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- S v R[2005] QDC 86
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S v R[2005] QDC 86
S v R[2005] QDC 86
DISTRICT COURT OF QUEENSLAND
CITATION: | S v R [2005] QDC 086 |
PARTIES: | S Plaintiff and R Defendant |
FILE NO: | 1054/2002 |
PROCEEDING: | Trial |
ORIGINATING COURT: | District Court, Southport |
DELIVERED ON: | 26 April 2005 |
DELIVERED AT: | Southport |
HEARING DATE: | 3 & 4 February 2005 - written submissions received 11 February 2005 |
JUDGE: | Newton DCJ |
ORDER: | Defendant to pay plaintiff within 60 days the sum of $101,450; in default, the property at 53 Whittings Road, Guanaba be sold and the plaintiff be paid the said sum from the sale proceeds, together with interest thereon at 9% per annum from the date due to the date paid. |
CATCHWORDS: | FAMILY LAW – de facto relationshipS – LEGISLATION – where plaintiff and defendant were in a de facto relationship for seven years – where plaintiff provided domestic assistance to the defendant – where plaintiff provided limited financial support to the defendant – where plaintiff provided limited contribution to furthering defendant’s business – adjustment of property interests – where defendant in stronger financial position than plaintiff at end of relationship Property Law Act 1974 Cases cited: E v S [2003] QSC 378 Mallett (1984) 146 CLR 605; |
COUNSEL: | Ms C E Carew – Plaintiff Ms K Magee – Defendant |
SOLICITORS: | K & L King & Associates - Plaintiff Gladstones Solicitors - Defendant |
- [1]This is an application pursuant to the provisions of s 283 of the Property Law Act 1974 (“the Act”) for an order adjusting interests in the property of the plaintiff and defendant. The Court is empowered to make any order it considers just and equitable about the property of either or both of the de facto partners, adjusting the interests of the de facto partners in the property (s 286(1) of the Act). In deciding what is just and equitable the Court is required to consider the matters mentioned in subdivision 3 of division 3 of the Act.
- [2]Jurisdiction is conferred upon the Court in this case to make a property adjustment order because the de facto partners have lived together in a de facto relationship for at least two years (s 287(a) of the Act).
- [3]The Court is empowered in this case to make a property adjustment order as the application was made within two years after the day on which the de facto relationship ended (s 288(1)(a) of the Act).
Background
- [4]The plaintiff and the defendant commenced a de facto relationship in April 1994 and separated on 13 June 2001. Thereafter they remained living under the same roof until August of that year.
- [5]When the parties commenced the relationship the defendant owned a property situated at 53 Whittings Road, Guanaba, which was valued at $250,000. The defendant’s equity in that property was $70,000 with $180,000 owed by way of mortgage on the property. The defendant also owned a motor vehicle worth approximately $2,000. He had few, if any, other significant assets. The plaintiff owned a motor vehicle valued at approximately $2,000 as well as some household goods.
- [6]The de facto relationship having commenced, the parties agreed that the defendant would continue to make the mortgage payments and the plaintiff would pay all other household expenses. In fact, the defendant, as will be discussed later, made contributions to the household expenses himself on a regular basis.
- [7]The defendant began operating a motor mechanic business in late 1994 or early 1995; and did so, eventually, by means of a company called TRS Auto Repairs Pty Ltd, of which he was the sole director and shareholder.
- [8]Apart from a period of some 12 months in 1999 and 2000 when the plaintiff worked four days a week, the parties were each employed full time throughout the whole relationship.
- [9]A commercial property situated at Unit 2 Egerton Street, Southport was purchased by the defendant in June 2000 for $130,000. The defendant borrowed the sum of $110,000 and no financial contribution was made by the plaintiff in respect of the purchase of this property. Repayments were made by the business of the defendant which was being operated from the unit.
- [10]The plaintiff’s motor vehicle was generally used by the parties for social outings and holidays, with all loan repayments and associated expenses being met by the plaintiff. The vehicle was serviced by the defendant and some petrol expenses were met by him on occasion.
- [11]After the parties became engaged a “wedding account” was opened to which each party contributed, although the bulk of the contributions were made by the defendant from monies he earned from his hobby of renovating motor vehicles. The account was maintained from 1996 to 2000 with credits totalling approximately $28,000. Funds from the account were used to purchase a boat, a mower and were also used as a deposit on Unit 2 Egerton Street.
- [12]Following the termination of the relationship in June 2001 the defendant gave the plaintiff $10,000, together with a Holden Camira motor vehicle and gave her a further $3,500 shortly thereafter. The plaintiff purchased a property at 11 Strathalbyn Court, Arundel in October 2001 for the sum of $157,000 using some of the money paid to her by the defendant as a deposit. The plaintiff borrowed the sum of $140,000 to enable the purchase of this property which she subsequently rented out.
