This matter concerns an application by the wife, Ms Kent ("the wife"), for a declaration of interest in a property pursuant to section 78 of the Family Law Act 1975 (Cth) ("the Act") or, in the alternative, for a property division under section 79 of the Act. The respondent husband, Mr Kent ("the husband"), has filed a submitting notice pursuant to Rule 2.21 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) ("the Rules") and accordingly does not seek to be heard as to any orders to be made by the court.
The husband and wife separated in about 2000 and divorced in 2004, however, they never formally dealt with their property division. The husband and wife remain the joint proprietors of the only significant asset of the marriage, the real property situated in Victoria at D Street, City E ("D Street").
The second respondent, Ms Foster, is the husband's (former) stepdaughter from a subsequent marriage to Ms F. The third and fourth respondents, Ms B Foster and Ms C Foster, are Ms Foster's children.
For ease of reference, and meaning no disrespect to the other respondents, I shall refer to the husband and wife as "the parties" and the second, third and fourth respondents collectively as "the Fosters."
The sad history of this matter is that either the third or the fourth respondent was sexually abused by the husband, although on the evidence before the court, it is not possible to ascertain which. The husband is currently imprisoned in relation to that offending. In late 2018 a compensation order was made in the County Court of Victoria with respect to the second, third and fourth respondents, which allowing for penalty interest, now totals $296,875 ("the compensation order").
The Fosters seek a declaration that, pursuant to the legal title, the parties own D Street in equal shares. They seek D Street be sold and that they be repaid what they are owed pursuant to the compensation order from the husband's share. In the alternative, if an order is made for a property adjustment pursuant to section 79, any funds paid to the husband be paid to them to satisfy the compensation order.
The wife's case is that the parties had an informal agreement that she would retain D Street, and that she subsequently lived in that property up to the date of the final hearing, to the exclusion of the husband, who she says made no meaningful contributions to its maintenance or conservation.
[2]
The parties commenced a de facto relationship in 1984.
The parties' first child, Ms G, was born in 1986, and is now aged 39 years old.
The parties married in 1988.
The parties' second child, Mr H, was born in 1988, and is now aged 37 years old.
In 1989, the wife was gifted 12 acres of unencumbered land at J Street, Town K ("J Street").
In April 1990, the parties obtained a mortgage over J Street and built a house for about $75,000.
In 1994, the parties' third and youngest child, Mr L, was born. He is now aged 31 years old.
During the relationship the husband was the primary income earner and the wife the primary homemaker and carer of the children. The husband worked as a tradesperson at M Company for part of the relationship, and later at a store in City E.
In or about 1995, the husband was made redundant from M Company and received a redundancy of about $375,000 ("the redundancy payment"). The wife believes some of those funds were applied to pay out the mortgage on J Street, to purchase two vehicles, and to buy a block of land at N Street, Town K ("N Street").[1]
In 1999, the wife was diagnosed with an illness and given only a few years to live. The husband left work to become the wife's carer.[2] The wife's evidence is that she commenced treatment for this illness.
Despite this, in 2000, the husband moved to Sydney, obtained a new job with O Company, and commenced a new relationship. The wife's evidence is that the husband took with him:
[3]
half the tools and items in the shed, the trailer, computers and various household furniture items. He stopped providing an allowance for groceries and utilities. He later came to the house and took more items from the shed, including even all the baby furniture.[3]
[4]
The wife, who was still very unwell at the time the husband moved to Sydney, was left as the sole carer of the children at J Street, and had to obtain a single parenting pension. The wife's evidence is that the husband did not spend any time with the children whilst he was living in Sydney.
At some stage the husband and his girlfriend moved to Melbourne.[4] The wife's evidence is that whilst in Melbourne the husband would occasionally visit the children, but never had them in his care.[5]
In mid-2001, the husband sold N Street for about $43,000. The wife says she does not know what the husband did with the proceeds of sale.[6]
The wife's evidence is that she struggled to manage J Street, given its size and her state of health. She says the parties therefore agreed to sell J Street and purchase a house in town for the wife and children to reside in.[7]
In July 2001, the parties purchased D Street as joint registered proprietors for approximately $135,000. The parties obtained a mortgage to fund the purchase with P Bank.[8] The wife's evidence was that the property was purchased in joint names because, despite all indications to the contrary, she believed there was still a possibility of reconciliation at that time. It is unclear if the husband shared that belief.
In late 2001, the parties sold J Street for about $128,000. The settlement occurred in March 2002, with the proceeds of sale applied to the mortgage over D Street.
The wife's evidence is that the parties agreed the husband would make the payments on the limited mortgage that remained over D Street in lieu of child support. The husband gave evidence that he paid both the mortgage and child support. I shall return to this in due course.
In or about 2002, the husband used D Street as security for a loan to purchase a car for his sole use. The wife's evidence is that he asked her to sign this when she was in bed with a migraine, and she was not aware until later what she was signing.
In 2004, the parties divorced.
The wife's evidence is that for many years she struggled with "fatigue and poor health" but that ultimately her treatment was successful, and she went into remission.[9]
At some stage thereafter, the husband married Ms F.
In 2011, the wife sought legal advice about finalising the parties' property division, however, after some limited correspondence, the matter went no further.
On an unknown date, the husband was charged with sexually abusing either the third or fourth respondent.
In mid-2016, in anticipation of a possible compensation order, a Judge, of the County Court of Victoria, made an order, pursuant to section 16 of the Confiscation Act 1997 (Vic), restraining the parties from dealing with D Street ("the restraining order").
In 2016, the wife was notified that a caveat was placed over D Street by Victoria Legal Aid ("VLA"), who were representing the husband in his criminal matters. The wife's evidence is that she sought advice at the time about the caveat, but that she could not recall what, if any, action was taken.
