Home Decisions Damiani & Damiani [2012] FamCA 535 - 2,583
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Damiani & Damiani [2012] FamCA 535
Categories: Child Support, Contributions, Departure Application, Departure Determination, Property, Property Settlement
Tags: child support, Departure Determination, family violence, Post Traumatic Stress Disorder, short marriage, significant assets
Judge Name: Watts J
Hearing Date:
Decision Date:09/07/2012
Applicant: Ms Damiani
Respondent: Mr Damiani
Solicitor for the Applicant: Dettmann Longworth
Counsel for the Applicant: Ms Knox
Solicitor for the Respondent: Blanchfield Nicholls
Counsel for the Respondent: Mr Lloyd, SC
File Number: SYF 4576 of 2004
Legislation Cited: Family Law Act 1975 (Cth)
Cases Cited: Biltoft & Biltoft (1995) FLC 92-614
Chidiac v Maatouk [2010] NSWSC 386
Chorn & Hopkins (2004) FLC 93-204
Gray v O'Donnell [2009] NSWSC 259
Gyselman & Gyselman (1992) FLC 92-279
Kennon & Kennon (1997) FLC 92-757
Ogilvie v Adams [1981] VR 1041
Omacini & Omacini (2005) FLC 93-218
Spagnardi & Spagnardi [2003] FamCA 905
Jurisdiction: Family Court of Australia
Parental Responsibility Outcome: Not Relevant
Residential Outcome: Not Relevant
Select to highlight: Tags | Expert |
Pursuant to s 79 Family Law Act 1975 (Cth), an order be made in the terms of paragraphs 2 – 9 below.
Within 60 days the husband pay to the wife the sum of $1,023,441.
Forthwith upon the making of such payment, the wife do all acts and things necessary to transfer her interest in the property situated at and known as … O Street, Suburb R ("the R property") in the State of New South Wales, Folio Identifier … to the husband.
The husband to do all acts and things and sign all documents necessary to indemnify and keep indemnified the wife from all rates and taxes and all other outgoings including utility expenses relating to the R property.
The husband is hereby declared the sole legal and beneficial owner of his shareholdings in:
B Pty Ltd ACN …;
D Pty Ltd ACN …;
E Pty Limited ACN …;
F Pty Limited ACN …;
I Limited ACN … .
The husband indemnify and thereafter keep indemnified the wife in respect of all and any liability in respect of:
I Limited ACN …;
liability in relation to loan accounts or pursuant to a guarantee or personal covenant(s).
liability incurred at the suit of any of the aforementioned entities or their shareholders, unit holders or office bearers.
any taxation liability, howsoever such liability arises and in whatever capacity such liability is incurred.
In the event that the husband has not paid to the wife the amount referred to in paragraph 2 within 60 days of the date of these orders then the husband shall immediately do all things and sign all documents necessary to sell the R property and the proceeds of sale shall be applied in the following order and priority:
costs of sale including legal expenses and agents commission;
73% of the sale price of the R property or $1,023,441 together with interest to the date of payment, whichever amount is higher, to the wife;
the balance to the husband.
Within 28 days of the payment to the wife of the capital sum, the wife cause to be delivered to the husband the engagement ring he had given to her.
The husband and the wife shall each solely be entitled to the exclusion of the other to all other property and resources not already referred to in these Orders in the possession or control of that party at this date.
The wife's application for spouse maintenance be dismissed.
Pursuant to s 117 Child Support (Assessment) Act 1989 (Cth):
the periodic rate of child support payable by the husband for the child N be varied by setting the annual rate of child support during the period 1 November 2011 to 31 October 2012 at $25,304.
That the annual rate of child support to be paid to the wife pursuant to sub-paragraph 11.1 herein be varied each year on and from 1 November 2012 and on each 1 November thereafter, in accordance with the variation of the Consumer Price Index for Sydney over the previous year as published by the Commonwealth of Australia Statistician as at 30 June of the year in question.
Each party shall be at liberty to apply on 7 days notice in relation to the implementation of these Orders.
Without admission and by consent, the husband pay the wife's costs, to be agreed or assessed, in respect of the husband's Application in a Case filed 27 May 2011 and withdrawn on 21 November 2011.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Damiani & Damiani has been approved by the Chief Justice pursuant to s 121(9)(g) of the Act.
REASONS FOR JUDGMENT
The parties married and then lived together for 19 months. They had one child. The husband contributed the bulk of the capital to the marriage and is on a far superior income. The net assets of the parties are in excess of $3,900,000. The wife has had the major responsibility of looking after the child since separation which happened nearly eight years ago. During the marriage, there were five occasions on which the husband perpetrated family violence against the wife. The wife had, but has recovered from, post traumatic stress disorder. The wife says the family violence has made her contributions in the role of homemaker and parent significantly more arduous. The husband has supported the wife and the child during the period since separation. The court is asked to make an order adjusting the property of the parties. The wife also seeks a departure from the current child support assessment.
The wife's application is set out in Schedule 1. The husband's application is set out in Schedule 2.
At the commencement of final submissions, the wife abandoned her application for spousal maintenance.
The wife amended her claim during the hearing. The wife on an overall basis now seeks that she receive 35 percent of the net assets of the parties.
The husband seeks to pay the wife $500,000. The basis of that calculation is set out below.
DOCUMENTS RELIED UPON
The wife's primary affidavit was filed on 8 February 2011. The wife also relied upon affidavits sworn on 10 December 2010; 12 August 2011; 30 April 2012; and her financial statement sworn 22 August 2011.
The wife's father filed three affidavits sworn 7 April 2008; 8 December 2008 and 1 May 2012.
The wife's mother swore two affidavits on 29 April 2008 and 1 May 2012.
Ms J swore affidavits on 31 March 2008 and 4 September 2008.
Katherine Doust swore an affidavit on 29 May 2008.
The wife sought to rely upon an affidavit of Mr A sworn 15 May 2012. Mr A was an adversarial expert and the application to rely upon his evidence, made on the first morning of the hearing, was refused.
Mr L, the wife's first husband, also filed an affidavit but he left for overseas during the hearing and his evidence was not read.
The husband relied upon his affidavits sworn 1 February 2011 and 5 December 2011; the husband's statement of financial circumstances sworn 4 May 2012 and an affidavit of Mr P sworn 16 December 2010.
The husband initially sought to rely upon a proof of evidence from Constable H but the husband failed to demonstrate an inconsistency in previously sworn evidence given by the wife before Justice Rose and consequently failed to satisfy the provisions of s 106 of the Evidence Act 1995 (Cth). I did not allow Constable H to be called as a witness.
Other evidence
Single experts, Mr Q and Dr W, also provided evidence. Mr Q swore two affidavits; on 8 March 2011 and 27 June 2008. Dr W swore an affidavit on 26 July 2011.
I also allowed into evidence in these property proceedings, the affidavit of Ms Y sworn 19 December 2006 (the admission of that affidavit is as a result of the findings made by Rose J at paragraph 67 of his Reasons of 19 December 2008).
The wife sought to rely upon a further affidavit of Ms Y sworn 16 May 2012. There was an objection to the admission of that evidence. The affidavit had been filed late. Given the history of the procedural case management of this matter and the procedural orders that had been made and the lack of adequate explanation for the late filing, the objection to the affidavit was successful.
As I indicated in my Reasons of 19 March 2010, paragraphs 68 and 72 of Rose J's Reasons did not directly adopt facts and opinions in Dr R's report, but rather, made findings based upon Dr R's report. On 19 March 2010 I found that Dr R's report was not to be admitted into evidence in the property proceedings (although paragraphs 68, 72 and 73 of Rose J's Reasons would be, subject to relevance).
On 16 April 2010 I ordered by consent:
3.Within 14 days the solicitor for the wife file and serve a document enclosing [Dr R's] report and the parts of the transcript that are relied upon and within a further 14 days the husband indicate to the wife and my associate what objections will be taken to this material.
I noted at a procedural hearing on 28 June 2010 that the parties were no longer in disagreement in respect of the tendering of the full report of Dr R, which is annexed to an affidavit sworn by her on 2 November 2007 and to those parts of the transcript of Dr R's evidence, given on 17 December 2008 before Rose J, which are annexed to a document entitled "Documents to be filed pursuant to orders 16 April 2010", which document was filed 22 April 2010 (and marked in pink highlighting).
Dr R was listed as a witness on the original trial plan. On the trial plan that was submitted to the court on 15 December 2011, Dr R was removed as a witness who was required for cross examination. On that day I made the following notation:
5.I note [Dr R] will no longer be a witness in the hearing.
Despite this, at the commencement of the hearing, both parties indicated that they wished Dr R be called to give oral evidence, but later in the hearing indicated that neither party wished to ask her any questions. Part of her report annexed to her affidavit sworn 2 November 2007 and parts of her oral evidence given before Rose J on 17 December 2008 were referred to by both parties in submissions.
The husband was born in 1963 and is now aged 48.
The wife was born in 1967 and is now aged 44.
The parties married and commenced cohabitation in April 2003.
The parties' first child N was born in August 2004 and is now aged 7.
The parties separated on 2 November 2004.
During her oral evidence, the wife answered questions in relation to whether or not she hated the husband. The wife conceded that she did not like him. Senior counsel for the husband pressed her and the following exchange took place (see exhibit 10):
Mr Lloyd: You'd like to see harm caused to him wouldn't you?
[The wife]: I have not said that.
Mr Lloyd: Is that your view?
[The wife]: Correct.
I formed the impression at that time that the wife having been asked three times, on the third occasion conceded the proposition. The wife subsequently attempted to say that her answer was "that no harm would come to him". As is clear from the transcript, that was not her answer. The following day the wife gave evidence that the word "correct" in the part of her evidence quoted above, meant that it was her view that she had not said that she would like to see harm come to the husband. I do not accept the wife was being frank with me in that evidence. I accept that what the wife said, when pressed by senior counsel for the husband, was an accurate statement by the wife of her current state of mind.
It was suggested to the wife that because in a financial statement the wife had not referred to the debt to her parents of $50,000 that the documents evidencing that loan were not documents that she took seriously. She said she took the "debt" seriously. I accept the wife is of the view that that money was loaned to her by her parents. The wife's view about this does not adversely impact upon her credit. Nonetheless, I do not accept that there will be a call on that loan any time soon, if at all.
Senior counsel for the husband pointed to the fact that the wife had made an error in her evidence before Rose J when estimating when it was that she had seen Mr Trevor Fowler in relation to the first financial agreement. The wife has explained to my satisfaction her lack of memory as to the precise time of that event. Ms Doust gave cogent evidence as to the wife's fragile mental state leading up to the actual signing of the agreement in August 2004. I accept that when the wife was giving evidence before Rose J on this point, she actually did not remember when she received advice from Mr Fowler.
I bear in mind when assessing the wife's credit, that she did suffer post traumatic stress disorder around about the time of the breakdown of the marriage and after separation and it is possible that certain parts of the history of her marriage have been confused by the disorder that she suffered at that time.
The husband wished to make an issue in relation to the wife's credit arising from a comparison between the evidence she gave before Rose J about what happened in the Local Court on 15 March 2005 and the husband's proposed evidence from Constable H about what happened on that day. As already indicated the evidence of Constable H was not admitted as the husband failed to demonstrate any inconsistency in the wife's previously sworn evidence. There is no issue of credit arising from what the wife said in evidence before Rose J about this occasion.
The wife did change her evidence about receiving money from her father. She originally said that she had not received any money from her father apart from the money to fix her car but when pressed she conceded that what her father had said in his affidavit (that he gave her $50 to $100 every six weeks or so) was accurate. It also seems that the wife swore a financial statement at a time when her father was holding $45,000 for her (which eventually was paid to her lawyers for fees in relation to this litigation).