- [13]After the parties separated the defendant purchased Unit 3 Egerton Street, Southport, having borrowed the entire purchase price.
- [14]Since separation the parties have met their own expenses including mortgage payments relating to their respective properties. Each has sold a motor vehicle after separation and purchased a replacement.
Approach
- [15]It is appropriate in an application of this kind to first, identify the property of the parties at the time of the hearing; second, to consider the contributions of the parties; and finally, to consider the matters of the type referred to in sections 297-309 of the Act.
- [16]The parties are in agreement in relation to the identity of most of the property and financial resources which should be taken into account, however there remains some disagreement as to the value of some of the property identified. The relevant property pool consists of the following:
Assets | wife’s value | Husband’s value | Agreed value |
TRS Auto Repairs Pty Ltd | $60,000 | $60,000 | $60,000 |
54 Whittings Rd | $690,000 | $600,000 |
|
Egerton Street Factory 2 | $210,000 | $210,000 | $210,000 |
Egerton Street Factory 3 | $210,000 | $210,000 (but to be ignored) | $210,000 (but in dispute as to whether to be taken into account) |
Strathalbyn Court | $315,000 | $315,000 | $315,000 |
Ride-on mower | $3,000 | $3,000 | $3,000 |
| $1,488,000 | $1,188,000 |
|
liabilities | wife’s value | Husband’s value | Agreed value |
Whittings Road mortgage | $152,000 | $157,000 | |
Egerton St Factory 2 mortgage | $100,000 | $120,000 | |
Egerton St Factory 3 mortgage | $100,000 | $120,000 (but to be ignored) | |
Strathalbyn Court mortgage | $135,000 | $135,000 | $135,000 (but to be deleted if Factory 3 deleted) |
| $490,000 | $412,006 |
|
Net Assets | $998,000 | $776,000 |
|
- [17]It was submitted by counsel for the plaintiff that the Egerton Street factories should both be included as part of the current property of the parties with the difference in contributions being taken into account when assessing contribution. It was further submitted that if Factory 3, Egerton Street is excluded, then the plaintiff’s property at Strathalbyn Court should likewise be excluded as it was also purchased after separation and the plaintiff has paid all outgoings in respect of that property since its purchase. Counsel for the plaintiff contended that if Factory 3 Egerton Street is excluded, then half of the debt secured on that property should also be excluded, and if the Strathalbyn Court property is excluded, then the entire mortgage debt secured on that property should also be excluded.
- [18]Counsel for the defendant contended that the property comprising Factory 3, Egerton Street should not form part of the asset pool to be distributed between the parties because it was acquired after separation and was not acquired from any asset of the parties existing at the time of separation, i.e, it was not acquired from the pool of assets available for distribution at the time of separation. It is not in dispute that Factory 3 was purchased on 30 July 2002 for the sum of $150,000, the whole of the purchase money being borrowed.
- [19]Notwithstanding the submissions of counsel in respect of the assets to be taken into account, I propose to include all the assets identified in the table above, if for no other reason than the requirement in section 298 of the Act which requires the Court to consider:
- a)the income, property and financial resources of each of the de facto partners; and
- b)the physical and mental capacity of each of them for appropriate gainful employment.
- [20]It is necessary to determine the value of those assets and liabilities where agreement between the parties has not been forthcoming. Each party engaged the services of a valuer to provide a valuation report of the property at 53 Whittings Road. I accept that each of the valuers who testified at the hearing of this matter is appropriately qualified by training and experience to give evidence in relation to the value of the property. Mr Elliott, who was called by the plaintiff, assessed the market value of the subject property at $690,000. In order to determine the property value, Mr Elliott considered recent sales evidence within the nearby vicinity. He did note that due to the size and pre-war architectural style the subject property was considered to be somewhat unique, and as such, directly comparable sales were difficult to find under current market conditions. He further noted that, although the Gold Coast real estate market has recently experienced its most buoyant market conditions for some 14 years, there has now been a softening in demand and confidence in the market. Market growth now appears to be slowing, with many areas seeing a levelling out in prices. Mr Elliott concluded that, on the evidence in respect of available comparable sales, he would envisage a likely value range for the subject property of between $675,000 and $720,000. He has adopted $690,000 as being the most likely sale price under current market conditions as at the date of the hearing.