In early 2017, the husband was convicted of sexually abusing either the third or fourth respondent and sentenced to a lengthy term of imprisonment.[10]
In late 2018, a Judge, of the County Court of Victoria, made a compensation order under the Sentencing Act 1991 (Vic), totalling $180,962.02 ("the compensation order"), which was made up as follows:
[5]
(1) The first applicant in the compensation application was awarded $87,312.02;
(2) The second applicant in the compensation application was awarded $48,450;
(3) The third applicant in the compensation application was awarded $45,200.[11]
[6]
On 23 June 2023, the solicitor for the Fosters wrote to the wife advising her of the compensation order and proposing that D Street be sold, and the proceeds divided equally between the wife and the Fosters to satisfy the compensation order.[12]
On 4 December 2023, the wife initiated these proceedings in this court, the Federal Circuit and Family Court of Australia (Division 2).
[7]
The wife relied upon the following documents:
her application for final orders filed 4 December 2023;
her affidavit filed 4 December 2023;
her financial statement filed 4 December 2023;
the affidavit of Mr Nathan Young ("Mr Young"), her solicitor, filed 7 May 2025;
her outline of case filed 13 May 2025; and
her written submissions filed 13 May 2025.
The husband relied upon the following document:
his submitting noticed filed 22 January 2025.
The Fosters relied upon the following documents:
their response to final orders filed 23 July 2024;
their outline of case filed 13 May 2025; and
their written submissions filed 14 May 2025.
[8]
Section 140 of the Evidence Act 1995 (Cth) sets out that the standard of proof in these proceedings is to a balance of probabilities. The party alleging the fact bears the burden of proving it.[13]
The matter proceeded in person at the Dandenong Registry with the husband appearing via video link from prison, in Victoria. The parties gave evidence and were cross-examined. The Fosters had not filed any evidence and were accordingly not required for cross-examination.
Both the Office of Public Prosecutions ("the OPP") and VLA have been put on notice of these proceedings and served with the orders sought, and neither organisation has chosen to intervene.
In terms of the evidence, I was of the view that the wife endeavoured to give her evidence in a truthful manner. Although she struggled to remember details of events, this was hardly surprising given that most of the events that she was asked about occurred many years ago, and that for a portion of this time, she was extremely unwell.
Notwithstanding that the husband had not filed any affidavit material, both counsel for the wife and the solicitor representing the Fosters, wished to cross-examine the husband. It was ultimately agreed that the husband's evidence in chief would be limited to three statements made by the husband. Those statements ("the three statements") were as follows:
[9]
(1) that the husband told the County Court that he had no equitable interest in D Street;
(2) that the husband wrote to the wife's solicitor saying that he had no equitable interest in D Street; and
(3) that the husband told Judicial Registrar Litterick on 24 April 2025 that he had no interest in D Street.
[10]
The solicitor representing the Fosters also sought an order, that despite being a party in the proceedings, the husband not be able to hear the wife give her evidence. The Fosters' concern was that in circumstances where the husband was not going to receive any benefit from the applications before the court, that he would be more likely to support the wife than have the property sold to satisfy the compensation order. In my view, there was merit in this concern, and given the husband had filed a submitting notice, I determined it was not unjust to treat him like any other witness.
In the end, any concerns that the husband would merely be a "yes man" for the wife were not borne out. Despite being aware of the wife's version of events via her affidavit, the husband refuted several key assertions made by the wife. Furthermore, notwithstanding that at the commencement of his evidence the husband adopted the three statements put to him by the court, which became his evidence in chief, only a short time later he said he was unsure if those statements were in fact correct, and that he could not remember giving that evidence. In addition, the husband repeatedly asserted that he had problems with his memory and labelled himself as "psychotic and diabetic," which he said impacted his memory. Whilst the court is discouraged from making broad credit findings based on isolated untruths, this is a case where it was evident that the husband's evidence was wholly unreliable. As such, where the wife's evidence is in conflict with that of the husband, I prefer the evidence of the wife.
However, that is not to say that I accept the wife's evidence in its entirety. As previously discussed, she too struggled to recall events. Accordingly, where possible I have endeavoured to rely on corroborating documentation, although this was unfortunately limited due to the passage of time and the husband's failure to provide financial disclosure, or to otherwise file any evidence in this matter. I was however assisted, by the evidence of the wife's solicitor, Mr Young. Mr Young was not required for cross-examination and accordingly his affidavit went into evidence unchallenged.
[11]
(1) In proceedings between the parties to a marriage with respect to existing title or rights in respect of property, the court may declare the title or rights, if any, that a party has in respect of the property.
(2) Where a court makes a declaration under subsection (1), it may make consequential orders to give effect to the declaration, including orders as to sale or partition and interim or permanent orders as to possession.
[12]
Counsel for the wife sought a declaration that the wife had a 100 per cent interest in the D Street property based on a constructive trust.
In Sivritas v Sivritas[2008] VSC 374 at [128], Kyrou J explained the different categories of constructive trust:
[13]
128. There are different categories of constructive trusts. One category involves contributions to property or to a relationship, including in a family context by the non-legal owner of the property. Such a constructive trust has its basis in preventing a person from unconscionably asserting his or her legal rights to property. I will refer to this species of constructive trust as a "Muschinski v Dodds constructive trust".
129. A Muschinski v Dodds constructive trust arises:
[14]
... where the substratum of a joint relationship or endeavour is removed without attributable blame and where the benefit of money or other property contributed by one party on the basis and for the purposes of the relationship or endeavour would otherwise be enjoyed by the other party in circumstances in which it was not specifically intended or specially provided that that other party should so enjoy it. The content of the principle is that, in such a case, equity will not permit that other party to assert or retain the benefit of the relevant property to the extent that it would be unconscionable for him so to do ...