I have detailed in full the deficiencies that I have found in the wife's evidence. Overall however, I was generally impressed with the way the wife gave her evidence. I formed the view that for almost all the time she was attempting to provide her memory to me of what had happened and how she had felt in an accurate way. I accept that the effect of the genuine anxiety and stress that the wife feels may have partly clouded her memory in certain respects. However I have accepted, in the main, her version as to what has happened.
For the purposes of this hearing, I have accepted findings of fact made in respect of the husband's behaviour. The husband continues to assert that those findings are incorrect. That does him no credit.
The husband surprisingly seemed reluctant at first to accept that the E Trust was his alter ego, but in the end he accepted that it was.
Apart from the history of family violence, the husband was not challenged in cross examination in respect of any matter of financial history (most of which are non contentious).
Conclusion in relation to credit
The substantial challenge in this case was to the credibility of the wife's assertions in relation to how she continues to react as a parent when attempting to facilitate N's time with his father. It was suggested that the court should not accept her evidence in that regard. My conclusions however in relation to the wife's credit do not lead me to significantly disregard the wife's evidence as it relates to the residual effect upon her of the husband's family violence.
The husband was born in September 1963.
The wife was born in 1967.
In 1986 the wife completed a course at a business college and commenced to work as a receptionist at Company T.
The wife married Mr L in April 1990.
In August 1993 the first child of the wife's first marriage, M, was born.
The wife says that in August 1993 she began to work part time for her parents two days a week. Her parents operated a trade business and the wife worked in that business up until August 2004. She became proficient at MYOB, being primarily responsible for the accounting in the business for receipts and payments. She also did reception work.
In May 1995 the husband set up his company B Pty Ltd and the property at U Street, Suburb V was acquired in B Pty Ltd's name.
On 26 September 1995 the wife had her second child in her first marriage, S.
In 1996 the husband commenced employment at G Business.
On 16 June 1996 the wife separated from her first husband, Mr L.
In 1997 the husband became an equity partner in G Business and set up the B Trust. The B Trust became a shareholder of X Pty Ltd which was G Business' service trust.
In 1997 the wife and her parents brought a unit at Suburb C ("the C Unit"). The wife's parents provided her with the sum of $50,000 to assist her in acquiring her share in the C unit.
The wife and her first husband divorced in October 1997.
The husband's father died in January 1998.
The husband and wife began dating in July 2001 and became engaged in June 2002.
On 1 July 2002 Z Pty Ltd took over the professional business conducted by the partnership of G Business and a business conducted by X Pty Ltd. The husband was appointed director and secretary of Z Pty Ltd and was allotted shares (both in his name and in B Trust/Pty Ltd's name).
On 4 April 2003 the wife and her parents executed a Deed of Trust which recorded the fact that the wife's parents had provided her with a loan of $50,000 to acquire her interest in the C unit.
The parties married and commenced to live together in April 2003. The members of their household included M, then aged 9, and S, then aged 7. The parties lived together in the C unit between the date of marriage and October 2003.
On returning from his honeymoon, the husband discovered that there were irreconcilable differences between himself and other directors of G Business. He left G Business. The husband did not work for a short period of time. In June 2003 the husband commenced working at AA Business.
In about August 2003 there was an incident of family violence purported by the husband upon the wife.
In September 2003 the parties exchanged contracts to purchase the property at O Street, Suburb R (on the balance sheet referred to as Suburb BB). The wife and her parents also sold the C unit.
In September 2003 the wife had a conference with a solicitor in relation to a draft financial agreement that the husband had given her. That solicitor advised the wife not to enter into the agreement and she did not do so.
On 1 October 2003 the wife and her parents entered into a second document entitled "loan agreement" which again recorded a debt by the wife to her parents of $50,000, being the same debt that was referred to in the April 2003 Deed of Trust.
On 16 October 2003 the parties settled the purchase of the R property and commenced to live there. The property was purchased by the parties as tenants in common, 80 percent to the husband and 20 percent to the wife. The purchase price was $1,150,000. The wife provided $242,000 towards the purchase of the property and the husband provided the balance of the purchase monies.
The settlement of the sale of the C unit took place on 5 November 2003.
Incidents of family violence by the husband against the wife took place in late October or November 2003; in March 2004 and in June 2004.
On 1 July 2004 the husband became an equity partner at AA Business.
In July 2004 the husband provided the wife with a new binding financial agreement and asked her to sign it. The wife attended Katherine Doust in July 2004 and had an initial conference with her. Given the thickness of the document, Ms Doust needed time to peruse the document. The wife attended Katherine Doust on 5 August 2004. On that day Ms Doust made alterations to the original format of the document. The wife signed the agreement and Ms Doust signed the certificate of advice.
On 6 August 2004 the wife again attended Ms Doust. The wife indicated to Ms Doust that the agreement needed to be signed in its original format without alterations. The wife signed the agreement in its original format and Ms Doust signed a second certificate of advice in respect of the form of agreement that was executed on 6 August 2004.
In August 2004 the wife ceased work at her parents' trade business.
The parties' first child N was born in August 2004.
On 1 November 2004 the husband assaulted the wife.
On 2 November 2004 the wife left the matrimonial home and went to live for a period of about three months with M, S and N to the home of her first husband.
On 3 November 2004 the wife attended a police station and reported what she said had happened on 1 November 2004. The police initiated proceedings against the husband for an apprehended violence order. A complaint and summons was issued on 12 November 2004 and the husband was served with those documents on 17 November 2004, with a first mention in the Local Court on 19 November 2004. The AVO proceedings were adjourned to 21 December 2004. On 21 December 2004 the matter was further adjourned to 16 March 2005.
On 11 December 2004 the husband was charged by the police with assaulting the wife.
On 13 December 2004 the wife commenced proceedings in this court for final and interim orders.
The husband's financial statement filed in December 2004 indicated that his gross income was $4,600 per week ($239,200 per annum).
Interim orders for the husband to see N and for spousal maintenance were made by the Family Court on 22 December 2004.
In February 2005 the wife moved to rental accommodation at Suburb DD (her current residence).
On 15 March 2005 the husband pleaded guilty to a charge of assault based on "agreed facts" negotiated between the police (in consultation with the wife) and the legal representatives of the husband. The husband was convicted of assault and placed on a bond and that conviction was recorded by the Magistrate. An apprehended violence order was made by consent for a period of twelve months. The husband appealed the sentence.
On 15 April 2005 the District Court set aside the conviction and bond so that although the offence was found to have been proven, no conviction was recorded against the husband's record.
In April 2005 the wife began attending counselling with a therapist, Ms Y.
On 6 May 2005 the Family Court made a declaration, by consent, that the document that the wife had signed on 6 August 2004 was not a binding financial agreement.
In March 2006 the twelve month period in which the AVO operated expired and the wife did not seek an extension of the AVO.
On 14 August 2006 orders were made by consent for the payment to the wife by the husband of $60,000 by way of interim property settlement and for the appointment of experts.
A parenting hearing took place before Rose J on 15 – 17 December 2008 and his Honour made parenting orders relating to N on 19 December 2008.
The Full Court dismissed an appeal by the husband against the final parenting orders made by Rose J on 1 December 2009.
In March 2010 the husband resigned from AA Business effective as at 30 June 2010 and on 1 July 2010 he commenced employment at F Pty Ltd. At that time the husband established the E Trust, the trustee of which is E Pty Ltd. The husband is the sole director and shareholding of the trust. The E Trust owns shares in F Pty Ltd. As a result of the husband joining F Pty Ltd, he receives a salary and the E Trust receives dividends in respect of the shares held by the trust.
On 19 August 2010 the husband's mother died. Probate was granted in respect of the will of the husband's late mother on 1 April 2011. The husband received a 50 percent interest in a property at CC Street, Suburb VV which is currently worth $412,500. On 3 June 2011 E Pty Ltd acquired one half interest in the CC Street property from the husband's sister.
PROCEDURAL HISTORY
In attempting to case manage this matter, there has been a significant procedural history. It is not necessary to detail that history except for two particular interlocutory applications.
The first related to whether or not the factual findings about family violence made by Rose J in the parenting proceedings could be admitted in the property proceedings when considering the wife's Kennon based claim (Kennon and Kennon (1997) FLC 92-757). That question was dealt with in my Orders and Reasons dated 19 March 2010.
The second set of interlocutory proceedings dealt with two matters. Both attempted to interfere with the result the husband had received in the hearing before Rose J. The first matter was an application by the husband to discharge the orders that I had made on 19 March 2010 in circumstances where the husband asserted additional information demonstrated that earlier findings had been improperly or erroneously made. In Orders and Reasons dated 20 July 2011, I concluded that the husband had not demonstrated that a conclusion based upon that assertion was justified. The second matter involved an application by the husband to discharge Rose J's final parenting orders which he had unsuccessfully appealed to the Full Court. Again, in Orders and Reasons on that day, I found that it could not be said that the husband had established a significant change in circumstances and I found it was not in N's best interest to embark on a new full hearing in respect of parenting matters.
The Reasons of 19 March 2010 are important in the context of this hearing because of the factual findings by Rose J that have been admitted into evidence in this hearing by reason of my orders of 19 March 2010.
APPROACH IN PROPERTY MATTERS
In this matter my task is to:
Identify and value the property, assets, financial resources and liabilities of the parties;
Identify relevant contributions and assess them;
Consider relevant matters referred to in Section 79(4)(d) – (g) FLA;
Ensure my order adjusting the property, assets and liabilities of the parties is just and equitable.
I set out below a balance sheet taken from Exhibit 14. At the end of submissions, there were four disputed items. Where values are not agreed they appear in bold as determined by me. The reasons for each determination are set out under item numbers following the table.
Item no. Title Description Husband Wife Agreed/ Determined Value
1 J [O Street, Suburb BB (the R property)] $1,400,000.00 $1,400,000.00 Agreed $1,400,000.00
2 H [CC Street, Suburb V] (50%) $412,500.00 $412,500.00 Agreed $412,500.00
3 W [Ford Laser] $500.00 $500.00 Agreed $500.00
4 H [BMW ] $16,000.00 $26,000.00 Determined $26,000.00
5 W Ford Territory $0.00 $0.00 Agreed $0.00
6 H [B] Pty Ltd (as at 30.6.11) $1,368,437.00 $1,368,437.00 Agreed $1,368,437.00
7 H [E Pty Ltd] (as at 30.6.11) $137,676.00 $137,676.00 Agreed $137,676.00
8 H Woolworths Ltd (1,527 shares) $41,138.00 $41,138.00 Agreed $41,138.00
9 H IAG Ltd (814 shares) $2,751.00 $2,751.00 Agreed $2,751.00
10 W Community First Credit Union $2,501.00 $2,501.00 Agreed $2,501.00
11 H St George A/C […]25 $183,875.00 $183,875.00 Agreed $183,875.00
12 H St George A/C […]08 $1,764.00 $1,764.00 Agreed $1,764.00
13 H St George A/C […99] $1,426.00 $1,426.00 Agreed $1,426.00
14 H St George A/C [12] $0.00 $0.00 Agreed $0.00
15 H Suncorp Metway $2,240.00 $2,240.00 Agreed $2,240.00
16 H [E] Trust bank account $95,227.00 $95,227.00 Agreed $95,227.00
17 H Household contents – husband $8,000.00 $8,000.00 Agreed $8,000.00
18 H Jewellery – wife's engagement ring $15,000.00 $15,000.00 Agreed $15,000.00
19 H […] watch – husband $1,500.00 $1,500.00 Agreed $1,500.00
20 H [B] Trust $0.00 $0.00 Agreed $0.00
21 H [E] Trust bank account $0.00 $0.00 Agreed $0.00
22 W Paid legals by wife $60,000.00 $60,000.00 Agreed $60,000.00
23 H Paid legals by husband $0.00 $34,000.00 Determined $34,000.00
24 H Colonial First State Super $138,329.00 $138,329.00 Agreed $138,329.00
25 H ANZ Super Advantage $16,708.00 $16,708.00 Agreed $16,708.00
26 H [EE] Super $17,494.00 $17,494.00 Agreed $17,494.00
27 W ING Super a/c […]56 $14,356.00 $14,356.00 Agreed $14,356.00
Total assets $3,981,422.00
28 W Debt to wife's parents $0.00 $50,000.00 Determined $0.00
29 W Debt to wife's parents $0.00 $1,700.00 Determined $0.00
30 H Loan from [B Trust/Pty Ltd] to husband $0.00 $0.00 Agreed $0.00
31 H Loan from [E Trust/Pty Ltd] to husband $50,000.00 $50,000.00 Agreed $50,000.00
Total liabilities $50,000.00
The husband's BMW motor vehicle (Item 4)
There was no formal valuation of the husband's motor vehicle. The husband gave evidence that he purchased the motor vehicle approximately two years ago for the sum of $26,000. It was agreed that he had produced a cheque butt for that amount. In oral evidence he said he had handed over the cheque for the registration papers and that there was no formal contract and no financing of the motor vehicle.