- [21]In his written report (which forms part of Exhibit 4) Mr Elliott has identified five recent sales in the area for comparison purposes. Four of these properties had sold for prices ranging between $1,030,000 to $740,000, while the fifth property had sold for $450,000. These recent sales illustrate the difficulty referred to by Mr Elliott in his report, of finding directly comparable sales with the subject property. Counsel for the defendant was critical of Mr Elliott’s evidence in that he appeared to discount any sales inconsistent with his opinion as an aberration without knowing the circumstances of those sales.
- [22]Mr Pederson, who was called by the defendant, valued the subject property at $600,000. He identified in his written valuation three recent sales ranging in price from $550,000 to $627,000. He described the level of market activity as average and the recent market direction as holding/decreasing. Counsel for the plaintiff was critical of Mr Pederson’s evidence in that it was suggested that Mr Pederson had carried out his valuation with a pre-conceived idea as to its worth, having previously spoken to the defendant and been told that the defendant thought the property was worth $600,000.
- [23]The criticisms made of the evidence of the valuers is of small moment. On balance, I consider that the valuation of Mr Pederson is more likely to reflect the current value of the subject property. In reaching this conclusion I have had particular regard to Mr Pederson’s experience over the last several years in valuing properties in the particular area where the subject property is located. I have also had regard to Mr Pederson’s preference for not including sales in his report that are too old (for instance, sales that occurred six months prior to the valuation). This may be erring on the side of caution, however I consider this to be justified in circumstances where there have been significant changes in the real property market around the date of valuation. Accordingly, I find that the value of the Whittings Road property is $600,000.
- [24]In respect of the mortgage over the Whittings Road property I note that the bank statement (Exhibit 13) shows that the mortgage had reduced to $150,000 by 6 December 2004 but increased by $7,000 on 10 January 2005. This increase was for the purpose of paying a credit card debt relating to the defendant’s business, of which the sum of $3,065.74 was able to be identified by the defendant to relate to a particular business expense. Notwithstanding the defendant’s inability to precisely identify the balance of the $7,000, I accept that the increase was wholly in respect of business expenses and, accordingly, conclude that the mortgage in respect of the Whittings Road property should be valued at $157,000 as at the date of hearing.
- [25]In relation to the mortgages in respect of Factory 2 and Factory 3, Egerton Street, the parties are in disagreement. The plaintiff contends that in each case the mortgage is $100,000, whereas the defendant claims that in each case the mortgage is $120,000. The difference between the two contentions is explained in each case by borrowings to overcome what was described as temporary cash flow problems for the defendant’s business. Again, notwithstanding the defendant’s inability to identify more than $10,671.74 as relating to any particular business expense, I am satisfied that the increases in the mortgages were wholly incurred to deal with the cash flow problems of the business and as such, should be recorded as a component of the mortgage amounts.
- [26]In the light of these conclusions the list of assets and liabilities may be set out in tabular form as follows:
Assets | Value |
TRS Auto Repairs Pty Ltd | $60,000.00 |
54 Whittings Road | $600,000.00 |
Egerton Street Factory 2 | $210,000.00 |
Egerton Street Factory 3 | $210,000.00 |
Strathalbyn Court | $315,000.00 |
Ride-on mower | $3,000.00 |
TOTAL: | $ 1,398,000.00 |
LIABILITIES | Value |
Whittings Road mortgage | $157,000.00 |
Egerton Street Factory 2 mortgage | $120,000.00 |
Egerton Street Factory 3 mortgage | $120,000.00 |
Strathalbyn Court mortgage | $135,000.00 |
TOTAL: | $ 532,000.00 |
NET ASSETS: $866,000.00
- [27]The plaintiff testified that she paid nearly all of the household expenses including electricity, rates, telephone, household and contents insurance and gas, with occasional contributions being made by the defendant and a tenant (Mr Collins) who paid one-third of the electricity costs from about 1996 and $50 per week for the last eight months of the relationship. The defendant alleged that he made contributions towards household expenses from cash he received from renovating motor vehicles and also that the plaintiff’s contribution was somewhat less than that claimed by her. There seems to be no disagreement as to the contribution made by Mr Collins.
- [28]The plaintiff’s evidence was that when she first commenced living with the defendant she was working at Mermaid Distributors, on a full-time basis, earning $326 net per week. She was also employed on a casual basis at Lady Small Haven Hospital earning up to $100 net per week. In August 1995 she commenced employment with Terry Morris International as a data entry operator. After 12 months she was transferred to the position of customer service person and was employed in that position for approximately six years until the position was made redundant in September 2002.
- [29]According to the plaintiff, her weekly income was utilised throughout the period of cohabitation to meet household expenses. The plaintiff does, however, concede that some of her weekly income was applied to the purchase of cigarettes and wine for herself. After separation, the plaintiff used the $10,000 given to her by the defendant in respect of stamp duty and furniture for the Arundel property as well as a deposit for that property. She accepts that the defendant gave her an additional $2,000 in cash to put towards the deposit, together with a further $1,500 to meet plumbing costs at the property.
