Burgess v Moss

LEGISLATION CITED: (NSW) Property (Relationships) Act 1984

Dwyer v Kaljo (1992) 27 NSWLR 728 Figgins v Figgins (2002) 173 FLR 273 Hayes v Marquis (2008) NSWCA CASES CITED: Howlett v Neilson (2005) 33 FamLR 402 Kennon v Kennon (1997) FLC 92-757 Mallet v Mallett (1984) 156 CLR 605 Moss v Burgess [2009] NSWDC138 Sharpless v McKibbin (2007) NSWSC 1498; (2008) DFC ¶ 95-414

PARTIES: Garry William Burgess (Appellant) Sarah Dawn Moss (Respondent)

COUNSEL: P Maiden SC w J F Heazlewood (Appellant) C M Simpson SC w W J Tregilgas (Respondent)

SOLICITORS: G J Harris & Co (Appellant) Braye Cragg Solicitors (Respondent)

LOWER COURT JURISDICTION: District Court

LOWER COURT MEDIUM NEUTRAL CITATION: Moss v Burgess [2009] NSWDC 138

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL 2009/298353

BEAZLEY JA TOBIAS JA BRERETON J

Ex Tempore Monday 31 May 2010 GARY WILLIAM BURGESS v SARAH DAWN MOSS Judgment 1 BRERETON J: The appellant Garry William Burgess and the respondent Sarah Dawn Moss commenced to cohabit as a couple in a de facto relationship in 1990. Mr Burgess brought to the relationship about $340,000, which he used early in the relationship to acquire a property, Hollydene Park, in which the partners thereafter resided. Thereafter, his were by far the predominant income contributions and he also undertook some development towards subdivision of Hollydene Park. Ms Moss brought practically no assets to the relationship. She made some modest income contributions, but her predominant contributions were as a homemaker.

2 According to the findings made at trial, in or about late 1996 the parties occupied separate bedrooms in the same premises and the relationship thereafter ceased to be a de facto relationship and became a close personal relationship, but nonetheless continued as a domestic relationship within the (NSW) Property (Relationships) Act 1984 until the parties finally separated in 2006, after a relationship of one kind or the other of some sixteen years, leaving a pool of divisible property which was found by the trial judge to amount to some $1,109,000 net, apart from the proceeds of a post-separation inheritance of Mr Burgess which were totally excluded from consideration.

3 In proceedings brought by Ms Moss in the District Court under the Property (Relationships) Act, Sidis DCJ ordered, pursuant to s 20, that Mr Burgess pay Ms Moss by way of adjustment of property interests the sum of $195,000, and costs [Moss v Burgess [2009] NSWDC 138]. Mr Burgess appeals to this Court from that order. 4 The appeal was not instituted within the time limited by the rules of Court, and an extension of time within which to appeal was sought. The Court has already indicated that that extension will be granted. Although purportedly initiated by summons for leave to appeal, it is accepted that leave to appeal is not required, there being an amount in excess of $100,000 in issue on the appeal, and that the appeal is, but for the extension of time, brought as of right.

5 Ultimately, no challenge was pressed to the trial judge's conclusion as to the divisible pool of property, and rightly so. On any view, the property Hollydene Park was worth $627,000, and the proceeds of sale of portions of it shortly after separation amounted to $472,000; other assets admitted in his defence to be held by Mr Burgess amounted to $109,000. These produce a total of $1,209,000. Her Honour deducted liabilities of $100,000, disallowing a debt Mr Burgess claimed to owe an acquaintance of $220,000 - as her Honour was entitled to, there being no evidence of that debt and Mr Burgess having been cross-examined in a manner which plainly put into issue its genuineness. Accordingly, the questions ultimately argued on the appeal related to her Honour's assessment of the respective contributions of the parties under s 20. 6 The Court refused leave to Mr Burgess to further amend his grounds of appeal to challenge the trial judge's conclusion that a domestic relationship continued after 1997 until 2006. In light of the circumstances that it was uncontentious that both parties continued to reside in the same house, that Ms Moss continued to provide some meals for Mr Burgess, that Mr Burgess financially supported the two of them, that they attended on at least some social occasions together and that they had previously been in a de facto relationship, it appeared that there was no prospect that a challenge to the conclusion that at least a close personal relationship survived until 2006 could succeed.

