Zuen & Lhao
[2024] FedCFamC1F 689
•16 October 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Zuen & Lhao [2024] FedCFamC1F 689
File number(s): SYC 6260 of 2017 Judgment of: ALTOBELLI J Date of judgment: 16 October 2024 Catchwords: FAMILY LAW – PROPERTY – Undefended hearing – Where the husband failed to comply with directions of this Court – Where the husband’s application was summarily dismissed – Where the husband contributed to proceedings in a limited manner – Where the wife sought a 100:0 adjustment in her favour – Where the husband’s initial and post-separation contributions heavily outweigh the wife’s – Where the wife’s contributions during the marriage were greater than the husband’s – Where the wife’s contributions were made significantly more arduous by virtue of family violence – Where the husband withdrew significant marital funds for personal use – Where the Court recognises an addback for the withdrawn funds – Where the Court orders a back payment for unpaid spousal maintenance – Order made for 70:30 division of property in favour of the wife.
FAMILY LAW – INJUNCTION – Where the wife sought orders restraining the husband from publicising the results of these proceedings – Where the husband has a history of non-compliance with Court orders – Where an injunction against publication order is made – Where the wife sought injunctions against the husband for her personal protection – Where the wife suffered significant family violence during the marriage – Where the wife was palpably fearful of the husband – Where injunctions for the wife’s safety are ordered.
Legislation: Family Law Act 1975 (Cth) ss 4AB, 75(2), 79, 114, 114Q
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 1.33
Cases cited: Allesch v Maunz (2000) 203 CLR 172; [2000] HCA 40
Australian Securities and Investments Commission v Hellicar (2012) 247 CLR 345; [2012] HCA 17
Bauer v Bauer (2013) 49 Fam LR 575; [2013] FCCA 1125
Bevan & Bevan (2013) FLC 93-545; [2013] FamCAFC 116
Black and Kellner (1992) FLC 92-287; [1992] FamCA 2
Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34
Britt & Britt (2017) FLC 93-764; [2017] FamCAFC 27
Gadhavi & Gadhavi (2023) 67 Fam LR 174; [2023] FedCFamC1A 117
Hickey and Hickey and Attorney General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143; [2003] FamCA 395
Kennon v Kennon (1997) FLC 92-757; [1997] FamCA 27
Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361; [2011] HCA 11
Martell & Martell (2023) 66 Fam LR 650; [2023] FedCFamC1A 71
Morgan & Valverde (2022) FLC 94-100; [2022] FedCFamC1A 133
Sadler & Mistry [2015] FCCA 3407
Saso v Saso (2023) 66 Fam LR 571; [2023] FedCFamC1A 65
Stanford v Stanford (2012) 247 CLR 108; [2012] HCA 52
Wei & Xia (2024) FLC 94-186; [2024] FedCFamC1A 65
Weir and Weir (1993) FLC 92-338; [1992] FamCA 69
Division: Division 1 First Instance Number of paragraphs: 113 Date of hearing: 18 September 2024 Place: Sydney Counsel for the Applicant: Mr Ang Solicitor for the Applicant: Lincoln Legal Counsel for the Respondent: Mr Shaw Solicitor for the Respondent: Vaikom Law ORDERS
SYC 6260 of 2017 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS ZUEN
Applicant
AND: MR LHAO
Respondent
ORDER MADE BY:
ALTOBELLI J
DATE OF ORDER:
16 OCTOBER 2024
THE COURT ORDERS THAT:
1.All previous orders are discharged.
REAL PROPERTY
2.The property located at AA Street, Suburb BB NSW (Lot … in Strata Plan … (Folio …/SP…)) (“the former matrimonial home”) be sold by way of public auction.
3.The Applicant be henceforth appointed trustee for sale of the former matrimonial home and be empowered to do all things necessary to cause the said property to be sold by auction.
4.The Respondent shall do all acts and things and sign all documents necessary to cause the trustee to be able to sell the property by auction.
5.The proceeds of sale from the auction of the former matrimonial home be disbursed as follows:
(a)Payment of trustee’s fees, agent’s commission, advertising expenses and legal expenses relating to the sale;
(b)Any money due and owing to a mortgagee, namely Westpac Banking Corporation BSB … Acc …78, fixed in the sum of not greater than $645,846.78;
(c)Payment to the Applicant of an amount equivalent to 70 per cent of the net pool of assets as found in these reasons for judgment given on this date, as crystalised upon the final sale of the former matrimonial home, and in addition, the total arrears of the order for spousal maintenance made by Senior Judicial Registrar McGrath on 24 March 2022, which as at the date of this judgment totals $66,000.
6.The cash amount to be paid to the Applicant be paid into the Applicant’s solicitor’s trust account, namely Lincoln Legal Trust Account BSB … Account …99.
7.Payment of the remainder, if any, is to be made to the Respondent in an account of his specification.
8.The reserve price for the auction is to be reasonably determined by the trustee after obtaining advice from a real-estate agent about reasonable market value.
9.Subject to the preceding orders, the Applicant be declared to have the sole right, title and interest in:
(a)All bank accounts and credit cards in her sole name;
(b)Any chattels, goods, furnishing and other property which are at the date hereof in her possession;
(c)All motor vehicles registered in her name; and
(d)Any monies, debentures, shares, superannuation entitlements, rollover funds or insurance policies which stand in her sole name respectively at the date hereof.
10.Subject to the preceding orders, the Respondent be declared to have the sole right, title and interest in:
(a)All bank accounts and credit cards in his sole name;
(b)Any chattels, goods, furnishing and other property which are at the date hereof in his possession;
(c)All motor vehicles registered in his name; and
(d)Any monies, debentures, shares, superannuation entitlements, rollover funds or insurance policies which stand in his sole name respectively at the date hereof.
Procedure
11.If either party refuses or neglects to sign or execute and return, within 14 days of a written request to do so by the other party, a document required for the implementation of these orders:
(a)A Registrar of the Sydney Registry of the Federal Circuit and Family Court of Australia is hereby appointed under section 106A of the Family Law Act 1975 (Cth) (“the Act”) to sign or execute such document on behalf of that party upon lodgement of such document and the filing of an affidavit of a solicitor on behalf of the requesting party as to the said neglect or refusal;
(b)The requesting party will be at liberty to apply for costs when submitting such an affidavit to the Registrar; and
(c)The costs are to be paid into the Applicant’s solicitor’s trust account, namely Lincoln Legal Trust Account BSB … Account …99.
RESTRAINTS
12.The Respondent be restrained from publishing the outcome of these proceedings on any social media platform.
13.The Respondent be restrained, pursuant to s 114 of the Act, from:
(a)Attending at or entering upon the Applicant’s residence;
(b)Communicating with the Applicant by any means whatsoever including, but not limited to, in writing or via text message, except through her legal representative;
(c)Assaulting, molesting, harassing, threatening or otherwise interfering with the Applicant;
(d)Stalking the Applicant; and
(e)Engaging in any other conduct that intimidates the Applicant.
RELISTING
14.Leave is granted to the parties to apply to relist the proceedings on 14 days’ notice to deal with the interpretation, implementation and/or enforcement of the property orders, provided that in the event that such liberty is exercised the person seeking to relist the proceedings shall:
(a)Forthwith notify all other parties of the intention to make the request and the reason for same;
(b)Make the request for relisting in accordance with the Federal Circuit and Family Court of Australia protocol as to communication with chambers; and
(c)Contemporaneous with any notice of relisting serve upon all other parties a minute of orders to be sought together, in the case of the parties, with such evidence as is relied upon by the party in seeking such orders.
15.Save as to any s 106A application, any future application that may be filed by either party is to first be listed before Justice Altobelli if his Honour is reasonably available, subject to any recusal application.