- [30]For approximately 15 months after separation the plaintiff continued working at Terry Morris International in customer service, earning $500 net per week. When that employment was terminated she received a redundancy package of $8,000, less tax. The plaintiff used $1,000 of that money in obtaining a truck licence and forklift ticket. The balance of the redundancy package was used to meet mortgage repayments when the house was untenanted and to pay rates and insurance costs.
- [31]The plaintiff has obtained employment as a farm hand for South Pacific Seeds at Griffith, New South Wales. She left that job in April 2003 and then worked for Imperial Produce at Tent Hill as a farm hand, earning, on average, $450 per week. She hopes to secure employment in the mines at Mt Isa or Kalgoolie. The plaintiff believes that she would not be able to work as a farm hand after 2008 due to arthritis in her hips, ankles and knees. She does, however, believe she could work in a nursery.
- [32]I do not accept that the plaintiff expended $100 per week on household expenses (comprising rates, electricity and telephone) as she initially claimed. The more likely amount was shown to be approximately $40 per week, although appropriate concessions were not made by the plaintiff. Other difficulties with the plaintiff’s evidence, as identified by Counsel for the defendant, include the following:
“ | • | In cross-examination the plaintiff said that at the commencement of cohabitation with the defendant she paid $50 per week rent and one-half of household expenses but that this changed when the parties became engaged such that she no longer paid rent but paid all of the household expenses. This does not appear anywhere in either of her two affidavits Exhibit 1 and 2, and is contrary to the allegation contained in paragraph 3(c) of her second affidavit, Exhibit 2. |
• | At paragraph 35 of her first affidavit, Exhibit 1, the plaintiff stated that when the defendant didn’t have a licence she drove him everywhere. In cross-examination it became clear that, in fact, the defendant had a work licence and drove himself to and from work. | |
• | At paragraph 45 of her first affidavit, Exhibit 1, the plaintiff said that after the defendant gave her the Camira motor vehicle, she had to spend $1,500.00 on brakes, oil leaks, cooling system (hoses) etc. In cross-examination it became clear that she had, in fact, spent $331.60. Apparently the $1,500.00 figure was intended to reflect the value of the work performed rather than her actual expenditure, in contrast to the clear wording of her affidavit. | |
• | At paragraph 47 of her first affidavit, Exhibit 1, the plaintiff said that when she continued to live at Guanaba following separation she still had to pay $30.00 per week real estate fees in respect of the Arundel property. When, in cross-examination, it was pointed out that she hadn’t purchased the Arundel property at that stage, she said that this was a mistake. | |
• | In paragraph 3(a) of the second affidavit, Exhibit 2, the plaintiff deposed to having expended $10,000.00 at the commencement of the relationship. In cross-examination it became clear that she had not spent $10,000.00 at the commencement of the relationship and did not have the financial capacity to do so. | |
• | At paragraph 39 of her first affidavit, Exhibit 1, the plaintiff said that the defendant said to her that he would give her $10,000.00. Reference is made to that payment at paragraphs 40, 42, 44 of her first affidavit, Exhibit 1. Nowhere in her affidavits is there any suggestion that the payment was offered on condition that she sign a disclaimer. This allegation was first made in cross-examination and her explanation for the failure to ensure it was in her affidavit material is unsatisfactory and inconsistent with the fact of the payment having been made.” |
- [33]While these criticisms of the plaintiff’s evidence are validly made and demonstrate a number of inconsistencies between her oral evidence and material in her affidavits, I accept that, to a significant degree, such inconsistencies may be explained by the passage of time and the difficulties inherent in attempting to remember and recreate the financial history of a seven-year relationship that ended some four years ago. I certainly do not conclude that the plaintiff should be regarded either as an untruthful or unreliable witness.
- [34]The defendant’s evidence was that during the relationship he renovated the house at Whittings Road by putting in a laundry and garage underneath the house. He also, with the assistance of his father and his uncle, painted the exterior of the home and constructed a driveway. The defendant paid for these improvements, with no financial or physical contribution by the plaintiff. A new kitchen was installed with the work being completed by the tenant who occupied the granny-flat in exchange for rent. The defendant was responsible for meeting some payments for materials. The plaintiff contributed neither financially nor physically to the kitchen renovations.
- [35]During the period of cohabitation, the granny-flat was also renovated internally by the tenant at his own expense in lieu of rent. The tenant vacated the property prior to the parties separating, and the defendant then further renovated the exterior of the granny-flat at a cost of approximately $13,000. These renovations included the construction of a brick retaining wall between the granny-flat and the driveway and the construction of an external bathroom for the granny-flat and the laundry. The defendant painted the exterior of the granny-flat and generally improved the appearance of the area.
