S v B[2004] QCA 449

SUPREME COURT OF QUEENSLAND

1. McPHERSON JA: I have read the reasons of Dutney J in this appeal, and I agree with them. His Honour has dealt so completely with the applicable law and the facts of this case that it would simply risk confusion to add anything of my own to what he has said.

2. There is a temptation which must be resisted in cases like this to act on or apply, some kind of presumption or inference of continuance by assuming that, if the relevant relationship is shown to have existed at a particular date, it continued thereafter. But the effect of s 257 of the Property Law Act 1974 is to extend the operation of Part 19 of the Act, which commenced operation on 21 December 1999, only to a relationship that existed at that date by excluding from the ambit of Part 19, a relationship that ended before that date. The use of the word “ended” in s 257 tends to obscure the fact that the onus rested on the applicant respondent to prove that the requisite relationship existed at that date. If she did not succeed in doing so, then there was no relationship to which Part 19 applied or was capable of applying.

3. For the reasons given by Dutney J, I am satisfied that the respondent failed in this endeavour. The evidence is too tenuous to establish on a balance of probabilities that the requisite relationship, evanescent as it was, existed at or after that date. The appeal must be allowed with costs and the order made on 6 April 2004 must be set aside. Proceeding No S6082 of 2000 in the Supreme Court is dismissed. There will be no order with respect to the costs of it including the trial.

4. WILLIAMS JA: I have had the advantage of reading the reasons for judgment of Dutney J and add some brief concurring observations.

5. I agree that Mahoney JA (with whom Hope and McHugh JJA agreed) in Hibberson v George (1989) 12 Fam LR 725 at 739-40 correctly defined the issues to be considered by a court in determining whether or not a de facto relationship had come to an end.  Virtually by definition all de facto relationships will not be precisely the same and in consequence there can be no single test to determine if, and when, such a relationship has ceased to exist.  Further, when, as here, the question is whether or not a de facto relationship existed as at a particular date, the onus is on the party asserting that the relationship existed to prove on the balance of probabilities that that was so. 

6. I agree with the analysis by Dutney J of the evidence and with his conclusion that the respondent failed to discharge the onus on her of establishing that the relationship existed after 21 December 1999.

7. Whilst I agree that the learned trial judge was correct in concluding that a de facto relationship did exist at least from about March 1996 for a period of time, it has to be said that the relationship was not evidenced by a number of the more concrete indicia which are frequently seen as an integral part of such a relationship. For example, there was no (or at best for the respondent minimal) public acknowledgement of the relationship. That on the evidence was largely explained by the respondent’s sensitivity with respect to her son Daniel who had been born in 1983 during an earlier relationship. That sensitivity probably also explained why the parties maintained separate bedrooms although they had a sexual relationship; the respondent generally returned to her own bedroom after such an encounter.

8. Further, (apart from the interest in the company) the parties had no joint interest in property; no property was purchased in joint names. There were no joint bank accounts and the parties kept separate telephone accounts. Not only did they have separate letterboxes at the house but they maintained separate mailing addresses.

9. In the circumstances outlined less was needed to establish a cessation of the relationship. If, for example, there was continued use of a joint bank account or continuing occupation of the same bedroom it would be easier for a court to infer a continuation of the relationship. But absent such considerations there was an onus on the respondent of leading evidence establishing the continued existence of the relationship.

10. I agree with all that Dutney J has said in his reasons and with the orders he proposes.

11. DUTNEY J: By the judgment appealed from the learned primary judge found that the appellant and the respondent lived in a de facto relationship commencing from February 1996.  Her Honour found that the relationship continued until late January 2000.  This latter finding is significant because of the enactment of Part 19 of the Property Law Act 1974 (“the PLA”).  Part 19 of the PLA commenced operation on 21 December 1999.  Section 257 of the PLA excludes parties to relationships which ended before the commencement of Part 19 from seeking orders under the Part.  At the trial the appellant denied the parties had ever lived in a de facto relationship.  At trial, the respondent asserted the existence of such a relationship since about 1993.

