- Notable Unreported Decision
- Appeal Determined (QCA)
SUPREME COURT OF QUEENSLAND
HAG v MAW  QCA 217
Appeal No 11402 of 2006
SC No 3537 of 2005
Court of Appeal
General Civil Appeal
Supreme Court at Brisbane
13 July 2007
29 May 2007
Williams JA, White and Atkinson JJ
Separate reasons for judgment of each member of the Court, each concurring as to the orders made
2.The appellant is to pay the respondent's costs of and incidental to the appeal to be assessed
3.The respondent shall take all necessary steps to cause the appellant to be discharged from any and all liability in respect of the debt secured by mortgages over the real property situated at 18 Surrey Court, Deception Bay, 5 Crowley Street and 9 Crowley Street, Zillmere within 60 days
4.The costs of and incidental to the trial be remitted to the trial judge
FAMILY LAW AND CHILD WELFARE – DE FACTO RELATIONSHIPS – ADJUSTMENT OF PROPERTY INTERESTS – GENERALLY – where trial judge apportioned property 30 per cent to the appellant and 70 per cent to the respondent – whether the distribution of property could be considered "just and equitable" – whether the discretion of the trial judge should be interfered with
Family Law Act 1974 (Cth), s 75(2)
Property Law Act 1974 (Qld), s 283, s 286, s 296, s 297, s 298, s 300, s 303, s 304, s 305, s 306, s 307, s 309
FO v HAF  QCA 555; Appeal No 4280 of 2006, 19 December 2006, applied
Hickey v Hickey (2003) FLC 93-143, applied
Kardos v Sarbutt  NSWCA 11, cited
Norbis v Norbis (1986) 161 CLR 513, considered
Bellenden (formerly Satterthwaite) v Satterthwaite  1 All ER 343, cited
C J Forrest for the appellant
M J Byrne for the respondent
SBA Family Lawyers for the appellant
Hatzis Lawyers for the respondent
- WILLIAMS JA: As the reasons for judgment of Atkinson J demonstrate, the findings of the learned judge at first instance were within the ambit of appropriately exercised judicial discretion and the result was a just and equitable one complying with s 286 of the Property Law Act 1974 (Qld). It follows that the orders should be as proposed by Atkinson J in her reasons.
- WHITE J: I agree with Atkinson J that the appellant has demonstrated no error in the judgment below which would lead to this Court intervening and, accordingly, the appeal should be dismissed and the orders should be as proposed by her Honour.
- ATKINSON J: An application for a just and equitable property distribution at the end of the de facto relationship may be made pursuant to Part 19 of the Property Law Act 1974 (Qld) (“PLA”). Part 19 was enacted as a result of recommendations made by the Queensland Law Reform Commission in its 1993 De Facto Relationship Report No. 44. The Commission recommended that eligible de facto partners should have, as far as practicable, the same property rights and relationships as married partners on the dissolution of their relationship.
- Section 283 of the PLA provides that after a de facto relationship has ended, a de facto partner may apply to the court for an order adjusting interests in the property of either or both of the de facto partners. The court is empowered under s 286(1) of the PLA to make any order it considers just and equitable about the property of either or both of the de facto partners adjusting the interest of those partners in the property. This is similar to the power of the Family Court under s 79(2) of the Family Law Act 1975 (Cth) (“FLA”).
- The court exercising its power under the PLA is required, in deciding what is just and equitable pursuant to s 286(2), to consider the matters mentioned in sub-subdivisions 3 and 4 of subdivision 2 of Division 4 of Part 19 of the PLA. The matters set out in sub-subdivision 3 which the court must consider in deciding what is just and equitable, are the contributions, financial and non-financial made by the parties to the welfare, property and financial resources of the couple and the effect of an order on their future earning capacity. In addition the court is required by
s 296 of the PLA to consider the matters mentioned in sub-subdivision 4 to the extent that they are relevant in deciding what order adjusting interest in the property is just and equitable.
- The matters in sub-subdivision 4 which are relevant to this matter include:
- The age and state of health of each of the de facto partners (PLA s 297);
- The income, property and financial resources of each of the de facto partners (PLA s 298(a));
- The physical and mental capacity of each of the de facto partners for appropriate gainful employment (PLA s 298(b));
- The commitments of each of the de facto partners necessary to enable the de facto partner to support himself or herself (PLA s 300);
- The standard of living which is reasonable for each of the de facto partners in all the circumstances (PLA s 303);
- The contributions made by either of the de facto partners to the income and earning capacity of the other de facto partner (PLA s 304);
- The length of the de facto relationship (PLA s 305);
- The extent to which the de facto relationship has affected the earning capacity of each of the de facto partners (PLA s 306);
- If either de facto partner is cohabiting with another person, the financial circumstances of the cohabitation (PLA s 307);
- Any fact or circumstance which the court considers the justice of the case requires to be taken into account (PLA s 309).