It was suggested to the husband in cross examination that the cheque for $26,000 might have only been a partial payment for the motor vehicle but the husband rejected that suggestion and I accept that he paid $26,000 for the motor vehicle about two years ago. The husband said he had looked on Redbook and ascertained the current value of the motor vehicle was $16,000. Senior counsel for the husband invited me to find that the motor vehicle was purchased for the sum of $26,000 two years ago and to take notice of the fact that motor vehicles do not hold their value. I am unable to make the assumption that the husband's motor vehicle has reduced in value by $10,000 in a two year period.
As the owner of the asset, the husband had an onus to properly establish the current value of the motor vehicle and he has not done so by providing a valuation or even the Redbook valuation to which he referred.
The only cogent evidence I have is that about two years ago the motor vehicle was worth $26,000. That is the value I will adopt.
Paid legals by husband (Item 23)
In the disputed item 23, the wife seeks an add back of $34,000 against the husband because that is what she has calculated the husband spent on legal fees in relation to the AVO proceedings and the proceedings in the Local and District Court arising out of the husband's assault on the wife on 1 November 2004. The wife asserts that this quantum can be identified by cheques to which the husband was referred in cross examination. Those cheques however were not tendered in evidence so there is a difficulty in establishing the quantum. There is some merit however in the wife's argument that the husband's legal costs associated with criminal proceedings and the AVO proceedings should be added back against him given that they were occasioned by behaviour which was represented by the five assaults which have been found by Rose J to have taken place. The husband got some value out of the legal fees he paid given the charges at the Local Court were downgraded by agreement and his appeal to the District Court on severity was successful, so that in the end no conviction was recorded against him. I do not have any evidence from the husband which allows me to say that all his legal fees have come from post separation income.
The parties generally seemed to have mutually agreed not to add back paid legal fees except for item 22 on the balance sheet. Item 22 (as per Exhibit 14) is styled "paid legals by wife – $60,000". That amount may well have been used for legal fees by the wife but it is in fact a payment by the husband to the wife of a lump sum amount pursuant to a "partial property order".
The husband submitted that there was no evidence about the quantum paid for legal fees in relation to proceedings in the Local Court connected with domestic violence. Whilst that might be so, Exhibit 9 contains the husband's cost notice in relation to legal fees in these proceedings. It indicates that costs paid to date, including disbursements, were in the sum of $201,723.96.
The wife's costs paid to date were in the sum of $252,008.
I am mindful of the seemingly conflicting statements of the Full Court about adding back legal fees which are contained in Chorn & Hopkins (2004) FLC 93-204 on the one hand and Omacini & Omacini (2005) FLC 93-218 on the other. The husband has not fully complied with the requirements of rule 19.04(5) Family Law Rules 2004 (Cth) ("FLR"). In specifying the source of funds for the costs paid, the husband has simply nominated a bank account. There is no indication at all as to where the source of funds into that bank account came from. I am unable therefore to know whether or not the husband asserts that those payments came from funds accumulated from personal exertion post separation.
In any event, in the exercise of my discretion, I find it reasonable in the circumstances to add back $34,000 against the husband for paid legal fees (out of the $201,723.906 that he has paid), given that the parties seem to have agreed that the $60,000 that the husband gave the wife by way of partial property settlement (which will be counted against her) went towards payment of her legal fees.
Debt to wife's parents (Item 28)
Annexure B to the affidavit of the wife's father filed 10 April 2008 is a loan agreement dated 1 October 2003 between the wife and her parents.
There had previously been a Deed of Trust dated 4 April 2003 created in respect of the same subject matter (see annexure A to the same affidavit).
The wife and her parents acquired the C unit in September 1997 for a sum of $315,000. The wife's parents advanced to the wife an amount of $50,000 by way of loan to acquire her interest in that property. The loan agreement of October 2003 provides that "the borrower shall repay the principle sum to the lender upon written demand". There is also a provision for the payment of interest.
Although counsel for the wife conceded that any ability for the wife's parents to legally enforce the loan agreement was now barred by the statute of limitations, on reflection that may not be the case.
In Gray v O'Donnell [2009] NSWSC 259, Rothman J considered whether a loan agreement made in 1997 couched in the terms "[t]he Mortgagors [the defendants], ….will pay to the Mortgagee [the plaintiffs] the principal sum, or so much thereof as shall remain unpaid, on demand in writing" was statute barred. His Honour considered that "that the term 'on demand' is a much settled term which, absent express words to the contrary (or words of necessary intendment), must be read as "immediately due", and as a consequence, the cause of action accrues at the time that the moneys are advanced." However, his Honour went on to say at para [23]
In the contracts that must here be construed, the amounts are payable not "on demand" simpliciter, but "on demand in writing"…the requirement that the demand be made "in writing" and be served in a particular manner, makes clear that the moneys advanced were not payable immediately, but payable only if and when a demand was made in writing…The requirement for a demand to be made "in writing" was a condition precedent to the obligation to repay the amount. In other words, the obligation to repay was conditioned upon the service on the borrowers of a demand in writing for the moneys. The demand for the payment of the moneys owing on the mortgage and/or loan was served on [the plaintiffs] on 13 October 2006, at which time the amount was payable by them and the cause of action accrued. On that basis, the statement of claim was not statute barred.
For examples of debt repayable "on demand" simpliciter see Ogilvie v Adams [1981] VR 1041 and Chidiac v Maatouk [2010] NSWSC 386.
In this case, the loan agreement requires a written demand and consequently the debt is not statute barred. Since separation, the wife has not been in the position to repay the debt and so it is not surprising that the parents have made no demand that she do so. I have no information about the financial circumstances of the wife's parents. The wife's father said that there was no demand "at the moment" for the loan.
In Biltoft & Biltoft (1995) FLC 92-614 the Full Court recognised that generally unsecured liabilities would be deducted from the value of assets when ascertaining the value of a property pursuant to the provisions of s 79 FLA. That general practice is subject to certain exceptions available in the Judge's discretion, including whether or not the debt is likely to be enforced. I find that although the debt is actionable, the wife's parents are unlikely to call upon the debt.
If the debt is counted on the balance sheet, then it will diminish the contribution the wife points to in the sum of $242,000 (the vast bulk of which came from the receipt by the wife of monies coming to her as a result of the sale proceeds of the C unit).
Accordingly, I find it is not appropriate to include the $50,000 debt to the wife's parents on the balance sheet in order to avoid double counting when I take into account the $242,000 that the wife provided in cash towards the acquisition of the Suburb BB property.
The wife has also placed on the balance sheet the sum of $1,700 owed to her parents. This apparently is a reference to the amount that her father paid for a servicing of the motor vehicle that the wife drives. In paragraph 7(b) of the wife's father's affidavit sworn 1 May 2012, he says "I loaned [the wife] the money to pay for the [car] service." I am unable to accept the sum of $1,700 was a "loan" which the wife's father expected to be repaid. In fact, the wife's father gave evidence that every now and then, maybe every six weeks or so, he gives his daughter some cash if she needs it. It is usually $50 to $100. The sum of $1,700 will not be included on the balance sheet.
Other comments on the balance sheet
The Suburb BB property is currently registered as owned by the parties as tenants in common, 80 percent to the husband and 20 percent to the wife.
Item 2 (the husband's half interest in CC Street, Suburb V), is an asset that the husband received by way of inheritance from his mother's estate (his mother died in August 2010 and probate was granted on 1 April 2011). This asset in the sum of $412,500 represents 10.5 percent of the overall pool ($412,500 ÷ $3,931,422 = 10.5%).
Senior counsel for the husband asked that I adopt a two pooled approach, placing the husband's half interest by way of inheritance of CC Street, Suburb V, into a separate pool so that an assessment could be made that the wife made no contribution to this asset. The wife concedes that she made no contribution. Senior counsel for the husband conceded that when assessing s 75(2) matters, all of the assets need to be taken into account in the third step in the assessment. Purely as a matter of convenience, I do not intend to create two pools. I would bear in mind that this asset represents 10.5 percentage of the overall pool when assessing the wife's contributions to the overall pool of assets.
The Ford Territory (item 5) is registered in the name of the wife's former husband, Mr L, and he has provided her with this motor vehicle for a significant period of time. The motor vehicle has been ascribed a nil value on the balance sheet. The husband during the hearing asserted that the wife had a beneficial ownership of this motor vehicle. That assertion however was not maintained by senior counsel for the husband in final submissions. Evidence from the owner of the motor vehicle, (who had provided an affidavit), was not able to be read or relied upon because he went overseas during the hearing and was unable to give evidence. I infer that the arrangement between the wife and her first husband in respect of this motor vehicle will continue and although the motor vehicle has no value on the balance sheet, the wife has continuing access to that asset and it is a financial resource to her.
The husband actually now holds the whole of the interest in CC Street, Suburb V. Through a corporate structure and using its assets, he purchased from his sister her half interest that his sister inherited from his mother's estate. The asset which represents this other half of CC Street is subsumed into other assets on the balance sheet.
The husband provided no valuation for the B Trust or the E Trust. The husband is the sole director and shareholder of E Pty Ltd who is the trustee of the E Trust. The husband agreed that the trust was his alter-ego. The husband's interest in the E Trust was not valued by the single expert, notwithstanding directions made on 15 December 2011 which enabled the wife to approach the single expert in relation to this issue and that leave was granted which enabled the wife to make an application if she was unable to pay the costs of that valuation. On the first morning of the hearing, counsel for the wife unsuccessfully sought leave to rely upon an adversarial expert report in relation to the value of the husband's shares in the E Trust. The E Trust holds shares in F Pty Ltd. The husband is an executive professional at F Pty Ltd. In the 2012 tax year, the husband expects to receive $200,000 by way of gross salary for his personal exertion as a professional together with a further $221,000 by way of dividends into the E Trust. The husband conceded that this arrangement has been put in place in order to split his income with the consequent advantages in respect of the tax that he pays, together with some asset protection advantages. The husband conceded that for the purposes of this hearing however, in reality, the court could approach the matter on the basis that he was receiving gross remuneration for personal exertion earnings in the sum of $421,000 gross per annum.
