ZHOU & SUN
[2017] FCCA 1615
•14 July 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| ZHOU & SUN | [2017] FCCA 1615 |
| Catchwords: HELD – As the Mother was the sole carer and homemaker for the parties’ son and managed and maintained the parties’ Australian assets singlehandedly, the Wife made a greater contribution during the marriage to the parties’ non-Singapore assets such that there should be an adjustment of 10% in her favour – the Husband has a greater earning capacity and a significant financial resource being his interest in the Singapore assets pursuant to the Singapore orders such that there should be an adjustment of the parties’ non-Singapore assets in favour of the Wife for section 75(2) factors of 20%. |
| Legislation: Family Law Act 1975 (Cth), ss.75(2), 79(2), 79(4) |
| Cases cited: Hickey and Hickey and Attorney General for the Commonwealth of Australia [2003] FamCA 395 Bevan & Bevan [2013] FLC 93-545 Bevan & Bevan (No.2) (2014) FLC 93-572 |
| Applicant: | MS ZHOU |
| Respondent: | MR SUN |
| File Number: | MLC 10035 of 2012 |
| Judgment of: | Judge Bender |
| Hearing date: | 26 June 2017 |
| Date of Last Submission: | 26 June 2017 |
| Delivered at: | Melbourne |
| Delivered on: | 14 July 2017 |
REPRESENTATION
| Counsel for the Applicant: | Mr Hamilton |
| Solicitors for the Applicant: | Nevett Ford |
| Counsel for the Respondent: | Self-Represented |
| Solicitors for the Respondent: | Not Applicable |
ORDERS
On or before 13 August 2017 (“the date”) the Husband pay to the Wife the sum of $61,300 (“the payment”).
The Husband shall forthwith
(a)do all things and execute all documents required to transfer to the Wife at the expense of the Wife all of his right, title and interest in the property known as and situated at Property A in the State of Victoria more particularly described as Volume (omitted) and Folio (omitted) (“the Property A”); and
(b)at his sole expense remove any caveat secured by him over the Property A property.
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 superannuation and other property (including choses-in-action) owned by or in the possession of such party as at the date of these orders;
(b)insurance policies remain the sole property of the owner or beneficiary named therein;
(c)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders; and
(d)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
IT IS NOTED:
A.Upon the Husband making the payment by the date the Wife is required pursuant to order (3)(d) of the orders made on 4 December 2015 by the Family Justice Courts of The Republic of Singapore to transfer to the Husband all her interest and share in and the title to the (omitted) Flat at (omitted) , Singapore (“the (omitted) Flat”).
B.In the event the Husband fails to pay the Wife the whole of the payment by the date then pursuant to order (3)(e) of the orders made 4 December 2015 by the Family Justice Courts of The Republic of Singapore, the (omitted) Flat shall be sold and so much of the payment that remains outstanding shall be paid to the Wife from the proceeds of sale of the (omitted) Flat.
IT IS NOTED that publication of this judgment under the pseudonym Zhou & Sun is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLC 10035 of 2012
| MS ZHOU |
Applicant
And
| MR SUN |
Respondent
REASONS FOR JUDGMENT
Introduction
This matter relates to the division of property following the breakdown of the parties’ marriage.
The Wife was born in (country omitted) and the Husband in (country omitted).
The parties married in Singapore on (omitted) 1994.
The parties’ son X (“X”) was born in Singapore on (omitted) 1997.
In 1999 the Wife and X migrated to Australia. The Husband remained living in Singapore for the entirety of the parties’ marriage.
On 4 December 2015 the Family Justice Courts of The Republic of Singapore made orders by consent that dealt with the parties’ Singapore assets (“the Singapore orders”).
