Shinohara & Shinohara [2025] FedCFamC1A 126 | Case summary

Shinohara & Shinohara [2025] FedCFamC1A 126 | Case summary | Zoe

[61]

By way of an Amended Notice of Appeal filed on 26 May 2025, Ms Shinohara ("the mother") appeals from Orders 1 to 39 inclusive regulating the parenting of children aged six and four years of age and from Orders 40 to 55 inclusive adjusting property made by a judge of the Federal Circuit and Family Court of Australia (Division 1) on 31 March 2025. During the hearing of the appeal, the mother restricted the property appeal to challenge Orders 40 and 41.
Mr Shinohara ("the father") opposed the appeal. The Independent Children's Lawyer ("the ICL") opposed the parenting appeal.
At trial, as to parenting, dispute existed as to parental responsibility and major long-term decision-making, with whom the children will live and the terms as to the time the children will spend with the other parent. The primary judge found (at [18] and [108]-[110]) that the totality of the psychiatric, psychological and other evidence concluded that the mother poses an unacceptable risk to the safety of the children by reason of her mental health challenges and vulnerabilities when stressed.
The parenting orders subject to challenge provide for the father to have sole parental responsibility and decision-making for the children and for them to continue to live with him. They provide for the children to spend time with the mother on each Wednesday evening and on alternate weekends from Friday after school until Sunday evening. The terms of increasing time spent by the children with the mother is then tethered to the mother attending on a clinical psychologist with expertise in the field of trauma and trauma response for trauma focused cognitive behavioural therapy regularly (no less than once each fortnight) for treatment of her mental health challenges and the adverse effects of stress. Compliance with the treatment orders produces a progression of the terms of time spent with the children to be then overnight each alternate Wednesday, and then to overnight from each alternate Wednesday until Friday, in addition to alternate weekends. It also provides at or about the time of completion of the treatment regime for block time during the school holidays from when the younger child attains six years of age.
As to property adjustment, at the conclusion of the trial, the mother and the father agreed that it was just and equitable for their superannuation entitlements to be adjusted, with a splitting order made of $69,483 from the father's entitlements in favour of the mother (at [121]), providing for the mother to receive roughly 47 per cent of the superannuation property of the parties and for orders that each would otherwise retain their respective other current property of modest value in their possession or control (at [150] and [154]). The agreed values of these items were $21,090 held by the father and $6,386 held by the mother. The mother abandoned her challenges to these consensual orders during the hearing of the appeal.
The disputed property adjustment at trial and on appeal was as to the distribution of the balance of proceeds of sale of the home of $589,155 (at [125] and [133]) and as to whom between the parties would assume responsibility for a liability of $21,994.89 due to Centrelink by way of a childcare subsidy debt ("the Centrelink debt") in the name of the mother (at [155]-[157]).
The mother at trial sought that the $589,155 be adjusted as $400,000 in her favour and the balance equally divided, such that she would receive $494,577.50 and the father would receive $94,577.50. The father sought for the balance of the proceeds of sale of the home to be divided equally, so that each of he and the mother would receive $294,577.50. As to the Centrelink debt, the mother sought that this be paid by the parties with contributions proportionate to the parties' respective incomes. The father sought that the Centrelink debt be paid from the proceeds of sale of the home prior to any distribution to the parties.
Order 40 divided the proceeds of sale of the home equally. Order 41 directed that the parties be equally liable for and pay the Centrelink debt.
For the reasons that follow, the appeal from the parenting orders will be dismissed. The appeal from Orders 40 and 41 will be allowed, with this court re-exercising discretion so that the balance of proceeds of sale of the home of $589,155 will be adjusted such that the mother will receive $409,840 and the father will receive $179,315. An order will be made that the father pay to the mother $115,262.50 within 28 days. By consent, the father is to pay to the mother 50 per cent of the Centrelink debt upon the mother serving him with documents verifying the amount she has paid to discharge that debt.

[62]