- [36]According to the defendant the parties shared costs and expenses of operating the home although each party maintained their separate incomes. The defendant was responsible for all mortgage payments and all other expenses in relation to the properties at Guanaba and Southport. The parties contributed equally to the costs of food in the approximate sum of $75 each per week. Other expenses such as telephone, electricity and rates were shared with the plaintiff contributing some two-thirds while the defendant contributed one-third. The tenant in the granny-flat contributed $50 per week and also contributed to electricity costs. These monies were paid to the plaintiff by the tenant.
- [37]The defendant stated that he drew approximately $500 per week from his business and would meet this own expenses from his drawings, together with mortgage payments of $450 per week as well as motor vehicle costs and expenses and his contributions to food, telephone and electricity. His evidence was that the plaintiff was earning some $400-$450 per week from which she would purchase cigarettes ($80 per week) and wine ($30-$40 per week). The plaintiff would meet her car loan expenses of approximately $100 per week and fuel costs of $50 per week in addition to her contribution to food, telephone and electricity.
- [38]The defendant stated that at the commencement of the relationship, the plaintiff attended to the cleaning of the interior of the house whilst he attended to the cleaning of the exterior. A cleaner was engaged by the defendant and also a lady to do the ironing. The plaintiff chose to work four days per week rather than five at some stage during the relationship so that she could do the cleaning. The defendant paid her the sum of $50 per week in respect of her cleaning work to make up the shortfall in her wages caused by reducing her work from five days to four.
- [39]When the relationship ended in June 2001, the defendant provided the following to the plaintiff:
- (a)The sum of $10,000; and
- (b)A Holden Camira motor vehicle valued at $4,000 in respect of which the defendant had spent between $3,000-$4,000 repairing the vehicle and providing a new motor.
- (a)
The plaintiff retained a Mitsubishi Pajero motor vehicle then worth approximately $16,000 with an equity of $10,000. She also took with her furnishings and her collectibles. Subsequently the defendant gave the plaintiff a further $3,500 to assist her in carrying out works to her property at Arundel. This property was purchased in October 2001 for $157,000 of which the plaintiff borrowed $140,000, with the balance being made up of monies provided by the defendant together with some of the plaintiff’s own funds coming from the sale of the Mitsubishi Pajero.
- [40]The defendant continued to pay the plaintiff the sum of $100 each week after the parties had separated as payment for cleaning the Guanaba property. This continued for approximately two months, although the payments were made by the defendant for approximately six months after the plaintiff ceased her cleaning duties.
- [41]I found the defendant to be an impressive witness who gave accurate and reliable evidence of the relationship to the best of his ability. His evidence, I am satisfied, should be preferred to that of the plaintiff where there is a conflict. Generally, however, there is a broad area of agreement between the parties with respect to their respective contributions.
- [42]I accept, then, that the plaintiff paid the majority of the household expenses such as electricity, rates, telephone, insurance and gas and that she contributed in other forms to the relationship. In particular, I accept that the plaintiff mowed the lawn in the immediate area surrounding the house on a regular basis and established and maintained a vegetable garden for a period of approximately two years. She fed and cared for the chickens, purchasing pellets and straw and cleaning out the coop regularly. She also fed and bathed the dog.
- [43]I also accept that the plaintiff was responsible for performing domestic duties throughout the relationship, apart from a short time when a woman was paid to do the ironing and a period of some six months when a house cleaner was engaged. The plaintiff prepared the defendant’s lunch and cooked meals in the evening and also cooked meals for the defendant’s family and friends when they visited.
- [44]I am satisfied, on the evidence, that the plaintiff did provide some assistance for the defendant in his business by ferrying passengers to and from the business premises on occasions, although I do not accept that this was done as frequently as each week, as claimed by the plaintiff. I also accept that the plaintiff distributed advertising material from time to time, promoting the defendant’s business at the defendant’s place of employment. However, any cleaning performed by the plaintiff at the defendant’s business was likely to have been on an extremely infrequent basis, as was any work that involved the checking of invoices.
- [45]The plaintiff claimed that she and the defendant would use her motor vehicle for recreational purposes and that she met all expenses relating to the running of the vehicle. This may be accepted, although it is noted that the defendant carried out some work on the vehicle.
- [46]It is reasonable for the plaintiff to claim, as she does, that she worked hard for seven years, believing that she was working for the parties’ joint future. No doubt she was upset when the engagement was called off by the defendant, probably in 2000, as evidenced by the continuation of contributions to the “wedding account” until that date. There seems to be little dispute that the plaintiff lived frugally throughout the relationship, for example, accepting and wearing second-hand clothes purchased by her mother and only ever buying new clothes when given money by the defendant at Christmas or on birthdays.