The Singapore orders provide as follows:
“3. Orders made:
By Consent:
a. The matrimonial assets in Singapore comprising
(a) the (omitted) flat at (omitted) Singapore (“the (omitted) flat”), and
(b) the Defendant’s funds in his (omitted) Accounts
shall be divided 20% in favour of the Plaintiff and 80% in favour of the Defendant.
b. For the avoidance of any doubt whatsoever, the 20%:80% proportion of division of the Singapore matrimonial assets shall not be construed as an admission acknowledgement or concession whatsoever that the remaining matrimonial assets (outside of Singapore) shall be divided in the same proportion.
c. Subject to the prayers below, the Defendant shall pay a sum of S$115,564.00 to the Plaintiff being the agreed value of the Plaintiff’s 20% share in the Singapore matrimonial assets. The Defendant shall pay the same sum of S$115,564.00 as follows:
(a) By way of a set off against the value of the Defendant’s share in the division of the other matrimonial assets outside of Singapore in the Australian Court’s final order; and
(b) if the value of the Defendant’s share in the other matrimonial assets outside of Singapore as divided under the Australian Court’s final order is less than S$115,564.00 or is zero, the Defendant shall pay the remaining balance or the entire sum of S$115,564.00 (as the case may be) to the Plaintiff within 30 days of the final order.
d. The Plaintiff shall transfer all her interest and share in, and title to the (omitted) flat to the Defendant and/or nominee upon full payment of the sum of S$115,564.00 by the Defendant.
e. If the Defendant shall fail and/or refuse to make payment of the said sum of S$115,564.00 in accordance with Paragraph 3 above,
(a) the (omitted) flat shall be sold in the open market with both parties having joint conduct of the sale;
(b) both parties shall bear the costs and expenses of the sale jointly;
(c) and the sale proceeds shall first be utilised to repay any monies owed to (omitted), and secondly to refund to the (omitted) accounts of the parties all (omitted) savings utilized by the parties for the acquisition of the (omitted) flat including any interest accrued thereon; and
(d) the balance sale proceeds shall be used to pay the said sum of S$115,564.00 to the Plaintiff and the remaining to the Defendant.
f. The Registrar shall be empowered to sign any documents and instruments relating to the transfer or the sale of the said (omitted) flat (as the case may be) in the event of a default by other party to sign the documents and instruments within 14 days of notice to sign the same.
g. Parties are at liberty to disclose this Order of Court to the Australian Courts in the ongoing matrimonial proceedings between parties.
h. Parties shall be at liberty to apply.
i. There shall be no order as to costs.
The Wife is seeking orders that of the parties’ remaining assets outside of Singapore, the Husband transfer the property at Property A (“Property A”) to her, she be responsible for the small mortgage on Property A and she otherwise retain her remaining assets including her small superannuation entitlement of $22,000. She also proposes the Husband pay to her the monies payable under the Singapore orders.
It is the Wife’s proposal that upon the Husband complying with the payment required under the Singapore orders, the Husband retain the Singapore property as well as the property at (omitted), (omitted) (“the (omitted) property”) currently registered in the Husband’s name.
It is the Husband’s proposal that the Wife pay him $445,093 (or $335,093 on the basis she relinquishes her entitlements under the Singapore orders) and he transfer his interest in the Property A property to the Wife. It is the Husband’s proposal the parties otherwise retain all assets in their possession or control which would mean he would retain the (omitted) property and the Wife would retain her superannuation.
Background
The financial history of the parties set out in this judgment may not be entirely accurate as unfortunately while both parties’ affidavit material was lengthy, much of it was not relevant and lacked independent supporting material. Neither party was cross-examined in any detail on their financial history and neither provided an outline of case document that assisted the Court in this regard. The financial history of the parties is therefore set out in this background as best as is possible given the evidence available to the Court.
The Wife was born in (country omitted) on (omitted) 1968 and is aged 49 years. She works part time as an (occupation omitted) earning approximately $17,800 per annum. She is not currently in a relationship. She rents a room in (omitted) for $400 per month. She currently receives rental of $1,200 per month from the Property A property together with monthly spousal maintenance of $500 from the Husband.
The Husband was born on (omitted) 1963, is aged 53 and is an (occupation omitted) earning $75,000 per annum. The Husband has remarried. He lives in the Singapore property with his wife and her 17 year old son.
The parties married in Singapore on (omitted) 1994. At the time the parties married the Husband was employed with (employer omitted). He owned a property in (country omitted) which he had purchased in 1990.
In 1997 the (country omitted) property was purchased in the Husband’s sole name. How this purchase was funded has not been explained by the parties.
In 1999 the Singapore property was purchased in the parties’ joint names. Again how this purchase was funded is unknown.