12. For reasons which I will develop the learned primary judge’s finding that a de facto relationship between the parties commenced from February 1996 was a finding which was open to her on the facts as found by her. As a result, the argument on the appeal focussed principally on the termination of the relationship. It was submitted on behalf of the appellant that the relationship, if it ever existed, terminated prior to 21 December 1999. The pleadings on which the trial was conducted relied solely on Part 19 of the PLA. At trial, no reliance was placed on the law concerning domestic relationships which existed prior to 21 December 1999. This was notwithstanding s 258(1) of the PLA which preserved the right of a de facto partner to apply for a remedy or relief under another law. On the hearing of the appeal counsel for the respondent confirmed that no reliance had been placed on the prior law at trial and he did not seek to rely on any such principles on the appeal. Indeed, he conceded that if he was unable to defend the learned primary judge’s finding concerning the existence of the relationship on 21 December 1999 his client’s case must fail.

13. The term “de facto partner” is defined in s 32DA of the Acts Interpretation Act 1954.  The relevant parts of that definition are as follows:

1. In an Act, a reference to a “de facto partner” is a reference to either 1 of 2 persons who are living together as a couple on a genuine domestic basis but who are not married to each other or related by family.
2. In deciding whether 2 persons are living together as a couple on a genuine domestic basis, any of their circumstances may be taken into account, including, for example, any of the following circumstances –
   1. the nature and extent of their common residence;
   2. the length of their relationship;
   3. whether or not a sexual relationship exists or existed;
   4. the degree of financial dependence or interdependence, and any arrangement for financial support;
   5. their ownership, use and acquisition of property;
   6. the degree of mutual commitment to a shared life, including the care and support of each other;
   7. the care and support of children;
   8. the performance of household tasks;
   9. the reputation and public aspects of their relationship.
3. No particular finding in relation to any circumstance is to be regarded as necessary in deciding whether 2 persons are living together as a couple on a genuine domestic basis.
4. Two persons are not to be regarded as living together as a couple on a genuine domestic basis only because they have a common residence.

14. By s 260 of the PLA a reference in Part 19 to a “de facto partner” is taken to be a reference to the term as defined in s 32DA of the Acts Interpretation Act 1954.  By s 261 of the PLA a “de facto relationship” is defined as “the relationship between de facto partners.”

15. Some background facts are necessary to provide a framework for considering whether a de facto relationship existed between the parties on 21 December 1999. These facts are also necessary to understand the basis of her Honour’s findings in relation to the relationship between the parties. In the main these facts are paraphrased from the judgment at first instance and represent findings of fact by the trial judge.

16. The appellant was born in 1926 and the respondent was born in 1948. The respondent had a child born of another relationship in 1983. That relationship terminated in 1991 or 1992.

17. The appellant divorced his first wife in the 1960s. He has two adult children from that marriage. In 1963 the appellant bought his former wife a house at N, where she and the two sons were still resident as at the date of trial.

18. The appellant retired in 1987 to C, in a house he had purchased in 1986. The respondent and her then partner lived next door. The appellant, the respondent and the respondent’s partner became friends. The appellant maintained his friendship with the respondent as the respondent’s relationship with her partner deteriorated.

19. The respondent went abroad for two months at the end of 1991. On her return she continued to reside next door to the appellant and the relationship developed into a sexual one by late 1992.

20. In September 1992 the appellant and the respondent travelled abroad together. After their return the respondent and her son moved into a unit owned by the appellant. She lived there rent free and the appellant paid the Body Corporate fees and the insurance. The respondent paid for her own electricity and telephone and made some minor improvements to the unit.

21. It was common ground that during this period the respondent performed domestic chores for the appellant although the extent of those chores was controversial. The parties were frequently in each other’s company and the sexual relationship continued.

22. In February 1994 the appellant and the respondent acquired a company, EMAS Investments Pty Ltd (“the company”), as a vehicle for property development. While the extent of the respondent’s financial contribution to the subsequent acquisition of two properties was disputed she was an equal shareholder with the appellant and assisted in identifying the properties acquired.

23. In late 1994 the appellant bought a block of land at W on which a house was constructed during 1995. The respondent assisted with the design of the property. The house was large and divided into two self contained sections. The appellant occupied one section and the respondent and her son occupied the other section. The sections each had a separate kitchen, living areas and bedrooms extending off a common hallway to which access was gained by a common entrance. The sections could be separately secured against access by the other party but that did not in fact happen until late January 2000. The laundry was shared. The sections had separate street numbers and separate letter boxes. The parties had separate telephone numbers. The respondent and her son moved into the house in February 1996.