The husband asserted that the wife's engagement ring was worth $15,000. The wife asserted that it was worth significantly less. Notwithstanding the normal practice of excluding engagement rings from the balance sheet, the wife proposed that the husband take the engagement ring at the husband's value. During cross examination, the husband agreed to that proposal.
At the commencement of the final hearing, the wife contended for an adjustment based on contributions at 35 percent of the overall assets of the parties. That was modified at the commencement of final submissions to a claim for 25 percent. The husband contended that it was appropriate in this case for an asset by asset approach to be taken with item 2 on the balance sheet (the husband's recent inheritance) to be considered separately in the assessment of contributions. I have said I will be mindful that item 2 represents 10.5 percent of the overall assets of the parties. The husband contended that the wife should receive by way of an adjustment for contributions, the sum of $280,000 (which is 7.1 percent of the overall assets).
The financial contributions in this matter heavily favour the husband.
The husband had significant assets at the commencement of the marriage worth approximately $2.1 million. At paragraph 54 of his affidavit sworn 1 February 2011, the husband says:
At the date of our marriage I had the following assets and liabilities:
Bank accountsE$244,377
Interest in [G Business]E$181,536
Shares in [B] Pty LtdE$1,263,298
Loan to [B Trust/Pty Ltd]E$295,232
Shares in Woolworths (1,090 Q [sic] $12.62)E$13,755
Shares in IAG (814 @ $3)E$2,442
ANZ SuperE$11,985
Colonial SuperE$92,161
Sub TotalE$2,104,786
Tax (net refund)E$1,107.91
TotalE$2,103,679
During final submissions, senior counsel for the husband asserted the current figures for those assets (the interest in F Pty Ltd replaces the interest in G Business) as:
[E Trust/Pty Ltd's] interest in [F Pty Ltd] E$137,676
1527 shares in WoolworthsE$41,138
814 shares in IAGE$2,750
Colonial SuperE$138,329
Although the figure asserted for the husband's bank accounts is slightly incorrect (senior counsel for the husband seems to have added in item 10 which is the wife's credit union account), I accept senior counsel's submission that there was no evidence the wife had contributed to those assets.
In comparison, the wife's assets at the commencement of the marriage amounted to $28,000 in cash, a 16/100th share in the C unit, and a motor vehicle. On the sale of the C unit six months after the marriage, the wife contributed from the sale the sum of $242,000 towards the acquisition of the former matrimonial home. Although the wife's interest was subject to a loan from her parents of $50,000, I have accepted the husband's submission in this case that the $50,000 should not be added to the balance sheet as a liability in favour of the wife. Accordingly, the wife is entitled to the credit of the full amount of $242,000 as a contribution.
When the matrimonial home was purchased in September 2003, its acquisition costs were $1,150,000. As recognition of the different contributions on the title of the property, the wife took a 20 percent interest as tenant in common, with the remaining 80 percent held by the husband. The wife had provided $242,000 and the husband had provided the balance of the purchase money.
At the commencement of the cohabitation, the wife was earning approximately $31,000 from her position in her parents' trade business.
As a result of the difficulties that the husband had with other directors of G Business, he was unemployed for a short period of time after the marriage. In the first full financial year after the marriage however (the year ended 30 June 2004), the husband's income was approximately $240,000.
Although the wife paid for groceries, rates and utilities and made various financial contributions towards the home, the husband's income was substantially more than the wife's during the short period of the marriage. There is no suggestion other than the husband's income was expended on maintaining the family and the parties' assets. I accept that the wife's father provided a contribution by way of carrying out odd jobs without charge.
The parties jointly did some work on the matrimonial home. The wife assisted the husband in the painting of the home and laying timber with the husband to the floor of the study. The wife also worked in the garden.
The husband worked long hours during the marriage and although I accept that he fulfilled the role of parent, his contributions to homemaking were necessarily of a minor nature. During the marriage, the husband worked six days a week.
The husband participated in the child's care for only a very short time after the child was born. The wife left the home when the child was less than three months old. I accept that during the time the parties were together, the wife provided almost all of the household duties consisting of cooking, shopping, cleaning, washing and ironing.
Since separation, the wife has been the primary carer for N. The husband's time with N has been confined as a result of both interim and financial orders made by the Family Court in the parenting proceedings.
The wife has not worked in paid employment since the separation. The husband has maintained employment and his significant income has increased since separation.
The wife's Kennonclaim
The Full Court in Kennon & Kennon (1997) FLC 92-757 said the following:
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, to 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 trial judges are entitled to take into account in assessing the parties' respective contributions within s 79.
The Full Court went on to say that considerations of this nature only apply in a relatively narrow band of cases and that it was not directed at conduct which does not have that effect and, of necessity, it does not encompass conduct relating to the breakdown of the marriage basically because it would not have had a sufficient duration for this impact to be relevant to contributions.
The violence in this case took place over a period of 15 months.
In Spagnardi & Spagnardi [2003] FamCA 905 the Full Court referred to the above passage in Kennon and emphasised the words "which is demonstrated" saying:
The question is whether a trial judge may infer from the evidence that the result must be that a party's contributions have been affected.
In Spagnardi, the Full Court approved a statement by the trial judge. The trial judge had commented on the difficulty in that case which arose from the wife's material, because although it gave evidence about specific acts of violence, it did not expressly refer to the impact of the violence on her contributions. The trial judge went on to say:
It cannot, however, be the law that the failure to state such matters expressly is necessarily fatal to such evidence; there must be cases where it is obvious or a very likely inference from the facts, that certain kinds of violence must have adversely affected a person's contributions.
The Full Court in Spagnardi also commented upon the reference to "exceptional cases" and "the relatively narrow band of cases". The Full Court in Spagnardi adopted the trial judge's comments that:
….the references to 'exceptional cases' and 'narrow band of cases' occurs in the context of the principle of misconduct in general rather than the more narrow formulation about domestic violence. My reading of these passages, therefore, is that it is not necessarily correct that only cases of exceptional violence or a narrow band of domestic violence cases fall within the principles. It seems to me that reading these passages carefully, the key words in a case where there are allegations of domestic violence are 'significant adverse impact' and 'discernable impact'. That reading of the passage is, I think, given some additional force by the actual decision in Doherty case and the judgments of Baker J in both Doherty and Kennon.
The Full Court in Spagnardi at paragraph 47 said:
An insufficiency of evidence in the present case leaves the Court with a limited ability to deal with allegations in the context of section 79 proceedings. As Kennon has established, it is necessary to provide evidence to establish:
The incidence of domestic violence;
The effect of domestic violence; and
Evidence to enable the court to quantify the effect of that violence upon the parties capacity to "contribute" as defined by section 79(4).
For convenience, I repeat what I said in the interlocutory argument in this case in Reasons delivered on 19 March 2010:
22. I agree with the wife's submissions that the approach regarding family violence in property ….. proceedings can be broken down into steps, however I think the process should be broken down into three steps rather than two. Those steps are:
22.1 make findings of fact about one party's conduct;
22.2(if applicable) make findings about the physical or psychological effect of the conduct on the other party;
22.3make findings of fact about the effect of the conduct of one party upon contributions made by the other party.
23. It may not be automatically assumed in a particular case that an effect on a party's condition automatically means there is an effect upon the party's contributions ….. For example, Strickland J's commented in Spence and Spence [2008] FamCA 263 at [163]:
"There is no doubt that there was some domestic violence during the marriage, but there is no basis to find that "there was a course of violent conduct" by the husband which had "a significant adverse impact" upon the wife's contributions to the marriage. There is simply no evidence provided by the wife to establish the link between any domestic violence by the husband and any impact on her contributions. Certainly the report of the psychologist does not assist in this regard. It does not assist the wife that she may be suffering from post-traumatic stress disorder. That says nothing about whether any conduct by the husband made her contributions "significantly more arduous than they ought to have been". Thus, this is a claim that cannot succeed."
24. Whether I am prepared to infer the wife's post traumatic stress, in this case, made her contributions significantly more arduous, will be a matter to consider after further submissions. The wife may choose to lead further evidence about that connection at the final hearing.
25. The wife in this case will have to establish to my satisfaction at trial, a connection between any proven family violence in this case and contributions she has made, for the family violence to be relevant in this property matter.
The wife contends that her contributions as homemaker and parent were made significantly more arduous both during the relationship and after separation by the course of violent conduct of the husband during the marriage.
Counsel for the wife asked for 5 percent on account of the application of the principles in Kennon. This was in the context of a submission by the wife for a 25 percent adjustment based on contributions. What I took that to mean is that the wife is seeking a 25 percent uplift factor for Kennon considerations on whatever the wife's contributions are found to be (5/20 = 25%).
The husband sought no adjustment be made but on the basis that the basis of the claim had not been established.
The incidents of violence were dealt with by way of findings by Rose J on 19 December 2008.
On 19 March 2010 I made an order in the following terms:
Subject to any further argument about relevance, the following factual findings and evidence are admitted in the hearing before me in respect to the alteration of the property of the parties:
Those parts of Rose J's Judgment of 19 December 2008 and those parts of the affidavit of the wife sworn 7 April 2008 which are set out at paragraphs 4 to 7 of my Reasons for Judgment dated 19 March 2010.
Paragraphs 66, 85 and 102 of Rose J's Judgment of 19 December 2008 and the photographs which were part of Exhibit 8 in the hearing before Rose J.
Evidence in the affidavit of [Ms Y] sworn 19 December 2006.
I will find that, in the circumstances of this case, the behaviour of the husband made the wife's contributions during the 19 months at they were together significantly more arduous. I will also find that the husband's behaviour during the marriage led to an effect on the wife that made the wife's contributions for some period after the separation significantly more arduous. As a result, I find that the evidence that could be admitted "subject to any further argument about relevance" may be admitted in this hearing as I find that it is relevant.
The findings that are admitted are set out in paragraphs 4 to 7 of my Reasons for Judgment dated 19 March 2010 and are as follows:
4.In the final hearing concerning property matters before me, the wife wishes to rely on certain factual findings relating to family violence made in the parenting proceedings together with certain evidence accepted by Rose J. In his Reasons for Judgment published 19 December 2008, at paragraph 80, His Honour made the following factual findings:
"[80] I find that the husband has engaged in violent and abusive conduct to the wife as alleged by her in each of the five incidents to which I have referred and which are set out in her Affidavit."
5.The five incidents to which His Honour referred were subject of findings by His Honour which are contained at paragraphs 56 – 60 of his Reasons for Judgment as follows:
"[56] In about August 2003 the husband yelled at her [the wife] and repeatedly pushed her hard on the chest forcing her onto the bed.
[57] In about October or November 2003 following a counselling session attended by them, the husband dragged her out of bed, across the floor, down the hallway, and then threw her up against the wall. He pushed her violently and repeatedly against the wall. Following that violence, he was abusive towards her for a lengthy period. He demanded an apology from the wife for not preparing food for him.
[58] In March 2004, when the wife was about four months pregnant, the parties argued. He then assaulted her. The husband chased the eldest child after he said he would call the police. The husband returned to assault the wife again. He then abused her.
[59] Subsequently, when the wife was about seven months pregnant, the husband spoke to her aggressively and then suddenly assaulted her. Upon the wife commencing to pack her clothes to leave the house, the husband assaulted her again. He then abused her.
[60] On 1 November 2004, an argument developed between the parties in relation to who might be the godparents of the child. The husband then assaulted the wife. He punched her on the arm and kicked her legs and on the bottom. He then pressed her head against the floor causing pain. He shouted at her and claimed he had the right to do what he did."