- The learned trial judge followed the four step approach approved by this Court in FO v HAF which adopted the approach of the Family Court to the exercise of discretion found in the equivalent section to s 286(1) of the PLA. Keane JA observed:
“It has frequently been emphasised that the judicial discretion conferred by s 286(1) of the PLA and its analogues in other statutes should not be constrained by pre-determined guidelines. It is essential, however, that the matters referred to in the provisions set out above be taken into account, and that they are 'seen, in the reasons for judgment, to have been taken into account'. To this end, the four step approach explained by the Full Court of the Family Court in Hickey v Hickey provides a useful discipline to ensure clarity of thought and transparency of judicial reasons.
The Full Court of the Family Court explained in Hickey and Hickey, in relation to the Family Court Act analogue of Pt 19 of the PLA, that the first step in making a property adjustment order is the identification and valuation of the property, resources and liabilities of the parties. The second step is the identification and assessment of the contributions of the parties to their pool of assets and the determination of their contribution-based entitlements in accordance with s 291 to s 295 of the PLA. The third step is the identification and assessment of the factors in s 297 to s 309 of the PLA to determine the adjustment to the contribution-based entitlement. The fourth step in the process is consideration of the result of these earlier steps to determine whether that result is just and equitable in accordance with s 286 of the PLA.”
- The evidence established that the parties commenced their de facto relationship in December 2000 when the respondent moved in with the appellant in rented premises at Bracken Ridge. The relationship ended in September 2004 so lasted for three years and nine months.
- Prior to the de facto relationship commencing the respondent entered into contracts for the purchase of two adjacent properties at Zillmere (“Zillmere A” and “Zillmere B”) for $80,000 each with a settlement date of 16 December 2000. He entered into mortgages with the First Australian Building Society dated 8 December 2000 to finance the purchase of those properties. In January 2001 the appellant and the respondent moved to the Zillmere B property. Immediately prior to the commencement of the relationship the appellant had no savings, a credit card debt of $3,990 and a car loan of $5,000. The respondent on the other hand had savings of $16,000 and the first home owner’s grant of $7,000 which he applied to the purchase of the properties at Zillmere.
- At Zillmere both parties applied themselves to the improvement of the properties and shared general living expenses. The appellant paid for groceries but as a result of not having to pay any rent or loan repayments she paid off her debts and saved about $14,000 during 2001. She received a $5,000 inheritance which she used to pay off the loan on her car. The appellant was able to purchase a block of land at Bridgeman Downs in July 2001 for $101,000 and enter into a contract to build a house for $127,500. She obtained a home builder’s grant of $14,000 and a loan from the Macquarie Bank. The respondent was a guarantor for that loan and the Zillmere properties were used as security.
- In June 2002 the parties purchased a property at Deception Bay for $104,000 in joint names. In July 2002 the parties took out a joint loan with the National Australia Bank to cover the debts on all the properties. This enabled the paying out of the loan on the Bridgeman Downs property and the release of the respondent’s guarantee and the refinancing of the loan on the Zillmere properties.
- The appellant was employed by Education Queensland throughout the relationship as a teacher/librarian. The respondent was employed in various jobs until May 2003 when he ceased work in order to search for a business venture. He did not work fulltime in the 16 months prior to the end of the relationship but during that time he did some substantial works on the Zillmere properties, managed the tenanting of those properties and received rental income of $30,451 from them. During the relationship the appellant’s young daughter lived with them.
- In September 2004 the parties separated. The appellant continued to reside in the Bridgeman Downs property which she sold in March 2005 for $435,000. She then purchased a property at Albany Creek in April 2005 for $350,000. In October 2004 the respondent moved into the Zillmere A property where he continues to reside. He continues to manage the rental of the Zillmere B and Deception Bay properties.
- The learned trial judge applied a global approach to the properties. Her Honour noted the significant initial financial contribution by the respondent and his ongoing financial skills but also the appellant’s higher income during the entire period which was paid into the joint account for the last two years of the relationship. The learned trial judge concluded that the property should be divided so that the respondent received 70 per cent of the net property pool and the appellant received 30 per cent.
- There were a number of grounds of appeal but the primary ground of appeal was that the property distribution of 30 per cent to the appellant and 70 per cent to the respondent could not be regarded as just and equitable in the circumstances and so evidenced a miscarriage of the discretion by the learned trial judge.