[15]
130. In rejecting the notion that a constructive trust will be imposed in accordance with idiosyncratic notions of what is just and fair, Deane J in Muschinski acknowledged that general notions of fairness and justice are relevant to the traditional concept of unconscionable conduct, this being a concept which underlies fundamental equitable concepts and doctrines, including constructive trusts. His Honour said that equity operates upon legal entitlement to prevent a person from asserting or exercising a legal right in circumstances where the particular assertion or exercise of it would constitute unconscionable conduct. He also noted that:
[16]
... the extent to which the relevant principle of equity operates to qualify legal entitlement is only that to which it positively appears that it would be unconscionable for one party to assert or retain the benefit of property contributed by the other party.
[17]
131. Muschinski was applied by the High Court in Baumgartner v Baumgartner, in a case in which the parties had pooled their earnings for the purposes of their joint relationship where one of the purposes of that relationship was to secure accommodation for the parties (who were in a de facto relationship) and their child. Their contributions, financial and otherwise, to the acquisition of land, the building of a house, the purchase of furniture and the making of their home, were on the basis of, and for the purposes of, that joint relationship. The court held that, in this situation, the appellant's assertion, after the relationship had failed, that the relevant property, which was financed in part through pooled funds, was his sole property, amounted to unconscionable conduct which attracted the intervention of equity and the imposition of a constructive trust at the suit of the respondent.
...
134. The "common intention constructive trust" is another species of constructive trust. It is different from a Muschinski v Dodds constructive trust, but will often arise in similar circumstances. A common intention constructive trust will arise where there is an actual or inferred common intention of the parties as to their entitlements to the beneficial interest in the property, and there has been detrimental reliance on that common intention by the claimant such that it would be an equitable fraud on the claimant to deny his or her interest in the property. The onus of proving the parties had a common intention lies on the party asserting the property is held on trust for his or her benefit.
(Citations omitted)
[18]
As was confirmed in the case of Marley & Ormonde[2021] FamCA 105, for there to be a common intention constructive trust, the parties must have "an actual common intention" at the time of the acquisition of the property. It was conceded for the wife, that it would be difficult to conclude on the evidence that the parties had such a common intention.
However, it is evident that a constructive trust may still be imposed to prevent a party from enforcing a right where it would be unconscionable for them to do so. As was set out in Alderuccio v Alderuccio[2019] VSC 404, (at [39] - [40]):
[19]
39. A constructive trust may be imposed upon a legal entitlement to property in order to prevent a person from asserting or exercising his or her legal right in respect of that property in circumstances where the particular assertion or exercise of it would constitute unconscionable conduct.
40. Authority has existed for a very long time for the proposition that where an owner of land creates or encourages an expectation in another, that the other will have an interest in the land, and the other acts upon that expectation, then the owner will be compelled to give effect to it. In Sidhu v Van Dyke the High Court reiterated the requirements of proprietary estoppel as analysed in Giumelli v Giumelli:
[20]
In Giumelli v Giumelli , it was said that the category of equitable estoppel that is usually traced back to the decisions in Dillwyn v Llewelyn and Ramsden v Dyson is now a 'well recognised variety of estoppel as understood in equity', which affords relief 'found in an assumption as to the future acquisition of ownership of property ... induced by representations upon which there had been detrimental reliance by the plaintiff'.
[21]
The wife gave evidence, that in or about 2011, a friend advised her to deal with D Street "legally." As such she contacted solicitors and instructed them to start property discussions with the husband. The wife's solicitor commenced corresponding with the husband, including seeking information about his superannuation. The wife's evidence was that the husband then contacted her directly, and threatened that if she pursued the matter she would "regret it," and, he "would not let me keep the [D Street] property."[14] The wife said in her oral evidence she did not take the matter any further at that time, because she was intimidated by the husband, who was "difficult to deal with". She also said she could not afford to go to court, and that there was not any real reason to pursue the matter as he was permitting her to stay in the house. The husband denied making any such threat. However, for reasons already stated, I prefer the evidence of the wife on this issue.
The wife's evidence is that, after 2011, the parties had an informal understanding that they would divide their assets, with the wife keeping the home, and the husband his superannuation and any other property in his possession. The wife said there had been conversations over the years in which the husband had confirmed she could keep D Street. It was put to her that this was a recent invention as it was not contained in her affidavit, however, having heard the wife provide other evidence, and given the husband at all times acted consistently with that assertion, I accept it to be the truth.
The solicitor for the Fosters argued that if the husband was content for the wife to retain D Street, he would simply have proceeded to formalise this arrangement in 2011. However, it is more likely, in my view, that given the wife's solicitors were seeking information about his superannuation, he was concerned the wife may have been seeking a share of his superannuation in addition to the house.
I accept the threat was made by the husband, as stated by the wife, and that it was reasonable for the wife to infer from that threat that if she did not pursue a formal property settlement then she would be permitted to continue to live in D Street and treat it as her own, as she had done for the ten years prior. In keeping with this, from 2011, the wife remained living in D Street and paid all of the outgoings and upkeep on the property from that time. The husband did not visit the property, nor make financial or non-financial contributions to the property after 2011, nor did he ever contact the wife to lay claim to it. At all times, the husband acted in keeping with the wife's understanding that she was the sole beneficiary of the property. The only possible exception to this was the caveat placed over the property by VLA during the husband's criminal proceedings in 2016, however, it is not known if the husband was aware that VLA intended to do this and/or whether VLA established his proprietary interest through other means such as a title search.
