Zanone & Zanone
[2022] FedCFamC2F 1474
Federal Circuit and Family Court of Australia
(DIVISION 2)
Zanone & Zanone [2022] FedCFamC2F 1474
File number(s): MLC 2391 of 2021 Judgment of: JUDGE GLASS Date of judgment: 9 November 2022 Catchwords: FAMILY LAW – PROPERTY – assessment of financial and non-financial contributions throughout the relationship – initial contributions – failure to comply with disclosure obligations – where there is a child from a previous marriage who lived with the parties – where funds from the Wife’s initial capital at cohabitation were applied to purposes outside of the relationship – whether it is just and equitable to make an order – orders made. Legislation: Family Law Act 1975 (Cth) s 79(2), s 79(4), s 81. Cases cited: Jabour & Jabour (2019) FLC 93-898; [2019] FamCAFC 78
Kingston & Field (No 2) (2020) FLC 93-986; [2020] FamCAFC 235
Kowaliw & Kowaliw (1981) FLC 91-092
Kramer & Anor & Ward (2017) FLC 93-817; [2017] FamCAFC 270
Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361; [2011] HCA 11
Parshen & Parshen (1996) FLC 92-720; (1996) 21 FamLR 199
Re Ronald Neville Mcgorm ex-parte: the Co-operative Building Society of South Australia [1989] FCA 87
Robb & Robb (1995) FLC 92-555; (1994) 18 FamLR 489
Russo & Wylie (2016) FLC 93-747; [2016] FamCAFC 227
Sabrosky & Putnam (2018) FLC 93-834; [2018] FamCAFC 32
Stanford v Stanford (2012) 247 CLR 108; [2012] FamCAFC 1
Division: Division 2 Family Law Number of paragraphs: 60 Date of last submissions: 24 October 2022 Date of hearing: 24 October 2022 Place: Melbourne Counsel for the Applicant: Mr Scriva Solicitor for the Applicant: Swifty Legal Counsel for the Respondent: Mr Potter Solicitor for the Respondent: Griese Lawyers ORDERS
MLC 2391 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS ZANONE
Applicant
AND: MR ZANONE
Respondent
order made by:
JUDGE GLASS
DATE OF ORDER:
9 November 2022
THE COURT ORDERS THAT:
1.Within 90 days, the Husband pay to the Wife the sum of $252,507, such sum to be paid to the Wife’s solicitors.
2.Having been accorded procedural fairness in relation to the making of these Orders, Orders 2 to 6 of these Orders bind the Trustee of the Super Fund B.
3.Orders 2 to 6 inclusive have effect from the operative time.
4.The operative time is the fourth business day after the day of service of a certified copy of the final sealed and signed orders on the Trustee of the Fund.
5.The Court allocate, pursuant to s 90XT(4) of the Family Law Act 1975 (Cth) (Act), a base amount of $86,905 to the Wife out of the Husband’s interest in the Fund.
6.In accordance with s 90XT(1)(a) of the Act, whenever a splittable payment becomes payable to the Husband, from his interest in the Fund, the Wife is entitled to be paid an
amount calculated in accordance with Part 6 of the Family Law (Superannuation)
Regulations 2001 (Cth) using a base amount of $86,905 and there be a corresponding
reduction in the entitlement that the Husband would have had but for these Orders.
7.Until the happening of any of the following:
(a)The establishment of a separate superannuation interest in the name of the Wife in the Fund; or
(b)The transfer or rolling over into another superannuation fund of the payment split created by Order 5 of these Orders (Payment Split); or
(c)The Husband satisfies a condition of release and the Wife is paid the Payment Split; or
(d)The Wife exercises a waiver of her rights within the meaning of s 90XZA of the Act in relation to the Payment Split,
the Husband be and is hereby restrained by himself, his servants or agents from executing a death benefit nomination in favour of any person or doing any act or thing which would render any part of his interest in the Fund a “not splittable payment” within the meaning of r 12 or 13 of the Family Law (Superannuation) Regulations 2001 (Cth).