7 Thus, the remaining questions that were argued relating to the respective contributions of the parties under s 20 were, first, a contention that her Honour failed to distinguish between the contributions made while the relationship was a de facto relationship and those made while it was a close personal relationship, it apparently being contended that the latter was entitled to less significance and less weight than the former; secondly, a complaint as to the adequacy of her Honour's reasons for concluding that $250,000 was a fair reflection of Ms Moss' contributions; and, thirdly (perhaps) an argument that the sum of $250,000 was outside the legitimate bounds of an exercise of her Honour's discretion.

8 As to the first of those, her Honour found that the nature of the relationship changed in or following 1996 consequent upon the parties occupying separate bedrooms from about that time. It appears a necessary consequence of her Honour's preference for Ms Moss' evidence over that of Mr Burgess that her Honour accepted that this change in the sleeping arrangements was attributable, not to a termination of the relationship between the parties, but to the circumstance that Ms Moss found her sleep was disturbed by Mr Burgess' snoring. In those circumstances, for my part I doubt that such a re-arrangement of the sleeping arrangements would cause what was formerly a de facto relationship to cease to be one, but there is no notice of contention in that respect.

9 For Mr Burgess, it was argued that, once the relationship became a close personal relationship and was no longer a de facto relationship, Ms Moss' contributions necessarily had a different and lesser quality. Section 20 provides for the alteration of interests in property of parties to a domestic relationship, of which de facto relationships and close personal relationships are each different subsets. Section 20 does not mandate any different approach in evaluating the contributions of the parties to a close personal relationship as distinct from those to a de facto relationship. In both cases, it directs attention to and requires consideration of the contributions of each party regardless of whether a party to a de facto relationship or to a close personal relationship.

10 The appellant focused on what was said in Sharpless v McKibbin (2007) NSWSC 1498, (2008) DFC ¶ 95-414, particularly at [71]: The inclusion within the Act of "close personal relationships" has the effect of extending the scope of the Act beyond marriage-like relationships. It does not follow that the approach applicable to a marriage-like relationship should also be applied in the context of a "close personal relationship" not amounting to a de facto relationship. "Close personal relationships" within the definition cover a wide range of relationships, and typically do not involve "a practical union of lives and property". In the case of a close personal relationship from which features of a marriage, such as union of lives and property, are absent, the rationale for the approach authorised by Mallet is much weakened, if not entirely removed. 11 The point of that passage was that the contributions in a de facto relationship occur in the context that the parties are by definition living together as a couple, whereas contributions in a close personal relationship do not necessarily have that feature. In the case of a de facto relationship there will usually, if not inevitably, be a social and economic partnership, whereas in a close personal relationship there will not necessarily be so. Sharpless was a case in which after the de facto relationship had ceased there was no such social and economic partnership. But the range of close personal relationships is wide, from those that are quasi marriages, to those that bear no similarity to a marriage at all (for example, where the relationship might be one much more akin to one between a parent and a daughter-housekeeper, in which the approach typically adopted in a de facto relationship case might not be appropriate). In each such case, the approach to the assessment of the respective contributions of the parties will depend on the facts, and in particular the specific contributions in that case. Sharpless does not state that a close personal relationship could never involve those characteristics of a social and economic partnership which make what was described in that case as the approach in Mallet v Mallett (1984) 156 CLR 605 an appropriate one.

12 In the present case, on her Honour's unchallenged findings of fact, there was precious little difference in this relationship before and after 1997, other than in the sleeping arrangements. There were no apparent differences, on her Honour's findings of fact, so far as the division of labour and the respective contributions of the parties were concerned. Just as before 1996, so afterwards, Ms Moss' domestic contributions continued to free Mr Burgess to generate income and to develop his property, so that each of them in their separate spheres contributed in their own way to an outcome that was reflected, inter alia, in the pool of property that had been accumulated by them at the time of separation. In this case, the change from a de facto relationship to a close personal relationship, if indeed there was one, was immaterial to the assessment of the contributions.

13 The second basis upon which her Honour's evaluation of the contributions was challenged was a complaint as to the adequacy of her Honour's reasons. Her Honour found that $250,000 was a fair reflection of Ms Moss' contributions, from which $55,000 was deducted (reflecting a $10,000 payment made to her in 2003, and another $45,000 payment made to her following separation). So far as the payment of $10,000 was concerned, that was made while the relationship remained on foot and remained, in one form or another, amongst the assets of one of the parties to the relationship at the time of separation. Effectively, her Honour determined that of the pool of property available at separation, Ms Moss should receive $240,000. Her Honour did not apportion the contributions on a percentage basis to reach that result, but there is no necessity to do so. It is implicit in the above figures that there was a 79 to 21 per cent (approximately) apportionment. Stating the percentages adds nothing to the force of the reasoning.