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).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of 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 the pseudonym Zuen & Lhao has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
ALTOBELLI J:
INTRODUCTION
These reasons for judgment explain the orders the Court has made between the applicant wife (“the wife”) and the respondent husband (“the husband”) (“the parties”) pertaining to financial adjustment following the breakdown of the parties’ matrimonial relationship.
BACKGROUND
The wife is 52 years old and is currently unemployed. She currently receives a disability pension from Centrelink as her sole means of income. The husband is 67 years old and is also unemployed. The parties commenced their relationship in Country Z in 2004. The wife gave birth to X in 2006. X is the sole child to the marriage and is currently 18 years old. The parties were married in 2006. In 2007 the wife and X permanently moved to Australia. The parties separated on a final basis on 20 May 2016.
Property and employment
At the commencement of the relationship, the wife was operating a business in Country Z. She was able to extract a salary of $2,000 per month from this enterprise. Upon leaving for Australia permanently, the business was managed by the wife’s sister and parents until it closed in 2011. The wife deposes, at paragraph 40 of her affidavit filed 8 September 2023 (“8 September 2023 affidavit”), that she brought $10,000 across with her from Country Z. In November 2007 she used these savings to establish a business named “[CC Business]” (“CC Business”) run out of the former matrimonial home (8 September 2023 affidavit, paragraph 40). The wife received daily income between “$200.00 to $300.00, averaging on a weekly basis $1,500.00 to $2,000.00” (8 September 2023 affidavit, paragraph 41). At CC Business’s most profitable point the wife was earning a salary of approximately $70,000 per annum.
The proceeds from CC Business were placed into an ANZ bank account (“the ANZ account”) opened in 2007. The wife asserts that the husband had complete control over the ANZ account as he retained the attached bank card and held control of the internet banking password. When the ANZ account was closed in March 2010 no funds remained. In June 2009, the parties opened a joint account with EE Bank. The wife alleges that she provided the initial deposit of $20,000. Similarly, it is contended that the husband maintained full control over that account and withdrew funds to satisfy his own private and business expenses (8 September 2023 affidavit, paragraphs 44–45).
The wife also deposes to the existence of numerous “IOU” notes that the husband would sign in exchange for cash payments from the wife (8 September 2023 affidavit, paragraph 48). The wife allegedly received these notes between 2007 and 2016. On the wife’s evidence, “from the best of my recollection there were over 50 IOUs in the safe, the amounts for these IOU’s were mostly in the sum of $10,000.00” (8 September 2023 affidavit, paragraph 48).
The wife’s father owned a unit located at FF Street, Suburb GG, City HH, Country Z (“the Country Z property”). The property was purchased off the plan in 2002 and was registered in the wife’s sole name as she was “expected to live and care for my parents as they became older” (8 September 2023 affidavit, paragraph 59). Upon learning of the parties’ separation, the wife’s father transferred ownership of the Country Z property back into his name in mid-2016. The husband contended that in 2005 he transferred funds to the wife as contribution towards the Country Z property. The nature of the ownership of the Country Z property and the existence of any purported contribution towards it were contentious issues during the current proceedings.
Aside from limited savings and sporadic periods of gainful employment, the wife neither held significant assets at the commencement of the relationship, nor did she individually accrue significant assets during the relationship.
At the commencement of the relationship, the husband owned a two-bedroom unit located at AA Street, Suburb BB NSW (“the former matrimonial home”), which he had solely purchased in 2000. It is unclear if any liability over the property existed when the parties commenced their relationship. During the relationship the husband operated his own business, JJ Pty Ltd, and was employed as the sole director and secretary of the company (the wife’s affidavit filed 22 September 2017, paragraph 127 (“22 September 2017 affidavit”)). There is no information available to the Court to ascertain his likely income during the marriage. As per the husband’s Financial Statement filed 10 February 2022, post-separation, he still earns $401 per week from this business. The former matrimonial home, was, and still is, the most significant asset held between the parties.
Family violence
The wife attests to being the victim of significant family violence during the marriage. The alleged family violence comprises events of physical assault, verbal abuse, and coercive and controlling conduct. The first instance of physical violence occurred in mid-2007, shortly after the wife and X permanently moved to Australia. On 20 May 2016, the husband allegedly threatened and physically assaulted the wife. This event demarcated the final separation of the parties (8 September 2023 affidavit, paragraph 19).
The most significant instance of family violence occurred shortly thereafter in mid-2016. The assault, in the words of the wife, involved the husband “proceeding to smash [an object] over my head and face repeatedly. The [object] became deformed […]” (8 September 2023 affidavit, paragraph 27). The incident in mid-2016 led to an ADVO against the husband for the wife’s protection. The police charged the husband with an offence (8 September 2023 affidavit, paragraph 30).
PROCEDURAL HISTORY
This matter commenced in 2017, with both property and parenting issues. There are no parenting issues on foot as the only child to the marriage has recently turned 18 years old. It is unfortunate for any matter to be within the Court system for seven years, let alone a matter with substantial family violence issues and historic non-compliance by both parties. The substantial delay between the commencement of proceedings and final orders has been caused by numerous adjournments sought by both parties. The husband bares the bulk of the criticism for this, particularly in relation to his lacklustre disclosure.
Disclosure issues
The matter was first heard by Judge Sexton on 1 November 2017. Amongst other orders, the husband was restrained from selling the former matrimonial home and the wife was restrained from selling the Country Z property. The husband was ordered to meet the mortgage payments, rates, taxes and to maintain the former matrimonial home. Both parties were ordered to provide disclosure in relation to their private and business interests.
The matter returned on 7 March 2018 before Judge Monahan. Orders were made by consent to facilitate the valuation of the husband’s business interests. Similar disclosure orders were made with respect to the parties’ financial and business interests.
On 17 August 2018 Judge Monahan transferred this matter from the then, Federal Circuit Court of Australia, to the then, Family Court of Australia, due to cultural issues, psychological or psychiatric issues, international property issues, allegations of contempt and the probable length of any interim or final hearing.
On 26 November 2018, Loughnan J listed the matter for a four-day final hearing commencing 15 April 2019. Judgment was delivered on 5 June 2019 but was ultimately overturned on appeal and remitted for rehearing on 17 April 2020. Final parenting orders were made by consent in this matter by Senior Judicial Registrar Rice on 8 November 2021.
The matter came before Deputy Chief Justice McClelland on 9 March 2020. His Honour made orders permitting the parties to seek further disclosure before 23 March 2020, or to provide reasons for objections to the same. On 4 May 2020, Senior Judicial Registrar Bastiani extended the direction for disclosure until 1 June 2020 due to non-compliance. So too did Senior Judicial Registrar McNamara on 7 July 2020, Senior Judicial Registrar Bastiani on 9 September 2020 and Senior Judicial Registrar Turner on 24 November 2021.
On 6 December 2021, Judicial Registrar Bardetta made further orders that disclosure be exchanged between the parties before 4.00 pm 10 January 2022. Senior Judicial Registrar McGrath noted on 24 March 2022 that the husband had not fully complied with his obligations under the orders made 6 December 2021. On 8 April 2022, Judicial Registrar Bardetta noted that:
Serious issues remain in relation to ongoing disclosure in this matter. The Respondent has not filed any undertaking as to disclosure to date. The Court has requested that the parties give consideration to serving specific questions pursuant to Part 6.3 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021.
Summary dismissal
The matter first came before me Court on 6 July 2023. I made orders for the husband to comply with his disclosure obligations as particularised in the 8 April 2022 orders of Judicial Registrar Bardetta, and the 17 November 2022 orders of Henderson J. The husband did not appear during the 6 July 2023 hearing. I noted that his Amended Response and Initiating Application filed 16 July 2020 would be dismissed if his non-compliance continued. I made a similar order on 26 April 2024 with respect to the wife.
The husband filed an Application in a Proceeding on 30 April 2024. On 3 May 2024, I made orders directing the husband to file and serve an Amended Application in a Proceeding ahead of the scheduled 24 June 2024 hearing date. I noted that, if the husband did not comply with the directions before a further mention date of 17 August 2023, his application would be summarily dismissed.