In 1999 the Wife and the parties’ son X moved to Australia.
In 2000 the parties jointly purchased a property at Property B (“the Property B property”) for $125,000. A deposit of $25,000 was paid and the balance of the purchase monies was borrowed.
In 2001 the Wife purchased a (omitted) business known as (“omitted”) for $40,000. The business was not successful and was sold 12 months later for $16,000.
In 2002 the Wife purchased another (omitted) business in (omitted). This too proved to be unsuccessful and was sold shortly after purchase.
In 2003 the parties purchased the Property A property for $219,000. A deposit of $20,000 was paid and the balance was borrowed.
In 2004 the parties purchased a property at Property D (“the Property D property”) for $340,000. A deposit of $30,000 was paid and the balance was borrowed. The $30,000 was the redundancy payment received by the Husband when he was retrenched from (employer omitted) in 2004.
In 2004 the Husband sold the property in (country omitted) owned by him prior to the parties’ marriage for approximately $38,000. It is the Husband’s evidence $13,000 of the sale proceeds were, at the Wife’s request, loaned to an unnamed friend of the Wife and never repaid. The Wife denies any such loan occurred. It is her evidence she believes $8,000 of these funds were placed in the parties’ joint Australian account and the balance used towards the mortgage on the (country omitted) property.
In 2007 the Property B property was sold for $340,000. The mortgage on that property of $131,000 was discharged.
The Husband alleges that the Wife is unable to account for $140,000 of the net proceeds of sale of the Property B property. He highlights the varied explanations made by the Wife in the three affidavits filed by her on this issue between November 2013 and April 2015 as evidence of the Wife’s inability to explain what she did with this money. The Husband argues that this unexplained expenditure by the Wife should be considered as wastage by the Wife.
It is the Wife’s evidence that the sale of the Property B property was many years ago and that any variation in her estimate of the amounts spent on various items reflect her further recollection of those events. It is her evidence that because the Property B property was sold during the marriage and because it is now 10 years since its sale, she did not retain the original documents relating to the sale and is unable to obtain copies of those documents.
The Wife denies the Husband’s allegation of wastage. It is her evidence that the net proceeds of sale were placed in the parties’ joint account and the Husband was aware of her use of those funds.
It is the Wife’s evidence that to the best of her recollection the proceeds of sale of the Property B property were expended as follows:
| $65,000 | Deposit on property at Property C, Melbourne |
| $10,000-$11,000 | Stamp duty and costs of purchase of Property C property |
| $15,100 | Costs and commission on sale of Property B property |
| $12,000-$25,000 | Costs of renovations for Property B property prior to sale |
| $8,000-$30,000 | Costs of family holidays to (country omitted), including travel and accommodation, spending money, a cosmetic procedure undertaken by the Wife and jewellery purchased by her |
| $5,000-$13,000 | Shares and currency investment |
| $16,000 | Purchase of Hyundai motor vehicle |
| $5,500-$6,000 | Dental care for X |
| $14,000 | Costs of obtaining (omitted) qualifications |
| $57,600 | Rental costs for three years for the Wife and X living in rental properties in (omitted) |
| $9,000-$12,000 | Utility costs for three years |
| $4,000 | Furniture and appliances |
| $5,000 | Repayment of loan to the Wife’s mother |
It is the Wife’s evidence that between 2008 and 2011 she and X lived in three different rental properties in (omitted). She agrees that she sublet rooms in the (omitted) rental properties which augmented her income and offset the rental paid by her on the properties.
It is noted that during the marriage the Husband also augmented his income by renting rooms in the parties’ Singapore property. He also received rental for the (country omitted) property.
In 2007 the Wife purchased an apartment at Property C (“the Property C property”) for $230,000 -$235,000. She used $65,000 from the proceeds of sale of the Property B property by way of deposit and a further $10,000 for stamp duty and registration fees.
The Wife’s evidence is the Body Corporate for the Property C property sent the Body Corporate fee/rate notices to the wrong address and as she did not receive them, they fell into arrears. It is the Husband’s evidence he had to borrow $10,000 from his sister to pay the arrears.
The Property C property was sold in 2010 for $208,000 at a loss to the parties.
It is the Husband’s evidence that when the Wife and X moved to Australia he paid $3,000 per month to the Wife for the support of she and their son.