14 Her Honour plainly gave weight, and considerable weight, to the circumstances that the assets were almost exclusively introduced by Mr Burgess - Hollydene Park having been purchased by him early in the relationship with his pre-relationship funds - and that his were by far the greater income contributions. The weight that her Honour attributed to those matters is reflected in the overwhelmingly greater share of the divisible pool that was allocated to Mr Burgess [and see, for example, her Honour's judgment, at [76]].

15 Against that, her Honour took into account, as she was bound to, Ms Moss' albeit modest income contributions and, more particularly, Ms Moss' substantial contributions as a homemaker over a period of sixteen years, which involved - albeit that there were no children - cleaning the house, cooking meals, attending to the garden, assisting with Mr Burgess' horses, supervising and contributing to renovations, providing bookkeeping services to Mr Burgess, and caring for chickens. In addition, her Honour took into account that Ms Moss gave up full time employment in Western Australia and the opportunity to establish her own asset position, in favour of providing homemaking support to Mr Burgess; and that by acting as a homemaker she enabled Mr Burgess to generate income and progress the development of Hollydene Park.

16 Her Honour's having taken into account and given weight to those matters is evident from paragraphs 81, and 95 to 100, of her Honour's judgment. From those parts of her Honour's judgment it is plainly possible to ascertain why her Honour attributed the contributions overwhelmingly in favour of Mr Burgess, and also why Ms Moss received some, albeit minority, recognition for her contributions. It is true that it is not possible to see why it was that her Honour fixed precisely upon the sum of $250,000, but in cases where contributions are non-financial as well as financial, and where they have to be satisfied out of a pool of property that will rarely reflect in total all the contributions that have been made to it, it is almost never possible to see in precise mathematical terms why a particular sum is appropriate. To my mind, her Honour's reasons amply expose the process which led to the conclusion that Mr Burgess should receive a shade under 80 per cent and Ms Moss a shade over 20 per cent of the divisible pool of property.

17 The third issue which was (arguably) advanced was whether her Honour's assessment of Ms Moss' contributions at 21 per cent was manifestly excessive, or outside the legitimate range of the generous discretion given by s 20 of the Property (Relationships) Act. I am content to proceed on the basis that such a challenge was implicit in the challenge to the reasons, if it was not explicit. 18 Although counsel for the respondent argued to the contrary, I do not know of any better way to describe the legitimate range of that generous discretion than by reference to judicial decisions in cases bearing some similarity (see, for example the exercise undertaken in Sharpless, at [94]), but it remains fundamental that each case involves its own exercise of judicial discretion, attending to the particular features and circumstances of that case.

19 There are significant differences of materiality between the present case and the cases to which reference was made in Sharpless at [94]. First, the relationship was significantly longer than the relationships in Figgins v Figgins (2002) 173 FLR 273, in Kennon v Kennon (1997) FLC 92-757 and in Dwyer v Kaljo (1992) 27 NSWLR 728. That, of itself, indicates that the homemaker contribution is entitled to greater weight here than it was in those cases. Secondly, the asset pool in the current case was a very much smaller asset pool than in any of those three cases. The smaller the asset pool, typically the more significant will be the homemaker contribution and the less significant will be the financial contributions. That is plainly so in the present case. Thirdly, there is the circumstance that by moving from Western Australia to New South Wales and foregoing secure full time employment in Western Australia and the opportunity to accumulate her own asset position the domestic contributions of Ms Moss are accentuated.

20 A second way of looking at it is in absolute terms. In Figgins, Mrs Figgins received about $1.7 million on account of her domestic contributions alone. In Kennon, Mrs Kennon received about $400,000 on account of domestic contributions alone and in Dwyer, Ms Kaljo received about $400,000 also for domestic contributions alone. It can be seen that in absolute terms, for contributions which were not (at least significantly) less than those in each of those three cases, and in some respects more, Ms Moss will receive a lesser amount, principally because her contributions were to a smaller pool. That, I think, demonstrates that it cannot be said that the amount to which she was held to be entitled was manifestly excessive.

