Pryor v Stojanovski

CATCHWORDS : FAMILY LAW - de facto relationship - adjustment of interests of parties in property - respective contributions of parties - significant contributions of Plaintiff as homemaker and parent - Defendant was sole breadwinner, and made all financial and material contributions to relationship - non-compliance by parties with directions for provision of Case Statements

LEGISLATION CITED : Property (Relationships) Act 1984

CASES CITED : Davey v Lee (1990) 13 FamLR 688 Bilous v Mudalia [2006] NSWCA 38

PARTIES : Shannon Pryor (Plaintiff) Jim (Dimce) Stojanovski (Defendant)

COUNSEL : Mr J. Berry (Plaintiff) Ms E. Cohen (Defendant)

SOLICITORS : Shaddick Baker & Paull (Plaintiff) Broun Abrahams Burreket (Defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

4306 of 2008 SHANNON PRYOR -v- JIM (DIMCE) STOJANOVSKI JUDGMENT 1 HIS HONOUR: These are proceedings under the Property (Relationships) Act 1984. 2 The proceedings were instituted by statement of claim filed by Shannon Pryor on 12 April 2007. The Defendant named in that pleading is Jim (Dimce) Stojanovski. By that pleading the Plaintiff claims orders adjusting the interests in property of herself and the Defendant, pursuant to section 20 of the Property (Relationships) Act. 3 The Defendant filed a defence on 13 July 2007 and subsequently an amended defence on 11 August 2008, by which pleadings he opposes the relief sought by the Plaintiff and seeks the dismissal of the Plaintiff's claim. 4 In addition to seeking the dismissal of the statement of claim the Defendant by his amended defence seeks the sale (and the equal division between the parties of the net proceeds of such sale) of the residential property situate at and known as 1/22 Bell Street, South Windsor; and a declaration that the Defendant is the sole legal and beneficial owner of certain expressly identified chattels. 5 The Plaintiff and the Defendant were in a de facto relationship until 6 or 7 March 2007. However, the date of the commencement of that relationship was in dispute between the parties. It was originally asserted by the Plaintiff (in the statement of claim and in her primary affidavit) that the relationship commenced in January 1999, whilst it was asserted by the Defendant that the relationship between the parties commenced in May 2000. In a subsequent affidavit the Plaintiff asserted that the parties commenced to live together in January 1998, whilst in a later affidavit it was the assertion of the Plaintiff that the parties had commenced to live together in late 1996. 6 Two children were born of the relationship, being a daughter, Murphy Hollywood Pryor (who was born in 2000, and is presently aged nine), and a son, Raine Stojanovski Pryor (who was born in 2001, and is presently aged eight). The Plaintiff also has a daughter, O'Neill Rousek Pryor, born of a previous relationship in 1991 (and who is presently aged 18). 7 The Plaintiff was born in 1961, and is presently aged 49. The Defendant was born in 1963 and is presently aged 46. 8 At the time when the parties met (which appears to have been in 1998) the Plaintiff was residing in rented accommodation at 31 Campbell Street, Windsor, with her daughter O'Neill, and was working as the manager of the Jolly Frog Hotel at Windsor (which establishment was owned by the Plaintiff's family). At the time when the parties commenced cohabitation the Plaintiff had only minimal assets, being household furniture, personal items, money in a bank account (in an amount unspecified) and a Ford Capri motor vehicle. 9 At the time when he said that the relationship commenced (being in May 2000) the Defendant owned the following assets: Shops and units in Civic Arcade, Richmond Land at Castle Hill Holden Statesman motor vehicle Porsche Carrera motor vehicle, 1973 model (to which an estimated value of $60,000 was attributed) Items of household furniture Personal items Money in a bank account Jupiters Night Club Shares in NRMA and in AXA Superannuation entitlement 10 It was not in dispute that there was at least one period of separation between the parties in 2006 (the Plaintiff asserting that that separation was for a period from April until early July in that year; whilst the Defendant asserted that the separation was from April to October). The Plaintiff also asserted that there were two short periods of separation in September 2000, whilst the Defendant also asserted that those periods of separation were in August 2000. 11 At the time of the commencement of the relationship the Defendant, who was a property investor by occupation, was residing with his parents at their home in Bankstown. He also rented a room in a townhouse at South Windsor. During the early period of their relationship it was the practice of the Defendant to spend part of each week with the Plaintiff in her rented accommodation in South Windsor. 