- Such a ground of appeal raises the two competing considerations referred to by the High Court in Norbis v Norbis. On the one hand, there is the need for reasonable consistency in decision making so that like cases are treated alike and there is predictability in outcome. On the other hand is the recognition that while the exercise of the discretion is guided by the factors set out in Part 19 of the PLA, it is not capable of mathematical precision and so long as the discretion has been exercised judicially it should not be interfered with by appellate courts. Referring to the difficulty that besets an appellate court which tries to develop guidelines in order to review the exercise of the discretion under s 79 of the FLA Brennan J (as his Honour then was) said at :
“Unless the primary judge reveals an error in his [or her] reasoning, the Full Court can intervene only if the order made is not just and equitable. How does the Full Court arrive at the conclusion? In Bellenden (formerly Satterthwaite) v Satterthwaite (1948) 1 All ER 343 at 345, Asquith LJ stated the rationale of an appellate court’s approach:
‘It is, of course, not enough for the wife to establish that this court might, or would, have made a different order. We are here concerned with a judicial discretion, and it is of the essence of such a discretion that on the same evidence two different minds might reach widely different decisions without either being appellable. It is only where the decision exceeds the generous ambit within which reasonable disagreement is possible, and is, in fact, plainly wrong, that an appellate body is entitled to interfere.’
The ‘generous ambit within which reasonable disagreement is possible’ is wide indeed when there are a number of factors to be taken into account and the comparative weight to be attributed to those factors is not clearly indicated by uniform standards and values of the community. The generous ambit of reasonable disagreement marks the area of immunity from appellate interference.” (Emphasis added)
- The appellant was obliged to show that the judgment by the learned trial judge was outside the generous ambit of reasonable disagreement which would make it immune from appellate interference. She endeavoured to do so by focusing on a number of specific complaints.
- The first complaint was that the learned trial judge erred in finding that “neither party has significantly contributed to the earning capacity of the other as a result of the de facto relationship.” This is one of the factors that the court is required to take account of by s 304 which provides:
“The court must consider the contributions made by either of the de facto partners to the income and earning capacity of the other de facto partner.”
- At the point in the judgment where the learned trial judge considered s 304, she had already taken into account the unequal contributions to the income of the relationship during the relationship made by the appellant and the respondent when the appellant was the only party working fulltime for the period from May 2003 to September 2004 and at the same time the respondent’s source of income was the income on the rental properties at Zillmere which returned a modest after tax profit. A problem for the appellant arose from the fact that in submissions at the trial the appellant’s counsel had argued that neither had significantly contributed to the earning capacity of the other as a result of the de facto relationship. On appeal, counsel for the appellant, who was not the counsel who appeared at trial, argued that had the respondent not had the advantage of living with the appellant when she was employed and he was receiving the income from the rental properties, “it is most unlikely that the respondent could have retained the investment properties that he did that provided him with a capital base and the income source that they now do.” However this is speculative and contrary to findings made by the trial judge that the respondent was capable of living frugally. There is no evidence to support the appellant’s submission that there should have been a finding that but for her income the respondent would not have been able to retain the investment properties. The complaint against the finding of fact that neither party had significantly contributed to the earning capacity of the other as a result of the de facto relationship was not made out.
- The second ground of complaint was that the trial judge gave too much weight to the initial contribution of $16,000 made by the respondent at the beginning of the relationship. It was submitted that an initial contribution of that quantity could not be used to justify the disparity in result. It was of course only one of the factors relied upon by Her Honour, but it was a significant factor and she was entitled to regard it as so. The respondent was able to purchase the two properties at Zillmere paying a deposit which used about half of the $16,000. The appellant on the other hand was in debt at the beginning of the relationship. This was a relatively short relationship and so not one in which the effect of the disparate initial contributions could be said to have been eroded or extinguished as would be the case in a long relationship. Although the appellant’s counsel complained on appeal that it was not clear what the remaining $8,000 was spent on, it is obvious that the purchase of properties incurs expenditure of other monies than just the amount paid as a deposit on the property. It could not be said that Her Honour erred in giving the weight she did to the disparate financial contributions of the parties at the commencement of the relationship.
- The third ground of complaint was that the adjustment of 10 per cent in favour of the respondent made by the learned trial judge when she considered the matters set out in sub-subdivision 4 was in error because she “clearly focused too much on those matters which she refers to and given them too much weight proportionally.” In fact Her Honour mentioned all of the relevant matters found in sub-subdivision 4 but regarded as decisive in allowing a 10 per cent adjustment in the respondent’s favour, his greater age, his less secure employment and his greater difficulty in finding employment as well as his lower level of superannuation. There was no relevant matter which was not taken into account and Her Honour correctly listed those matters which she regarded as decisive in sub-subdivision 4 which meant that a further allowance should be made in favour of the respondent.