21 Yet another way of looking at it is to look only at the increase in value of assets from cohabitation (when they were about $340,000) to separation (when they were about $1.11 million), an increase of some $770,000 over the period of the relationship. The award to Ms Moss represents a shade over 30 per cent of the increment in the value of the property of the parties over that period. To my mind, it cannot be said that such apportionment attributes manifestly excessive significance to a sixteen year long homemaker contribution, and her modest income contributions, against Mr Burgess' significant initial contributions, his ongoing income contributions and his contributions to development of the property. Conversely, in my judgment it cannot be said that it demonstrates that insufficient weight was given to his unquestionably important initial and ongoing contributions. 22 The result cannot be said to be outside the legitimate range of the generous discretion given by s 20 to a trial judge.

23 It follows that, in my opinion, the appeal should be dismissed. I propose the following orders; 1. Extend time for filing a Notice of Appeal up to the date upon which it is filed.

2. Direct that the appellant to file a Notice of Appeal, containing the grounds specified in the draft Further Amended Summons for Leave to Appeal, and pay the appropriate filing fee, within seven days.

3. Order that the appeal be dismissed with costs. 24 BEAZLEY JA: I agree with the orders proposed by Brereton J and with his Honour's reasons. I would make the following and more general remarks. As finally formulated in this Court, the appellant's principal challenge to her Honour's judgment was that she gave inadequate reasons for her determination that the respondent was entitled to an adjustment with respect to the property of the parties to the relationship in an amount of $195,000 after having given credit for monies already received by the respondent. The amount of the adjustment, if expressed as a proportion, was in the order of 22 per cent of the divisible pool of assets. 25 Although the challenge was to her Honour's reasons, the underlying complaint was that the order made by her Honour was simply too much and, as Brereton J has indicated, the adjustment ordered by her Honour was outside the range of orders made in such cases. Care must be taken in deciding cases under this legislation in referring to "ranges" or "tariffs" for two reasons. First, the assessment required under the legislation is an evaluative one. Secondly, and this feeds back into the first, the evaluative judgment is made in a diverse range of circumstances including the relationships that fall within the Act, the pool of assets that are available for adjustment and the nature and quality of the contributions that are made by the parties. 26 It would be wrong given those wide range of circumstances that fall to be determined to have a "tariff" reflecting the contribution of particular types of claimants, such as homemaker claimants. In other words, the legislation does not authorise the adoption of a tariff in the evaluation of what is just and equitable in a particular case. 27 The adoption of a "tariff" not only has the tendency to ossify the just and equitable compensation payable to claimants under the Act (which of itself may adversely affect the interest of one or other of the parties in a way that is not authorised by the legislation), it also has the tendency to distract attention from the evaluative judgment that is required by the legislation. That is not to say that guidance cannot be obtained from the approaches of other judges in other cases. However, such cases may only be used as a guide and not as a replacement for the Court's own discretionary judgment in a particular case.

28 TOBIAS JA: I agree with the orders proposed by Brereton J and, subject to one matter, with his reasons. However, like Beazley JA and for the reasons she has stated with which I respectfully agree, I do not find much assistance in the use of other cases of the nature of those referred to at [94] of Brereton J's judgment in Sharpless v McKibbin as providing any reliable "tariff" in what is an inexact and non-scientific evaluative process or task dependent on its own facts and circumstances. This is particularly so in a case such as the present where one is assessing a wholly non-financial homemaker contribution of the respondent. 29 The relevant principles in relation to the evaluative task required under s 20 of the Act are summarised by McColl JA, with whom in this respect Beazley JA agreed, at [106] and [108] of Hayes v Marquis (2008) NSWCA 10, as well as in the judgment of Einstein J in the same case at [195] to [197]. As Einstein J noted at [197] in Howlett v Neilsen, Hodgson JA observed that the task of identifying and evaluating the respective contributions of the parties for the purpose of s 20 was not a narrow or purely mathematical process. It is, indeed, an exercise of a discretionary power of a very general kind and referred to in the authorities as a "holistic value judgment". Those factors in my view support the proposition advanced by Beazley JA in this case that it is misleading and unhelpful for reference to be made to the decisions in other cases on entirely different fact situations as providing some some sort of tariff let alone an appropriate upper and lower end of the range of orders which may be made under s 20 founded, as they are required to be, on no more precise a test that what is "fair and equitable". 30 I appreciate that Brereton J in the reasons that he has just given is generally of a similar view but I do not think that a citation of the authorities in the manner which his Honour adopted at [94] of his judgment in Sharpless is going to be of any assistance to the evaluative task in which the Court is engaged by s 20 of the Act. Subject to the foregoing remarks, I agree with the orders proposed.

31 BEAZLEY JA: The orders of the Court are those proposed by Brereton J.

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