8.The solicitor for the Wife serve a sealed copy of these Orders on the Trustee of the Fund within fourteen days from the making of these Orders.
9.Unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:-
(a)Each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders;
(b)Monies standing to the credit of either party in any bank account is to remain the property of the deposit holder;
(c)Insurance policies remain the sole property of the owner named therein;
(d)Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders; and
(e)Any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
10.All extant applications be dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym Zanone & Zanone has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE GLASS:
Ms Zanone and Mr Zanone commenced cohabitation in 2013, married in 2014 and ceased cohabitation in December 2019. Ms Zanone agreed in cross-examination that she had left the former matrimonial home at that time, despite deposing in her affidavit to the parties’ separating in April 2020. She conceded that later date was inaccurate and that the parties separated under the one roof in April 2019.
Arising for determination are the parties’ competing applications for alteration of their property interests. Ms Zanone proposes an equal distribution of the parties’ interests in property and that she receive a split of $174,821 from Mr Zanone’s superannuation interest. Mr Zanone proposes that he make a payment to Ms Zanone of $50,000 and that she receive a split of $72,000 from his superannuation interest. So much amounts to Ms Zanone retaining approximately 7% of the value of the parties’ non-superannuation assets and 12% of the value of their superannuation assets.
Statutory framework
Pursuant to section 79 of the Family Law Act 1975 (Cth) (“the Act”), I have a discretion to make such order altering the parties’ interests in property as I consider appropriate. I am prohibited from making an order unless I am satisfied, in all the circumstances, it is just and equitable to do so.[1] If I am so satisfied, I am required to consider the matters prescribed by subsection 79(4) of the Act and by the device of paragraph 79(4)(e), relevant matters referred to in subsection 75(2) of the Act.
[1] Family Law Act 1975 (Cth) s 79(2).
Property interests
It is necessary to begin by identifying, according to common law and equitable principles, the existing legal and equitable interests of the parties in property.[2] For reasons that follow, I find those assets to comprise the following:
[2] Stanford v Stanford (2012) 247 CLR 108 (“Stanford”) at [37].
Asset
O'ship
Value
Bank Accounts
W
$1,102
Motor Vehicle 1
W
$20,000
C Street, Suburb D
H
$900,000
Less Bank E Mortgage
H
($30,000)
Commonwealth Bank Accounts
H
$12,500
Bank E Account
H
$15,000
Motor Vehicle 2
H
$4,000
Motorbike 1
H
$2,500
Motor Vehicle 3
H
$4,500
Livestock
H
$90,000
Farming equipment
H
$75,000
Credit Cards
H
($165)
Total non-superannuation interests
$1,094,437
Super Fund B
H
$579,367
Total superannuation interests
$579,367
Total property interests
$1,673,804
Ms Zanone gives uncontradicted and unchallenged evidence that she has bank savings in an ANZ bank account and a NAB Classic account totalling $1,102. There is no evidence to support a finding that two other NAB bank accounts in her name have balances of $1 each as contended for in Ms Zanone’s Outline of Case, contrary to her sworn evidence, they both have nil balances.
The parties obtained a joint valuation for the C Street, Suburb D property in July 2021 of $900,000. That valuation was not challenged and no update of it was obtained. Ms Zanone’s assertion that the value of the property is $999,000 is not supported by any evidence. I accept the uncontradicted and unchallenged evidence of the valuer and find the property to be worth $900,000.
Mr Zanone gives sworn evidence that the balance of his home mortgage approximates $30,000. Ms Zanone contends that its current balance is $27,950, however adduces no evidence to support that assertion. Mr Zanone’s evidence as to the balance of the mortgage was unchallenged and I accept it.
Also unchallenged was Mr Zanone’s evidence that he has interests in two bank accounts with the Commonwealth Bank with balances totalling $12,500 and one account with the Bank E with a balance of $15,000. Ms Zanone’s assertion of the existence of another Commonwealth Bank account in his name was not established by any evidence. I accept Mr Zanone’s evidence of the value of his bank accounts.