[22]
The High Court in Sidhu and Van Dyke[2014] HCA 19 ("Sidhu") stated as follows:
[23]
72. In Amalgamated Investment & Property Co Ltd (in liq) v Texas Commerce International Bank Ltd 77, Robert Goff J said that:
[24]
the question is not whether the representee acted, or desisted from acting, solely in reliance on the encouragement or representation of the other party; the question is rather whether his conduct was so influenced by the encouragement or representation ... that it would be unconscionable for the representor thereafter to enforce his strict legal rights.
[25]
(Emphasis in original)
73.Similarly, in Steria Ltd v Hutchison, Neuberger LJ said that it is sufficient for the representee to show that "the representation was a significant factor which he took into account when deciding whether to [act as he did]." This approach conforms to that taken by the High Court as long ago as Newbon v City Mutual Life Assurance Society Ltd where it was said that the "supposed belief" of the representee as "a contributing cause" of the representee's conduct was a "sufficient connection between the assumption and the position of detriment". It is the view which continued to prevail in Gould v Vaggelas.
(Emphasis added)
[26]
It is apparent from these passages, that the representation need not be the sole reason a party acted, or in this case, desisted from acting. It is clear the wife did not take any further legal action for a number of reasons, including that she could not afford to go to court. However, I accept her main motivation was her belief, based on the husband's threat, that if she did not pursue the matter, she could retain the home for her benefit and that of the children.
Nonetheless, the solicitor for the Fosters argued that the wife did not in fact suffer a detriment, but rather, an advantage, as she was able to live in the home rent free for decades, only paying for minor maintenance, some house insurance, and rates. However, this case has some similarities to the facts in Stamatou & Stamatou[2022] FedCFamC1F 241 ("Stamatou"), in which His Honour Justice McEvoy was asked to consider the issue of estoppel. In that case the wife asserted that her parents in law had promised that she and the husband would be able to retain a property purchased by the parents, provided they paid the mortgage. About six years after the purchase, the parents no longer required the payment of that mortgage. It was argued by the parents in that case that the savings the husband and wife had made in living rent/mortgage free in that home outweighed the expenses they had incurred on the property.
Indeed, Justice McEvoy found that the husband and wife had "benefited greatly from the facility which the husband's parents extended to them for the purchase of the property in 2006, from the discharge in 2013 of the loan obtained for the purchase of the property, and from the preparedness of the husband's parents to have the husband and the wife remain in the property thereafter."[15] Notwithstanding this, His Honour found that "equity requires the husband's parents to vindicate the expectation of the wife that she (and the husband) had acquired an interest in the ...property_._"[16]
In any event, I find the wife did suffer a detriment as a result of the husband's threat, namely she lost the opportunity to litigate a property settlement at a time when she would have had far greater ability to establish the property pool and contributions, by way of evidence. It appears the husband also had substantial superannuation in 2011 (in relative terms), which has since been disposed of, and the wife questions what other assets he had at that time, including what became of the proceeds of N Street. The wife is now in a very difficult position where the husband has failed to participate or provide financial disclosure, and many of the documents that would assist her are not available due to the passage of time. The wife is also disadvantaged by virtue not only of her own memory, but because time would naturally limit the availability and/or utility of calling other witnesses.
In all of these circumstances it would be unconscionable for the husband to now assert that he has a beneficial interest in D Street.
[27]
Having reached this conclusion, and as was confirmed in Sidhu, it is no longer necessary for the court to accord "the minimum relief" required to do justice between the parties. As stated by the High Court in Sidhu at [85]:
[28]
where the unconscionable conduct consists of resiling from a promise or assurance which has induced conduct to the other party's detriment, the relief which is necessary in this sense is usually that which reflects the value of the promise.
(Emphasis added)
[29]
The "promise" or representation, in this case, was that the wife could retain D Street for her own sole benefit. Accordingly, I propose to make the declaration sought by the wife, that she is the beneficial owner of D Street as to 100 per cent.
[30]
Although the solicitor for the Fosters also sought a declaration under section 78(1) of the Act, and urged the court to make consequential orders for the sale of D Street under subsection (2), he also paradoxically submitted that the court did not have the power to make such an order. In support of this submission, the solicitor for the Fosters relied upon the Full Court authority of Akbar & Gandega[2023] FedCFamC1A 174 ("Akbar").
In Akbar, the Full Court held the primary judge erred in expanding the pool, by converting a "chose in action" being a claim against third parties, into a "chose in possession." In this regard, the Full Court said at [23] as follows:
[31]
The power under s 78 of the Act is confined to the use of legal and equitable principles to establish the spouses' existing, not prospective, legal and equitable property interests.
(As per original)
[32]
However, unlike in Akbar, this case does not involve an argument that the pool should be expanded to include assets in the name of third parties. Rather, the court is being asked to make a declaration about existing equitable interests in the property of the parties to the marriage. Having done so, it is my view that section 78(2) of the Act enables the court to make consequential orders in accordance with that declaration.
For completion, I have considered whether the wife would be statute barred from bringing an action for a declaration under section 78(1) of the Act, given the provisions of section 8 of the Limitations of Actions Act1958 (Vic). Justice Wilson in Emerald & Emerald[2023] FedCFamC1F 183 ("Emerald") discussed the issue of applying for equitable relief out of time. In such circumstances, the court must consider the reason for the delay in bringing an action, and whether they acquiesced to the situation. In regard to acquiescence, his Honour said in Emerald at [146]:
[33]
The authorities make clear that acquiescence depends on knowledge, capacity and freedom, that is to say -
[34]
(a) in respect of knowledge, a person cannot be said to acquiesce unless he or she is fully cognisant of his or her right to dispute a claim;
(b) in respect of capacity, there can be no acquiescence if a person is under a disability; and
(c) in respect of freedom, a person does not acquiesce while he or she is subject to such circumstances or undue influence or other pressure as to deprive him or her of the ability to give true consent.