- [47]As noted previously, the Court may make any order it considers just and equitable about the property of either or both of the de facto partners, adjusting the interests of the de facto partners in the property (s 286(1) of the Act). In deciding what is just and equitable, the Court is required to consider the matters mentioned in subsubdivision 3. It is to those matters that attention must now be turned.
Contributions to Property or Financial Resources
- [48]S 291(1) of the Act provides as follows:
- “(1)The Court must consider the financial and non-financial contributions made directly or indirectly by or for the de facto partners … to
- (a)the acquisition, conservation or improvement of any of the property of either or both of the de facto partners; and
- (b)the financial resources of either or both of the de facto partners.
- (2)…
- (3)It does not matter whether the property or financial resources mentioned in subsection (1) still belong to either or both of the de facto partners when the Court is considering the contributions made.”
- [49]The most valuable asset of the parties is undoubtedly the Whittings Road, Guanaba property. This property was owned by the defendant at the commencement of the relationship and at that time his equity in the property was $70,000. Mortgage repayments of $450 per week were made wholly by the defendant. The defendant also paid for renovations to the property including: repainting (inside and out); installation of a laundry and garage underneath the house; construction of a driveway, installation of a new kitchen; construction of a brick retaining wall between the granny-flat and driveway; construction of an external bathroom for the granny-flat; and painting of the exterior of the granny-flat.
- [50]In terms of non-financial contributions, the plaintiff was responsible for mowing of the curtilage area and maintenance, and in some cases establishment, of the gardens. The balance of the 10-acre property was maintained by the defendant using a ride-on mower.
- [51]In relation to the expenses associated with the Whittings Road property, I accept that on average approximately $50 per week was contributed by the plaintiff. The defendant would, on occasions, contribute $40-$50 towards these expenses.
- [52]I am satisfied that the greater financial to the Guanaba property were made by the defendant. The non-financial contributions were more evenly shared between the parties.
- [53]The TRS Auto Repairs business was acquired by the defendant in 1995 for $12,000 with funds wholly sourced from him. The business is currently worth $60,000. No direct financial contribution has been made by the plaintiff. Non-financial contributions made by the plaintiff include the promotion of the business at her workplace, assisting with transporting work colleagues to the business thus facilitating their custom, occasional assistance with pamphlet distribution and occasional assistance with banking. Some infrequent cleaning and invoice checking also were performed by the plaintiff.
- [54]Factory 2, Egerton Street was purchased on 30 June 2000, some 12 months prior to the cessation of the relationship. The deposit of $20,000 for the purchase of this property was procured by the defendant, drawing $10,000 from payments made by him in respect of the Guanaba property. This was wholly his financial contribution. A further $10,000, used for the deposit, was withdrawn by the defendant from the so-called “wedding account”. I accept that nearly all the monies in that account had been contributed by the defendant and accordingly, the direct financial contribution to the deposit by the plaintiff must be considered negligible. Furthermore, I accept that all of the repayments on the borrowings to finance the property have been paid by the defendant with no contribution by the plaintiff. There is no non-financial contribution to this asset.
- [55]Factory 3, Egerton Street was acquired by the defendant after the parties had separated with the entire purchase price being borrowed by the defendant.
- [56]The property at Strathalbyn Court was purchased by the plaintiff following the separation of the parties. The defendant paid the sum of $13,500 to the plaintiff after they separated and this sum was utilised in the expenses of acquiring and maintaining the Strathalbyn Court property. The plaintiff contributed $10,000 from the proceeds of the sale of a Pajero motor vehicle and has been responsible for the mortgage repayments since the property was acquired. The mortgage repayments are currently funded by rental income.
- [57]The ride-on mower was purchased from the proceeds of the “wedding account”, the contributions to which were mainly made by the defendant.
- [58]With respect to superannuation, it appears that both parties have comparable funds to which they are each the sole contributor.
Contributions to family welfare
- [59]The Court is required to consider the contributions, including any home-making contributions made by either of the de facto partners, to the welfare of the de facto partners (s 292(1) of the Act).
- [60]In regard to the parties’ contribution to family welfare, I accept that the plaintiff’s contribution is substantially greater than that of the defendant. The plaintiff was responsible for the preparation of meals, although the defendant did take the plaintiff out to dinner at least once a week. Interior cleaning of the Whittings Road property was done by the plaintiff, except for occasional periods when a cleaning lady was employed. I note that there was a period of time when the defendant paid the plaintiff to do the cleaning. The plaintiff also was largely responsible for the ironing. The respective contributions to gardening and lawn maintenance have previously been discussed.