The husband did not attend Court for the 17 August 2023 mention, and he did not comply with the directions provided on 3 May 2024. Considering the broader circumstances, public policy implications behind the significant time already elapsed since the commencement of these proceedings, the lack of compliance from the husband and his inconsistent participation, his Application in a Proceeding was summarily dismissed, and the matter was listed for undefended hearing on 18 September 2024.
COMPETING PROPOSALS
On the day of final hearing the wife provided a Final Minute of Order dated 18 September 2024 (“the wife’s minute of order”) detailing her property adjustment proposal.
The wife’s minute of order seeks that a trustee be appointed to arrange and facilitate the sale of the former matrimonial home. The sale proceeds are to firstly repay the outstanding balance of any Westpac mortgage encumbering the former matrimonial home, secondly to pay the trustee’s direct and incidental fees incurred whilst selling the house, as well as agent’s commission and advertising and legal expenses, and thirdly, all remaining proceeds, including any money remaining in the Westpac loan offset account, be allocated completely in the wife’s favour. The wife’s minute of order also prescribed broad facilitative orders that both parties sign all documents and do all necessary steps to effectuate the orders made.
The wife also seeks to claim the arrears of any unpaid spousal maintenance as part of the final property adjustment by way of lump sum payment from the husband’s portion of any sale proceeds from the former matrimonial home.
When asked to quantify the proposed property adjustment in percentage form, the wife’s counsel estimated that the orders would equate to an 80:20 split in favour of the wife.
The wife’s minute of order was orally varied by her counsel prior to final submissions. The wife sought to be appointed as the trustee for the sale of the former matrimonial home in the event that the entirety of the proceeds be distributed to her.
The wife also seeks personal protection orders against the husband. These include restraints on the husband attending at or entering upon the wife’s residence, communicating with her by any means whatsoever, and assaulting, harassing, threatening and stalking her.
The wife’s minute of order is reproduced in full in the schedule to these reasons.
THE EVIDENCE BEFORE THE COURT
In support of her case, the wife relies upon the following material:
(1)Outline of Case Document filed 22 September 2024;
(2)Amended Initiating Application filed 8 September 2024;
(3)Her affidavit filed 19 September 2017;
(4)Her affidavit filed 12 January 2022;
(5)Her affidavit filed 3 February 2022;
(6)Her affidavit filed 21 February 2022;
(7)Her affidavit filed 8 September 2023;
(8)Her affidavit filed 14 September 2024;
(9)Affidavit of Ms KK filed 11 September 2023;
(10)Balance sheet filed 17 September 2024;
(11)Financial Questionnaire of Mr Lhao filed 12 January 2022;
(12)Financial Statement of Mr Lhao filed 12 January 2022; and
(13)Various documents tendered during the proceedings and marked as Exhibits A1–A2.
The wife’s minute of order is tendered as the Court’s exhibit and has been marked in chambers as Exhibit C1.
The husband was represented by solicitor and counsel at the undefended hearing. Thus, he was able to participate in a limited manner. The husband was not permitted to rely upon any evidence previously filed in this matter, nor was he permitted to provide any oral evidence in chief. However, his counsel was permitted to cross-examine the wife on the evidence she relied upon, and to make submissions. During cross-examination the husband tendered various documents marked as Exhibits R1–R2.
In the interests of procedural and substantive fairness, the Court has also had regard to the husband’s proposed Minute of Order filed 17 September 2024, and any other material referred to by either party in cross-examination or submissions. The husband’s proposed Minute of Order filed 17 September 2024 is tendered as the Court’s exhibit and has been marked in chambers as Exhibit C2.
APPLICABLE LAW
Property adjustments
This is an application under s 79 of the Family Law Act 1975 (Cth) (“the Act”) which relevantly provides:
79 Alteration of property interests
(1)In property settlement proceedings, the court may make such order as it considers appropriate:
(a)in the case of proceedings with respect to the property of the parties to the marriage or either of them—altering the interests of the parties to the marriage in the property; or
(b)in the case of proceedings with respect to the vested bankruptcy property in relation to a bankrupt party to the marriage—altering the interests of the bankruptcy trustee in the vested bankruptcy property;
including:
(c)an order for a settlement of property in substitution for any interest in the property; and
(d)an order requiring:
(i) either or both of the parties to the marriage; or
(ii) the relevant bankruptcy trustee (if any);
to make, for the benefit of either or both of the parties to the marriage or a child of the marriage, such settlement or transfer of property as the court determines.
…
(2)The court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
(4)In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e)the matters referred to in subsection 75(2) so far as they are relevant; and
(f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
Section 79(4) incorporates the provisions contained in s 75(2) of the Act, which states:
(2) The matters to be so taken into account are:
(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.
In Bevan & Bevan (2013) FLC 93-545 (“Bevan”), the Full Court considered the High Court’s decision in Stanford v Stanford (2012) 247 CLR 108, which provided guidance on how s 79 was to be interpreted and implemented. Bevan endorsed the continuing application of the four‑step approach articulated by the Full Court in Hickey and Hickey and Attorney General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143 (“Hickey”), but on the basis that it is a shorthand distillation of the words of s 79 of the Act, as opposed to being a statutory edict. The four steps articulated in Hickey at [39] are:
(1)Identify and value the property, liabilities and financial resources of the parties;
(2)Identify and assess the contributions of the parties and express them as a percentage of the net value of the property;
(3)Identify and assess the other facts relevant under s 79(4)(d)–(g) including s 75(2); and determine the adjustment (if any) to be made to the contribution entitlements at step two; and
(4)Consider the effect of the above and resolve what order is just and equitable in all the circumstances.
Family violence and s 79
As part of her case, the wife raises an argument based on the principle enunciated in Kennon v Kennon (1997) FLC 92-757 (“Kennon”). Fogarty and Lindenmayer JJ at 84,294 stated:
Put shortly, our view is that where there is a course of violent conduct by one party towards the other during the marriage which is demonstrated to have had a significant adverse impact upon that party’s contributions to the marriage, or, put the other way, to have made his or her contributions significantly more arduous than they ought to have been, that is a fact which a trial judge is entitled to take into account in assessing the parties’ respective contributions within s 79…
In the above formulation, we have referred only to domestic violence…but its application is not limited to that…
…There have been marked changes in perceptions, both legal and social, about domestic violence in recent times and it appears to be appropriate to give effect to them: see Nguyen (1990) 169 CLR 245; Farnell and Farnell (1996) FLC 92-681, and lvanovic v Jvanovia (1996) FLC 92-689.
Recently, Aldridge J in Martell & Martell (2023) 66 Fam LR 650 (“Martell”) stated at [20] that:
Although widely quoted and followed, the principle stated in Kennon cannot be treated as if they were those of a statute – immutable and unvarying. At the least, those words must be read in the light of the Act as it speaks now.
The Court agrees with Aldridge J and reiterates that the parameters of the principles in Kennon must expand as the definition of family violence expands. The “Act as it speaks now” defines family violence in s 4AB as:
4AB Definition of family violence etc.
(1)For the purposes of this Act, family violence means violent, threatening or other behaviour by a person that coerces or controls a member of the person’s family (the family member), or causes the family member to be fearful.
(2)Examples of behaviour that may constitute family violence include (but are not limited to):
(a) an assault; or
(b) a sexual assault or other sexually abusive behaviour; or
(c) stalking; or
(d) repeated derogatory taunts; or
(e) intentionally damaging or destroying property; or
(f) intentionally causing death or injury to an animal; or
(g)unreasonably denying the family member the financial autonomy that he or she would otherwise have had; or
(h)unreasonably withholding financial support needed to meet the reasonable living expenses of the family member, or his or her child, at a time when the family member is entirely or predominantly dependent on the person for financial support; or
(i)preventing the family member from making or keeping connections with his or her family, friends or culture; or
(j)unlawfully depriving the family member, or any member of the family member’s family, of his or her liberty.