[35]
I am firstly not satisfied the wife understood she had limited time in which to bring an application for a declaration. However, even if she had that knowledge, I accept her capacity to bring an application was reduced by her ill health, her responsibilities as the primary carer of the children (with little or no assistance from the husband) and her financial situation. Furthermore, when the wife attempted to resolve the matter, she was threatened by the husband.
In addition, the Fosters did not object to a declaration being made out of time and indeed sought a declaration themselves. For these reasons, the wife should be allowed to bring her action regardless of any bar imposed by statute.
[36]
Alteration of property interests under section 79 of the Act
[37]
In the event I have erred in making the declaration under section 78(1) of the Act, and/or the consequential orders under section 78(2) of the Act, I shall now consider whether it would be just and equitable to alter the parties' interests in property under section 79 of the Act.
Section 44(3) of the Act requires a party to file for an alteration of property interests, under section 79 of the Act, within one year of divorce. The parties divorced in 2004, and therefore the wife who filed in 2023 was about 18 years out of time. A party may, however, bring an application out of time with leave of the court, or with the other parties' consent, which is the situation in this case.
The wife seeks in her application pursuant to section 79 of the Act, orders including that the husband transfer D Street into her name. The husband submits to the orders of the court. The Fosters have no standing to bring a section 79 application in their own right, although, their interests must be taken into account pursuant to section 75(2)(ha) of the Act.
As the final hearing of this matter took place in May 2025, all references in this judgment to legislation are references to the version of the Act prior to its amendments, which commenced on 10 June 2025.
Section 79(1) of the Act authorises the court to make such orders between the parties as it considers appropriate. Section 79(2) of the Act states that the court cannot make an order for property settlement, unless it is just and equitable to do so.
Full Court authorities have identified a four-step process to assist the court in reaching a just and equitable decision.[17]
The court must first identify the parties' legal and equitable interests in the assets arising from their relationship, as well as their liabilities. The court should then assess each party's contributions during the relationship in accordance with sections 79(4)(a) to (c) of the Act (as it then was).
The third step requires the court to consider the factors set out in sections 79(4)(d) to (g) of the Act, including the "future needs" factors identified in section 75(2) (as it then was). The court should then consider its findings, and what order, if any, is just and equitable.
The Full Court in Bevan & Bevan[2013] FamCAFC 116 at [86], made it clear that the four-step process is not legislatively mandated. Rather, it provides a structure to ensure that a property settlement order is only made when the court is satisfied that it is just and equitable to do so, and that the terms of the order itself are also just and equitable.
[38]
The wife is in the difficult position of having to prove the current asset pool without any disclosure from the husband. As best she can establish the existing assets and liabilities are as follows:
[39]
It was conceded for the Fosters that the compensation order should not be treated as a debt of the marriage and should be excluded from the pool. This was a reasonable concession given the debt was incurred 14 years after the divorce and had no causal connection to the marriage, with the wife neither knowing about the liability nor having any involvement in the circumstances in which it arose.[24] In this regard, I note the comments of Evatt CJ In The Marriage of PrinceGeneral Credits Australia Limited (Intervener); AG For The State of Queensland (Intervening); AG For the Commonwealth of Australia (Intervening)[1984] FamCA 7; (1984) 9 FamLR 481at [486]:
[40]
Of course, the court cannot ignore the fact that there is or may be a liability; the effect is simply that it does not consider that the other spouse should be called upon to in effect "contribute" to the liability by having that spouse's fair share in the parties' property reduced by virtue of its existence. The effect may be that the party who has incurred the liability will be left to meet it out of whatever funds remain to that party after the satisfying the property order made under section 79 ...[25]
(As per original)
[41]
Consequently, the compensation order will not be included in the asset pool, although its existence will be taken into consideration as part of the court's assessment under section 75(2) of the Act. I shall return to this shortly.
For the same reasons, the loan obtained by the wife for her legal fees will also be excluded from the pool.
Accordingly, I find the asset pool available for division between the parties to be as follows:
[42]
Is it just and equitable that an order be made?
[43]
Having identified the parties' assets and liabilities, as per the High Court decision of Stanford v Stanford[2012] HCA 52 ("Stanford"), I must now determine whether it would be just and equitable to make an order altering that interest pursuant to section 79 of the Act.
Although the husband does not oppose his interest in D Street being transferred to the wife, the court must still be satisfied that such an order is indeed just and equitable in all the circumstances of the case.
In Stanford, their Honours, in the joint judgment of French CJ, Hayne, Kiefel and Bell JJ, considered the expression "just and equitable" at [36] and noted that it:
[44]
... is a qualitative description of a conclusion reached after examination of a range of potentially competing considerations? It does not admit of exhaustive definition. It is not possible to chart its metes and bounds.
(Citations omitted)
[45]
As expounded by Strauss J in the Full Court decision of Ferguson & Ferguson[1978] FamCA 70, that section 79(2) of the Act "is directed to both the questions whether an order should be made at all, and what the order should be, if one is made."
In this matter, where the parties' have a property in joint names and the parties have each made various contributions to the property, I find that it is just and equitable to make an order. As to what order is just and equitable, this will ultimately be determined after the considerations in section 79(4) of the Act.