6.As indicated, as part of his findings, His Honour (at paragraph 80 of his reasons) accepts what the wife set out in her affidavit sworn 7 April 2008. The affidavit contains evidence of the husband's conduct which His Honour has accepted as factual. That affidavit provided a more detailed description of what has been summarised by Rose J, as quoted in paragraph 5 of these Reasons [for judgment dated 19 March 2010]. The evidence at paragraphs 14 and 15 of affidavit of the wife is as follows:
"[14] During the marriage I suffered physical violence from [the husband] on 5 occasions.
(a) In about August 2003 we were living in [the C unit] and house-hunting on weekends. On one weekend [the husband] and I were standing in the bedroom of my unit. We had a discussion about the house-hunting during which [he] began yelling at me things like "you should be more committed to finding a place for us". I said "I am but I need to take an hour off to watch [S] play netball". [He] kept yelling at me and then used both his open hands to hit me hard on the upper chest and push me backwards onto the bed. I crawled off the other side of the bed. [He] came around and pushed me back on the bed with force. This happened 3 or 4 times during the episode. The episode lasted about an hour. It ended when my father came to the door.
(b) On a Thursday night in late October or November 2003 [the husband] and I had been to counselling. [M] and [S] were staying at my parent's home. [He] and I returned to the house at about 10:45pm. I prepared for and went to bed. [He] came into the bedroom and dragged me out of bed by my ankles. He dragged me by my ankles across the timber bedroom floor and then along the slate hallway. [He] threw me up against the wall at the end of the hallway. [He] gripped my pyjama top ripping a button. [He] pushed me against the wall. [He] used his hands to grip my upper arms and shoulders against the wall. [He] pushed me backwards and forwards against the wall with such force that my upper back and head was [sic] hitting the wall. I crouched down to try and protect myself. [He] picked me up and gripped my arms and again pushed my back and head backwards and forwards against the wall with force. During the time [he] dragged me along the floor and hit me against the wall [he] was shouting at me things like:
"you're selfish and do not think of me."
"I am your husband."
"You didn't even think if I would be hungry".
The only thing I said to [him] throughout the episode was "Stop – you're hurting me". I said this about 4 times. Each time I said this [he] paused but then began again hitting me against the wall. The episode lasted about 10 minutes and ended when I managed to get my hands to [his] shirt and pushed him away. I later saw that [he] had a scratch on his chest. After the episode I went back to my bedroom and was shaking and crying. I sat on the bed and continued crying. [He] came back in and walked around the bed from one end to the other and back. [He] was talking loudly at me saying things like "you are selfish" and "you are spoilt". I cannot remember all the things [he] said. I felt cold and numb. This went on for about 3 hours, during which the whole time [he] was shouting at me and walking around the bed. I cannot recall much of what I said to [him]. I was afraid of saying much to [him] at all. I recall saying "If you were hungry why didn't you get something yourself." I recall saying 2 or 3 times "Please can we turn the light off and talk about it tomorrow?" In response to that [he] said "No we need to talk about it now." I was afraid of lying down and trying to sleep in case [he] hit me again or dragged me away. I felt by sitting up I could watch what he was doing. One of the last things I recall [him] saying was "You should write me an apology letter that you will not neglect me again." When I finally lay down I remember the time on the bedside clock was about 2:10AM. The next day I had bruising on my upper arms. I did not go to the doctor nor to the police. I did not tell anyone about this episode. I felt embarrassed and humiliated. I do not know if I was pregnant with [N] at the time.
(c) On a weekend in March 2004 I was at the home. I say it was March because I was about 4 months pregnant with [N]. I say it was a weekend because the children and [the husband] were at home during the day. [The husband] and I were having an argument. It was daytime. I do not recall the details but I recall [he] was yelling. [He] and I were both standing. [He] was in front of me and suddenly grabbed me by the upper arms and pushed me back onto the bed forcefully. [He] then immediately grabbed my ankles and dragged me onto the floor. I started yelling "Stop". I saw my son [M] start to walk downstairs from the upstairs level where his room was. There is a telephone on the downstairs level but not on the upstairs level where [M] was. [The husband] turned and saw [M] and shouted to [M] in an aggressive and angry tone of voice "What are you doing". [M] said "I'm calling the police". [The husband] shouted "go back upstairs now". [The husband] ran out of the bedroom towards [M]. [M] ran back upstairs. [The husband] stopped chasing [M] and came back into the bedroom. During the time [the husband] ran out of the bedroom I crawled back onto the bed. When [he] returned he grabbed me with both hands by my ears and hair and dragged me back onto the floor. [He] pinned me to the ground. The left side of my face was against the floor and [he] was above me and placed his hands on the right side of my face and applied downwards pressure. I felt a surge of intense pain in my head from the pressure. I shouted "stop, stop, stop". [He] was shouting at me but I do not recall the words. I again shouted "stop, stop, stop". I am not sure how long the episode lasted but I think it was about 15 minutes in total. During this 15 minutes [he] pressed my head into the floor for 2 or 3 minutes, released for a minute or so, then pressed my head back into the floor for another 2 or 3minutes. He repeated this throughout the 15 minutes. Each time [he] applied pressure forcing my head down to the floor I felt intense pain in my head. Each time I shouted "stop". I recall [he] was shouting something to me but I cannot recall the words. When [he] eventually released me from the floor I crawled to a corner and crouched down. The left side of my head was numb. I also felt physically numb all over and felt in shock. [He] then started to talk at me in a loud voice. I said something like "I'm going" or "I'm leaving". [He] said "just like your first marriage." This went on for 1 or 2 hours during which the whole time [he] was shouting at me and walking around the bedroom. I don't recall saying anything. I stayed in the one spot with my knees up and my arms wrapped around my knees. I did not want to antagonise [him] in case he attacked me. I don't recall how the episode ended. The next day I had bruising on my upper arms at the positions [he] had gripped me. [M] pointed at my bruises and said to me "Are they from yesterday?" I said "I'll be OK. Don't worry about it." I did not go to the doctor nor to the police. I did not tell anyone about the episode. I felt embarrassed and humiliated.
(d) On a weekend in June 2004 I was at the home. I say it was June because I was about 7 months pregnant with [N] and heavily so. I say it was a weekend because the children and [the husband] were home during the day. I was sitting on the bed in the bedroom when [the husband] came in. [He] began to talk to and at me in a loud voice with an aggressive tone. I do not know what caused [him] to suddenly talk loudly. [He] suddenly lunged at me, grabbed my ankles and dragged me off the bed. I crawled back onto the bed and broke my ankles free of [his] grip. I said "That's it. I'm not putting up with this". I took a suitcase from the wardrobe and started to pack clothes. I started to walk through the doorway and out of the bedroom. [He] grabbed me from behind my upper arms. [He] dragged me back into the bedroom and threw me onto the bed. We had the following exchange:
[The husband]"I'm sorry. I don't want you to go."
Me"You've got a problem with aggression [the husband's first name]. You need to see someone."
[The husband]"You're the one with the problem."
I felt shaken and afraid. I didn't try to get off the bed. I crawled to the centre of the head of the bed which was against the wall. I raised my knees up against my belly and wrapped my arms around my knees as far as they could go. [He] talked to and at me for 1 or 2 hours. I felt very afraid. I did not say much if anything. I recall saying in a loud voice "would you please stop yelling". The episode ended when [he] said to me "You have broken a promise by threatening to walk out" and I said "I promise I won't walk out". I don't think I had any bruises. I did not go to a doctor nor to the police. I did not tell anyone about the episode. I felt embarrassed and humiliated.
(e) On Monday, 1 November 2004 I was at home in the evening. [N] by this stage was just over 2 months old. We had finished dinner and the children had gone to bed. [The husband] and I were talking about [N's] baptism planned for 3 December 2004. We had a difference of opinion as to Godparents. This developed into an argument. [He] said "you're selfish". Both [him] and I were sitting on the couch. [He] suddenly got up in front of me and grabbed my hair and ears on the side of my head and dragged me onto the ground. When I was lying on the ground in front of the couch [he] started punching me on the arms and kicking me on my legs. I think [he] was wearing running shoes. [He] then punched and wrenched my left arm pulling it upwards. I crouched in towards the couch and held my arms around my belly where I had had a caesarean operation about 10 weeks previously. [He], who was still holding my left arm up, kicked me on the bottom. Whilst punching and kicking me [he] was yelling things like "You're so spoilt" and "You only think of your family". I was shouting "Stop. You're hurting me." I was crying and felt intense pain in my arm which I thought had been broken. [He] released his grip on my arm slightly. This episode last [sic] about 5 minutes after which [he] stopped kicking and punching me and I crawled onto the couch into a foetal position. [He] sat beside me. [He] started talking loudly to and at me for about 10 minutes. I felt shocked. I do not recall the words but only that he was shouting and his voice was angry. I then said something like "Was your father a violent man?" [He] became angry and stood up and dragged me by my ankles back onto the ground and began punching and kicking me. I shouted "Stop. You're hurting me". I was lying on my left side holding my knees up and my arms around my knees and belly. [He] stopped punching and kicking me but then pressed my head into the ground such that the left side of my face was against the floor. [He] was above me and placed his hands on the right side of my face and applied downwards pressure. I felt a surge of intense pain in my head from the pressure. [He] said "apologise for what you said and say you will never say it again." I said "I'm sorry". [He] then released me. I crawled back onto the couch and crawled into a foetal position again. [He] began shouting at me. [M] and [S] had been in bed. I saw [S] walk to the bathroom. I went down to the bedroom and sat on the bed. [The husband] and I had a conversation:
Me:"You've got a problem. You need to see someone."
[The husband]:"It's you. If you ever speak to me like that I have every right to do what I did. Do you accept that?"
Me:"Yes". I said this to keep [him] quiet.
[15] On 2 November 2004 I woke up and had bruising on my arms and legs. [the husband] got up and went to work at his normal time of about 7:20AM. [M] and [S] had earlier come into my bedroom. They both looked at my bruises. [M] said to me "Are you alright?" I said "We'll be OK". [S] said to me "We can't stay." I said "Get ready for school. Go to school. I'll sort something out." [M] and [S] went to school. I telephoned someone who later collected me and [N] from the home. I took with me goods for the children and some basic clothes for myself."
7.Rose J made further factual findings which can be found amongst the following discussion by His Honour:
"[61] The wife also alleges that the husband was frequently abusive towards her, at times unpredictably and without apparent reason. The wife did not report the husband's alleged violence to the police or anyone else, with the exception of the incident which occurred on 1 November 2004.
[62] The husband was charged with common assault and assault occasioning grievous bodily harm. Apprehended Violence Order proceedings were also instituted by the police against him.
[63] On […] March 2005, in the Local Court, […] the husband pleaded guilty to the charge of common assault. He was convicted and placed on a good behaviour bond for 12 months. An Apprehended Violence Order was also made on the same date against the husband for the protection of the wife and the three children. The Apprehended Violence Order was for a period of 12 months.
[64] On […] May 2005 in the District Court, on appeal by the husband, he was found guilty, a conviction not recorded, and the husband was discharged upon entering into a good behaviour bond for 12 months.
[65] The husband denies all of the allegations made by the wife of violent and/or abusive conduct towards her, except for part of his alleged violent conduct towards her on 1 November 2004. He admits be restrained her by her arm and slapped her on the bottom.
[67] Affidavit evidence was given by [Ms Y], a social worker. [Ms Y] conducts a counselling and therapy practice. [Ms Y] is a social worker of substantial experience. The wife has been consulting [Ms Y] since 11 January 2005 to enable her to manage stress and anxiety as a result of the alleged domestic violence. [Ms Y] concluded that the wife has suffered from post traumatic stress symptoms due to the alleged violent conduct of the husband. [Ms Y] was not required for cross-examination. I accept her evidence which is detailed and professional.