(3)For the purposes of this Act, a child is exposed to family violence if the child sees or hears family violence or otherwise experiences the effects of family violence.
(4)Examples of situations that may constitute a child being exposed to family violence include (but are not limited to) the child:
(a)overhearing threats of death or personal injury by a member of the child’s family towards another member of the child’s family; or
(b)seeing or hearing an assault of a member of the child’s family by another member of the child’s family; or
(c)comforting or providing assistance to a member of the child’s family who has been assaulted by another member of the child’s family; or
(d)cleaning up a site after a member of the child’s family has intentionally damaged property of another member of the child’s family; or
(e)being present when police or ambulance officers attend an incident involving the assault of a member of the child’s family by another member of the child’s family.
In Martell at [22], Aldridge J expanded the test in Kennon and made clear that given the prevalence of family violence in society today, the relevant conduct is not limited to “exceptional” cases:
It has to be said, that their Honours (sic) terms “exceptional” and “narrow” lose much of their force if cases involving significant violence are to be the subject of the application of the principles. Such cases might have been regarded as exceptional at the time Kennon was decided but they cannot today be so regarded. Unfortunately the prevalence of family violence is wide and artificial barriers to its recognition, such as trying to limit its recognition in property cases to exceptional or narrow cases, has no basis in principle…the focus of the majority’s reasoning was on the nature and quality of the contributions themselves which were not limited by such qualifying adjectives.
Undefended hearings
The Court has an obligation to ensure a fair trial and afford procedural fairness to all parties in proceedings. In Allesch v Maunz (2000) 203 CLR 172 Kirby J held:
35.It is a principle of justice that a decision-maker, at least one exercising public power, must ordinarily afford a person whose interests may be adversely affected by a decision an opportunity to present material information and submissions relevant to such a decision before it is made. The principle lies deep in the common law. It has long been expressed as one of the maxims which the common law observes as "an indispensable requirement of justice". It is a rule of natural justice or "procedural fairness". It will usually be imputed into statutes creating courts and adjudicative tribunals. Indeed, it long preceded the common and statute law. Even the Almighty reportedly afforded Adam such an opportunity before his banishment from Eden.
36.The rule is also implicit in international principles of human rights. It is inherent in the proper conduct of judicial proceedings in a court of law. It may even be an implied attribute of the Judicature established under, and envisaged by, the Constitution. So deeply ingrained is the principle that more recent times have seen its extension, with certain exceptions, to administrative tribunals and other decision-makers. The principle governed the Family Court of Australia in determining the rights of the present parties.
(footnotes omitted)
When parties fail to comply with procedural directions, the Court has a number of options available pursuant to r 1.33(2) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) as follows:
1.33 Failure to comply with a legislative provision or order
…
(2)If a party to a proceeding does not comply with these Rules, the Family Law Regulations or a procedural order, the court may do any of the following:
(a) dismiss all or part of the proceeding;
(b) set aside a step taken or an order made;
(c) determine the proceeding as if it were undefended;
(d) order costs;
(e)prohibit the party from taking a further step in the proceeding until the occurrence of a specified event;
(f) make any other order the court considers necessary, having regard to the overarching purpose of these Rules (see rule 1.04).
As explored in detail during the procedural history of this matter, due to non-compliance with procedural directions and disclosure, the Court struck out the husband’s Application in a Proceeding filed 30 April 2024 and listed the matter for undefended hearing.
If a party does not comply with procedural directions but still attends the final hearing, a judge may allow limited engagement by that party (Morgan & Valverde (2022) FLC 94-100; Saso v Saso (2023) 66 Fam LR 571). In this matter the Court ruled that the husband could not rely on any evidence in chief, but could cross-examine on issues arising from the wife’s material, tender documents in support of such cross-examination and make final submissions.
CREDIT FINDINGS
A witness giving oral testimony is bound by the obligations enunciated by the High Court in Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361. Namely, they must tell the truth, the whole truth and nothing but the truth. The same obligation applies to deponents to affidavits. Here, the wife had no contradictor to her evidence-in-chief. The case was undefended. Due to the limited scope of cross-examination and absence of countervailing evidence, the wife’s written and oral evidence must be carefully examined.
To make a finding of fact in line with the wife’s evidence, the Court “must feel an actual persuasion” as to its existence (Briginshaw v Briginshaw (1938) 60 CLR 336 at 361) (“Briginshaw”). Actual persuasion should not be produced by “inexact proofs, indefinite testimony, or indirect inferences” (Briginshaw at 362). Actual persuasion is a state of subjective belief or state of mind held by the tribunal of fact, which may be unattainable if the material for decision is “slight, general or scanty” (Australian Securities and Investments Commission v Hellicar (2012) 247 CLR 345 at [255]). In reaching a state of actual persuasion, it is necessary for the Court to assess the combined weight of all evidence, including circumstantial evidence, as a unified whole (Wei & Xia (2024) FLC 94-186 at [163]).
Financial circumstances
The weight that is attributed to the wife’s evidence is impacted by the Court’s view on her credibility. The wife was pervasively unresponsive during cross-examination. Her testimony gave the impression that she knew significantly more about the husband’s financial circumstances during the marriage than she was willing to profess. In cross-examination it was put to the wife that it was incredulous that she did not know that the husband was self-employed after seven years of marriage. In response, she replied “that is what he said to me, I am not certain what he was at the time, as he never gave me his income, I do not know where his income came from”. Similarly, when directed to the existence of a mortgage over the former matrimonial home in favour of Westpac, the wife stated “okay, I know there is a mortgage with a bank, only because he asked me for money to repay the loan”. Accepting that the wife does not speak or read English, the Court finds it implausible that she did not know about the nature of the husband’s employment, or the means by which they were able to retain their home. Regrettably, the Court finds that it was convenient ignorance on the part of the wife. Ironically, it was also totally unnecessary.
Loan documents
The Court does not accept the wife’s contended lack of knowledge surrounding the loan documents that she signed. In cross-examination she was shown a document purporting to be a loan offer from LL Bank to the parties. When the wife was asked if she knew anything about this loan offer, she replied “I became aware of the document after the proceedings started”. As will be later shown, that assertion is implausible.
When asked if her name was on the loan offer, she replied, “it is not my full name and under normal circumstances I normally put my full name down”. It was suggested to the wife that she had signed below her, allegedly, abbreviated name. She firmly denied that the signature on the document was hers. Similarly, the wife was taken to another Westpac loan document headed “Declaration Bank Copy” with identical names and signatures present. The wife again denied that her name or signature were on the document.
The wife was finally taken to her own Financial Statement filed on 22 September 2017 in these proceedings. The Financial Statement bore the Court seal and contained a self-produced signature of the wife. The document referred to a 50 per cent share of the, now refinanced, Westpac mortgage valued at $330,000. When taken to this liability, the wife asserted that “this is the first time I’ve heard that today, so I don’t know what that means”. The wife was asked to identify if the signature on her own sealed Financial Statement was hers, and she denied so. It is plainly implausible that the wife could not identify her own signature, on a document prepared by her own solicitor in furtherance of the case she sought to run. It speaks poorly to the wife’s reliability in determining whether she had signed the previous loan documentation. The Court finds that the wife’s credibility with respect to loan documentation during the marriage is poor.
The Country Z property
By contrast, the Court was impressed by the wife’s evidence regarding the ownership of the Country Z property. The wife was steadfast in her assertion that the Country Z property was never beneficially hers. She explained that, due to Country Z cultural expectations, it was usual custom and practice for an unmarried daughter to provide physical care for her parents and financially mind their assets. Similarly, the mother was forthright in her denials surrounding the husband’s alleged contributions to the Country Z property. There was no embellishment of her evidence or position and the wife did not seek to be an advocate in her own cause on this issue.