Section 79(4) of the Act (as it then was) states as follows:
[46]
In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(a) the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last - mentioned property, whether or not that last - mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last - mentioned property, whether or not that last - mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c) the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d) the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
(f) any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
[47]
Section 75(2) of the Act (as it then was) sets out the following factors to be taken into consideration when assessing the parties "future needs":
[48]
(a) the age and state of health of each of the parties; and
(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c) whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d) commitments of each of the parties that are necessary to enable the party to support:
[49]
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
[50]
(e) the responsibilities of either party to support any other person; and
(f) subjection to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
[51]
and the rate of any such pension, allowance or benefit being paid to either party; and
(g) where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha) the effect of any proposed order on the ability of a creditor of a party to recover the creditor's debt, so far as that effect is relevant; and
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k) the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l) the need to protect a party who wishes to continue that party's role as a parent; and
(m) if either party is cohabitating with another person the financial circumstances relation to the cohabitation; and
(n) the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party; and
[52]
(naa) the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
[53]
(i) a party to the marriage; or
(ii) a person who is a party to a de facto relationship with a party to the marriage; or
(iii) the property of a person covered by subparagraph (i) and of a person by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p) the terms of any financial agreement that is binding on the parties to the marriage; and
(q) the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.
[54]
In determining this matter, I have taken into account each of the factors listed in sections 79(4) and 75(2) of the Act, albeit I may not specifically refer to each one.
[55]
In considering what orders are to be made pursuant to section 79 of the Act, as set out in Aleksovski & Aleksovski[1996] FamCA 111 ("Aleksovski") at [50], I must:
[56]
...weigh and assess the contributions of all kinds and from all sources made by each of the parties throughout the period of their cohabitation and then translate such assessment into a percentage of the overall property of the parties or provide for a transfer of property in specie in accordance with that assessment.
(As per original)
[57]
In Aleksovski at [90] his Honour Kay J said:
[58]
The Judge must weigh up various areas of contribution. In a short marriage, significant weight might be given to a large capital contribution. In a long marriage, other factors often assume great significance and ought not be left almost unseen by eyes dazzled by the magnitude of recently acquired capital... What is important is to somehow give a reasonable value to all of the elements that go to making up the entirety of the marriage relationship.
(As per original)
[59]
Those observations were quoted by the Full Court in Dickons & Dickons[2012] FamCAFC 154 ("Dickons") at [21], which noted that "...the requirements of the section are met by approaching the assessment of contributions holistically..." by analysing the contributions of all types and does not require "over-zealous" attention to the ascertainment of contributions nor the "the performance of a mathematical or accounting exercise," at [25].
[60]
The parties commenced their relationship in 1984. The wife does not appear to have had any assets at the commencement of the relationship. I note at that time, that she was only 21 years of age.
The wife believes the husband came into their relationship with some superannuation, however, there is no evidence as to how much he had at that time. Although the husband had been working for a number of years prior to the commencement of the relationship, as was pointed out by the solicitor advocate for the Fosters, compulsory superannuation did not come into effect until 1992. In any event, it is not possible to quantify the husband's contribution in this regard.
[61]
In terms of day-to-day contributions, the parties appear to have adopted fairly traditional roles during their relationship, with the wife taking care of the home and the children (including the husband's children from his former marriage every alternate weekend),[31] and the husband being the primary income earner. On the evidence the parties appear to have contributed on a day-to-day basis to the best of their abilities.
In about 1989, the wife was gifted J Street. There is no evidence of the value of J Street when it was gifted. However, it is reasonable to conclude that given the parties subsequently obtained a loan of $75,000 to build a home on it in 1990, and the entire property sold for just $128,000 a little over ten years later, that the land had a fairly modest value. It nonetheless constituted a "springboard" of sorts which can be traced to the current property pool.
On the wife's evidence, it seems that in about 1995, the husband received the redundancy payment. The wife says that in 1995, some of those funds were used to pay out the small amount left on the J Street mortgage, to buy two motor vehicles, and to purchase the N Street property for $38,000.[32]
The wife says she does not otherwise know what the husband did with the remainder of the redundancy payment.
Whilst the husband's contribution, by way of his redundancy, was on the face of it quite substantial, there is no evidence as to how much of that payment was accumulated during the relationship. This is important because to the extent that the husband accrued the entitlement during the relationship, the wife made an indirect contribution to the redundancy through her role as homemaker and carer of the children, thus enabling him to work.
Furthermore, due to the husband's failure to file evidence or provide disclosure, there is no evidence as to what the remainder of the redundancy payment was spent on. On the wife's evidence, even allowing for the payout of the J Street mortgage, the purchase of two vehicles, and the purchase of N Street, there appears to be a substantial amount unaccounted for. It is therefore not possible to assess with any certainty the husband's contribution by way of his redundancy payment.
[62]
It was submitted by the solicitor for the Fosters that post-separation the parties maintained the same roles they did before the separation, with the wife continuing as homemaker and carer of the children, and the husband providing financial support. However, on the evidence the husband moved interstate, spent no overnight time with the children, and provided only minimal financial support by way of payments on the mortgage.
The wife's evidence is that at separation the husband moved to Sydney (and thereafter to Melbourne), and that she was left seriously ill, with the sole care of the parties' three children, and her only income being a single parent pension.[33] (Although, I do note that the wife was later able to obtain employment including working for the hospitality sector).[34] The children were aged 14, 12 and six years at separation, and the wife's evidence is that although the husband would visit the children from time to time, they were never in his care.