[68] The appointed child expert [Dr R], a child and family psychiatrist, provided a full expert report completed in about October 2007 and annexed to her Affidavit sworn 2 November 2007. That report was prepared following her interviews with the parties and the two eldest children.
[72] [Dr R] expressed the opinion in her report and oral evidence that, if the wife's allegations of violent and abusive conduct by the husband is accepted, then her symptoms of stress and anxiety are consistent with her having suffered trauma due to conduct as alleged and/or violent conduct by the husband and that [Ms Y's] conclusions are well supported.
[73] I accept [Dr R's] evidence in relation to those matters and find accordingly.
Paragraphs 66, 85 and 102 of Rose J's judgment of 19 December 2008 were in the following terms:
[66] Exhibit 8 comprises the Court papers provided by the Local Court, […], and the District Court in the proceedings to which earlier reference has been made. It includes photographs showing severe bruising to the wife's left arm, left leg and left buttock.
[85] I also have given weight to the photographs and "Statement of Full Facts" as well as the testimonial of [Mr K] which are inconsistent with the husband's evidence that he merely restrained the wife by the arm and smacked her perhaps lightly on the bottom on 1 November 2004.
[102] In my view, it is not a coincidence that the only violent conduct that the husband admits he perpetrated against the wife was arising out of the one incident he could not refute. That was the incident on 1 November 2004 which the wife reported to the police and corroborated with photographs as contained in Exhibit 8.
As already indicated, I allowed into evidence the affidavit of Ms Y sworn 19 December 2010 and Dr R's report annexed to her affidavit sworn on 2 November 2007 and parts of the transcript of Dr R's evidence before Rose J on 17 December 2008.
As I said in my Reasons of 19 March 2010 at paragraph 31, I am content that the exploration of the issues of violence before Rose J was comprehensive.
The wife's reaction to the violence
The wife was cross examined about possible violence in her first marriage which the husband seemed to be floating as an explanation as to why she suffered post traumatic stress disorder at the conclusion of her marriage to the husband. I do not accept that there is any evidence that ameliorates the conclusion that the husband's violence during the marriage led to the wife's post traumatic stress disorder.
That disorder however, resolved over time:
The wife began attending upon Ms Y in January 2005. In her affidavit of 19 December 2006, Ms Y opines "A couple of months prior to the completion of the AVO, [the wife's] anxiety level soared to a new high…she was indeed manifesting symptoms of post-traumatic stress syndrome…"
In October 2007, the wife had two interviews with Dr R. In her report of November 2007, Dr R opined that the wife's "alleged experience of verbal, emotional and physical abuse during her relationship with [the husband] resulted in her developing symptoms generally associated with an involvement in traumatic incidents." She went on to say that "currently, [the wife] does not warrant a psychiatric diagnosis." In her oral evidence of 17 December 2008, Dr R said that "I think in 2006… if I had seen [the wife] at that time I would have diagnose[d] post-traumatic stress disorder. I don't believe when I saw her a year later that the full syndrome was present at that time."
On 9 March 2011, the wife was interviewed by Dr W. In his report dated 4 June 2011, he found the wife had no current psychiatric diagnosis, but "probable resolved Post-Traumatic Disorder." He opined that "traumatic memories associated with her previous experience were still affecting her, though not in a way to affect her current well-being or capacity to function."
The connection between the incidents of family violence and the effect of the domestic violence AND the effect upon the wife's capacity to contribute as defined by s 79(4)(c) FLA
There are two distinct periods in which the wife was making contributions that are relevant to the Kennon considerations.
The first was from the first act of violence in August 2003 to the date of separation on 2 November 2004 and the second period was from the date of separation to the date of hearing.
In relation to the first period, the contributions made by the wife were in the role primarily as homemaker and at the time of the fifth assault also as parent. The wife was also in paid employment for 12 of the 15 months over which the assaults occurred. In the second period since separation, the contributions have been solely in the role of N's parent.
Ms Doust gave oral evidence about the wife's fragile state before N's birth. Ms Doust said that when the wife came to her office in early August 2004 for legal advice she was
…heavily pregnant and extremely distressed… she was insistent that I sign it [the financial agreement and certificate of advice] with her… she was so upset… I've never had a matter like that before and I haven't had a matter like that since where someone has come in so distressed, she was just in despair, that's the best way to put it. She said [to me] "you have to, you have to sign this with me, you have to sign, I have to do it, I have to sign this agreement" and I remember that today, I remember her saying those words to me.
The wife gives evidence that during the marriage she "felt depressed and upset every night before [the husband] was due home." She would become "nervous and teary" while cooking dinner, although she would wash her face before the husband arrived home. She says she became angry at M and S without reason. She started sending them to bed before the husband arrived home so that he wouldn't "turn on them".
The wife says that she contributed as homemaker during the marriage by performing all the cooking, cleaning, washing, ironing and shopping. She says she also paid all the expenses for the home. The wife says that she prepared all the family's meals throughout the marriage. She says she bathed N as a baby and got up when he stirred during the night. Counsel for the wife invites me to draw an inference that these tasks were performed under the threat of violence.
After the parties separated, the wife deposes that she and the children "lived out of suitcases at the home of [her] former husband, [Mr L]." She gives evidence that she attempted to communicate with the husband about N via email. The wife has annexed to her affidavit a large volume of emails sent between the parties. She says she was "afraid to check the email inbox in case there was something from [the husband]. When [she] did see an email from [him]… [her] heart began to pound in [her] chest and [she] felt a shiver."
The wife continued in her role as parent, she says while dealing with her continuing psychological difficulties arising from the family violence she had experienced during the cohabitation.
Counsel for the wife also invited me to find that the wife's contribution during changeovers has been made more difficult because of the husband's behaviour. The wife gives evidence about a changeover on 9 December 2006 where the husband returned to her home with N and spoke to the wife in an angry tone, demanding to know why he couldn't have overnight time with N. The wife says she "began to shake", her "chest tightened", her "heart raced" and she had "difficulty breathing". She deposes the husband remained outside her home for approximately 15 minutes. This made her upset and anxious.
The wife also refers to a changeover on the 9 June 2007, where the husband was collecting N, but he insisted the parties had to talk. The husband put his foot in the doorway preventing the door from closing. The wife says he remained there for five minutes, before taking N, saying he would return him a day later than originally intended because it was his "turn for access with [N] [that] public holiday." She also refers to another event in June 2007 where N was upset at spending time with his father. The wife had to calm N down in the husband's presence which she found "very difficult."
The wife describes her behaviour just before N returns from time with his father. She says that she is "always looking at the clock or [her] watch" and if by 5.00pm N has not been returned she "begin[s] to pace the lounge area", her muscles start tightening, and her mind races. She "find[s] it impossible to not think of [N] and whether he has come to any harm."
The wife says she has tried to keep to the 2008 Orders to minimise interaction with the husband. She says when she interacts with the husband she feels nauseous and short of breath.
The wife says her contribution to parenting N has been made harder by attending school events where the husband has also attended. At one event in September 2010, the wife says she "immediately froze" when she found out the husband was at the event. She says she feels stressed and anxious when the husband requests to change the parenting plan. The wife says that between February 2007 and December 2008 N's toilet training at night was set back by continual changes to his routine because of the husband's requests to change the time spent with N.
Counsel for the wife invites me to find that the wife's contributions are more arduous because of the concern she has that the husband will communicate to N that violence is acceptable.
The wife gives evidence that she has friends who observe changeovers at N's school, however she still feels anxious. While N is with the husband, the wife says she does not sleep well and "cannot remove from [her] mind [her] fear that something hurtful or painful will happen to [N] including physically at the hands of [the husband]." She says this is because "children go through phases… at some stage [N] will do something or say something in a way which will irritate [the husband]." Counsel for the wife submitted that the wife's fears are genuine and well founded. She pointed to Dr R's oral evidence, where Dr R accepted that the wife had a genuine fear of dealing with the husband in person, as well as agreeing that "when it gets to the point where [the husband] experiences N's oppositional behaviour… if [the husband] personalises it [rather than perceiving it as a developmental stage] then I would expect a negative response in [the husband]."
It was the husband's case that:
The court would have doubts about the wife's credibility generally and therefore doubts about the evidence that she gave about her reactions when there was nobody else present.
On the occasions when there were persons present (on some occasions the wife's father, her mother, Mr L and Ms Ms J), those persons were not put on affidavit to give evidence in the wife's case about the wife's difficulties in making contributions in the role of homemaker and parent, or parent. Consequently an adverse inference should be drawn (see Jones v Dunkel (1959) 101 CLR 298) and the wife's evidence about her reaction rejected.
Conclusion about Kennon Claim
I have the findings of fact in relation to the five assaults made by Rose J. I have the opinion of Ms Y unchallenged at the first hearing, that the wife suffered from post traumatic stress disorder (whose opinion is supported by Dr R on the proviso that the wife's allegations against the husband were found to be true, which they were).
In the circumstances of this case I am willing to infer that the wife's contributions in the role of homemaker and parent during the period over which the violence took place during the period of cohabitation were made significantly more arduous by that violence. This was a period of 15 months.
It is more difficult to make an assessment as to how the wife's role as parent post separation was made significantly more arduous by the family violence during the cohabitation. The wife, as N's parent, for N's sake, needed to be able to interact with the father of N in some way. Arrangements and court orders meant that N had to spend some time with his father which mean that N had to move between his mother and his father. This created occasions where the wife needed to communicate with the husband and came into contact with the husband. This opportunity and need for facilitation of the husband's parenting role meant that there was an ongoing effect given what had happened during the cohabitation and given the disorder from which the wife suffered at the date of separation when she left the marriage. Although I have already commented on some difficulties in some of the wife's other evidence, I accept what she was saying about the apprehension and heightened emotion that she experienced, around dealing with the husband's time with N after the separation.
The effect of the violence on contributions has not been constant over the last eight years. The wife's post traumatic stress disorder had significantly dissipated by the time the wife saw Dr R and was not evident when she saw Dr W.
Counsel for the wife seeks a 25 percent uplift on any contribution finding in respect of the overall pool of assets (presumably excluding the husband's most recent inheritance) in respect of the Kennon claim.
I accept that it is appropriate to increase the wife's assessed contributions, for a period of 15 months during the time the parties were together, by an uplift of 25 percent on what they would have been had they not been made significantly more arduous by the husband's conduct. I will increase the contributions the wife has made since separation by an uplift of 5 percent on what they would have been had they not been made significantly more arduous by the husband's conduct.
Payments by the husband to the wife since separation
Senior counsel for the husband put alternate arguments in relation to the payments made by the husband since separation. On the one hand he asserted that monetary contributions by the husband after separation equally balanced the wife's post separation contributions in the role of parent to N. The calculation was done by senior counsel for the husband that one third of $1 million has been paid by the husband to the wife post separation. That calculation comes from an order that was made by consent on the 22 December 2004, which provided:
6. That pending further order the following orders be made in relation to the payment of spouse maintenance by the husband to the wife
6.1 That pending further order the husband pay direct to the wife by way of maintenance for herself the sum of $400 per week, the first payment to be made on the date of these orders
6.2 That the maintenance to be paid to the wife pursuant to sub-clause 6.1 herein be varied each year on and from 1 July each year, in accordance with the variation of the Consumer Price Index for Sydney over the previous year as published by the Commonwealth of Australia Statistician as at 30 June of the year in question.
8.2 [In addition, the husband shall] pay to the agent in advance an amount of $450 per week for rent payable by the wife for accommodation of herself and her children.
Without taking into account CPI changes, the husband has paid $850 per week for approximately 387 weeks (from the date of the order until the final day of the hearing) equating to $328,950. Senior counsel for the husband submitted that the wife has had the benefit of these orders amounting to approximately 10 percent of the current net assets.