12 In May 2000, the parties moved into residence at 21 Brabyn Street, Windsor, which the Defendant purchased at about that time for $437,000. That purchase was financed by a mortgage from the National Australia Bank in the sum of about $380,000, which mortgage was secured over that property, and also over a number of shops and units in the commercial complex known as Civic Arcade at 223 Windsor Street, Richmond. The Defendant, subsequently, in July 2005, refinanced the loan over the Brabyn Street property. 13 The balance of the purchase price of the Brabyn Street property was provided from the net proceeds of sale of a property owned by the Defendant in Powys Circuit, Castle Hill, which he sold in May 2000 for $345,000. After the discharge of a mortgage of about $310,500 on that property, the Defendant received net proceeds of sale of about $34,000. The Plaintiff made no financial contribution towards the purchase of the Brabyn Street property. 14 The Brabyn Street property remained the matrimonial home of the parties throughout the entirety of their relationship. At the termination of the relationship, on either 6 or 7 March 2007, the Defendant departed the Brabyn Street property. He has subsequently, in consequence of apprehended violence orders obtained against him at the instance of the Plaintiff, been denied access to that house property. The Plaintiff, together with her children, has remained in residence in the Brabyn Street property to the present time. She does not make, and never has made, any payments towards the outstanding mortgage loan upon that property. Similarly, the Plaintiff has retained possession of a 2002 model Jeep Cherokee motor vehicle, which had been acquired in the name of the Plaintiff. All leasing payments upon that motor vehicle, both during the relationship, and since its termination, have been made by the Defendant. 15 One of the Defendant's assets at the commencement of the relationship was an establishment known as Jupiters Night Club, which the Plaintiff owned through the vehicle of his company Percilija Pty Limited. 16 For a period of about six months before the birth of the parties' first child, Murphy, the Plaintiff performed intermittent work in that nightclub. However, she was not paid a wage for that work. The extent of the work which she performed in the nightclub was disputed between the parties. 17 During the course of the relationship the Defendant participated in a number of real property and business transactions. Each of the properties which he purchased, with one exception, was purchased in the name of the Defendant alone. That exception was the property known as Unit 1, 22 Bell Street, South Windsor, which was purchased in the joint names of the Plaintiff and the Defendant. It was not suggested that the Plaintiff made any financial contribution towards the purchase of that property. Each of the property purchases made by the Defendant during the course of the relationship was funded by loans obtained by the Defendant from various financial institutions (each such loan being secured by way of an appropriate mortgage), together with the Defendant's own personal funds. The Plaintiff made no financial contribution towards any of those property purchases, or towards the meeting of any of the mortgage repayments. 18 During the course of the relationship the Defendant embarked upon an enterprise of selling secondhand reproduction and antique furniture and other items. That business at the outset was conducted from the building known as "The Barn", located within the grounds of the Brabyn Street residence. Subsequently, the business was conducted from commercial premises in George Street, Windor. Despite the Plaintiff's assertions concerning the extent of her involvement in that business, I am satisfied that her contribution towards the business (which was essentially conducted by two paid employees) was minimal. 19 At the termination of the relationship the Plaintiff had the following assets: One half interest in the property situate at and known as unit 1, 22 Bell Street, South Windsor. Minimal account in a bank account Items of jewellery and personal items 20 The Defendant was jointly liable with the Plaintiff in respect to the mortgage upon the Bell Street property. The amount outstanding under that mortgage loan at the termination of the relationship was about $250,000. 21 Somewhat curiously, there was no precise evidence offered as to the assets and liabilities of the Defendant at the time of the termination of the relationship. There was, however, evidence of his assets and liabilities at the time of the hearing of the present proceedings, some two and a half years after the relationship came to an end. 22 But, as I understand it, there was a not any significant difference between those assets and liabilities at the time of the hearing and at the time of the termination of the relationship. 23 It was noted that it was agreed between the parties that Exhibit 6 sets forth the assets of the Defendant at the date of the hearing. Originally, it had been asserted by the Plaintiff that the value of the Brabyn Street property at that date was $750,000, whilst it was asserted on behalf of the Defendant that that value was $600,000 (see joint statement of valuers, Exhibit E). However, by the conclusion of the hearing, it was agreed between the parties that the value of the Brabyn Street property was $675,000 (that value being disclosed in Exhibit 6, and it being stated in that regard that the parties and their respective Counsel had "agreed to split the difference" between the various valuations (T127). Those assets of the Defendant totalled $2,805,031. 