- [61]In considering the adjustment to be made in favour of the plaintiff with respect to the matters required to be considered by the Court in subsubdivision 3 of the Act, the assessment of contributions must fall heavily in favour of the defendant. Counsel for the plaintiff has submitted that her client should be awarded 40% of all assets. However, I am satisfied that the evidence establishes that this suggested percentage is overly generous in the circumstances of this case. In my view, the plaintiff’s contribution, if expressed in percentage terms, should be assessed at 25%.
Additional matters
- [62]Subsubdivision 4 of Part 19 of the Act sets out additional matters for consideration to the relevant extent in deciding what is just and equitable.
- [63]S 297 of the Act requires the Court to consider the age and state of health of each of the de facto partners. The plaintiff is currently aged 38, while the defendant is currently aged 46. The plaintiff suffers from bronchitis which does not appear to have affected her ability to work. It, no doubt, may do so if she continues to smoke. She also claims to suffer from osteoarthritis although no evidence from a medical practitioner was placed before the Court in this regard. The defendant suffers from chronic fatigue syndrome, although this condition appears to have improved in recent times.
- [64]The Court must consider the income, property and financial resources of each of the de facto partners and the physical and mental capacity of each of them for appropriate gainful employment (s 298 of the Act). The property and financial resources of the defendant are clearly greater than those of the plaintiff.
- [65]The defendant’s evidence is that his sources of income derive from his business at TRS Auto Repairs where he works as a motor mechanic and from rental income from Factory 3, 41 Egerton Street. He works on a full-time basis and has done so since 1995. He draws $700 each week from the business and meets all telephone, electricity and rate accounts, mortgage payments and credit card accounts from the business account. He receives the sum of $277 per week from rental of shed space. He lists his assets as follows:
Assets | AGREED Value |
Property at 53 Whittings Road, Guanaba, value of which as determined in this judgment | $600,000.00 |
Egerton Street Factory 2 | $210,000.00 |
Egerton Street Factory 3 | $210,000.00 |
Ride-on mower | $3,000.00 |
TRS Auto Repairs Pty Ltd | $60,000.00 |
Suncorp Metway Bank Account | $200.00 |
Furniture and household effects | $5,000.00 |
TOTAL: | $ 1,088,200.00 |
The defendant also has superannuation of $25,000.
With respect to liabilities, there is presently approximately $157,000 outstanding under the mortgage over 53 Whittings Road, Guanaba to Suncorp Metway. The defendant recently had to increase this debt by $8,000 to pay debts of TRS Auto Repairs Pty Ltd. There is presently some $240,000 outstanding under the mortgage secured over the properties at Factories 2 and 3, Egerton Street to Suncorp Metway. The defendant recently had to increase this debt by $10,000 to pay debts of TRS Auto Repairs Pty Ltd. There is presently a debt of $4,000 outstanding on the defendant’s Westpac credit card.
The defendant estimates his outgoings on a weekly basis as follows:
weekly outgoings | Value |
Income tax | $145.00 |
Mortgage instalments (Whittings Road) | $450.00 |
Food | $100.00 |
Household supplies and toiletries | $20.00 |
Household maintenance | $10.00 |
Clothing | $20.00 |
Entertainment | $50.00 |
Haircuts | $2.00 |
TOTAL: | $ 797.00 |
- [66]The plaintiff, in her statement of financial circumstances, has estimated her income for the financial years 2002/03 and 2003/04 as follows: for the 2002 tax year $28,000 from her employment with South Pacific Feeds and Imperial Produce, together with $7,704 from rental income; and for the 2003 tax year $28,000 from her employment with the same employer, together with $11,569 from rental income. The plaintiff has listed her debts as comprising $135,000 by way of mortgage to Suncorp Metway, credit card debt of $2,000 and a debt of $4,000 to AGC. She has $16,000 in an MLC superannuation fund. Her recurring weekly expenses are as set out in the table following:
weekly outgoings | Value |
Food | $65.00 |
Household supplies | $10.00 |
Telephone | $10.00 |
Clothing and shoes | $10.00 |
Medical and dental | $18.00 |
Chemist/pharmaceutical | $20.00 |
Dry cleaning | $5.00 |
Books and periodicals | $5.00 |
Gifts | $10.00 |
Hairdressing and toiletries | $4.00 |
Accommodation | $65.00 |
Transport/car | $50.00 |
Electricity | $8.00 |
TOTAL: | $ 242.00 |
- [67]Both parties have the physical and mental capacity to engage in gainful employment. To reflect the stronger financial position of the defendant at the end of the relationship an appropriate adjustment of 7.5% should be made in favour of the plaintiff.