It is the Wife’s evidence that the Husband paid $2,000 per month until 2011 when the payment increased to $3,000.
After the Wife and X moved to Australia, the Husband visited them in Australia for a week up to twice a year. The Wife and X would also visit the Husband up to twice per year travelling to Singapore or for holidays with the Husband in (country omitted) or other (omitted) countries.
On 1 November 2012 the Wife filed an Application for Divorce which she served on the Husband on 8 November 2012. The Husband opposed the Wife’s Divorce Application on the grounds that until November 2012 the marriage was intact and the service on him of the Wife’s Divorce Application was the first time the Wife had advised him she considered their marriage to be over. The Wife withdrew the Divorce Application.
Both parties now agree they separated in November 2012.
On 21 May 2013, the Wife filed an Initiating Application seeking final property orders.
On 23 August 2013, interim orders were made for the Husband to pay $5,100 for tuition fees for X until the end of year 12 and for him to pay the Wife the sum of $500 per month interim spousal maintenance in addition to child support as assessed.
On 21 April 2014 orders were made by consent for the sale of the Property D property and for the proceeds of sale to be applied in payment of the costs of sale, discharge of the mortgage and payment to the Wife of $29,215, the characterisation of that payment to be determined by the trial judge.
The Property D property was sold for $560,000 and after the discharge of the mortgage on that property and the payment to the Wife, the balance of the proceeds of sale were used to pay down the mortgage on the Property A property so that the amount outstanding on that mortgage is now only $6,500.
On 28 August 2014, orders were made for the parties to do all things necessary to jointly apply to the ((omitted) in Singapore) Tribunal for an adjustment and division of the Husband's (omitted) as between the parties.
As set out in paragraphs 6-7 of this judgment, consent orders were made in the Family Justice Courts of The Republic of Singapore dividing the parties’ Singapore assets.
The Husband continues to pay the Wife $500 per month. He is also paying $335 per month directly to X for his support whilst he is studying (course omitted) at (omitted) University.
The Issues
Having considered the parties’ evidence and their submissions the issues between the parties are:
a)how should the payment of $29,215 to the Wife from the proceeds of sale of the Property D property be characterised?;
b)should there be any adjustment for contributions in the Husband’s favour arising from:
i)the alleged wastage by the Wife of some of the proceeds of sale of the Property B property;
ii)the alleged poor investment decisions by the Wife and in particular losses arising from the two (omitted) businesses and the Property C property; and
iii)the Husband’s greater financial contributions?;
c)should there be an adjustment for contributions in the Wife’s favour for her role in having the sole responsibility for X’s upbringing since moving to Australia in 1999 and for her management of the parties’ Australian assets?
d)what adjustments should be made pursuant to section 75(2) favours in the Wife’s favour for;
i)the Husband’s greater earning capacity; and
ii)the financial resource that is the Husband’s greater interest in the Singapore properties pursuant to the orders of the Singapore Court?
The Law
Section 79 of the Family Law Act 1975 (“the Act”) defines the Court’s powers in determining applications for property settlement. Section 79(2) of the Act provides that:
The Court shall not make an Order under this Section unless it is satisfied that, in all the circumstances, it is just and equitable to make the Order.
Section 79(4) of the Act sets out the matters the Court must take into account when considering what orders should be made for the alteration of the interest of the parties in property. Those matters are:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
(f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
The matters to be taken into account under section 75(2) of the Act are as follows:
(a)the age and state of health of each of the parties; and
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h)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; and
(ha)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; and
(j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party's role as a parent; and
(m)if either party is cohabiting with another person--the financial circumstances relating to the cohabitation; and
(n)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; and
(naa)the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i) a party to the marriage; or
(ii) a person who is a party to a de facto relationship with a party to the marriage; or
(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na)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; and
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any financial agreement that is binding on the parties to the marriage; and
(q)the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.
The High Court in the matter of Stanford v Stanford [2012] HCA 52 held that prior to making orders for the division of the property in which the parties have an equitable interest in accordance with the provisions of section 79 of the Act, the Court must first determine that it is just and equitable that the Court make such orders.