In the alternate, senior counsel for the husband submitted the amount of one third of $1 million which the wife had received over the period since separation, extinguished any further s 79(4)(d) – (g) adjustment to which she might be entitled. Senior counsel for the husband conceded he could not have it both ways.
I will treat the payments the husband has made since separation as contributions to N's welfare rather than a matter to consider under s 79(4)(d) – (g) FLA. The wife has been out of the paid workforce during this period.
Although the husband has paid the outgoings on the matrimonial home since separation, he has occupied it and has had the advantage of that superior accommodation since separation.
The husband had superannuation at the commencement of the cohabitation and has continued to contribute to that fund since 2004 (with interest, it has increased by the sum of approximately $46,000).
The husband's substantial earning capacity has meant that he has accumulated assets over the past seven and a half years.
Conclusion in relation to contributions
The wife made a 20 percent financial contribution to the R property. Today that is worth $280,000 ($1,400,000 x 20%). During cohabitation, the wife made contributions in the role of homemaker for 19 months and as parent for less than three months. The wife has made contributions in the role of parent in the last 7 ½ years since the separation. To varying degrees, those two periods of non financial contribution by the wife have been made significantly more arduous by the husband's violence during the marriage. The wife has made no contribution to the husband's half share in the Suburb V property. Notionally excluding that property from the pool, the remaining pool is $3,519,000 ($3,931,000 – $412,000). The wife's financial contribution is 8 percent of the pool excluding the Suburb V property (280/3519). I assess the wife's non financial contributions (including the Kennon considerations) at 12 percent of the pool of assets (excluding the Suburb V property). The overall entitlement on contributions is consequently 20 percent (8 + 12). The wife's overall entitlement in dollar terms is $704,000 ($3,519,000 x 20% rounded up). This is 18 percent (rounded up) of the overall pool including the Suburb V property (704/3931). I consequently find that based on her contributions, the wife is entitled to 18 percent of the overall pool of assets.
SECTION 79(4)(d) TO (g) FLA MATTERS
The wife sought an adjustment of 10 percent for s 75(2) matters, but on the basis that she receive a 25 percent adjustment arising from the contributions that she has made.
The wife is aged 44 years and the husband is aged 48 years.
Both parties are in reasonably good physical health. The wife has suffered post traumatic stress disorder. I accept the wife continues to have considerable difficulties coping with her interaction with the husband and has some genuine but unreasonable fears for the child when the child is in the husband's care.
Senior counsel for the husband, when cross examining the wife, explored why it was that the wife refused to obtain treatment for the fears that she had about the husband. I find that the wife does have fears that are not reasonably held on an ongoing basis and it is true that the wife has shown an incapacity to obtain proper treatment for those fears. This however is somewhat a circular argument. I have formed the view that her inability to obtain treatment arises from the psychological difficulties from which the wife continues to suffer to some degree in respect of issues involving N and his father. The fact that the wife feels that way and does not obtain treatment is not a matter that is to be held against her as a s 75(2) consideration. I would however encourage the wife to seek some professional therapy to assist her to deal with the reality of N's relationship with his father for the future. There is no evidence before me that since separation the husband has behaved in a manner similar to the way he was found to have behaved during the marriage.
In the husband's financial statement filed 22 December 2004 he indicated that his income was $244,816 per annum. The husband has achieved a substantial increase in his income since the separation and it was not suggested that the trajectory of that income earning capacity would change in the near future. The husband is now an executive professional in a leading Sydney professional business. His income earning capacity is currently $421,000 per annum. The income earning capacity of the husband is substantially superior to that of the wife.
As a result of the distribution based on contributions, the husband's assets are significantly greater than the assets of the wife.
The wife will continue to have the major responsibility for the care and control of the child of the marriage who is currently aged 7. He will be dependent upon the wife's day to day care for the vast majority of the time in the foreseeable future.
The wife also has a responsibility to support the two children of her first marriage, M aged 18 and S aged 16. I do not have a great deal of information about what periodic financial support the wife receives from the father of those children except that in her financial statement sworn 22 August 2011, she says that she receives $205 per week by way of child support from her first husband, Mr L. The wife also will be the person who directly pays for N's day to day needs.
I will deal with the wife's application for departure from the administrative assessment later in these reasons where I am required to make a periodic order which is just and equitable.
The wife has no other duty to support any other person other than the responsibilities I have referred to in respect of her three children. The wife currently receives an income tested pension.
Both parties have superannuation but both parties have agreed that superannuation be treated on the balance sheet as an asset.
The wife complains that she is currently living with her three children in extremely cramped rental accommodation while the husband has, since separation, lived in superior accommodation in the former matrimonial home. I accept that the husband's income has allowed him to have a superior standard of living to that of the wife since separation, and I have taken that into account when assessing contributions.
During the short marriage, the parties had a standard of living which was commensurate with the level of income that the husband was earning.
I accept that the wife wishes to continue her role as parent to the child N in circumstances where, consistent with findings and orders made by this court in a defended hearing in December 2008, the husband has limited time with him.
The husband has complied with all orders made in relation to him providing support to the wife and the child since separation. The husband has exercised all regular contact with N that is available to him under the current orders. The wife has not offered any additional time to the husband.
It was suggested to the wife that she go back and work for her father. I accept the wife's evidence that her sister-in-law has had her old job for many years now and that there is in fact currently no job to go back to at her father's place of business.
The wife is currently unemployed and has not worked since 2004 prior to the birth of N. The wife has had previous experience in the workforce working in an administrative role and has some experience with the well known accounting program, MYOB. The wife's evidence is that in her view, she does not have any capacity to work until 2018 by which time she will be 55 years old and would have not worked for 14 years. The wife asserts that N's young age is a factor; she believes N is "too young to be left on his own at home", and will not be old enough to take the bus to school until he is 10 or 11 years old. She says that it would place an unfair burden on her family to look after N during school holidays. She expresses concern that employment may leave "gaps of time when [N] [is] not in [her] direct care" and that the husband may seize these as opportunities for litigation. She also asserts that she is actively involved in N's schooling, attending sports carnivals and helping with homework in the afternoons. The wife is "concerned if [she] were less…available [to care for N] it would have a de-stabilising effect on him."
I do not accept the wife's contention that she does not have an immediate earning capacity. N is now nearly 8 years old and the wife has not attempted to obtain employment, using the skills that she has, commensurate with N's school hours and any other day care arrangements that are necessary to enable the wife to maintain employment of her choosing. The wife now has the opportunity to re-engage with the workforce.
During final submissions, the wife withdrew her application for spousal maintenance. Senior counsel for the husband invited me to draw an inference that the wife was conceding that she had the capacity to support herself but she was choosing not doing so. Counsel for the wife did not indicate why the application for spousal maintenance was withdrawn but the provisions of s 81 FLA are a relevant consideration. In addition to child support, at the current time the husband is paying a large proportion of the wife's rent plus $400 a week and these payments will cease. The wife will rely upon the capital which she receives as a result of this adjustment together with her ability to re-engage in the workforce, to provide for her daily support. I find that the end of this debilitating litigation and her focus upon it will give the wife a new freedom to re-engage as a productive member of the workforce.
Neither party is cohabitating with another person.
The wife contents that the violence perpetrated by the husband during the relationship and his conduct at these proceedings has contributed to circumstances of need relevant to assessing s 75(2) factors. It follows from what I have already said that I do not place any significant weight on that submission.
There is some authority to say that violence perpetrated by one party against another can be taken into account in assessing s 75(2) FLA factors. In Barkley v Barkley (1976) 11 ALR 403, Carmichael J found that a husband's assault on his wife which resulted in her completely losing hearing in one ear "should be taken into account as an aspect of her "state of health" (s 75(2)(a) [FLA]) and as an element of her "physical and mental capacity… for appropriate gainful employment (s 75(2)(b) [FLA])." His Honour found that the wife's "defective hearing could seriously affect her earning capacity in the future."
The circumstances in this case are not analogous to those in Barkley v Barkley. Given Dr W's opinion that the wife's traumatic memories are not affecting her current well-being or capacity to function, I am unable, in the context of this case, to find that the family violence perpetrated by the husband against the wife during their marriage has a significant ongoing effect on the wife's health or her earning capacity.
Conclusion in relation to s 79(4)(d) – (g) matters
The overwhelming matters are:
the disparity in the capital of the parties after an assessment of contributions;
the disparity in the earning capacities of the parties. The husband is on a significantly high income ($421,000 gross per annum). The wife's earning capacity, if she was able to return to full time work, is significantly less than the husband's. This disparity leads to a large difference in the ability of the parties to regenerate capital.
I find that an adjustment of 10 percent should be made in the wife's favour on the overall pool (including the Suburb V property) in relation to s 79(4)(d) – (g) matters.
JUST AND EQUITABLE
As indicated, the wife sought an adjustment equivalent to 35 percent of the net assets of the parties.
The husband seeks to pay the wife $500,000 and approaches the calculation of the adjustment on a different basis. The husband seeks that the total value that he has received for item 2 on the balance sheet to be notionally quarantined (for contribution purposes only). The husband asserts that the net uplift in asset values since the commencement of cohabitation (notionally quarantining the inheritance) is approximately $800,000 to which the husband has made significant contribution. The husband contends that the wife's principal contribution was 20 percent to the acquisition of the former matrimonial home (excluding any indirect contribution made by her) which would be reflected in a payment to her based on the current value of the home of $280,000 ($1,400,000 x 20% = $280,000). The husband then asserts that a s 75(2) adjustment of 5 percent of the total pool should be made ($3,931,422 x 5% = $196,571 + $280,000 = $476,571), which the husband rounds to the sum of $500,000.
I note in passing that senior counsel for the husband in his written submissions asserts that approximately $825,000 of the pool came into the husband's hands in the last 18 months. This is a reference to the husband receiving his interest in the Suburb V property by way of inheritance. However, the amount of $825,000 is the whole of the value of Suburb V. Senior counsel conceded during submissions that that is a double counting and the correct figure is $412,500. This is because the husband's other half share of Suburb V which he acquired through a corporate entity from his sister was acquired as a result of his sister being paid one half of the value of Suburb V from assets already held by the husband.
Based on my findings in relation to contributions and s 79(4)(d) – (g) matters, an adjustment should be made between the parties as to 28 percent to the wife (18 + 10) and 72 percent to the husband.
That could be achieved by distributing the assets between the parties in accordance with the following table:
Husband gets 72.0%
Item No. Description Percentage Value
1 The R property 100% $1,400,000
2 CC Street, Suburb V 100% $412,500
4 BMW motor vehicle 100% $26,000
6 B Pty Ltd (as at 30.6.11) 100% $1,368,437
7 E Pty Ltd (as at 30.6.11) 100% $137,676
8 Woolworths Ltd (1,527 shares) 100% $41,138
9 IAG Ltd (814 shares) 100% $2,751
11 St George A/C …25 100% $183,875
12 St George A/C …08 100% $1,764
14 St George A/C …12 100% $0
15 Suncorp Metway 100% $2,240
16 E Trust bank account 100% $95,227
17 Household contents – husband 100% $8,000
18 Jewellery – wife 100% $15,000
19 … watch – husband 100% $1,500
20 B Trust 100% $0
21 E Trust bank account 100% $0
23 Paid legals by husband 100% $34,000
24 Colonial First State Super 100% $138,329
25 ANZ Super Advantage 100% $16,708
26 EE Super 100% $17,494
30 Loan from B Trust/Pty Ltd to husband 100% $0
31 Loan from E Trust/Pty Ltd to husband 100% $50,000
Husband pays Wife $1,023,441
Net Assets to Husband $2,830,624
Wife gets 28.0%
3 Ford Laser […] 100% $500
5 Ford Territory 100% $0
10 Community First Credit Union 100% $2,501
22 Paid legals by wife 100% $60,000
27 ING Super a/c …56 100% $14,356
28 Debt to wife's parents 100% $0
Wife receives $1,023,441
Net Assets to Wife $1,100,798
In the event the husband fails to pay the sum of $1,023,441 within a period of 60 days from the date of these orders, then the wife will be entitled to seek a sale of the R property and upon its sale, will be entitled to the benefit (if any) of any amount by which the sale price exceeds $1.4 million. If a sale is necessary, the wife is to receive $1,023,441 together with any interest accruing under the Family Law Rules or 73 percent of the sale price ($1,023,441/$1,400,000), whichever is the higher figure.