The only additional support the wife received from the husband were payments on the mortgage over D Street. The husband's evidence was that he paid child support on top of the mortgage. It is unclear if there was ever a child support assessment in place. The husband gave evidence that he believed there was. The wife made reference in her oral evidence to "going to child support_,_" and the husband paying the mortgage in lieu of same. For reasons already given, I prefer the evidence of the wife, that the sole payments the husband made were to the mortgage. The wife does not know precisely when the mortgage was paid out, only that she knows it occurred by 2016. The husband says it was paid out by 2010. Given this was an admission against interest I accept that evidence of the husband. As such, I find that the husband stopped making any payments to assist the wife and children when the youngest child, Mr L, was only 16 years of age.
Furthermore, it is evident that the payments the husband did make on the mortgage would not have been sufficient to meet the costs of the children. On the wife's evidence the redundancy payment was applied to pay out the J Street mortgage in 1995, and therefore when J Street sold in 2001 it would have been unencumbered. The wife's evidence is that the proceeds of J Street, being $128,000, were applied to the mortgage on D Street, which was purchased for $135,000. Even allowing for stamp duty and the costs of purchase, the remaining mortgage would have been of a very modest nature, and the payment instalments over a ten-to-fifteen-year period almost nominal.
It was also argued for the Fosters, in their outline of case, that the wife made no significant contribution to the D Street property post-separation. In that outline it is stated as follows:
[63]
The Applicant Wife has not contributed to the acquisition, conservation and/or maintenance of the assets in any significant way - that is, the mere fact of her residing in the real property of the marriage is not a contribution of any significance. Significantly, the Applicant did not acquire any further assets postseparation.[35]
(Emphasis added)
[64]
However, this fails to recognise the wife's contribution, at the very least, by way of homemaker and sole carer of the children, with the youngest not turning 18 for some 12 years after separation.
I note that section 79(4)(c) of the Act does not make any reference to "the acquisition, conservation and/or improvement of the assets". In addition, the Full Court in Dickons, made it clear there need not be a causal link between a party's contribution and a particular asset.[36]
In any event, the undisputed evidence of the wife is that she was directly responsible for the conservation of D Street. She attests to paying the annual rates on D Street for nearly 25 years; the insurance for about ten years; and for repairs on D Street, such as replacing the hot water service and the toilet cistern. She says she also maintained the garden. The wife gave further oral evidence that she would make the mortgage payments from time to time, when she received correspondence from the bank. However, whilst I find these were direct contribution by the wife, I take into account that the wife had the benefit of living mostly rent and mortgage free in the home, for the majority of that time.
[65]
Taking into account the myriad of contributions in this case,[37] I find the wife made the overwhelming contribution to the assets available for division, and that based on her contributions, she should receive 75 per cent of the pool.
[66]
Section 75(2)(a) - Age and health of the parties
[67]
The wife is 62 years of age and the husband 70 years old.
The wife's oral evidence was that she continues to suffer from migraines, exhaustion and lymphoedema (swelling), as a result of treatment for her illness. She says further that her arm does not function properly as a result.
[68]
Section 75(2)(b) - Income, property and financial resources
[69]
The wife works casually as a cleaner and earns about $850 per week.[38]
If the wife receives 75 percent of the known asset pool, she will have assets totalling $344,360.25. This includes very limited superannuation. The wife is, therefore, likely to be reliant on a government pension in her retirement. The wife has also had to obtain a loan to pay her legal fees, which have been unnecessarily inflated due to the husband's failure to provide disclosure in this matter.
The husband is currently in prison, and thus his needs are currently being met by His Majesty's service. The husband believes he is to be released from prison in 2028. If this is correct, he will be about 73 years of age. It is not known if he has any other property or financial resources available to support him, when he re-enters the community. However, he will have a significant debt by way of the compensation order, which I take into consideration.
[70]
Section 75(2)(ha) - the effect of any proposed order on the ability of a creditor of a party to recover the creditor's debt, so far as that effect is relevant
[71]
If the wife is to retain 75 per cent of the assets, this would necessarily impact the amount the Fosters would be able to recover from the husband arising from this property division.
It was argued for the Fosters, that any future needs of the wife should be entirely offset by the impact on the Fosters of being unable to recover their debt. In support of this submission, the solicitor for the Fosters relied upon the case of Trustee of the property of G Lemnos & Lemnos and Anor[2009] FamCAFC 20 ("Lemnos"). However, in that case it was observed at [178]:
[72]
... the trial Judge was required to consider whether such entitlement was outweighed by the quantum of the husband's indebtedness, the identity of the creditor, the manner in which the indebtedness arose and the reality that, on the evidence before him, the wife must have benefited, directly or indirectly, from the husband's non-payment of, at least, his proper primary taxation obligations from 1991 to 2002.[39]
(Emphasis added)
[73]
Lemnos concerned the husband having to repay the Australian Tax Office for benefits he unlawfully received by tax deducting a property in which the parties lived. Albeit the wife may have been unaware of the unlawful actions, the wife had the benefit of the additional income. As already discussed, in this case the debt arose from unilateral criminal acts committed by the husband many years after the marriage came to a conclusion, and from which the wife received no benefit.
I also cannot be certain on the evidence that the husband does not own other property from which he could repay his debt. The Fosters submit that I should infer he simply has no property, however, they have filed no evidence as to any requests made of the husband in this regard nor any attempts they have made to ascertain property in his name, such as real estate and company searches, nor have they issued any subpoenas such as to any financial institutions. Whilst the husband says he has no property, for reasons already stated, I am not able to rely on his evidence alone. Although the wife's solicitor did subpoena the husband's superannuation and a bank account identified in that subpoena, this does not extinguish the possibility that the husband has other assets or bank accounts in his name.