24 The liabilities of the Defendant at the time of the hearing (which I understand to be the same as at the time of the termination of the relationship) totalled $1,487,360 (Exhibit 4). 25 It was conceded on behalf of the Plaintiff that she did not make any direct financial contribution to any of the properties (or, as I understand, to the relationship). It was, however, asserted by the Plaintiff that she made indirect financial contributions to the relationship, in that she brought into the relationship assets estimated at about $21,000, and that from time to time she was in paid employment and her income was used for the benefit of the family constituted by the parties and by the three children. Further, the Plaintiff asserted that she made direct non-financial contributions, by giving assistance to the Defendant in relation to the purchases of various properties, by assisting in the maintenance and care of the Brabyn Street property, and by assisting the Defendant in the conduct and management of Jupiters Night Club. Further, that she made indirect non-financial contributions in her role as homemaker and parent. 26 It is in light of the foregoing facts and circumstances that the Court must proceed to a consideration of the claim of the Plaintiff. 27 I have had the benefit of receiving a written outline of submissions and a chronology from Counsel for the respective parties. Those documents will be retained in the Court file. 28 In this regard, I would, however, observe that on 25 September 2009 Associate Justice Macready directed each party to serve a Family Law Case Statement one week before the hearing and to lodge a copy of that document with my chambers. Neither party complied with that direction. No Case Statement was provided on behalf of the Plaintiff until after the commencement of the hearing. A Case Statement on behalf the Defendant was delivered to my chambers on the morning of the hearing. 29 Neither party was able to offer any adequate (indeed, any) explanation for the non-compliance with the direction made by Associate Justice Macready on 25 September 2009. The hearing date of 12 October 2009 had been fixed some six months earlier, on 17 April 2009. 30 The purpose of such directions as those made in the instant case by Associate Justice Macready is to enable the Judicial Officer who will hear the matter to familiarise himself beforehand with the evidence and with the areas of dispute between the parties, so that valuable time in the courtroom (expensive to the parties, and a precious resource of the Court as an institution) can be used to the greatest benefit when the matter comes on for hearing. The conduct of each party, in the total disregard for, and non-compliance with, the directions made on 25 September 2009, thwarted the achievement of that purpose. 31 The jurisdiction invoked by the Plaintiff in the present proceedings is founded upon section 20 of the Property (Relationships) Act, subsection (1) whereof provides:

On an application by a party to a domestic relationship for an order under this Part to adjust interests with respect to the property of the parties to the relationship or either of them, a court may make such order adjusting the interests of the parties in the property as to it seems just and equitable having regard to: (a) the financial and non-financial contributions made directly or indirectly by or on behalf of the parties to the relationship to the acquisition, conservation or improvement of any of the property of the parties or either of them or to the financial resources of the parties or either of them, and (b) the contributions, including any contributions made in the capacity of homemaker or parent, made by either of the parties to the relationship to the welfare of the other party to the relationship or to the welfare of the family constituted by the parties and one or more of the following, namely: (i) a child of the parties, (ii) a child accepted by the parties or either of them into the household of the parties, whether or not the child is a child of either of the parties. 32 In approaching a claim for adjustment of the interests of parties in property pursuant to section 20(1) of the Property (Relationships) Act the Court must make a holistic judgment and must not attempt to evaluate the respective contributions of the parties as if it were undertaking a reductionist process analogous to the taking of partnership accounts (notoriously one of the most time consuming of litigious exercises). (See Davey v Lee (1990) 13 FamLR 688; see also Bilous v Mudalia [2006] NSWCA 38, at [43], where Ipp JA said that some situations do not lend themselves to either a pure global approach or a pure asset by asset approach in determining what orders should be made.) 33 In considering the claim of the Plaintiff the Court should not be diverted from the clear words of the statute, where, by section 20 (1), the Court is required to have regard to the respective contributions of the parties of the nature referred to in that subsection. 