The Court accepts the wife’s evidence regarding the nature of her ownership of the Country Z property, and her details regarding the husband’s contended contributions towards the Country Z property.
Evidence broadly
There were no other issues of credibility, matters brought up in cross-examination, or inherent implausibility of the wife’s evidence that would lead the Court to not accept the remainder of her viva voce, affidavit or documentary evidence.
THE BALANCE SHEET
Material provided
The wife filed a balance sheet on 17 September 2024 (“the balance sheet”). A copy of the balance sheet has been reproduced below:
Ownership Description Applicant’s value Respondent’s value ASSETS H AA Street $800,000 to 1.2 million Total $800,000 to 1.2 million
ADDBACKS H Westpac refinancing which was disbursed via gambling losses and post separation $654,846.78 Total $645,846.78
LIABILITIES Debt accumulated relating to looking after child, expensing coming to Australia and airfares $95,000 Debt built up during period of homelessness until receiving Centrelink $32,000 Total $127,000
SUPERANNUATION Member Name of Fund Type of Interest Applicant’s value Respondent’s value $ $ Total $ NIL $ NIL
FINANCIAL RESOURCES Ownership Description Applicant’s value Respondent’s value $ $ Total $ NIL $ NIL (Typographical errors from the provided document have been remedied by the Court)
From the balance sheet provided to the Court it is clear that the value of the former matrimonial home is unknown. The husband was ordered several times to facilitate or otherwise provide a valuation of the former matrimonial home. The earliest of such orders was made by Judge Monahan on 25 June 2018. The husband has not complied with the valuation order six years following a request for the same. To effectuate any property adjustment, the former matrimonial home will need to be sold.
Disputes
Disputes over the quantum and existence of certain assets on the balance sheet arose during the cross-examination of the wife.
The mortgage
The former matrimonial home is encumbered by a mortgage from Westpac. The wife contended that, sometime between 2013 and 2014, the parties had discussed purchasing a second property together (8 September 2023 affidavit, paragraph 71). In order to facilitate this, the wife recalled signing a loan pre-approval form. During cross-examination the wife firmly denied having signed any form of final loan, or joint refinancing arrangement. The wife went so far as to suggest that the loan agreement is vitiated by fraud (8 September 2023 affidavit, paragraph 73). She asserted that, as of 28 July 2017 the corresponding offset account comprised only $2,300 in funds. The wife alleged that the husband withdrew $330,000 from the offset account following the refinancing.
In cross-examination, the husband’s counsel produced a number of signed loan agreements and bank statements that disputed the wife’s contention that she was unaware of the refinancing, or that she was subject to mortgage fraud. The wife initially conceded that she did not have “a good knowledge of the [banking] system in Australia”. The husband’s counsel then took the wife to two separate signed loan agreements containing the wife’s name and signature. The wife attempted to dispute the veracity of the signatures, making comments to the effect “it is not my full name and under normal circumstances I normally put down my full name”, “yes it does look like mine, it is a copy, but it is my full name”, and “she may have extracted it from a legal aid document”.
The wife shortly thereafter failed to recognise her own signature on a sealed Court document filed in furtherance of her case. The wife’s inability to recognise her own signature where appropriate, and admitted lack of knowledge over the banking system in Australia, add to the Court’s adverse finding on credit about her evidence surrounding this topic.
The wife’s counsel correctly conceded in final submissions that the re-financing had occurred between LL Bank and Westpac, that the mortgage was valid and that it was a known debt to be shared between the parties.
The husband was unable to provide evidence on the whereabouts of the $330,000 allegedly drawn down from the mortgage offset account. During cross-examination, the wife’s counsel tendered a Westpac statement for the period 28 April 2016 to 28 July 2016 (Exhibit A1). The statement contained nine highlighted transactions. It was contended that the marked withdrawals were made by the husband from the offset account, for his own benefit, without the consent of the wife. The transactions total $320,000 in withdrawals across an 11-day period, from 9 June 2016 to 20 June 2016. Noting that the parties separated on 20 May 2016, the withdrawals culminated precisely one month after the husband knew the relationship had concluded. The proximity of the withdrawals to separation renders the wife’s account of the money more believable. Further, the husband’s counsel did not address the issue of the putative addback in his cross-examination of the wife.
On the basis of the wife’s sworn testimony, the existence of corroborative documentary evidence, and the failure of the husband’s counsel to contest such allegations, the Court finds that it is appropriate to exercise discretion and award an addback of the withdrawn funds. Such an addback will be made in the figure $320,000 against the husband’s final property interests in these proceedings. Moreover, the mortgage liability will be found to be in the amount asserted on the balance sheet and will, of necessity, be paid out on settlement of the sale.
The Country Z property
The wife denies that the Country Z property was an asset that she beneficially owned during the relationship. For these reasons the wife has not listed, or provided a value for, the Country Z property on the balance sheet. The husband, in cross-examination, raised his long-standing position that the Country Z property be included within the pool of assets.
The wife provided evidence of a signed Country Z statutory declaration at page 120 of the 8 September 2023 affidavit. The signed declaration was produced by the wife’s father in response to the husband’s assertion that the Country Z property beneficially belonged to the wife. The wife’s father stated that he purchased the property in 2002 before registering it in the wife’s name. The wife’s father explains that, due to family customs and the marital status of the wife at the time, the registration was not culturally abnormal. In cross-examination, the wife admitted that the property was transferred back into the wife’s father’s name in 2016 after she had informed him that the parties’ marriage had broken down.
This transfer evinces an intention to separate the Country Z property from other assets that would be more apt to label marital property. There is no reason to suggest that the wife’s father did not provide the entirety of the purchase price for the Country Z property himself. All the title documents to the Country Z property are retained by the wife’s father.
The husband asserted that the Country Z property ought to be an asset split between the parties. He subsequently bore the burden of proof to establish that intention. The nature of the evidence provided by the wife’s father, the wife’s evidence, alongside the Court’s favourable view of the veracity of that evidence, means that the husband has not proven his contention. The Country Z property will not be included on the balance sheet.
In closing submissions, the husband contended that he contributed personal and borrowed monies to the maintenance and upkeep of the Country Z property. If proven, such funds may be considered as contributions in his favour, or the purported loans may be recognised as liabilities.
In the aforementioned Country Z statutory declaration, the wife’s father denies that he has received financial support:
My daughter [Ms Zuen], nor any other member of the family, nor any third party has paid any money to the purchases of the [City HH] property, nor made financial contributions for the decoration, maintenance, management, utility charges such as water, gas, electricity on the [City HH] property.
The wife’s affidavit evidence similarly denies any financial contribution or transfer between the parties facilitated by the MM Bank (8 September 2023 affidavit, paragraphs 60–61). The husband alleges the existence of a fact, namely, that he contributed towards the property. He again has the same duty to substantiate this. No loan agreements, bank account statements or other probative evidence was put before the Court or put to the wife in cross-examination. The Court finds that neither the alleged property in Country Z, nor the alleged loans are to be placed on the balance sheet.
Contended post-separation liabilities
The wife contends that her personal post-separation liabilities should be listed on the balance sheet. In making this assertion she bears the onus to prove to the Court that the liabilities exist, and that they should remain on the balance sheet. The wife provides limited financial disclosure and sworn evidence as to her ongoing monthly expenditure in her affidavit filed 14 September 2024. The husband did not seek to impugn those figures in cross-examination. Whilst it is reasonable that expenses of the nature and size alleged by the wife would be accrued in the post-separation period, the Court sees no reason to include those liabilities on the balance sheet, particularly given her application that spousal maintenance arrears be paid out of the husband’s share of the sale proceeds of the former matrimonial home.
The Court accepts that the post-separation expenses exist, however, and they will be taken into account under s 75(2) of the Act.