Mr Zanone’s unchallenged evidence is that he has credit card balances totalling $165. Ms Zanone’s assertion that he has higher balances is not established by any evidence. I accept Mr Zanone’s evidence as to the balances owing on his credit cards.
Mr Zanone deposes to having a superannuation interest worth $579,367. Ms Zanone’s assertion that the balance is $582,736 is not supported by evidence. Mr Zanone’s evidence was unchallenged and I accept it.
The parties otherwise agree on the identity and value of their other interests in property, including the Motor Vehicle 3 which was orally agreed by both parties to be worth $4,500.
Justice and equity
Both parties seek an alteration of their property interests in order to finally determine the financial relationships between them.[3] It is implicit in both parties’ requests that the Court make orders that it is accepted the making of an order would be just and equitable.[4] I consider it to be just and equitable to make a property settlement order because there will no longer be the common use of property by the parties.[5]
[3] Family Law Act 1975 (Cth), s 81.
[4] Russo & Wylie (2016) FLC 93-747 at [54].
[5] Stanford at [42].
Contributions
I am required to take into account the parties’ financial and non-financial, direct and indirect, contributions to the acquisition, conservation or improvement of property, whether or not that property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them.[6] I am also required to take into account the parties’ contributions to the welfare of the family which consists of the parties to the marriage and children of the marriage.[7] Those contributions do not extend to include contributions made to the welfare of any of the parties’ children from prior relationships.[8]
[6] Family Law Act 1975 (Cth), s 79(4)(a-b).
[7] Family Law Act 1975 (Cth), s 79(4)(c).
[8] Robb & Robb (1995) FLC 92-555 (“Robb”) at 81,547.
At the commencement of the parties’ relationship, Mr Zanone owned the C Street, Suburb D property which was subject to a mortgage of approximately $33,000. Mr Zanone gives evidence that the property was then worth approximately $600,000. No objection was made to that evidence and it was unchallenged by Ms Zanone. Ms Zanone agreed in oral evidence that was then the value of the property. Absent any controversy, I find that the property was then worth $600,000.
The house on the property had been destroyed by fire in around July 2012, following which Mr Zanone received insurance payments totalling $200,145 by November 2012. Construction works commenced to rebuild the property in 2013 prior to the parties’ cohabitation at the property in July 2013. Given Mr Zanone’s evidence that the property was valued at $600,000 at the commencement of the relationship, I do not regard the application of the insurance sums to build the home on the property as an additional contribution on his behalf.
At the commencement of the relationship, Mr Zanone also had superannuation interests with Super Fund B worth approximately $220,000. He gives evidence that at the commencement of the relationship, he also owned farming equipment with a value of $20,000, several motor vehicles, several head of livestock, chattels, Company F Shares worth $3,500, Company B Shares worth $14,390 and a Company F superannuation interest worth approximately $22,000. Ms Zanone did not challenge Mr Zanone’s evidence in that regard and I accordingly accept it.
I accordingly find that Mr Zanone initially contributed non-superannuation assets worth $604,890 and superannuation assets worth $242,000.
At the commencement of the parties’ relationship, Ms Zanone owned a property at H Street, Suburb J. She had purchased the property three years earlier for $610,000. The property was sold in January 2014, generating net sale proceeds of $634,249.
Mr Zanone deposes to having contributed $45,000 towards the H Street, Suburb J property, approximately $5,000 of which was applied to a retaining wall and fencing. It appears from the parties’ oral evidence that the balance of $40,000 was applied to issues arising from an incomplete pool installation. Ms Zanone initially denied in cross-examination that Mr Zanone had given her the $40,000 to do the house up for the sale. She subsequently admitted that he had possibly given her $40,000. Mr Zanone’s evidence on the issue was not challenged. I accept it and find that he contributed $45,000 towards the H Street, Suburb J property prior to its sale.