- [68]The Court is required to consider whether either de facto partner has the care of a child of the de facto partners who is under 18 years. In this regard, I note that there are no children of the relationship and indeed, neither party has any children.
- [69]The Court is required to consider the commitments of each of the de facto partners necessary to enable the de facto partner to support himself or herself (s 300 of the Act). Both parties have mortgage commitments which they are apparently able to meet from their respective incomes.
- [70]The Court is required to consider the responsibility of either de facto partner to support another person (s 301 of the Act). There is no evidence of any such responsibility attaching to either of the parties.
- [71]S 302 of the Act relates to government assistance in the form of pension, allowance or benefit. The evidence does not suggest that either party is eligible for government assistance.
- [72]The Court is required to consider, under s 303 of the Act, if the de facto partners have separated, what standard of living is reasonable for each of the de facto partners in all the circumstances. Nothing has emerged from the evidence in this case to suggest that the standard of living of either the plaintiff or the defendant has been adversely compromised such as to require redress following their separation.
- [73]The contributions made by either of the de facto partners to the income and earning capacity of the other de facto partner must be considered by the Court (s 304 of the Act). I accept that, in this regard, the contribution of the plaintiff to the earning capacity of the defendant through assisting with his business can be adequately compensated by taking that contribution into account when assessing her entitlement under subsubdivision 3. In that way, the plaintiff’s contribution to the business asset can be appropriately considered.
- [74]The length of the de facto relationship was seven years. This must be considered by the Court pursuant to s 305 of the Act.
- [75]The Court is required to consider the extent to which the de facto relationship has affected the earning capacity of each of the de facto partners (s 306). The evidence does not suggest that the de facto relationship has in any way affected the earning capacity of either the plaintiff or the defendant. Nor is it suggested by their respective counsel that such has occurred.
- [76]If either de facto partner is cohabiting with another person, the Court must consider the financial circumstances of the cohabitation pursuant to s 307 of the Act. No evidence concerning such cohabitation has been placed before the Court.
Conclusion
- [77]Counsel for the plaintiff has submitted that her client should be awarded 40% of all assets, whereas counsel for the defendant has contended that a range of between 22.5%-25% of the net assets is appropriate. The former is, in my opinion, overly generous to the plaintiff in all the circumstances, while the latter undervalues the contributions made by the plaintiff as a home-maker. In that regard I am mindful of the need to recognise such contribution in a substantial way (Mallett (1984) 146 CLR 605; E v S [2003] QSC 378. In my view the adjustment which should be made in favour of the plaintiff in this case, based on the evidence reviewed above, is 32.5% of the net assets detailed in the table in paragraph [26] of this judgment. This 32.5 % consists of adjustments of 25% for the plaintiff’s contributions and 7.5% to reflect the stronger financial position of the defendant at the end of the relationship. With the sum of the assets being $866,000, the adjustment to be made in favour of the plaintiff is therefore $281,450. As the plaintiff is in possession of the Strathalbyn Court property, the net value of which is $180,000, she should receive a cash payment from the defendant of $101,450.
- [78]I make the following orders:
- (1)That within 60 days of the date hereof the defendant pay to the plaintiff a sum equivalent to 32.5% of the net assets of the parties comprised as follows:
- (1)
- (a)the defendant pay to the plaintiff the sum of $101,450;
- (b)the plaintiff retain the property at 11 Strathalbyn Court, Arundel and the defendant relinquish any entitlement to the equity of this property.
- (2)That the defendant retain, to the exclusion of the plaintiff, all the right, title and interest in the following property:
- (a)53 Whittings Road, Guanaba described as Lot 10 on RP 13841, County of Ward, Parish of Cedar;
- (b)Unit 2, 41 Egerton Street, Southport, described as Lot 2 on SP 120565, County of Ward, Parish of Nerang;
- (c)Unit 3, 41 Egerton Street, Southport, described as Lot 3 on SP 120565, County of Ward, Parish of Nerang.
- (3)That the defendant retain all his right, title and interest in TRS Auto Repairs Pty Ltd.
- (4)That the defendant retain his XR8 utility.
- (5)Each party retain for their own use the following:
- (a)their respective bank or credit union accounts;
- (b)their respective superannuation funds;
- (c)their respective items of furniture;
- (a)their respective personal chattels and effects.
- (6)If the defendant fails to pay the plaintiff the said sum of $101,450 within 60 days of the date hereof, then the property at 53 Whittings Road, Guanaba is to be sold and the plaintiff be paid the said sum from the sale proceeds, together with interest thereon at 9% per annum from the date due to the date paid.