24. The parties shared meals frequently but not invariably.

25. One matter that occupied some time in the trial concerned a claim by the respondent that some of her jewellery had been stolen. The respondent told the appellant that jewellery valued at about $15,000 had gone missing from her study. The appellant seems to have doubted the validity of this allegation. The appellant lodged a claim under the household insurance policy which he had taken out in his own name. The claim was rejected because the respondent had not been noted on the policy as a de facto partner of the appellant. On 7 December 1999 the appellant wrote a letter to the insurer the material parts of which were as follows:

“First of all I like to apologise for the late reaction to your letter dated 12 November 1999.

I do agree that [the respondent] is neither my wife or what is called ‘my defacto’ but is as a matter of fact a very close friend of mine for years and years.

…

Although she does not receive a salary from me for her activities I do take care of the financial side for living, such as food, council rates, insurance etc etc.

…

Without her help I would be lost as I can not cook or do the ironing etc etc.

It is indeed a most unfortunate fact that her inherited jewelry was stolen without me having the slightest idea that I should have insured her belongings separately.

The house is built in such a way that [the respondent] can invite her friends or guests without bothering me.  The same can be applied to me, my visitors or friends are not bothering her.

I have my own kitchen as well but I seldom use it since I can’t cook and [the respondent] is taking care of me.

I would really appreciate if you could judge this case from another point of view as I absolutely did not know that [the respondent’s] belongings were not insured under the policy.  She is as a matter of fact a domestic staff without a salary for her service, but enjoys the separate living accommodation, likes to cook and does other domestic daily pursuits . . .”

26. Both sides relied on this letter at the trial. The appellant relied on it as evidence that he did not acknowledge the respondent as his partner. The respondent relied on it as evidence of the nature of their domestic arrangements.

27. The facts I have set out, while by no means exhaustive, are a sufficient background to understand her Honour’s finding that a de facto relationship existed from the time the parties moved into the house at W. At paragraph [41] of her judgment, after rejecting the respondent’s submission that a de facto relationship commenced much earlier, the learned primary judge said:

“… I am satisfied that a de facto relationship commenced in February 1996 when the [respondent] moved into the house at W.  Importantly, the actions of the [respondent] in moving into the residence and of the [appellant] in providing the residence are significant indicators that the parties had undertaken a mutual commitment to a shared life on the basis of a shared common residence.  Even though the relationship was an unusual one, in that the parties continued to reside primarily in their own part of the house, I am satisfied that they interacted on a frequent basis in a number of important respects, which demonstrated that they did indeed live together as a couple on a genuine domestic basis, whilst accommodating a degree of independence in their lifestyle.  I am satisfied that the parties continued to enjoy an intimate relationship, which included a mutually exclusive sexual relationship.  I accept that the [respondent] routinely performed household duties for the [appellant], including preparing meals and cleaning.  As regards the letter of 7 December 1999, it appears that the [appellant] was endeavouring to find a way around the dilemma created by the omission of the [respondent] as a de facto in the household insurance policy, by instead claiming that she was ‘a domestic staff without a salary for her service’.  However, the letter does confirm the extent to which the [respondent] did assist the [appellant] in his day to day life.  The [appellant] in turn also assisted with the care and support and welfare of the [respondent’s] son.  There was also a significant degree of financial dependence by the [respondent] on the [appellant] during this period, which I am satisfied the [appellant] encouraged and willingly undertook on the basis that he would provide for her as his partner.  Their financial arrangements indicated features of trust, generosity and intermingling.  Notwithstanding the reticence of some witnesses called by the [appellant], I consider that the evidence indicates that the parties presented themselves to the outside world as a couple.”

28. Her Honour’s conclusion that a de facto relationship existed from February 1996 can be seen from the above passage to be based on five findings of fact. The first was that the parties enjoyed an intimate relationship which included mutually exclusive sexual intimacy. The second was that the respondent routinely kept house for the appellant. The third was that the appellant supported and cared for the respondent’s son. The fourth was that the respondent was significantly dependent financially on the appellant and this dependency was encouraged by the appellant. The fifth was that the parties presented themselves to the outside world as a couple.