In October 2013, Ms Zanone received a death benefit payment from her late son’s superannuation fund totalling $224,417.
The essential question arising for determination is the extent to which Ms Zanone’s capital can be treated as contributions made by her to the acquisition, conservation and improvement of the property of the parties. She relies on the proposition that “in the absence of evidence to the contrary, it should be inferred in proceedings pursuant to the provisions of s 79 that moneys howsoever received by a party during the course of the parties' cohabitation, are used by that party for the benefit of the family unit.”[9]
[9] Parshen & Parshen (1996) FLC 92-720 at 83,665.
Ms Zanone’s capital was retained by her in accounts in her sole name. Mr Zanone gave uncontradicted evidence that he considered it to have been her money and that he could not tell her what to do with it. Whilst clearly Ms Zanone’s capital was in a strict sense “property of the parties to the marriage or either of them”[10], they were not funds that were globally available for the benefit of the family unit comprising the parties to the marriage.
[10] Family Law Act 1975 (Cth) paragraph 79(4)(a).
In summary, Ms Zanone deposes in her trial affidavit to the following specific applications of her capital:
(a)$89,291.92 to the “fixtures, fittings, building materials and other items relating to the improvement of the C Street, Suburb D Property”[11] along with further unquantified sums and cash payments;
(b)$44,699.99 for the purchase of the Motor Vehicle 1 and $10,000 for the purchase of the Motor Vehicle 2;
(c)$152,000 “invested”[12] in a business operated by her daughter, Ms K; and
(d)$40,000 gifted equally to Ms Zanone’s sons, Mr L and Mr M.
[11] Applicant’s Affidavit filed 26 September 2022, paragraph 14.
[12] Applicant’s Affidavit filed 26 September 2022, paragraph 28.
Ms Zanone also deposes to the following:
Except where otherwise indicated in this affidavit, I spent the totality of the funds I received from the sale proceeds of the [H Street, Suburb J] Property and the death benefit from my late son on various household expenses for our family’s benefit…[13]
[13] Applicant’s Affidavit filed 26 September 2022, paragraph 36.
Ms Zanone’s evidence in that respect was inconsistent with her previous affidavit in which she deposed having contributed $270,000 “towards building materials and fixtures”[14] on Mr Zanone’s property and having given $80,000 to her children. It was also inconsistent with her initial oral evidence to the Court that she gave each of her children $20,000, given she has four children.
[14] Applicant’s Affidavit filed 5 March 2021, paragraph 10.
Mr Zanone’s evidence, as corrected by him in evidence in chief, is that Ms Zanone contributed in the vicinity of $72,000 to the construction and fit out of the farm house. Ms Zanone largely agreed with the sums identified by Mr Zanone in his affidavit. Although she denied spending only $1,000 on doors and door furnishings aside from the stacked doors, she was unable to answer the question of how much the doors cost. Ms Zanone’s evidence that she applied $89,291.92 to the fixtures and fittings of the C Street, Suburb D property relied on a schedule that erroneously treated credit receipts from Bunnings as expenses incurred by her. Those receipts also include significant purchases of spray paint, some of which Ms Zanone conceded was used for spraying an old motor vehicle of hers rather than anything to do with the house. In those circumstances, I prefer Mr Zanone’s unchallenged evidence in relation to the amount spent by Ms Zanone on the C Street, Suburb D property. Clearly it is a financial contribution made by her to the conservation and improvement of the parties’ property.
Ms Zanone was asked about various transactions in her bank statements that were either unlabelled or described as ‘Bills’. In the twelve months from February 2014, withdrawals of that type from her NAB iSaver account totalled $207,100. Her oral evidence that she applied all of the funds labelled ‘Bills’ to household expenses including food was fanciful given the sums involved and I do not accept it. She gave other evidence that some of those transactions related to the acquisition of a horse and horse float for her daughter for $10,000. She also gave oral evidence of three inconsistent explanations for a withdrawal of $34,000 on 6 May 2015, first asserting it was for the purchase of her car, before agreeing with Mr Zanone’s counsel that it could not have been her car. She then asserted it was absolutely spent on something to do with the house. Unprompted, she then gave evidence that it was money lent to her sister. She subsequently gave evidence that she was not very skilled at accountancy.