34 I have already observed that there was considerable dispute between the parties as to the date of the commencement of the relationship. The Plaintiff gave various dates, 1996, or 1997, or 1998. Under cross-examination, she conceded that she had made a mistake in the date originally asserted by her as the commencement of the relationship (that date being January 1999, which was asserted both in the statement of claim and in her principal affidavit). 35 There was little difference between the assets and liabilities of the parties at each of those various dates, and to that extent a finding as to the date of the commencement of the relationship makes little difference to the outcome of the proceedings. However, such a finding impacts upon the credibility of the Plaintiff. It was quite apparent that the Plaintiff was not a reliable historian. 36 It was the case for the Plaintiff that the de facto relationship commenced while she was residing with her daughter O'Neill in the rented premises at Campbell Street, South Windsor. However, even on the Plaintiff's own account, the Defendant was not spending every night in those premises. (He spent at least one night each week with his parents, and he was also renting a room in a townhouse at South Windsor.) The parties certainly had a sexual relationship at that time. 37 I am not satisfied that the de facto relationship between the parties commenced until they moved into the Brabyn Street property in May 2000, that property remaining their matrimonial home throughout the entirety of the relationship. That conclusion, that the de facto relationship between the parties (as distinct from a social or a sexual relationship) commenced only when they moved into the Brabyn Street residence, is supported by the cessation of the Plaintiff's Centrelink single parent benefits in June 2000. She did not resume receiving those benefits until April 2006, after the termination of the relationship. 38 At the outset of the relationship (whether that be in May 2000 - as I have concluded - or earlier, as asserted by her) the financial and material circumstances of the Plaintiff were minimal. Indeed, under cross-examination it emerged that at that time she had liabilities, being an indebtedness of about $1,000 in respect to her Ford Capri motor car, and outstanding legal fees of at least $6,000 (the Defendant asserted $9,000), both of which liabilities were then paid out by the Defendant. The Plaintiff made no reference in her statement of claim or in her affidavit evidence to those liabilities or to their discharge through the good offices of the Defendant. 39 It appeared that the Plaintiff (under a stage name of Shannon Luka) had been involved in significant proceedings in the Land and Environment Court of New South Wales. In those proceedings she had incurred a very considerable costs liability, which had resulted in bankruptcy proceedings being instituted against her by the Lake Macquarie City Council (which was the opposing party in that litigation). It was apparently in respect to those legal costs that the Defendant at the outset of the relationship paid on behalf of the Plaintiff at least $6,000. 40 Throughout the period of the relationship the Plaintiff was in receipt of very little income from employment, although she was receiving Centrelink family benefits in respect of, first, her daughter O'Neill, and then also of the two children born of her relationship with the Defendant. Those Centrelink payments were used by the Plaintiff for expenses and outgoings for the children and for the household. Essentially, however, all household expenses were met by the Defendant, who also provided the Plaintiff with regular amounts of money, for housekeeping expenses. 41 The extent of the non-financial contributions of the Plaintiff to the relationship was disputed by the Defendant. It was asserted by the Plaintiff that she assisted the Defendant in relation to the purchase and the renting of various pieces of real estate. However, I am satisfied that such assistance was minimal. Evidence from a number of tenants of the Defendant and from a managing estate agent did not support the Plaintiff's claims in this regard. 42 I do not accept the Plaintiff's evidence concerning the extent of her involvement in the conduct and management of Jupiters Night Club. Most of her asserted activities in that establishment were in fact performed by paid employees. The maintenance and care of the Brabyn Street property performed by the Plaintiff was hardly more than that performed by the Defendant. 