The High Court in Stanford (supra) held that in the majority of matters the decision as to whether it is just and equitable for the court to make property orders is easily resolved by the breakdown of the marital relationship and the mutual desire of both parties for orders altering their respective property interests.
This is such a matter. It is therefore apparent it is just and equitable that orders be made adjusting property matters between the parties.
Prior to the decision in Stanford (supra), a trial judge would follow the four step approach in determining how to alter property interests between the parties as articulated by the Full Court in Hickey and Hickey and Attorney General for the Commonwealth of Australia [2003] FamCA 395.
The four step process set out in Hickey is as follows. Firstly, the Court determines the nature of the property pool and attributes valuations. Secondly, the Court considers the contributions of the parties to the property pool including direct and indirect financial contributions and non-financial contributions often in the form of homemaker or parent. Thirdly, and after considering entitlements based on contributions the Court determines whether any further adjustments to either party’s entitlement is proper, given the considerations under s 75(2) of the Act. Finally, the Court stands back and considers whether the proposed division of the property is just and equitable pursuant to section 79(2) of the Act.
The High Court in Stanford (supra) and subsequently the Full Court in Bevan and Bevan [2013] FLC 93-545 observed that this four step approach should not be rigidly followed.
In Bevan & Bevan (No 2) (2014) FLC 93-572 the Full Court, having upheld the appeal against the decision at first instance proceeded to re-determine the property application before the Court. At paragraphs 18 and 19 of Bevan (No 2) Bryant CJ and Thackray J state the following:
18.Senior counsel for the husband structured his submissions by reference to the “four-step” approach to property settlement applications discussed in our earlier reasons. By way of explanation for doing so, senior counsel said:
16.The adoption of the above [four-step] approach is not intended to presuppose a positive answer to the question posed [by] section 79(2), nor to suggest that it is an approach appropriate in all proceedings. Rather, and provided that the fundamental propositions outlined by the High Court in Stanford (2012) 293 ALR 70 … are not obscured, such approach is intended to and does no more than provide a principled, disciplined and structured means by which all of the matters arising for consideration pursuant to section 79 can be conveniently and properly identified and assessed.
17.Further, and whilst not said critically nor in a matter which seeks to cavil with the decision in this appeal, no other approach to the determination emerges readily from either Stanford nor the decision in this appeal. It is respectfully submitted that provided that the ‘fundamental propositions’ articulated in Stanford are not obscured, and whilst not universally so as has always been recognised, the approach set out above continues to provide a proper, transparent, certain and structured approach to the presentation and determination of applications pursuant to section 79.
19. We have no issue with what senior counsel has said about the utility of the four-step process, which we accept provides a convenient way to structure both submissions and judgments, provided the caveat mentioned is not overlooked.
I am satisfied that this is a matter where the four step approach of Hickey is the appropriate approach to be taken to determine a just and equitable division of property between the parties.
Assets and Liabilities
How should the payment of $29,215 in 2014 to the Wife from the proceeds of sale of the Property D property be characterised?
The Wife’s solicitors made no submissions to the Court as to how these funds should be treated.
The Husband made no oral submission as to how those funds should be treated however in his trial affidavit sworn 9 June 2017 the Husband deposed that these funds should be treated as partial property settlement and included in the pool of assets for division between the parties.
When the order was made by the Court the Husband had not provided support to the Wife since separation in November 2012. The Wife was earning a very small income and supporting the parties’ son with little assistance from the Husband.
In those circumstances I am of the view this payment should be classified as spousal maintenance.
The parties are otherwise in agreement as to what constitutes the pool of assets and their values. The pool is as follows:
| Non-Singapore Assets | ||
| Property A less mortgage | $725,000 -$6,500 $718,500 | |
| Property (omitted), (country omitted) | $118,000 | |
| The Wife’s superannuation | $22,000 | |
| Total: | $858,500 | |
Singapore Assets | ||
| (omitted) flat at (omitted) Singapore | The Husband’s interest: $462,000 The Wife’s interest: $115,000 | |
| The Husband's (omitted) Accounts | ||
| Total | $577,000 | |
Contributions
Was there a wastage by the Wife of proceeds of sale of the Property B property?