[74]
The wife's solicitors issued subpoenas to the husbands superannuation fund, Super Fund 1, and established that in 2014 the husband withdrew $109,745.98 from his superannuation funds ("the super funds") and deposited it into a bank account in his name. The wife subpoenaed that bank, and established that the funds were deposited on 19 November 2014. Subsequently the husband made the following transactions:
[75]
(a) $90,000 was withdrawn on 20 November labelled 'transfer to HL';[40]
(b) $5,000 was withdrawn on 20 November labelled 'Withdrawal - cash'; and[41]
(c) $10,000 was withdrawn on 21 November labelled 'Transfer to Sav ...93 to Ms F Recovery.[42]
[76]
The husband gave evidence that the funds he withdrew may have gone to a failed business venture, however, he was not cross-examined in any detail about this nor has he provided evidence to corroborate same. It is therefore not possible to determine whether the use of those funds constituted some form of "wastage" of the type identified in Kowaliw & Kowaliw[1981] FamCA 70; (1981) FLC 91-092. Nor can the court be confident that the husband has not retained part or all of those funds or applied them to other assets.
Furthermore, there are questions about what the husband did with various amounts during the relationship. As already discussed, there is no evidence about what became of the remainder of the redundancy payment. In addition, the wife does not know what became of the proceeds of sale of N Street. Whilst the wife says the husband may have applied some of the proceeds to the mortgage on D Street, if this had occurred this would likely have meant that when J Street settled in March 2002, that there would have been no mortgage left on D Street.[43]
In the matter of Weir & Weir[1992] FamCA 69 the Full Court stated:
[77]
It seems to us that once it has been established that there has been a deliberate non-disclosure, which follows from his Honour's findings in this case**, then the Court should not be unduly cautious about making findings in favour of the innocent party**. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature.
(Emphasis added)
[78]
Further, in Kannis & Kannis[2002] FamCA 1150, the Full Court said at [51]:
[79]
Whether the non-disclosure is wilful or accidental, is a result of misfeasance, or malfeasance or nonfeasance, is beside the point. The duty to disclose is absolute. Where the Court is satisfied the whole truth has not come out it might readily conclude the asset pool is greater than demonstrated. In those circumstances it may be appropriate to err on the side of generosity to the party who might be otherwise be seen to be disadvantaged by the lack of complete candour.
By reason of a breach of the duty of disclosure, the uppermost limit of what can be ordered to be transferred to one party in an application under s 79 is the whole of the ascertained property of the parties (Monte).
(Emphasis added)
[82]
I determine, having taken into account the aforementioned factors, that this is a case where the wife ought to receive a further 25 per cent of the pool, bringing her entitlement to 100 per cent of the parties' property pool.
[83]
DETERMINATION: ORDERS THAT ARE JUST AND EQUITABLE
[84]
In order to provide the wife with 100 per cent of the asset pool, I would need to make a superannuation splitting order, such that the husband transfer to the wife all of his known superannuation. However, the husband's superannuation fund has not been accorded procedural fairness, and it is not known whether the fund would permit the splitting of such a modest amount. I further note that the wife does not ask the court to make such an order. Accordingly, the husband shall retain the modest balance of his known superannuation and the wife all other assets, including D Street.
Having determined the wife should receive close to 100 per cent of the known asset pool, I must stand back and consider the real impact of such orders.[44] The primary concern for the court is that such orders do not enable the Fosters to recover from these proceedings any funds to satisfy the compensation order. However, it is my assessment that had the parties settled their property matters in 2011, that it is likely the wife would have been ordered to retain the home, and the Fosters would be in the same position. On a cursory assessment of the situation at that time, and assuming the main assets available for division were D Street (now worth $430,000) and the husband's superannuation (being $109,000 in 2014), this matter involved a small pool. Considering the wife's post-separation contributions to that point, and her ongoing future needs, it was certainly within the range of possible outcomes that she retain the home. On that basis, I find that the orders I propose to make are now just and equitable in all of the circumstances.
Finally, I will make an order pursuant to section 106A of the Act, as sought by the wife, that if the husband fails to sign any documents required to give effect to the transfer of D Street into the wife's sole name, then those documents be signed by the wife's solicitor. The husband did not seek to be heard on these orders and has otherwise failed to participate in any meaningful way in these proceedings noting that he has no real interest in the outcome. In such circumstances, the court can have no confidence he will cooperate in signing the required documents.
I note that both the VLA and the OPP,[45] have been served with a copy of those orders and have not sought to intervene. VLA have confirmed in writing, without being able to comment specifically on this case, that if the court finds a party has no interest in a property over which they have placed a caveat, they will remove the caveat.[46] VLA will therefore be requested to remove their caveat from the real property within 28 days.
For all of the aforementioned reasons, I make the orders as set out at the commencement of this judgment.
[85]
I certify that the preceding one hundred and thirty-four (134) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Jenkins.
[86]
[1] Wife's affidavit filed 4 December 2023 ("wife's affidavit") at [15] - [17].
[87]
[7] Wife's affidavit at [28] and [29] and expanded on in her oral evidence.
[88]
[10] There is no evidence before the court as to which of the respondents were the primary victim as the reasons for the compensation ordered are anonymised. See the affidavit of Nathan Young, solicitor for the wife at annexure "NY-9."
[89]
[11] Again, it is not known which of the Fosters was the first, second and third applicant in those proceedings.
[25]In The Marriage of PrinceGeneral Credits Australia Limited (Intervener); AG For The State of Queensland (Intervening); AG For the Commonwealth of Australia (Intervening)[1984] FamCA 7; (1984) 9 FamLR 481 at [486].
[101]
[26] Valuation of D Street, City E, annexed as "MRQ-1" to the Affidavit of Single Expert Witness Mr Q filed 30 April 2025 at [9].
[102]
[27] Financial statement of the wife filed 4 December 2023 ("wife's financial statement") at [6].