43 However, it was in the role of homemaker and parent that the substantial contributions of the Plaintiff were made to the relationship. Those contributions, especially as parent to the two children of the relationship and to the Plaintiff's daughter O'Neill, were significant. They considerably outweigh the contributions of the Defendant as homemaker and parent. I do not, however, overlook the orders of the Federal Magistrates Court made in 2007, after the termination of the relationship, by which since then the parties have shared the parenting of Murphy and of Raine. 44 Neither do I overlook the fact that the Plaintiff has had the benefit of continuing to reside in the Brabyn Street property since the termination of the relationship, without making any contributions to the mortgage payments; and, further, that since that termination she has continued to have the use of the Jeep Cherokee motor vehicle, also without making any contributions towards the payments on that vehicle. The foregoing payments on house and on vehicle have all continued to be met by the Defendant. He, although the sole legal and beneficial owner of the Brabyn Street property, has been deprived of his right of occupancy therein, by reason of the AVO obtained by the Defendant. 45 Neither do I overlook the fact that on 12 October 2007, Justice James in the Common Law Division of this Court, in proceedings for possession of the Brabyn Street property brought by the Defendant against the Plaintiff, held that the Defendant was entitled to possession of that property, and that under the general principles of law, there was no defence to his claim for possession. He is the sole registered proprietor of the property. There is no evidence of any lease or licence in favour of the Plaintiff. His Honour considered that there should be judgment for possession of the property in favour of the Defendant. However, His Honour declined at that stage to grant leave for the issue of a writ of possession. 46 The substantive relief originally sought from by the Plaintiff in the present proceedings was for the transfer by the Defendant to the Plaintiff of the Brabyn Street property and 50 percent of the remaining assets (presumably, of the Defendant). Subsequently, she claimed the Brabyn Street property and the Jeep Cherokee motor vehicle, in return for the Plaintiff paying to the Defendant the sum of $100,000 and transferring to the Defendant her interest in the Bell Street property. However, the Plaintiff ultimately sought only orders 7 to 12 in the draft minute of order annexed to the Plaintiff's Case Summary. The effect of those orders was that the Defendant pay to the Plaintiff the sum of $500,000 and transfer to the Plaintiff the Jeep Cherokee motor vehicle, whilst the Plaintiff would transfer to the Defendant her interest in the Bell Street property. 47 As I have already observed, the contributions of the Plaintiff as homemaker and parent were significant and should not be disregarded. They were contributions which extended over a period of some seven years. 48 The contributions of the Defendant were essentially of a financial and material nature. He was the sole breadwinner of the relationship. It was assets which the Defendant already owned before the commencement of the relationship (for example, Jupiters Night Club, and the rental generated from various pieces of real property, already owned by him) or subsequently acquired by him (with little, or minimal, input from the Plaintiff) which provided the income upon which the household largely subsisted throughout the relationship. The matrimonial home was acquired in the sole name of the Defendant, and he was solely responsible for the financing of that purchase. The contributions of the Defendant as homemaker and parent, although considerably less than those of the Plaintiff, were real and material. It should not be overlooked that O'Neill's father paid very little by way of maintenance for her (in amounts fluctuating between $3 and $20 a week), and that otherwise she was totally dependent upon the income of the Defendant. All expenses for clothing, education, and the like, for all three children were met by the Defendant. 49 The Plaintiff had access to the Defendant's creditcard, of which she made use on occasion. 50 It will be appreciated, therefore, that the significant contributions of the Plaintiff to the relationship were confined to her contributions as homemaker and parent. Those contributions were substantial. However, they were to a very large extent offset by the financial and material contributions made by the Defendant. His assets were far greater than those of the Plaintiff both at the commencement and at the termination of the relationship. He was the sole breadwinner and a generous father and parent throughout the relationship. The Plaintiff since the termination of the relationship has had the benefit of residing, without financial contribution by her, in the Defendant's Brabyn Street property, and has had the benefit of using, again without financial contribution by her, the Defendant's Jeep Cherokee motor vehicle. 