Ms Zanone gave her daughter Ms K the sum of $152,000 to purchase a business in February 2014. She deposes to that transaction as being an “investment”[15] and one in which she would be “entitled to a share of the business’s profits”.[16] She gave oral evidence that she considered herself to be a “silent partner”. No evidence of any agreement in relation to those financial arrangements was adduced by her. She gives no evidence of what share of the business’s profits she considered herself entitled to. Her conclusory statements are unsupported by facts that might enable the Court to be satisfied of the conclusions.[17] The business ceased operation within 12 months as a result of a statutory ban on artificial products.
[15] Applicant’s Affidavit filed 26 September 2022, paragraph 31.
[16] Applicant’s Affidavit filed 26 September 2022, paragraph 29.
[17] Kramer & Anor & Ward (2017) FLC 93-817 at [10].
On 21 October 2021, Ms Zanone was directed to produce “copies of all documents relating to the purchase and lease of the business and payments made to her children including for rent or any other payment whatsoever.”[18] Although she maintained in oral evidence that she had complied with that direction by providing documents to her solicitors, when the lease and purchase contract were called for by Mr Zanone, they were not produced. Once her representatives had indicated the documents were not available, Ms Zanone sought to correct her evidence by claiming she thought she was being asked about the lease for her current residence. That attempted clarification was fanciful, given she had been asked specifically about the order for production of documents relating to the business, including the lease. I reject her evidence that she thought she was being asked for the lease for her residential premises. It is well-established that property settlement orders may make more generous provision for Mr Zanone in the absence of Ms Zanone fully disclosing her financial affairs.[19]
[18] Orders of 21 October 2021, paragraph 1(c).
[19] Kingston & Field (No 2) (2020) FLC 93-986 at [106] and the cases there cited.
Ms Zanone also failed to call evidence from her daughter Ms K, who would clearly be in a position to explain relevant transactions between herself and Ms Zanone that related to the business. Ms Zanone herself gave oral evidence that her daughter should be answering questions in relation to the business. She was available to give that evidence. I infer from that failure that Ms K’s evidence would not have assisted Ms Zanone’s case.[20]
[20] Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361 per Heydon, Crennan and Bell JJ at [63-4].
Mr Zanone gives unchallenged evidence that, aside from funds applied to the purchase of the business, Ms Zanone spent at least a further $40,000 on the business as cash injections. Mr Zanone submits that the further sums applied by Ms Zanone to the business totalled approximately $250,000. That figure approximates the following handwritten notation appearing on the top of a bank statement of Ms Zanone’s from 10 January 2015 to 10 July 2015: “Minus business $250,965.68 (transferred to …89)”.[21] It is noteworthy that the initial purchase price of $152,000 was not transferred into the specified bank account. Ms Zanone denied that the notation reflected sums applied by her to the business. However, she provided no alternative explanation for it.
[21] Exhibit R2.
Ms Zanone gave oral evidence that the notation was recorded by her accountant. She did not call the accountant to give evidence to explain it, despite giving oral evidence that the accountant needed to give evidence in order to explain the notation. Given the issue of the application of her capital was squarely raised in these proceedings, I also infer from that failure that the accountant’s evidence would not have assisted her case.
Absent any evidence from the accountant, the absence of any alternative explanation from Ms Zanone and the general unreliability of her evidence in relation to the application of funds, I reject her denial that the figure of $250,965.58 handwritten on her bank statement for business expenses did not accord with her instructions to the accountant.
