember that in the adjustment of property interests, I have already taken into account the impact of the marriage on the wife’s earning capacity. I should also bear in mind that whilst the wife understandably would like to retain [the apartment], it is not appropriate to ignore the equity she will have in
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that property in determining whether she has the capacity to support herself. In this regard it must be remembered that when the parties married, the wife had quite modest resources and certainly had no equity in any real estate. Regrettably, notwithstanding the wife’s desire to have some security for herself and [D], it would be reasonable to approach the issue of payment of spousal maintenance on the assumption that the wife could liquidate her interest in [the apartment] property and use the proceeds to maintain herself until such time as she has full-time employment. Furthermore, in the current economic climate, it would be reasonable to assume the wife could find some form of employment during the hours that [D] will be attending kindergarten and pre-primary. Finally, it should be recalled that the wife had an opportunity to put her [overseas] superannuation entitlements to one side for her own support, but instead chose to use the money to meet a moral obligation.
155 In these circumstances I consider that it would not be appropriate for me to make an order for spousal maintenance.
Child bearing expenses
156 The wife sought a lump sum payment by way of “child bearing expenses”. That application will be dismissed as I accept the submission made on behalf of the husband that there is no jurisdiction to make such an order in a case where the parents of the children were married.
| Costs | |
| 157 | The wife made an application for a lump sum payment by way of legal costs. I was not referred to any orders made by Magistrates adjourning any costs issues to the trial Judge. In these circumstances any arguments concerning payment of costs should await the delivery of these reasons. |
Credibility
158 It is important, before concluding these reasons, to make some observations on the credibility of the husband and the wife.
159 Both parties repeatedly accused the other of lying. I had some difficulty in assessing which of them was telling the truth on a number of the disputed matters. English is not the wife’s first language and whilst she is an intelligent and articulate person, she spoke with a fairly heavy accent. There were also cultural factors at play that made
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it difficult for me to form an assessment of credibility. Although I accept that both parties, in their everyday lives, might be honest and reliable people, the extent of their hatred for each other is such that I ultimately determined that I should approach the evidence each of them gave with even more than normal caution.
160 In arriving at my assessment of credibility, I had no hesitation in accepting that a simple typographical error, probably made by the wife’s former solicitors, led to the understatement of the wife’s original superannuation entitlements. I also accept that a couple of fairly obvious errors in the husband’s chronology of events contained in his affidavit were not any indication of dishonesty but merely reflected confusion in his mind.
161 One aspect of the wife’s evidence which concerned me related to the documentation she prepared in connection with the funds advanced to her by her [two female relatives]. The documents were prepared in English and signed by both women, notwithstanding they are illiterate even in their own language. Furthermore, the strong impression I gained was that the acknowledgement of debt/loan agreements were prepared at the same time as the money was repaid. The wife was also shown to have not been telling the truth when in an earlier Statement of Financial Circumstances she claimed that she was paying $200 per week in reduction of her “debt” to her [two female relatives] when, in fact, the evidence indicated that she had never made any payments to them until the advances were repaid in full.
162 The major area in which I consider the husband’s evidence to be suspect was his suggestion that he was planning to come to Perth to be near [D] when, in fact, it seemed much more likely that his plans were associated with his desire to further his own education in Perth. I also had some doubts whether or not he was telling the truth about the extent of the financial assistance he has been providing to his mother.
163 Both parties criticised the other for failure to produce what they saw as being relevant documents. I gained the impression that the disclosure of documents from both sides, but perhaps particularly the husband, was less than satisfactory. The husband appeared not to have disclosed some of the documents relating to his financial position after the breakdown of the marriage. The wife did not disclose all of the documents relating to the receipt and disbursement
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of the funds from her superannuation entitlement (for example,
documents relating to the joint account she had with her mother).164 I am not convinced that the failure to make adequate disclosure of documents was any indication of an intention by either party to deceive the other, but was more likely due to poor preparation of the case and strongly held views about what documents were relevant and what were not.
Orders
165 With a view to ensuring all relevant orders are contained in the one document, I will discharge the parenting orders made at trial and make them again as part of these orders.
166 As the proposed financial orders differ from anything discussed at the hearing, I will hear from the wife and counsel for the husband wife concerning the form of orders. If the wife has some means of acquiring the husband’s interest in the property, I would be favourably inclined to recast the orders to allow this to be achieved. The wife needs to appreciate, however, that the funds earmarked for future child support will still need to be set aside in an account and not retained in the form of equity in the apartment.