Spousal maintenance arrears
The orders of Senior Judicial Registrar McGrath made 24 March 2022 obligate the husband to pay the wife $500 of spousal maintenance per week commencing from 31 March 2022 until further order. The wife claims that the husband has not complied with this order, and she has not received any financial support from the husband post-separation.
The husband did not question the wife on this issue during cross-examination. The husband failed to provide any disclosure that demonstrates that he had complied with the spousal maintenance payments as ordered. In the absence of countervailing evidence and noting the wife’s generally positive credit as a witness, the Court sees no reasons not to order that the husband’s spousal maintenance arrears be listed as a personal liability of the husband to be paid out of his share of the sale proceeds of the former matrimonial home.
Final balance sheet
The final balance sheet will therefore read as follows:
Ownership Description Value ASSETS 1. Husband AA Street $800,000 to $1.2 million Total $800,000 to $1.2 million ADDBACKS 2. Husband Disbursed mortgage funds from the Westpac Loan Account Ending #...78 $320,000 Total $320,000 LIABILITIES 3. Joint Mortgage outstanding in Westpac Loan Account Ending #...78 $645,846.78 4. Husband Spousal Maintenance Arrears as calculated on 16 October 2024 $66,000 (for noting only) Total $645,846.78 SUPERANNUATION Member Name of Fund Type of Interest Value 5. $ $ Total $ Not Known $ Not Known NET POOL (INCLUDING SUPERANNUATION): $474,153.22 to $874,153.22 ASSESSMENT OF CONTRIBUTION
Initial contributions
The wife had no significant assets at the commencement of the relationship. She operated a business in Country Z that enabled her to draw down a salary of $2,000 per month (22 September 2017 affidavit, paragraph 114). The wife possessed $10,000 in savings at the time she moved to Australia permanently (22 September 2017 affidavit, paragraph 117). In contrast, the husband owned the former matrimonial home, having purchased it in 2000 (22 September 2017 affidavit, paragraph 119). Its purchase price and current value are unclear. Regardless, initial contributions are heavily weighted in favour of the husband.
Contributions during the marriage
In 2007 the wife established and ran a business out of the former matrimonial home. The business was funded by the wife’s savings that she had brought over from Country Z when she moved to Australia. She contends that her parents also purchased various items and supplies as a form of contribution to the enterprise (22 September 2017 affidavit, paragraph 120). The wife suggests that the husband had sole access to two bank accounts: ANZ (opened in 2007) and EE Bank (opened in 2009). The proceeds from the day care were deposited into the ANZ account, whilst the husband allegedly paid any monies owing to the wife into the EE Bank account (22 September 2017 affidavit, paragraphs 121–122). The husband had sole use of the family’s finances, to the deliberate exclusion of the wife.
The wife suggests that from her arrival in Sydney with X, in addition to running the business, she completed all domestic work. This includes cooking, cleaning, washing, shopping and caring for the husband and X. The husband did not cross-examine the mother on these issues, or otherwise suggest that this is not correct. It has long been established that domestic labour is a valuable contribution under the Act.
Due to significant issues with disclosure, it is difficult to ascertain the husband’s contributions during the relationship. During the relationship, the husband operated his own business, JJ Pty Ltd, and was employed as the sole director and secretary of the company (22 September 2017 affidavit, paragraph 127). The husband also caused the parties to rent out the second bedroom in the former matrimonial home. Again, the benefit the parties received from this is unknown, as the rent was paid in cash to the husband and proper disclosure has not occurred (the wife’s affidavit filed 12 January 2022, paragraphs 22–25 (“12 January 2022 affidavit”)).
The wife contends that the husband gambled frequently during the relationship (22 September 2017 affidavit, paragraphs 131–134). The husband did not deny that he participates in gambling or that he takes trips to the casino. He does, however, deny that he gambles at an unacceptable quantity or frequency. The Court has reference to the husband’s affidavit filed 6 April 2022, where at paragraph 15 he stated:
I object to the accusation from the Applicant and the Legal Representative that I am a gambler. If accompanying my clients to go to the casino for occasional recreation in bouts of $200 to $500 each time would qualify one as a gambler, then the threshold of becoming a gambler is too low.
The husband’s gambling must be taken into account when determining the respective contributions of the parties.
Assessment of contributions during the marriage is difficult. The husband’s continued lack of disclosure throughout the entire seven-year duration of these proceedings obfuscates the function of this Court. The orders made for document production and requests for disclosure have been so frequent and forceful in nature that the husband’s failure to comply must be seen as deliberate. The Full Court in Weir and Weir (1993) FLC 92-338 (“Weir and Weir”) at 79,593, provides guidance in such scenarios:
It seems to us that once it has been established that there has been a deliberate non-disclosure, which follows from his Honour's findings in this case, then the Court should not be unduly cautious about making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature.
On the basis that the wife was engaged in gainful employment and provided the majority of the domestic labour, the Court finds that her direct and indirect, financial and non-financial contributions outweigh that of the husband during the relationship.
Post-separation contributions
The parties have been separated for over eight years. Immediately post-separation the wife was homeless until mid-2017. Naturally, during this period the wife accumulated significant debt in the figure of $32,000 (14 September 2024 affidavit, paragraphs 6–7). The wife only earned nominal income during this period as she had, and continues to have, a reduced capacity to work (14 September 2024 affidavit, Annexure B).
Since 2020, the wife has received financial support and funding for a carer through Centrelink. The wife receives $657.68 in income weekly from a Centrelink allowance. This is her sole form of income. The husband was ordered by Senior Judicial Registrar McGrath on 24 March 2022 to pay the wife child support in the amount of $500 per week. The wife has not received any payment from the husband since 2016 (14 September 2024 affidavit, paragraph 7).
Whilst it is patently clear that the husband has solely borne the costs of housing, educating and otherwise raising X since separation, the husband’s lack of disclosure hampers any effort by the Court to quantify his post-separation contributions. Nonetheless, the Court is able to observe that it is highly likely that the husband’s post-separation contributions outweigh those of the wife.
The wife’s Kennon claim
The relevant law is outlined at [35]–[38] of these reasons for judgment.
The wife submitted that her financial and non-financial contributions were rendered significantly more arduous both during the marriage and post-separation as a result of the family violence perpetrated by the husband. The wife asserts that the husband was regularly physically, sexually and verbally abusive, as well as coercive and controlling during the relationship. Any of this behaviour may constitute family violence under s 4AB of the Act. Providing they hold a relevant nexus to the wife’s contributions, a finding on any of the proffered points may found the basis for her Kennon claim.
The husband’s abuse during the relationship
Since the commencement of these proceedings the wife has asserted that she was the victim of continued and damaging physical, sexual and verbal abuse at the hands of the husband. The police charged the husband with an offence (8 September 2023 affidavit, paragraph 30), and successfully obtained a final ADVO against him in mid-2016.
Further, at Annexure B of the 14 September 2024 affidavit, the wife provides a medical report detailing her poor state of physical and mental health. The report includes subtitles that detail her “major depression, generalised anxiety, post-traumatic stress disorder”, “[…] and tinnitus”, “chronic pain” and her poor “social wellbeing”. The report directly attributes the wife’s physical and mental maladies to “the consequences of domestic abuse”. The summary paragraph of the medical report provides a sobering view of the wife’s current, post-separation, circumstances:
In summary, [Ms Zuen] presents as a severely traumatised woman who continues to suffer from the consequences of domestic abuse. In 2021 I saw [Ms Zuen] as a patient [over 50] times, in 2022 I saw her [over 40] times, and in 2023 I saw her 20 times. She was seeing her psychologist once a week to once a fortnight throughout 2022 and 2023, till funding ran out. Her psychologist now sees [Ms Zuen] voluntarily for crises that arise. [Ms Zuen] has a very high requirement for ongoing medical and psychiatric care, the barriers to which are monetary.