I reject Ms Zanone’s suggestion that Mr Zanone could have obtained a forensic accountant to examine the application of Ms Zanone’s capital. It is inconsistent with Ms Zanone’s failure to produce documents for a business in which she contends she was a silent partner. She gives no evidence of the enquiries she made to obtain the documents she was ordered to produce.[22] She does give evidence that the business “did not yield any financial benefit”.[23] She accepted in cross-examination that her daughter was not making any money out of the business and that she has produced no documents showing that the business made any money. It is consistent with the assertion that the business had rent to pay of $1,000 per week and Ms Zanone’s acceptance that that it had wages to pay for a staff member on a salary, that substantial funds were required in addition to the purchase price to support the business. Ms Zanone gave no evidence of other support the business may have received.
[22] Re Ronald Neville Mcgorm ex-parte: the Co-operative Building Society of South Australia [1989] FCA 87 at [5-6].
[23] Applicant’s Affidavit filed 26 September 2022, paragraph 31.
Whilst it is certainly a robust finding to conclude that Ms Zanone applied funds totalling $250,966 from her capital to the business in addition to the purchase price, a robust approach is warranted in circumstances where Ms Zanone has failed to comply with orders to produce relevant documents.[24] It is a finding consistent with the accountant’s notation to her bank account, which accountant was not called to give evidence. Further, the business’ registered owner was available and also not called by Ms Zanone. I conclude that Ms Zanone applied a total of $402,699 from her capital to the business.
[24] Sabrosky & Putnam (2018) FLC 93-834 at [32].
Mr Zanone contends that I ought treat Ms Zanone’s expenditure on the business as wastage. That concept is relevant where a party has engaged in conduct designed to reduce or minimise the value of matrimonial assets or acted recklessly, negligently or wantonly with respect to matrimonial assets.[25] Here, it is not so much that Ms Zanone has acted with respect to matrimonial assets, rather she has applied her initial capital to purposes outside of the marriage. I consider it preferable to treat her expenditure in that sense as reducing the extent and weight to be afforded to her financial contributions to the marriage. Put another way, it is evidence militating against the otherwise available inference that the totality of her capital funds are a financial contribution by her.
[25] Kowaliw & Kowaliw (1981) FLC 91-092 at 76,644.
Ms Zanone’s trial evidence is that she gave $20,000 to each of her sons in late 2013. That evidence is as follows:
On 19 December 2013, I withdrew $35,000 from my ANZ Access Advantage account. From that amount, I gifted $20,000 to my son, [Mr L], and $15,000 to my other son, [Mr M]. (…) [Mr M] received $5,000 less than [Mr M] because I had already advanced that amount to him on a previous occasion.[26]
[26] Applicant’s Affidavit filed 26 September 2022, paragraph 49.
Inconsistently with that evidence, when asked why she withdrew $20,000 on 16 October 2013, she gave oral evidence that she could have given it to Mr M, although I accept that she may have been confused about the timing of those payments.
Ms Zanone gave oral evidence that she gave funds to her children which transactions were labelled as being referrable to each of them in her bank accounts, including helping to pay Ms K’s rent. That oral evidence is inconsistent with her affidavit evidence in which she deposes that if not mentioned in her affidavit, she applied the “totality” of her capital funds to household expenses for the family’s benefit.[27]
[27] Applicant’s Affidavit filed 26 September 2022, paragraph 36.
The bank statements in evidence reveal transactions totalling $48,130 labelled with the names of her children from a previous relationship which find no mention in Ms Zanone’s affidavit:
(a)a total of $3,070 for Mr L from April 2015 to May 2017;
(b)a total of $33,060 for Ms K from October 2014 to May 2017; and
(c)$12,000 for Ms O on 5 May 2017.
I accordingly conclude that Ms Zanone gave direct cash funds to her children totalling $88,130. I note that figure approximates Ms Zanone’s original evidence that she gave $80,000 to her children.