29. It was not really submitted before us that any of those findings was not open to her Honour on the evidence. It seems to me that on the basis of those findings her Honour was entitled to conclude that the relationship between the parties was one in which the parties lived together as a couple on a genuine domestic basis. Those findings provide an acceptable basis for concluding that the parties had achieved “a practical union of both lives and property,”^[1] which phrase was used to identify the ordinary matrimonial relationship.

30. For my part, I am not persuaded that her Honour’s conclusion that the parties were in a de facto relationship from February 1996 can be challenged.

31. Accepting the existence of the de facto relationship from February 1996 leads to a consideration of whether that relationship persisted until 21 December 1999. As to that, her Honour’s finding was expressed in these terms:

“As regards the termination of the relationship, I find that the relationship did not cease prior to 21 December 1999.  Whilst the relationship had clearly deteriorated by late 1999, the [appellant] nevertheless continued to permit the [respondent] to remain in the house as before.  However, I consider that the relationship effectively ceased in late January 2000 when the [respondent] changed the locks of the door to her side of the house.  I therefore find that the de facto relationship commenced in February 1996 and ceased in late January 2000.”

32. Plainly it could not be suggested that the parties were continuing to live together on a domestic basis after one had been excluded from the residence of the other.

33. De facto relationships are by nature fragile. The robust institution of marriage survives until formally dissolved by legal process, even though the parties are no longer a couple and exhibit none of the observable indicia of a domestic arrangement. It has been recognised, however, that the persistence of those indicia are fundamental to the continuance of a de facto relationship. In Hibberson v George^[2]              Mahoney JA, with whom Hope and McHugh JJA agreed, spoke of the de facto relationship as follows:

“There is, of course, more to the relevant relationship than living in the same house.  But there is, I think, a significant distinction between the relationship of marriage and the instant relationship.  The relationship of marriage, being based in law, continues notwithstanding that all of the things for which it was created have ceased.  Parties will live in the relationship of marriage notwithstanding that they are separated, without children, and without the exchange of the incidents which the relationship normally involves.  The essence of the present relationship lies, not in law, but in a de facto situation.  I do not mean by this that cohabitation is essential to its continuance: holidays and the like show this.  But where one party determines not to ‘live together’ with the other and in that sense keeps apart, the relationship ceases, even though it be merely, as it was suggested in the present case, to enable the one party or the other to decide whether it should continue.”

34. Accepting that on any view the parties had ceased to live together at all by the end of January when the locks were changed it is necessary to work backwards to see if the relationship which was based on the five findings of fact to which I referred in paragraph [28] above in fact ended at any earlier time.

35. In conducting this analysis of the evidence I am starting with the finding by the learned primary judge that the relationship had “clearly deteriorated by late 1999”.

36. In 1998 the respondent gave up her occupation as a teacher in a tertiary institution because her position had been made redundant and she would have had to reapply for it. There was a dispute in the evidence as to whether or not leaving the workforce at that time was as a result of the urging of the appellant or for reasons personal to the respondent. In view of the learned primary judge’s general finding that the appellant encouraged the respondent’s financial dependence on him it is more likely that the appellant urged the respondent to cease work.

37. In August 1998 the respondent made an application to Centrelink for a parenting allowance without disclosing the existence of any de facto relationship. In the application form the respondent asserted that she paid rent to the appellant. The respondent also claimed a sole parent pension without disclosing any de facto relationship. While apparently dishonest, having regard to the claims made by the respondent in the action, I do not think these failures to disclose the relationship shed any particular light on when the relationship found by her Honour could be said to have ended. Although her Honour does not expressly make any finding in relation to this matter it is implicit in her judgment that she adopted a similar view.

38. In her own affidavit the respondent records this history of the latter part of 1999. From late 1999 the respondent resumed teaching on a part time basis. She principally spent the money she earned on her own needs. In the second half of 1999 the appellant began to make remarks that the respondent was “fat”. In the early years of their relationship the respondent alleged that she and the appellant had had an active sex life. By 1999, however, the appellant was experiencing erection dysfunction. The appellant initially tried injections to sustain an erection but ultimately sexual activity ceased. The appellant blamed his failure to obtain and sustain an erection on the respondent being fat.