It is the Husband’s submission that of the $208,000 proceeds of sale of the Property B property, the Wife has only supplied a reasonable explanation for $66,800 of the monies spent by her. The expenses the Husband says are justified are $15,100 sale costs, $4,000 for renovations before sale, $6,000 for the family visit to (country omitted), $16,000 to purchase a new car, $5,500 dental care for the X, $16,200 rental costs incurred by the Wife and $4,000 for furniture and appliances.
It is the Husband’s submission that the Wife’s explanations for monies spent other than as outlined in the preceding paragraph are not supported by independent evidence and further, the varying estimates given by her as to what she expended should be seen by the Court as indicative of the Wife making these figures up rather than they being a true reflection of monies expended reasonably by her.
The Wife strongly refutes the Husband’s allegation that she wasted the proceeds of sale.
It is her evidence that the net proceeds of sale were paid into the parties’ joint account and annexed to her affidavit is a bank statement confirming the monies went into the joint account.
It is the Wife’s evidence that the Husband had full access to the parties’ joint account and its statements and therefore was fully informed of her expenditure from the joint account at all times.
It is the Wife’s evidence that at no time did the Husband raise with her any concerns about how she was spending or managing the money in the joint account. It is the Husband’s evidence that he did raise his concerns about how the monies were spent but the Wife either ignored or played down his concerns and that he did not pursue matters further with her in order to preserve the relationship.
It is the Wife’s evidence that because settlement of the sale of the Property B property is now ten years ago and because it occurred whilst the parties’ marriage was intact, she did not keep any of the documents and receipts at that time and she is not able to now obtain that information.
It is the Wife’s evidence that the use by her of the proceeds of sale of the Property B property were sensible and reasonable and that there was no wastage at all by her.
Whilst the Husband now takes issue with the explanations provided by the Wife in relation to the expenditure of some of the proceeds of sale of the Property B property, he did not really challenge the decisions made by the Wife during the parties’ marriage. Further, he had access to the parties’ joint account and its statements and in those circumstances was fully cognisant of how these monies were being expended at the time.
Whilst the Wife’s estimates and evidence as to the exact amounts spent by her has varied in the affidavits filed by her in these proceedings, I accept that she was trying to reconstruct these figures without access to the source documents and that they reflect her best memories at the time she was making those estimates.
There is nothing in the expenditure by the Wife that is profligate or extravagant.
The Wife lived and continues to live very frugally in Australia. In the period from the sale of the Property B property to separation, the Wife at best had by way of support the funds paid to her monthly by the Husband in the sum of $2,000-$3,000 per month and her limited earnings of $17,000 per year. From these monies she had to support herself and X, as well as managing the parties’ investment properties.
That some of the proceeds of sale were used by her to support herself and her son can only be seen to be appropriate and not in any way a wastage of these monies.
In all these circumstances I am of the view that there has been no wastage by the Wife of any of the proceeds of sale of the Property B property.
The Wife’s alleged poor investments
The Husband argues that the decisions made by the Wife to purchase two (omitted) businesses and the Property C property which resulted in losses to the parties should be considered by the Court to be a negative contribution by her.
It is the Husband’s evidence that the decisions for the purchases of the (businesses omitted) and the Property C property were made unilaterally by the Wife and that he felt obliged to support these decisions in order to preserve the parties’ relationship.
The Wife refutes the Husband’s evidence that she made these decisions unilaterally. It is her evidence that she had the Husband’s support in these endeavours. She concedes that they were not successful ventures but were decisions made by her in the hope that they would be successful. In respect to the (businesses omitted), their purchase was to try and enable her to generate an income upon which she could support herself and X. In relation to the Property C property, she hoped to generate further profit for the parties as did the other three property investments made in Australia.
The purchase of the (business omitted) and the Property C properties were made in the course of the marriage and the Husband acquiesced to those endeavours. Whilst these particular investments were unsuccessful, the purchases of the Property B, Property D and Property A properties have resulted in the parties now owning an unencumbered property which has a value seven times the initial capital sum invested by the parties. The Husband cannot lay claim to an interest in the successful investments but disavow himself of those investments which were unsuccessful.
Accordingly, those investments that were not successful are not to be considered a negative contribution by the Wife.
The parties’ contributions
It is submitted on behalf of the Wife that in relation to the Australian properties, hers has been by far the greater contribution given that she has been solely responsible for their care, management and upkeep given she was permanently resident in Australia and the Husband at best visited twice a year.