The wife provides extensive affidavit evidence about the violence she suffered at the hands of the husband. It is unnecessary to delve into each individual incident as alleged. The 22 September 2017 affidavit, at paragraphs 56–84, provides a comprehensive background of the wife’s evidence.
The report, the ADVO, and the wife’s un-impugned sworn evidence leads the Court to find that family violence occurred during the parties’ marriage.
The husband’s coercive and controlling behaviour during and after the relationship
During the relationship the wife attests that she was unable to access the family’s finances or control any of her own finances (8 September 2023 affidavit, paragraphs 35–57). Similarly, she also alleges that the husband would react violently if she was found on the phone with, or otherwise to socialise with, outside parties without his permission (8 September 2023 affidavit, paragraph 19).
The lack of evidence in this case stems from the husband’s pervasive lack of disclosure. The husband bore such a significant duty in these proceedings because he solely held access to the documents required. This fact, of its own, goes some way to establishing the wife’s contention that the husband was unduly financially controlling.
The Court has no evidence before it to dispute the allegation that the husband socially ostracised the wife. On the basis that this Court has found the husband to have perpetrated other family violence on the wife, and that no questions on this issue were put to the wife in cross‑examination, the Court finds that the husband was financially and socially coercive and controlling of the wife during, and after, their relationship.
The nexus
The Full Court in Britt & Britt (2017) FLC 93-764 (“Britt & Britt”) established that even where a party does not call specific evidence that suggests their contributions were made more onerous, the Court can infer that there is a nexus between one party’s conduct on the other party’s contributions:
74. The respondent submitted that the appellant’s evidence was not relevant to an issue because even if it was evidence of family violence, the appellant had called no evidence to suggest that the violence had made her contributions more onerous. This submission overlooks the obvious point that the court can infer from appropriate evidence that there was a nexus between the conduct and the relevant contributions.
75. The real question is whether the evidence, taken as a whole, is capable of leading to such an inference…
Whilst not explicit in the wife’s evidence, it is clear that living in a state of terror or apprehension for 12 years would have had some material negative impact on the wife’s contributions. The Court finds that the wife’s Kennon case is substantiated.
Overall contribution
The wife’s material does not provide a clear articulation of her assessment of contributions. In oral submissions her counsel suggested that an 80:20 assessment in her favour would be reasonable. In closing submissions, the husband’s counsel was unable to clearly articulate how his contribution should be assessed save that it would be “more or less 100 per cent of everything post 2016”.
In Gadhavi & Gadhavi (2023) 67 Fam LR 174, the Full Court expressed at [41] that:
…it is to be appreciated that the exercise of the broad discretion bestowed upon the Court pursuant to s 79 of the Act “‘inevitably involves value judgments and matters of impression’, and accordingly it cannot be treated as ‘a mathematical exercise’”. It is often stated that there is an inevitable ‘leap’ from the evaluation of the parties’ contributions to declaring the “quantitative reflection of such an evaluation”.
In relation to Kennon claims, Aldridge J explained in Martell at [28] that:
In reality, all the majority said in that case was that a person’s contributions are to be assessed in the light of all of the circumstances and where those circumstances have the effect of making the contributions more difficult, onerous or arduous, that should be recognised in the assessment of contributions. That, of course, takes place in a holistic manner (Dickons v Dickons (2012) 50 Fam LR 244; Jabour & Jabour (2019) FLC 93-898).
The Court must assess the contributions of the parties, including the wife’s Kennon argument, holistically. Considering the matters discussed above, the Court assesses contribution, both direct and indirect, financial and non-financial as being equal as at the time of hearing.
Whilst the wife made significant financial and non-financial contributions, it must not be forgotten that her initial contributions were dwarfed by the husband’s. The husband owned the former matrimonial home before meeting the wife. The former matrimonial home remains the largest asset to the marriage by some margin.
S 75(2) ADJUSTMENTS
The wife seeks an adjustment in her favour based on her future needs. The wife’s counsel noted that due to the unknown size of the asset pool, the adjustment sought might be different as “the smaller the property pool, the higher the adjustment”. There is significant weight of authority to indicate that smaller asset pools justify additional weight being placed on the future needs of the parties (see e.g. Bauer v Bauer (2013]) 49 Fam LR 575 and Sadler & Mistry [2015] FCCA 3407). The wife’s counsel omitted to provide “future needs” percentage in her Outline of Case Document filed 17 September 2024. During closing submissions, it was ultimately suggested that a 20 per cent adjustment should be made in the wife’s favour.
The husband’s lack of disclosure is a fundamental deficit in this case. As expounded by the Full Court in Black and Kellner (1992) FLC 92-287, it is the duty of a party involved in property proceedings in this jurisdiction to make a full disclosure of their financial affairs. The failure to disclose undermines the whole process of adjudication of proceedings for a settlement of property, in that the Court is unable to identify the property of the parties, properly assess contribution, or properly assess s 75(2) factors. The husband’s non-compliance must be seen as deliberate. As endorsed by Weir and Weir at 79,593, this Court will not be “unduly cautious about making findings in favour of the innocent party [as] to do otherwise might be thought to provide a charter for fraud in proceedings of this nature”.
There can be no doubt, based on the medical evidence provided by the wife, that she will struggle to find gainful employment. Due to deliberate non-disclosure by the husband this Court cannot be certain about his future needs, or financial circumstances. The only relevant factor provided to the Court is the husband’s advanced age. The wife’s future needs are extensive and outweigh the mere fact of the husband’s age. The Court finds an adjustment of 20 per cent in the wife’s favour to be warranted on the facts.
JUSTICE AND EQUITY
The Court must be satisfied that it is just and equitable for an order to be made before altering the parties’ interests in their assets. This is an enquiry separate from determining what order should be made.
There is no presumption that the parties’ entitlements in the existing asset pool should be altered, or that one party has the right to have the property of the parties divided between them only on the basis of the considerations in s 79(4).
In the Court’s view, this is one of the “vast majority of cases” referred to by the plurality of the High Court in Bevan at [164], in which the requirements of s 79(2) of the Act are readily satisfied. It is plainly just and equitable to make an order pursuant to s 79 of the Act in these proceedings for a division of property between the parties.
ORDERS FOR ALTERATION OF PROPERTY INTERESTS
The Court has found that the asset pool (including the notional addback of $320,000) be divided 70:30 in favour of the wife. If the Court notionally values the former matrimonial home at its lowest supposed estimate, $800,000, the wife will receive $331,907.31 (not accounting for fees, commission and advertising, and arrears of maintenance) plus arrears of maintenance, and the husband will receive $142,245.96 less arrears of maintenance. If the former matrimonial home is valued at its highest supposed estimate, $1,200,000, the wife will receive $611,907.25 (not accounting for fees, commission and advertising, and arrears of maintenance), and the husband will receive $262,245.96 less arrears of maintenance.
To effectuate this adjustment, the former matrimonial home must be sold. The wife’s minute of order does not specify who is to be appointed as trustee for the sale of the former matrimonial property. In closing submissions, the wife’s counsel suggested that the wife be appointed as trustee. The husband has a poor track record of compliance with orders of this Court. His deliberate and longstanding defiance of his disclosure obligations provides the Court with little faith that he would transparently manage the sale of the former matrimonial home. Additionally, the wife is the natural trustee for this sale given that the majority of the sale proceeds will be distributed to her on final adjustment.
The Court is prepared to make orders in accordance with the wife’s minute of order subject only to minor changes to enhance the enforceability of the orders. Such orders are made acknowledging the uncertainty as to the quantum of the sale proceeds and taking account of the addback of $320,000 in line with the findings of the Court. If the husband is materially disadvantaged by this order, he is the author of such outcome. If he wishes to retain the property, he can either negotiate a price with the wife, or bid at the auction.