- The appellant also complained in an additional ground of appeal added when the matter came on for hearing that the learned trial judge erred in finding that the school fees for the appellant’s daughter in the three years and nine months that the appellant and the respondent resided together were $6,000 per year and that the appellant was assisted with the fees by an aunt who provided $3,000 in 2003. The appellant submitted that of the $18,000 in school fees attributable to the three years and nine months when the parties lived together, $15,000 was contributed by the appellant’s aunt.
- However the unchallenged evidence of the appellant was not quite to that effect. It is true that the aunt contributed $15,000 over the whole period of the relationship but not all of that was used for school fees. In 2001, the aunt contributed $6,000, of which $3,000 was used for school fees and the remainder covered other expenses for the appellant’s daughter. The same occurred in 2002 when the appellant’s daughter was in Grade 6. When the appellant’s daughter was in Grade 7 in 2003, the appellant’s aunt contributed $6,000 for the school fees and in 2004 when the appellant’s daughter was in Grade 8, the school fees were $6,000 and the appellant’s aunt did not contribute anything towards them. It appears therefore that $9,000 was contributed in total by the appellant’s aunt to the appellant’s daughter’s school fees rather than the $3,000 referred to by Her Honour. This error in fact finding however was relatively minor and could not be said to have vitiated the proper exercise of the discretion. Her Honour took into account the differences in the financial contributions made by the parties during the relationship. Apart from the contributions made by the appellant’s aunt, the appellant and the respondent contributed equally to the expenses and welfare of the appellant’s daughter, including $9,000 in school fees.
- The final ground of appeal is however one on which both parties agree. It was common ground that there was one matter in the judge’s orders which could have been corrected under the slip rule but can now be conveniently corrected by this Court. It was quite properly conceded by the appellant that so far as costs were concerned it was not to be treated as if the appellant had succeeded on the appeal and that the costs of and incidental to the appeal ought to be determined in accordance with whether the appeal stands or falls on the other matters raised. It was agreed that this Court should order:
“That the respondent shall take all necessary steps to cause the appellant to be discharged from any and all liability in respect of the debt secured by mortgages over the real property situated at 18 Surrey Court, Deception Bay, 5 Crowley Street and 9 Crowley Street, Zillmere within 60 days.”
It was also agreed that no matter the outcome of the appeal, the question of the costs of the trial should be remitted to the trial judge.
- The exercise of discretion by the trial judge in awarding 70 per cent of the property to the respondent and 30 per cent to the appellant has not been found to be attended with such error that it should be set aside by this court. Accordingly the orders of the court should be:
- Appeal dismissed.
- The appellant is to pay the respondent’s costs of and incidental to the appeal to be assessed.
- The respondent shall take all necessary steps to cause the appellant to be discharged from any and all liability in respect of the debt secured by mortgages over the real property situated at 18 Surrey Court, Deception Bay, 5 Crowley Street and 9 Crowley Street, Zillmere within 60 days.
- The costs of and incidental to the trial be remitted to the trial judge.
 cf FLA s 75(2)(a).
 cf FLA s 75(2)(b).
 cf FLA s 75(2)(b).
 cf FLA s 75(2)(d).
 cf FLA s 75(2)(g).
 cf FLA s 75(2)(j).
 cf FLA s 75(2)(k).
 cf FLA s 75(2)(k).
 cf FLA s 75(2)(m).
 cf FLA s 75(2)(o).
  QCA 555 at -.
 Norbis v Norbis (1986) 161 CLR 513; In the Marriage of Lenehan (1987) 11 Fam LR 615; Kardos v Sarbutt  NSWCA 11 at .
 Davut and Raif (1994) FLC 92-503 at 81,237.
 (2003) FLC 93-143 at 78,386, cf Kardos v Sarbutt  NSWCA 11 at  – .
 (2003) FLC 93-143 at 78,386.
 (1986) 161 CLR 513.
 Pierce v Pierce (1998) FLC 92-844.
- Published Case Name:
HAG v MAW
- Shortened Case Name:
HAG v MAW
 QCA 217
Williams JA, White J, Atkinson J
13 Jul 2007
- White Star Case:
|Event||Citation or File||Date||Notes|
|Primary Judgment||SC3537/05 (No Citation)||-||Application for an order adjusting interests in the property of either or both of the de facto partners; concluded that the property should be divided 70 / 30.|
|Appeal Determined (QCA)|| QCA 217||13 Jul 2007||Appeal dismissed with costs; no error in just and equitable distribution of property at the end of a de facto relationship pursuant to s 286 PLA: Williams JA, White and Atkinson JJ.|