It is further submitted on behalf of the Wife that she has made by far the greater contribution as homemaker and parent. The Husband has spent only four weeks per year with the parties’ child and she has been almost singlehandedly responsible for his care since their arrival in Australia in 1999.
It is submitted on behalf of the Husband that whilst the Wife, through necessity, has been the primary carer for the parties’ son, it is he who has made the greater financial contributions to the parties’ Australian and (country omitted) assets.
In the Husband’s trial affidavit sworn 19 June 2017, he sets out in considerable detail using a number of tables what he calculates to have been his financial contributions to the parties’ Australian and (country omitted) assets.
The Husband deposes that his direct financial contributions to acquiring the Australian and (country omitted) assets is $193,000. The monies sent to his wife for the support of she and the parties’ son was $354,129 up to the date of separation and the monies paid by him post separation in support of the Wife and X is $88,355.
It is submitted by the Husband that when the vastly superior financial contributions made by him together with what he deems is the reckless loss of monies as a result of the (business omitted) investments and the purchase of the Property C property are considered, there should be an adjustment in his favour of 12%.
At paragraph 93 of the Husband’s trial affidavit he notes that the division of assets between parties on the breakdown of a relationship is not a precise mathematical exercise. I agree with the Husband in that regard.
During the course of the parties’ lengthy marriage, each has made contributions both as income earners and homemakers in the acquisition and conservation of the matrimonial assets.
As has been set out in paragraphs 79-80 there are financial decisions made in the course of the marriage that are successful and some that prove to be unsuccessful. It is not open to the Husband to now take issue with the unsuccessful decisions made by the Wife after the breakdown of the relationship in circumstances where he acquiesced to them at the time or shortly after they were made and where, if they had been successful, he would have quite properly sought to be entitled to a reasonable share of any profit to the parties.
The parties, somewhat unusually, made a decision to conduct most of their marital relationship on the basis that they lived in two different countries. The Wife has lived in Australia with the parties’ son from 1999. He was only two years of age when she and X arrived in Australia. This meant that she bore almost solely the responsibility for his nurturing and upkeep. Whilst there is no doubt the Husband was a loving and caring father, he was not physically present to assist in the daily care and nurturing of X. That responsibility fell solely on the shoulders of the Wife.
The Husband to his credit provided adequate financial support for his wife and son. Further, the Husband contributed, on his evidence $100,000 towards the purchase of the parties’ properties in Australia. That property is now worth $718,500, which is not an unreasonable return on the funds invested.
The parties also own a property in (country omitted). That property was purchased subsequent to the parties’ marriage. The equity in that property has increased as a result of the sale by the Husband subsequent to its purchase of a property previously owned by him in (country omitted). It would appear from the evidence that the mortgage on the (country omitted) property was discharged in or about 2004.
It would also appear that the rental from that property supports the Husband’s aged mother, although how long those funds have been utilised for that purpose is unclear.
Having considered the parties’ respective contributions to both the Australian and the (country omitted) assets, I am of the view that the contribution of the Wife as parent, homemaker and in the acquisition of the Australian assets including their upkeep, management and maintenance exceeds the Husband’s financial contributions and initial ownership of a property in (country omitted) prior to the parties’ marriage, such that there should be an adjustment in the Wife’s favour for contributions of 10%.
Section 75(2) factors
It is submitted on behalf of the Wife that the Husband has a much greater earning capacity than she.
It is submitted that whilst the Wife is in good health and qualified as a (occupation omitted) working in the (employment omitted) area, she only pursued casual (employment omitted) whilst the parties’ son was still being educated.
It is the Wife’s evidence that since X started university, she has sought to work longer hours but has found the physical nature of her employment too demanding and now suffers from back, wrist and neck injuries. She is therefore hoping to find alternate employment and to that end is currently undertaking extensive English classes to improve her current English skills. It is her evidence that despite living in Australia for 18 years, her spoken English is not good and she is attending (omitted) TAFE three days per week until the end of 2017 in an effort to improve her spoken language skills.