The evidence indicates that the husband has not paid spousal maintenance as ordered. The order made on 24 March 2022 was for $500 per week. The arrears amount to $66,000 as at the date of making orders and delivering judgment. The Court sees no reason why the wife’s order for back-payment via lump sum should not be satisfied from the husband’s share of the net sale proceeds of the former matrimonial home.
Preparing a final balance sheet in this case is futile given the uncertainty that exists about the current market value of the former matrimonial home. The property will need to be sold, and the expenses of sale and the mortgage paid out from the sale proceeds. To this amount is added to the addback of $320,000. The wife will receive 70 per cent of this amount plus the amount of the spousal maintenance arrears, before the husband is to receive the remainder, if any. The Court is satisfied that, to the extent that the evidence permits, the orders are just and equitable to both parties. The Court is left with a profound sense that the husband has other assets, resources and income not disclosed to the Court.
PERSONAL PROTECTION AND NON-PUBLICATION ORDERS
As part of the wife’s minute of order, she seeks that the husband be prevented from publishing the outcome of these proceedings on any social media platform and that a range of injunctions be placed upon the husband to ensure her safety.
Pursuant to s 114Q of the Act it is an offence to communicate an account of proceedings to the public of the nature identified by the wife in her minute of order. Nonetheless, noting the Court has already expressed concerns with the husband’s compliance with Court orders generally, such an order is appropriate in the circumstances.
Injunctions in the form requested by the wife pursuant to Order 6 of the wife’s minute of order may be made under s 114 of the Act. In proceedings under a matrimonial cause, the Court may make any injunction it considers proper with respect to the personal protection of a party to the marriage (s 114(1)(a)). Whilst no submissions were made on this topic, it is clear from the evidence before the Court that the wife suffered significant and prolonged family violence at the hands of the husband. In cross-examination the Court observed that the wife appeared to be palpably fearful of the husband and male figures. For example, a request was made for the husband’s male counsel to step back from the witness box due to the discomfort experienced by the wife. On these bases, the Court finds that it is appropriate to make the injunctions sought by the wife as a means to ensure her future safety.
I certify that the preceding one hundred and thirteen (113) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Altobelli. Associate:
Dated: 16 October 2024
SCHEDULE ONE
FAMILY LAW ACT 1975
IN THE FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
AT SYDNEYFile No. SYC6260/2017
BETWEEN
MS ZUEN
(Applicant)
and
MR LHAO
(Respondent)WIFE’S FINAL MINUTE OF ORDER
IT IS ORDERED THAT:
1.1 A trustee be appointed to arrange for the property known as AA Street, Suburb BB NSW (title) Lot … in Strata Plan … (Folio …/SP…) to be sold by auction and the proceeds of sale be disbursed as follows:
a) Payment of 100 % to the Wife
b) Payment of 0 % to the Husband.
1.2 The Husband shall do all acts and things and sign all documents necessary to cause the trustee to be able to sell the property by auction.
1.3 The reserve price for the auction is to be determined by the the Trustee or their nominee and that the proceeds of the sale be disbursed as follows:
a)Payment of any money due and owing to the mortgagee, namely Westpac Banking Corporation BSB … Acc …78;
b)Payment of trustee’s fees, agent’s commission and advertising expenses and legal expenses.
c)That any money available on the loan’s offset account namely BSB … Acc …14, be paid to the Wife.
d)Payment of 100 % to the Wife.
e)Payment of 0 % to the Husband.
1. Both parties do all acts and things and give all consents and execute all documents and writings necessary to give effect to the orders made herein.
2. If either party refuses or neglects to sign or execute and return, within 14 days of a written request to do so by the other party, a document required for the implementation of these
Orders:
3.1 A Registrar of the Sydney Registry of the Federal Circuit and Family Court of Australia is hereby appointed under section 106A of the Family Law Act 1975 to sign or execute such document on behalf of that party upon lodgement of such document and the filing of an affidavit of a solicitor on behalf of the requesting party as to the said neglect or refusal.
3.2 The requesting party will be a liberty to apply for costs when submitting such an affidavit to the Registrar.
3. That the cash amount to be paid to the wife be paid into the wife’s solicitor’s trust account, namely Lincoln Legal Trust Account BSB … Account …99.
4. The Husband be prevented from publishing the outcome of these proceedings on any social media platform.
5. Such further Order as this Honourable Court deems necessary.
Personal Protection
6. That pending further orders, the HUSBAND be restrained by injunction from>
8.1 Attending at or entering upon the wife’s residence.
8.2 Communicating with the wife by any means whatsoever including, but not limited to, in writing or via text message, except through her legal representative.
8.3 Assaulting, molesting, harassing, threatening or otherwise interfering with the Wife.
8.4 Stalking the Wife.
8.5 Engaging in any other conduct that intimidates the Wife.
SCHEDULE TWO
FAMILY LAW ACT 1975
IN THE FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
File No. SYC6260/2017
BETWEEN
MS ZUEN
(Applicant)
and
MR LHAO
(Respondent)MINUTE OF ORDERS SOUGHT BY THE RESPONDENT HUSBAND
PREAMBLE:
1.The property in Country Z is known as FF Street, Suburb GG, City HH, Country Z (Country Z property) in the applicant’s sole name.
2.The property known as AA Street, Suburb BB NSW (Suburb BB property) in the sole name of the respondent. There is a mortgage to Westpac in joint names.
3.The court notes that the respondent asserts that he made a substantial financial contribution to the acquisition of the Country Z property.
4.The court notes that the respondent husband claims to have recently borrowed the sum of $20,000 AUD to maintain his obligation to Westpac Banking Corporation as primary mortgagor.
5.There is one child of the relationship namely X born in 2006.
6.That the applicants interest in the Country Z property is almost equal to her interest in the Suburb BB property and that there be a property division between the parties that finalises these proceedings.
The court orders:
1.The Applicant do all things necessary and sign all documents to transfer to the Respondent her interest in the Suburb BB property.
2.That the applicant indemnify the respondent in relation to the renovations paid for by the respondent of $800,000 on the Country Z property and the applicant’s interest in the mortgage on the Suburb BB property be discharged.
3.That simultaneously the applicant sign documents to withdraw the caveat on the Suburb BB property.
4.Except as specifically provided for by these orders the Respondent will otherwise retain to the exclusion of the Applicant all interest in and entitlement to the following:
a.His bank account
b.His superannuation
c.All personal property now in his possession or control
d.All real property now in his possession or control
5.Except as specifically provided for by these orders the Applicant will otherwise retain to the exclusion of the Respondent all interest in and entitlement to the following:
a.Her bank account
b.Her superannuation
c.All personal property now in her possession or control
d.All real property now in her possession or control
6.Except as specifically provided for by these Orders to the contrary, the Applicant hereby indemnifies the Respondent from and in respect of all actions, claims, suits, demands, costs and expenses as may be made against the husband in relation to all liabilities in the name of the wife.
7.Except as specifically provided for by these Orders to the contrary, the Respondent hereby indemnifies the Applicant from and in respect of all actions, claims, suits , demands, costs and expenses as may be made against the wife in relation to all liabilities in the name of the wife.
8.Except as specifically provided for by any Order herein each of the Applicant and the Respondent release the other from all debts owing from one to the other.
9.Pursuant to section 81 of the Family Law Act the parties intend the Orders to finally determine all financial relations and issues between them (including any spousal maintenance) and avoid further proceedings between them.
10.Pursuant to section 79 of the Family Law Act the parties are and are declared to be the sole owner respectively at law and in equity to the exclusion of the other of all other assets and financial resources within their respective ownership possession or control, whether vested or contingent.
11.In the event that either party fails, refuses or neglects to execute any document deed or instrument necessary to give effect to these Orders within 7 days of their making then under section 106A of the Family Law Act a Registrar of this Court be appointed to execute the documentation, deed or instrument in the name of the defaulting party to give validity and operation to the deed document or instrument and the defaulting party shall pay the costs incurred to the party not in default on the indemnity basis.
0
9
2