Parenting orders
1. The child [D], born July 2003, reside with the wife, [Ms H].
2. The wife have sole responsibility for major long-term issues in relation to the welfare of [D]’s.
3. The husband, [Mr Y], be restrained and an injunction be granted restraining him from removing [D] from the metropolitan area of Perth without the wife’s written consent or an order of the Court.
4. The requirement for the husband’s consent to the issue of an Australian passport for [D] be dispensed with and the wife be at liberty to remove the child from the Commonwealth of Australia from time to time.
5. The husband have liberty to apply in relation to the time he spends with [D] upon giving the wife 21 days’ notice in writing of his intention to exercise this liberty.
(Page 42) 6.
The husband be restrained and an injunction is hereby granted restraining him from:
(a) physically disciplining the said child; (b)
saying anything derogatory about the wife or the wife’s family to the child or within earshot of the child;
(c)
approaching the wife’s family members or posting threatening materials to them [overseas];
(d)
physically assaulting the wife, any members of her family or her friends;
(e)
changing or causing to be changed the child’s name, to a name other than according to her birth certificate.
7.
The husband be restrained and an injunction is hereby granted restraining him from entering upon or within 10 metres of the wife’s residence without the wife’s written consent.
8.
The wife shall keep the husband informed from time to time concerning significant matters relating to the health and education of [D] and shall keep the husband informed of her postal address.
9.
Paragraphs 2 and 3 of the orders made on 22 August 2006 be discharged.
10.
The application and the response, insofar as they seek parenting orders other than orders relating to the time the applicant is to spend with [D] be and are hereby dismissed.
Financial orders
11. The husband and the wife be appointed joint trustees for the sale of the property situate at and known as [the address of the apartment], (“the property”), being the whole of the land contained in Certificate of Title Volume xxxx Folio xxx.
(Page 43) 12.
The proceeds of sale of the property shall be disbursed in the manner following:
(a)
in payment of expenses of sale including agent’s commission, settlement costs and adjustment of rates and taxes;
(b)
in discharge of the mortgage to St George Bank;
(c)
in distribution of the balance then remaining as follows:
(i) 65% to the wife;
(ii) 35% to the husband;
13. The husband’s share of the proceeds of sale of the property shall be disbursed in the manner following:
(a) in payment to the Child Support Agency of all child support arrears (other than penalties) presently owing by the husband; (b) $10,000 to the husband; (c) the balance to be paid into an interest-bearing trust account (“the trust account”) in the joint names of the husband and the wife (or their nominee) in relation to which account the signature of each party shall be required for funds to be withdrawn, other than by order of the Court. 14. The husband and the wife shall execute such authorities as are required to permit an automatic bank transfer from the trust account to the Child Support Agency in an amount equal to 70% of the child support assessments for the child [D] from time to time.
15. In the event of either party defaulting on their obligation to sign an authority required pursuant to the preceding paragraph, a Registrar of the Family Court of Western Australia be authorised to sign the authority on behalf of the defaulting party.
(Page 44) 16.
The wife shall advise the Child Support Agency of the name and number of the trust account with a view to the Agency being at liberty to garnish funds in the trust account in the event that other reasonable means of enforcing the obligation of the husband to pay the remaining 30% of the periodic Child Support payments prove unsuccessful.
17.
The husband have liberty to apply to the Court for orders for the alternative investment of the funds held in the trust account and for payment to him of the balance remaining in the account.
18.
Any interest accruing on the trust account shall be deemed to be the income of the husband for all purposes.
19.
Pending the sale of the property the wife shall pay the mortgage instalments and other outgoings as and when they fall due for payment.
20.
Pending sale of the property the husband and the wife be restrained by injunction from in any way dealing with the title to the property and from extending or refinancing the loans from St George Bank.
21.
The husband retain all assets in his name, possession or control, including his entitlements in the Central Provident Fund [overseas].
22.
The wife retain all assets in her name, possession or control including the furniture, contents and effects in her possession.
23.
The husband and the wife have liberty to apply on short notice with respect to the terms and conditions for the sale of the property.
24.
The application and response insofar as they seek financial orders be otherwise dismissed.
(Page 45) I certify that the preceding [166] paragraphs are a true copy of the reasons for judgment delivered by this Honourable Court
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