By contrast, it is submitted on behalf of the Wife that the Husband is in stable employment earning in excess of $75,000 per annum. He is also able to receive rental from the (country omitted) property and upon the transfer of the Singapore flat into his name, he will again be able to rent rooms in the Singapore property.
It is submitted on behalf of the Wife that there should be an adjustment in her favour arising from the orders made in the Singapore Court that provide the Husband retain 80% of the parties’ Singapore assets and she retain 20% of those assets.
It is the Husband’s submission that the Wife is capable of earning up to $60,000 per annum as an (occupation omitted) if she obtained full time employment. It is his evidence that given the parties’ son is now at university and living independently, there is nothing to prevent the Wife obtaining full time employment.
It is therefore the Husband’s submission that the Wife’s earning capacity is not dissimilar to that which he is able to generate in Singapore and accordingly there should be no finding that his income earning capacity is greater than that of the Wife.
The Husband made no submissions in relation to whether there should be an adjustment in the Wife’s favour because of the orders of the Singapore Court in relation to the parties’ Singapore assets.
Orders were made by the Court on 23 August 2013 that the Husband pay spousal maintenance in the sum of $500. Those orders were made on the basis of the disparity in the parties’ income at that time. There is no application put before the Court that final orders be made for ongoing periodic spousal maintenance for the Wife. Therefore upon the finalisation of this matter the interim spousal maintenance order will cease.
On the evidence before the Court, I am satisfied that the Husband has a superior earning capacity, albeit neither party can be viewed as high-income earners.
Whatever was the basis for the consent orders made in the Singapore Court, the reality is that the Husband has a far greater financial resource in relation to those assets than does the Wife.
When all those factors are considered I am of the view that there should be an adjustment in the Wife’s favour of 20%.
Just and Equitable
As can be seen, I have made a determination that the parties’ Australian and (country omitted) assets should be divided such that the Wife receive 80% of same and the Husband receive 20% of same.
Given the Australian and (country omitted) assets of the parties are valued at $858,500, an 80% division in the Wife’s favour would see her receiving assets worth $686,800 including the Wife’s superannuation valued at $22,000. This means if the Wife is to retain the Property A property she should pay the Husband the sum of $53,700.
Order (3)(c) of the orders made by the Family Justice Courts of The Republic of Singapore on 4 December 2015 provides as follows:
Subject to the prayers below, the Defendant shall pay a sum of S$115,564.00 to the Plaintiff being the agreed value of the Plaintiff’s 20% share in the Singapore matrimonial assets. The Defendant shall pay the same sum of S$115,564.00 as follows:
(a) By way of a set off against the value of the Defendant’s share in the division of the other matrimonial assets outside of Singapore in the Australian Court’s final order; and
(b) if the value of the Defendant’s share in the other matrimonial assets outside of Singapore as divided under the Australian Court’s final order is less than S$115,564.00 or is zero, the Defendant shall pay the remaining balance or the entire sum of S$115,564.00 (as the case may be) to the Plaintiff within 30 days of the final order.
The Court was advised by the parties that currently the Australian dollar and the Singapore dollar have almost identical value. On this basis, if the amount payable by the Wife to the Husband in order for her to retain the Property A property, being $53,700, is subtracted from the amount payable by the Husband to the Wife in order to retain the Singapore assets, then the Husband should pay the Wife $61,864 within 30 days and the Wife transfer her interest in the Singapore property to the Husband.
The making of final orders will see the Husband’s obligation to pay ongoing spousal maintenance to the Wife cease. This will ensure that he has more than sufficient income to fund any borrowings needed to pay the Wife so that he retains the Singapore property..
The orders proposed by the Court will therefore enable the Husband to retain the Singapore property, the (country omitted) property and his Singaporean superannuation.
The Wife will retain Property A which she can continue to use to generate income for herself, her small amount of superannuation and a reasonable cash payment that will support her until such time as she finishes her studies and is in a position to pursue appropriate employment for her support going forward.
As such, I am satisfied that these orders are just and equitable.
I certify that the preceding one hundred and fifteen (115) paragraphs are a true copy of the reasons for judgment of Judge Bender
Date: 14 July 2017
Key Legal Topics
Areas of Law
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Family Law
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Property Law
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Equity & Trusts
Legal Concepts
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Remedies
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Jurisdiction
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Costs
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