39. Late in 1999 the respondent suggested that they should visit a psychologist to save their relationship. The appellant responded by saying, “You’re the crazy one” and, “A psychologist isn’t good enough. You need a psychiatrist.” Wishing to try to save the relationship the respondent made an appointment and visited a psychologist on 26 November 1999. After that consultation she made a joint appointment for herself and the appellant. The appellant refused to attend and cancelled the appointment.

40. The respondent hoped for a reconciliation over Christmas. As Christmas approached the respondent noted that the appellant became increasingly hostile. The respondent said that she and the appellant spent time together on Christmas Eve. The nature of that contact was not disclosed beyond the respondent admitting that their relationship was not going well. The appellant could shed little light on this period because by trial his capacity to give reliable evidence appears to have been compromised by age and mental infirmity. The appellant spent Christmas Day with a friend away from the respondent. The respondent suggested they spend the millennium New Year’s Eve together. The appellant responded by saying, “No. I have another invitation.” The appellant returned to the house at about 3 am in an inebriated condition. His first words to the respondent in the morning apparently were, “I met someone who is neither as fat nor as ugly as you are.” He also told her that in light of that there was no point in trying to rekindle their relationship. About a fortnight later he told the respondent to, “Piss off.” It was about two weeks after this that the respondent accepted the fact of the end of the relationship and changed the locks.

41. There is other independent evidence which bears on this period. A Mr Sims, a neighbour, gave evidence the effect of which was that he moved into the property next door to the parties in late 1998. He spent a lot of time drinking with the appellant. At first the respondent was sociable towards him but throughout 1999 she became increasingly hostile both to Mr Sims and, more significantly, the appellant.

42. There is evidence that by December 1999 the parties were communicating by notes left in each other’s letter boxes^[3].  Prior to returning to work in late 1999 the respondent completed a course through the University of Southern Queensland.  Apparently, this was paid for in part at least by means of the appellant’s credit card.  By November, the appellant wanted his money back.  On 5 December 1999 the appellant wrote a note to the respondent which read as follows:

“You promised to pay back the $1500 for USQ Toowoomba which you paid with my credit card on 14 Oct.  You were waiting for the transfer of your sold shares Triton.  Then you told me that you needed money to pay for Daniel’s dental operation and I was promised to get paid after you had received payments from your health company.  We are now almost 2 months later and still no settlement.  Please arrange some [indecipherable] otherwise I have to request USQ to refund the money as it was transferred by using false pretences.”

43. The respondent delivered a note in reply on the same day. It read:

“I would suggest you deduct the $1500 from my jewellery claim which is still in your hands.  As you know a sum of $15,000 was involved and it was up to you to get it settled.  Otherwise I do not have the money.  I have $500 to live on for the next 8 weeks – a financial dilemma caused by you.”

44. Two things relevant to the present consideration seem to flow from this exchange of correspondence. Firstly it is difficult to identify any degree of intimacy in a relationship where communication is reduced to correspondence placed in the other party’s letter box. Secondly, it is clear that the parties were keeping their financial affairs separate. It also appears that the appellant was no longer financially supporting either the respondent or her son.

45. At trial, the respondent dismissed these letters as evidence of the appellant’s eccentricity and something not out of the ordinary for their relationship. In contrast the appellant said in his affidavit that the relationship between them had degenerated to the point where by 5 December 1999 they had ceased to even be friends.

46. Adopting the learned primary judge’s caution regarding the evidence of both parties it seems to me that by 20 December the relationship was at this stage. Sexual intimacy had ceased because of the impotence of the appellant. I do not think this is particularly relevant to whether or not the relationship continued in this case. The parties’ general intimacy seems to have reduced to a point where communication between them was largely in writing. There is no evidence concerning their face to the outside world beyond the inference capable of being drawn from the fact that they spent Christmas Day apart and the appellant accepted an invitation to a New Year’s Eve party to which the respondent was not invited and only told her of it when she asked if he would spend some time with her. It appears the appellant was embarking independently on a social outing to which he was not prepared to invite the respondent. Both parties recognised the relationship was in trouble as evidenced by the appointments with the psychologist but the appellant would not join in any attempt to save it.