DEPARTURE FROM CHILD SUPPORT
The wife makes an application that there be a departure from her current assessment of child support. The current child support assessment is dated 17 September 2011. The Child Support Agency ("CSA") has calculated the husband's child support to be $12,614 annually.
The current assessment has been calculated in the following manner
The Child Support Agency has attributed provisional adjusted taxable income to both parents. They have attributed $197,250 to the husband and $41,187 to the wife. Both parties receive a self support allowance of $20,594 and the wife receives a multi-case allowance of $2,986 (as a result of her having another dependant child). Consequently, the husband's child support income was assessed to be $176,656 and the wife's $17,607 (a combined total of $194,263). Accordingly, their income percentages were 90.94 percent ($176,656/194,263) for the husband and 9.06 percent ($17,607/194,263) for the wife.
N is with his father three nights a fortnight. This led to the CSA assessing the husband's care percentage at 21 percent. As a result, the husband was entitled to a calculation of a cost percentage which the CSA assessed at 24 percent.
The applicable child support percentage which the husband was required to pay was his income percentage less his cost percentage (90.94 – 24), namely 66.94 percent.
The Cost of Children Table created by the CSA indicates that as at 2011 the costs of a child under the age of 12 whose parents have a combined child support income over $154,453 is capped at a maximum amount of $18,843 per annum. This is the figure to which the calculated percentage of 66.94 applies.
Consequently, the husband was assessed to have an annual liability for child support in the sum of $12,614 (18,843 x 66.94%).
As is clear from the previous discussion, the manner in which the husband has structured his interest in his professional business means that his real level of income is $421,000 gross per annum. It is unclear to me as to how the wife has been assessed by the CSA as having a provisional taxable income of $41,187.
The Court may make an order for a departure from an administrative assessment of child support in the special circumstances of the case if the liable parent or carer entitled to child support is a party to an application pending in the Court and the Court is satisfied that it would be in the interest of the liable parent and the carer entitled to child support for the Court to consider whether orders should be made in relation to the child based on the special circumstances of the case (Child Support (Assessment) Act 1989 (Cth) s 116(1)(b)).
In Gyselman & Gyselman ((1992) FLC 92-279 at 79,060) the Full Court identified that a trial judge must follow the clearly established threestep process outlined in s 117 of the Child Support (Assessment) Act 1989 (Cth) ("CSAA") – that is, assess whether in the special circumstances of the case a ground of departure has been established; assess whether it is "just and equitable" to make the proposed order; and assess whether it is "otherwise proper" to make the order. The Full Court also considered what constituted "special circumstances", stating:
a)Whilst it is not possible to define with precision the meaning of [special circumstances], as a generality it is intended to emphasise that the facts of the case must establish something which is special or out of the ordinary.
The grounds of departure are outlined in s 117(2) of the CSAA. The wife relies upon what is commonly known as "ground 8" (s 117(2)(c)(ia) CSAA). The assets and income earning capacity of the husband clearly mean that this is an appropriate case where that ground is attracted.
The court must also be satisfied that it is just and equitable to make a departure determination, having regard to ss 117(4) – (8) CSAA.
I have already canvassed the differences in the parties' earning capacities and their duty to care for dependants in paragraphs above.
Part N of the wife's financial statement annexes two lists of average weekly expenditure; Annexure A reflecting current weekly expenditure and Annexure B for estimated future weekly expenditure.
The wife in Annexure A of $15080 ($290 x 52) and the figure claimed by the wife in Annexure B $29,770 per annum ($572.50 x 52). These figures are to be compared with the statistical average used by the CSA in the sum of $18,843.
Senior counsel for the husband submitted that the items in Annexure A could not be relied upon, and the items in Annexure B were a "wishlist".
In this case, the husband's income is over two and a half times the combined child support income upon which the costs of children is calculated (in 2011, it was $154,453 and in 2012 it is $162,163). In those circumstances s 117(4)(d) CSAA (and specifically the income of the husband) becomes a very weighty consideration in determining what a just and equitable outcome should be.
One significant difference in annexures A and B is the provision for N's accommodation. At the moment, the husband is paying $450 per week towards the wife's rent. That payment will no longer continue. The wife's current rent is $600 per week. She has given evidence that her current accommodation is cramped and inadequate and she wishes to upgrade her accommodation. The overall provision in annexure B for rent at a rate of $900 per week is not unreasonable and the consequent increase in the allowance for rent for N from $37.50 to $225 per week is also reasonable.
The wife asserts that her current weekly expenditure on N is $290 but contends future spending on N will be approximately $572.50 per week. N is currently aged 7 years. He has no special needs. He attends a catholic school and I infer, at least in the medium term, he will continue to do so. The current assessment by the wife for school fees and excursions is $59 per week.
Annexure A does not provide any allowance for pocket money or holidays. The other differences in individual items listed in annexures A and B are modest.
Overall I accept the wife's evidence that her reasonable expenses in relation to N each week are in the sum of $572.50 per week.
The wife conceded during cross examination that the items in Annexure B were calculated on the basis that N's expenses are wholly met by the husband. I find that the wife does have an earning capacity (albeit limited, and much less than the husband) and will be receiving capital in the amount of $1,023,441. It might be that the wife would use some of her capital to assist in the purchase of accommodation and by doing so make a capital contribution which will defray the regular weekly expenses for N's accommodation. In the circumstances, it is appropriate that the wife contribute 15 percent of the cost of maintaining N.
If the wife was to be responsible for 15 percent of N's expenses, it would mean that the husband would be responsible for paying a weekly amount for N's support in the sum of $487 per week ($572.50 x 85%) or $25,304 per annum.
The husband conceded during the hearing that he had the financial capacity to meet any reasonable order for periodic child support. I find that it is just and equitable that the husband pay $25,304 per annum (to be annually indexed).
I find that this result is otherwise proper and accordingly, I make an order varying the current child support payable by the husband to an amount of $25,304 per annum. That amount should be indexed in accordance with the application made by the wife.
I certify that the preceding two hundred and thirty-eight (238) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Watts delivered on 9 July 2012.
Associate:
SCHEDULE 1 – Orders sought by the wife
The following definitions for the purpose of these Orders:
"the home" means the former matrimonial home at [… O Street, Suburb R], folio identifier […].
"the parties net assets and liabilities" shall mean the total value of all the parties assets and liabilities including but not limited to real estate, motor vehicles, camping equipment, furniture, home contents, and superannuation less the level of any debt secured against any of those items. It does not mean any debts (including credit cards) incurred or accrued after the date of separation.
Financial Orders
That within 30 days from the date of these Orders the following shall occur simultaneously:
the wife is ordered to do all acts and things and sign all documents necessary to transfer to the husband all right, title and interest in the home.
the husband is ordered to do all acts and things and sign all documents necessary to indemnify and keep indemnified the wife from all rates and taxes and all other outgoings including utility expenses relating to the home.
the husband pay to the wife or as she directs a sum of money ("the capital sum") by bank cheque such that, taking into account all assets, resources and liabilities in her name after the implementation of these Orders, she ultimately retains 45% of the parties net assets and liabilities. In the event that the husband has not paid to the wife the capital sum within 30 days of the date of these orders then interest shall accrue on the capital sum (or so much of it as remains unpaid) at the rate of 10% until paid, interest to be calculated from the date of these orders.
That pending the transfer of title of the home:
the husband shall have the right to occupy the home and shall pay and be responsible for all rates, charges and taxes related to the use and occupation of the home;
neither the husband nor the wife shall not mortgage, charge, encumber or assign their interest in the home;
That the husband is hereby declared the sole legal and beneficial owner of his shareholdings in the following companies:
[B Pty Ltd] ACN […]
That the husband is ordered to indemnify and thereafter keep indemnified the wife in respect of all and any liability in respect of:
[B Pty Ltd] ACN […];
[D Pty Ltd] ACN […];
[E Pty Limited] ACN […];
[F Pty Limited] ACN […];
[I Limited] ACN […];
i.liability in relation to loan accounts or pursuant to a guarantee or personal covenant(s).
ii.liability incurred at the suit of any of the aforementioned entities or their shareholders, unit holders or office bearers.
iii.any taxation liability, howsoever such liability arises and in whatever capacity such liability is incurred.
That in the event that the husband has not paid to the wife the capital sum within 60 days of the date of these orders then the husband shall immediately do all things and sign all documents necessary to sell the home and the proceeds of sale shall be applied in the following Order and priority:
to the wife so much of the capital sum as remains unpaid together with interest to the date of payment;
to the husband the balance.
That within 28 days of the payment to the wife of the capital sum, the wife cause to be delivered to the husband the engagement ring he had given to her.
That the husband and the wife shall each solely be entitled to the exclusion of the other to all other property and resources not already referred to in these Orders in the possession of that party at this date.
That the following orders be made in relation to the payment of spouse maintenance by the husband to the wife:
That until 1 February 2018 the husband pay direct to the wife by way of maintenance for herself the sum of $1,200 per week
That the maintenance to be paid to the wife pursuant to sub-paragraph [9.1] herein be varied each year on and from 1 July each year, in accordance with the variation of the Consumer Price Index for Sydney over the previous year as published by the Commonwealth of Australia Statistician as at 30 June of the year in question
That the maintenance to be paid to the wife pursuant to this paragraph herein be paid directly into the wife's bank account Community First Credit Union, account number […] or other such account as the wife may nominate in writing from time to time.
That pursuant to s.116 Child Support (Assessment) Act 1989:
the periodic rate of child support payable by the husband for the child [N] be varied by setting the annual rate of child support during the period 1 November 2011 to 31 October 2012 at $30,000.
That the annual rate of child support to be paid to the wife pursuant to sub-paragraph [10.1] herein be varied each year on and from 1 November 2012 and on each 1 November thereafter, in accordance with the variation of the Consumer Price Index for Sydney over the previous year as published by the Commonwealth of Australia Statistician as at 30 June of the year in question.
That each party shall be at liberty to apply on 7 days notice in relation to the implementation of these Orders.
That the husband pay the wife's costs of and incidental to these proceedings.
SCHEDULE 2 – Orders sought by the husband
That by way of property settlement the husband pay to the wife within 42 days of the date of the making of orders, the sum of $500,000.
That forthwith upon the making of such payment, the wife do all acts and things necessary to transfer her interest in the property [O Street, Suburb R] in the State of New South Wales, Folio Identifer [sic] […] to the husband.
That the parties otherwise be declared to be solely entitled to such other property, whether real or personal, as is currently in his or her name possession or control, and to any superannuation entitlements in his or her name.
That the wife's application for spouse maintenance be dismissed.
That the wife's application for departure from child support assessment be dismissed.
That there be no order as to costs arising from the discontinuance of the husband's application in a case filed 27 May 2011.
That there be no order as to costs arising from the subpoena issued to the wife and Dettmann Longworth set aside by order dated 18 October 2011.
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