The full extent of the sums applied by Ms Zanone to the benefit of her children from the remaining approximately $196,000 of capital unaccounted for is not particularised by her. She gave oral evidence that other transactions in her accounts related to Christmas presents including for her children, the purchase of a horse and horse float for her daughter with a total price of $10,000, school fees and uniform costs for her granddaughter. Through her counsel, she put to Mr Zanone that she was using her own savings to raise Ms O who lived with the parties throughout their cohabitation, which proposition he accepted. In her earlier affidavit, Ms Zanone gave evidence that she spent the funds she understood to be remaining from her capital of $288,000 on “day to day living expenses for Ms O, myself and [Mr Zanone] from the beginning of the relationship to the end”.[28] Given that evidence, I conclude that a substantial portion of the capital unaccounted for was applied to the benefit of her children, and particularly Ms O.
[28] Applicant’s Affidavit filed 5 March 2021, paragraph 12.
The other funds Ms Zanone advanced to her children, as well as those applied to their benefit, were also not used for the benefit of the marriage and so similarly cannot be seen as a contribution made by her in the sense prescribed by paragraphs 79(4)(a, b or c).
For those reasons, I conclude that the lump sums received by Ms Zanone at the commencement of the relationship ought be assessed as contributions made by her in the relevant sense in the amount of at least approximately $200,000. Those contributions were applied to the improvement of the C Street, Suburb D property, the acquisition of motor vehicles for the parties’, and other general expenditure.
During the parties’ relationship, Mr Zanone was employed full-time as a tradesman generating average annual income of $58,000. He also worked on the farm, although it has not generally been profitable during the relevant period.
During the parties’ relationship, Ms Zanone was in receipt of a disability support pension, initially at the rate of $827.10 per fortnight, as well as family tax benefits at an initial rate of $160.72 per fortnight.[29] She accordingly received income of less than $26,000 per annum.
[29] Exhibit A3, Annexure -16.
Mr Zanone’s unchallenged evidence is that he did the majority of the farm work on the property and contributed to domestic chores. Ms Zanone gave unchallenged evidence that she assisted Mr Zanone with farm work to the extent her physical condition permitted and that she was primarily responsible for domestic tasks such as cooking, cleaning and shopping for groceries.
I reject Ms Zanone’s evidence that she was responsible for the family’s day to day expenses and that Mr Zanone paid only rates and the power bill until the last 12 months of their relationship. She conceded in cross-examination that he had paid the mortgage for the C Street, Suburb D property and its rates throughout the parties’ relationship, though she may have paid a rates bill. She also failed to challenge Mr Zanone’s evidence that he contributed a large portion of his income to household expenses.
I conclude that by virtue of the increased initial contributions made by Mr Zanone and the additional income received by Mr Zanone during the parties’ relationship, that a holistic assessment of contributions substantially favours him. I am, however, not satisfied that an assessment of those contributions should sound in them being assessed as 93% in favour of Mr Zanone. An assessment of that magnitude in his favour appears to erroneously search for a nexus between Mr Zanone’s initial contribution by way of the C Street, Suburb D property and its present value.[30] The increase in the value of the property appears to have been unrelated to the efforts of the parties. Further, a 7% assessment of Ms Zanone’s contributions undervalues both her capital contributions and the contributions she made during the parties’ relationship, including through direct financial contributions to the improvement of the C Street, Suburb D property. I accordingly do not consider that the parties’ prior informal agreement to distribute the value of the parties’ assets as now proposed by Mr Zanone is just and equitable.
[30] Jabour & Jabour (2019) FLC 93-898 at [71].
Weighing the myriad of contributions, and particularly the parties’ financial contributions, I consider that their contributions to the non-superannuation assets ought be assessed as favouring Mr Zanone in the proportion of 75% and Ms Zanone in the proportion of 25%. So much would lead to a difference in dollar terms of $547,219.
In terms of the superannuation assets, neither party could articulate the basis upon which the relevant superannuation split proposed by them was calculated. It is Ms Zanone’s case that she ought receive a split of $174,821, equating to her retaining 30% of the value of the parties’ superannuation interests. It is Mr Zanone’s case that Ms Zanone ought receive a split of $72,000, equating to 12% of the parties’ interests in superannuation.