51 I consider it appropriate that relief be granted which will recognise the respective contributions of the Plaintiff as homemaker and parent and of the Defendant by way of significant financial and material contributions and as the sole breadwinner of the household. In my conclusion such relief requires that the Plaintiff transfer to the Defendant her interest in the Bell Street property, that the Plaintiff retain the Jeep Cherokee motor vehicle, and that the Defendant pay to the Plaintiff a sum of $50,000 within a specified period. (The Defendant will thereupon be entitled to immediate possession of the Brabyn Street property.) 52 There remains the matter of the various chattels which were in the Brabyn Street property at the time of the termination of the relationship. 53 It was the case for the Defendant that the Plaintiff had improperly abstracted a considerable quantity of chattels belonging to the Defendant. There is no doubt that the Plaintiff, quite unlawfully, gained control of and access to the contents of the Defendant's filing cabinet, and copied a considerable quantity of the Defendant's personal and business documents and records, without his authority. The Plaintiff occasioned great inconvenience, and no doubt considerable expense, to the Defendant by that improper conduct. 54 Further, I am not at all persuaded by the Plaintiff's evidence that the totality of the chattels in her possession are in fact owned by her. The Defendant, by paragraph 3 (c) in his amended defence, lists 38 specific chattels, as well as the contents of "The Barn", of which he claims to be the sole legal and beneficial owner. He seeks a declaration to that effect. Those chattels, or many of them, appear still to be in the possession of the Plaintiff. 55 If the parties cannot agree upon the ownership of those chattels, it will be necessary for the Court to determine, in respect to each individual item, which party is the owner. Such a process will, of course, be both protracted and expensive. 56 I have not heard any argument as to costs. My foregoing conclusion regarding the substantive relief is far less favourable to the Plaintiff than any of the outcomes that she was seeking (being originally the transfer to her of the Brabyn Street property, as well as 50 per cent of the remaining assets; or, subsequently, that the Defendant transfer to the Plaintiff the Brabyn Street property and the Jeep Cherokee motor vehicle, in return for payment by the Plaintiff to the Defendant of $100,000 and the transfer to the Defendant of the Plaintiff's legal interest in the Bell Street property; or, finally, that the Plaintiff retain the motor vehicle, transfer to the Defendant her interest in the Bell Street property, and that the Defendant pay to the Plaintiff the sum of $500,000). 57 In the light of my foregoing conclusions, I consider that there should be no order as to costs, to the intent that each party should bear her or his own costs of the proceedings. However, should either party desire some other costs result, then an opportunity will be given to that party to be heard regarding costs. 58 Accordingly, unless within seven days of the date hereof, either party arranges with my Associate for the matter to be listed for argument as to costs, I make the following orders: 1. I order that the Defendant pay to the Plaintiff by way of property settlement pursuant to section 20 of the Property (Relationship) Act 1984, the sum of $50,000 on or before 26 March 2010. 2. I order that the Plaintiff sign all documents and do all things necessary to effect the transfer to the Defendant of her interest in the property situate at and known as Unit 1, 22 Bell Street, Windsor. 3. I order that the Defendant sign all documents and do all things necessary to effect the transfer to the Plaintiff of any interest he may have in 2002 Jeep Cherokee wagon registered number ARQ47A. 4. I order that simultaneously with the payment by the Defendant to the Plaintiff of the aforesaid sum of $50,000 the Plaintiff vacate the property situate at and known as 21 Brabyn Street, Windsor. 5. I order that it be referred to Registrar to inquire into and determine the ownership of the items of property referred to in paragraph 3 (c) of the amended defence, and, upon such inquiry, that such of those items as are determined to be owned by the Defendant be forthwith delivered up to the Defendant by the Plaintiff, and that the costs of any such inquiry be decided by the Registrar. 6. That otherwise than as provided in these orders, and as between the parties, pursuant to section 8 of the Property (Relationship) Act 1984, (a) each party be declared to be the sole and beneficial owner of all that realty and personalty presently in that party's possession or control; and (b) each party be declared to be solely responsible for any liability, (i) standing in the name of that party; or (ii) attaching to any of the realty or personalty referred to in paragraph (a) of this order. 7. Subject to order 5, I make no order as to costs, to the intent that each party shall bear her or his own costs of the proceedings. 8. I reserve to the parties liberty to apply in respect to the implementation of these orders. 9. The exhibits may be returned.

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