47. There is no evidence of any event between 20 December 1999 and the appellant’s refusal to join the respondent on New Year’s Eve which might account for any further decline in the relationship over that period. The only personal contact between them of which we know was some contact on Christmas Eve. We have no evidence of the nature of the relationship on that occasion. All we know is that the appellant preferred the company of his neighbour on Christmas Day to that of the respondent. All that the respondent said about this was that for Germans, Christmas Eve was more important than Christmas Day. The respondent was of German extraction but the appellant was Dutch. There is the inference from the parties’ notes to each other that by early December 1999 the appellant was no longer willing to financially support the respondent. The respondent had some independent income on which she claimed she needed to rely. There is nothing in the evidence concerning the period between early December 1999, when the appellant refused to attend counselling and the notes were written, and New Year’s Eve 1999 from which any further significant decline in the nature of the parties’ relationship could be inferred.

48. Applying the passage of Mahoney JA in Hibberson v George^[4], which I set out earlier, a de facto relationship ends when one party decides he or she no longer wishes to live in the required degree of mutuality with the other but to live apart.  It does not seem to me that it is necessary to communicate this intention to the other party providing the party that is desirous of ending the relationship acts on his or her decision.  I do not think it is necessary that the other party agree with or accept the decision.  Once the parties cease to jointly wish to reside together in a genuine domestic relationship, a situation usually ascertained by looking objectively at the whole circumstances of the relationship, the de facto relationship ceases.  The relationship ceases even though one party is still anxious to try to save it. 

49. In order to bring this claim within the provisions of Part 19 of the PLA the respondent, who was the plaintiff at trial, needed to prove the existence of the relationship as at 21 December 1999 when the Part commenced. Perhaps because of the appellant’s denial at trial that a de facto relationship had ever existed, the evidence focussed on the creation of the de facto relationship. In any event, apart from events which suggest any such relationship had ceased there is a paucity of evidence as to the nature of the relationship as at 21 December 1999. In this regard there is a difference between a marriage and a de facto relationship. In a marriage, the parties remain married and are presumed to be living as a “couple” unless the party wishing to end the relationship proves a separation for the statutory period. In a de facto situation it is the party asserting the relationship that must prove cohabitation of the required quality. In Pavey v Pavey,^[5] on which the respondent relied, the Full Court of the Family Court in dealing with what constitutes “separation” between two parties to a marriage who continue to reside in the same residence said at 75,213-75,214:

“In such cases, without a full explanation of the circumstances, there is an inherent unlikelihood that the marriage has broken down, for the common residence suggests continuing cohabitation.  Such cases therefor require evidence that goes beyond inexact proofs, indefinite testimony and indirect inferences.  The party or parties alleging separation must satisfy the Court about this by explaining why the parties continued to live under the one roof, and by showing that there has been a change in their relationship, gradual or sudden, constituting a separation.”

50. The reverse applies in the case of a de facto relationship in the sense that the party asserting the continuing relationship must prove the positive aspects of the relationship rather than the party asserting separation being required to prove the negatives.

51. In my view, the respondent failed to prove the existence of the required relationship as at the critical date. On the contrary, the evidence overwhelmingly supports the conclusion that the de facto relationship between the parties had ended sometime earlier. The date on which her Honour focussed, the date on which the locks were changed, was the date on which it appears that the respondent finally accepted the end of the relationship and abandoned her attempts to revive it. Focussing on the mutual acceptance by both parties that the relationship has ended is inconsistent with the line of authority to which I have referred^[6] and which in my view ought to be followed in Queensland.

52. In light of the above conclusions and the respondent’s disavowal of any reliance on the law as it existed before Part 19 of the PLA commenced, the respondent’s action must fail. It is unnecessary to consider the learned primary judge’s assessment of the quantum of the respondent’s interest in the property held by the appellant. I should note, however, that the respondent’s financial interest in the company, which was assessed by the trial judge at $66,760, and which was subsumed by the learned primary judge’s order that the appellant pay the respondent a total of $255,431, remains an asset of the respondent.

53. In the result, I would allow the appeal with costs. I would dismiss the action but with no order in relation to the costs of the action. This is consistent in my view with the spirit of the legislation as recorded in s 341 of the PLA. Although my judgment here has the effect that that section has no application I nonetheless consider it provides a guide as to the way costs should be dealt with in a case like this.