Mr Zanone initially had superannuation interests worth approximately $242,000. They are now worth $579,367. Ms Zanone’s indirect contributions to Mr Zanone’s superannuation spanned only approximately six and half years. On Mr Zanone’s unchallenged evidence in relation to his earnings during the parties’ relationship, his compulsory superannuation contributions during that period would have been modest. Ms Zanone herself made no contributions to her superannuation. I consider Ms Zanone’s indirect contributions to Mr Zanone’s superannuation ought be assessed at 15%, or $86,905, leaving Mr Zanone with $405,557 more superannuation than Ms Zanone.
Paragraphs 79(4)(d, e, f and g) and subsection 75(2) factors
Ms Zanone is now 58 years old. She suffers from a broken neck which she sustained approximately 18 years ago. She is unemployed as a result and is in receipt of a government disability support pension at the rate of $513 per week or approximately $26,700 per annum.
Mr Zanone is now 62 years old. He suffers from carpal tunnel issues. He is not currently employed, having last worked in August 2022 as a tradesman in the services industry. His average taxable income for the last 8 years as a tradesman has been approximately $58,000 per annum. Mr Zanone operates a farming operation on the C Street, Suburb D property which operates at a loss, although he gave oral evidence that farming has improved in the last couple of years.
During the parties’ relationship, Ms Zanone’s daughter Ms O lived with the parties. In contributing to Ms O’s support, including providing her with accommodation, Mr Zanone was acting as a volunteer in circumstances where he had no legal obligation to support her.[31] Neither party deposed to the extent of any contributions made by Ms O’s father to her financial support. Mr Zanone gave oral evidence that Ms O’s father made some modest contributions towards her upkeep.
[31] Robb at 81,547.
Neither party contended that the relevant factors ought sound in an adjustment in either of their favour. Whilst the earning capacity differential between the parties might otherwise lead to some adjustment in favour of Ms Zanone, the principles enunciated in Robb[32] point in the other direction. Ultimately, I agree with the parties that no adjustment should be made to the assessment of the parties’ contributions.
[32] Robb.
Conclusions
I consider it just and equitable for Ms Zanone to retain 25% of the value of the parties’ non-superannuation assets, equating to assets worth $273,609. She will retain her existing assets worth $21,102, with the result that she requires a further sum of $252,507 to be paid to her. There is no evidence before me of the extent to which Mr Zanone is able to borrow to make a payment to Ms Zanone. Given he has earning capacity as a tradesman and substantial superannuation, he may be able to borrow sufficient funds to pay Ms Zanone. I will accordingly give him an opportunity to raise sufficient funds to do so. Given the payment is substantially more than he proposed, I consider it just and equitable to allow 90 days for him to arrange the finance.
Whilst it might ordinarily be expected that a default provision would be made for the sale of the property in the event the payment is not made, neither party sought such an order. In that circumstance, I consider it procedurally unfair to now impose a default provision. Clearly, in the event the payment is not made by the due date, Ms Zanone has enforcement rights under the Court’s rules.
I consider it just and equitable for Ms Zanone to receive a superannuation split from Mr Zanone’s superannuation of 15%, equating to $86,905. The superannuation trustee has been afforded procedural fairness of the orders proposed by Ms Zanone which I prefer for that reason. The injunctive relief sought by her pending that split is effectively agreed, although I prefer Ms Zanone’s formulation due to it being more comprehensive. Given the agreed injunction, I consider it proper that Ms Zanone be required to serve a copy of the Orders on the superannuation fund within 14 days as proposed by Mr Zanone.
Both parties otherwise agree that they should each retain the other assets in their respective ownership and possession. I prefer Mr Zanone’s formulation of the relevant orders as it is more comprehensive.
I certify that the preceding sixty (60) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Glass. Associate:
Dated: 9 November 2022
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