The mother is 42 years of age. The father is 40 years of age. The parents commenced cohabitation in or around late 2016 or 2017, the precise date not being material, married in October 2018 and separated in February 2023.
On separation the father obtained a family violence intervention order excluding the mother from the home. The parties' two children have lived with him since that time.
Following the making of the family violence intervention order, the mother spent time with the children for four hours each week supervised by the maternal grandfather and had electronic communication with the children on three occasions during each week. From June 2023, time was supervised by a professional agency.
A large volume of evidence was adduced as to the mother's mental fabric, including as to her thoughts, associated emotions and behaviours being vastly disproportionate to perceived stressors or unsupported by reality. The reasons record:
1. One of the major issues in this litigation was the mother's mental health and the risk of harm she posed to the children, especially to their emotional and psychological wellbeing by reason of the mother's mental health history and personality vulnerabilities.
2. It was undisputed that the mother's interactions with her father in her youth were difficult. Various sources of evidence disclosed that the mother's father was a dominating and domineering influence on the mother over many years.
3. The evidence in this trial revealed episodes where the mother's reaction to seemingly innocuous events caused the father to become concerned about the mother's mental health. One involved the mother forming the belief that an unidentified male, thought to live near the home where the mother, the father and the older child then lived, was behaving inexplicably by being frequently outside the mother's place of residence. Another involved the mother reporting that she heard noises being emitted from electric cables resembling morse code about which reports the father became concerned. In addition to other episodes which the father considered to be very concerning, the father obtained an intervention order against the mother, the effect of which was to restrain the mother from being physically present or proximate to him and the children. The mother was thereby forced to leave the former matrimonial home.
4. The evidence of the connection between the children's behavioural issues and the mother in the years 2021, 2022 and 2023 was not straight forward. The older child progressively exhibited behaviour described in the medical evidence in this case as "stimming", most simply expressed as a self-soothing pattern of conduct exhibited by a person in highly stressed circumstances by which the affected person attempts, without being aware of the relevant stimming conduct, to reduce the impact of stress on the person. In certain aspects of the psychological evidence in this case, the stimming behaviour was described as being exhibited when the affected person is in a trance-like state.
5. The younger child exhibited behaviour from an early age that included bed wetting. The mother disputed that any connection existed between her conduct towards the children and the behavioural traits exhibited by the children.
6. A major issue in this litigation was the safety of the children in the mother's care having regard to her own mental health issues.
7. No mental health issues were asserted against the father.

[76]

The only witness who gave evidence at trial by way of an affidavit annexing a report as to the mother's mental fabric who was not cross-examined, and hence their evidence was unchallenged, was Ms LL.
The reasons (at [18]) record that the primary judge considered all the psychiatric and psychological evidence, and hence the evidence of Ms LL. During the appeal hearing, the mother was unable to engage with this proposition, nor could she support the gravamen of her complaint that there was no reference to Ms LL's evidence in the reasons. The evidence of Ms LL was identified.
Further, "consider" does not mean that all evidence must be discussed, especially when the bulk of the evidence leads inexorably to the conclusion, as was the case here. The comprehensive identification and evaluation of the clinical and forensic expert evidence of Dr M, Ms G and Dr F led to intermediate findings:
1. On considering the totality of the medical evidence in this case, it is apparent from Dr [M] that the mother is continuing to make significant improvements in her treatment for her mental health issues. Dr [M]'s expression of optimism will no doubt provide a degree of reassurance about the benefits of ongoing psychological treatment to which the mother must subject herself. However, the steps yet to be undertaken by the mother call for immense dedication. On Dr [F]'s formulation, fortnightly sessions are required and are not-negotiable precursors to any enlargement of the mother's time with the children.
2. A matter that has weighed heavily with me is [Ms G]'s observation that the vulnerabilities affecting the mother may never leave the mother so an ever-present risk exists that the mother's mental health could deteriorate if the mother is adversely affected by stressors that she fails to or is unable to adequately manage. So far, Dr [M] has treated the mother, successfully as it happens, to the point that Dr [M] is well pleased with the mother's progress.
3. The mother has invited me to make an ambitious collection of orders ranging from her having equal shared parental responsibility, increased time and for the children to live with her. Dr [F] has cautioned against projecting beyond the end of term one of the 2025 school year. Yet final orders are sought by all parties. The parties seek orders being made now that operate until the children each turns 18 years of age. Making orders now that are final has the advantage of removing the parties and the children from the litigation process, and with it, all attendant stress and uncertainty. On the other hand, the pronouncement of final orders now, in a fluid and potentially dynamic set of circumstances, especially where the mother has participated in only 21 sessions with Dr [M], is no barometer against which to successfully measure the certainty of behaviour on the mother's part. Dr [F] was only willing to offer views about the appropriateness of orders being made operable for less than a calendar year, vastly less than to a date when each child attains her majority. Recognising that all parties sought final orders in circumstances where the success or otherwise of the mother's therapy is unknown, the possibility emerges that in years to come one party is likely to apply to the court for orders varying the ones I pronounce. In order to do that, the party applying will need to invoke the rule in In the Marriage of Rice v Asplund. I raised this with all counsel in final addresses and each agreed to the making of final orders.

[77]

The identification of the evidence of Ms LL (at [19]) coupled with the intermediate findings (at [43]-[45]) establishes that the mother's complaint by way of the sub-ground is unsustainable. The sub-ground then can only be that the evidence of Ms LL did not attract the probative weight she hoped or expected.
Leaving aside, as discussed later in these reasons, that a complaint as to weight is baseless unless advanced to support an argument that the result was manifestly unreasonable or unjust, it is incumbent on a party, who contends on appeal a failure to consider or give attention to a material matter, to demonstrate that the primary judge's attention was drawn to the evidence material to that matter unless it is fundamental and obvious (Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66 (at [120])). During the hearing of the appeal the mother could not identify where she drew the primary judge's attention to any finding sought from a consideration of the evidence of Ms LL other than she had attended on Ms LL from March 2023, prior to being ordered to attend on a clinical psychologist, and has continued to attend on Ms LL. She directed her oral and written submissions as to findings regarding her mental health presentation and its clinical treatment to the evidence of Dr M, Ms G and Dr F (Transcript 28 February 2025, p.25 line 19 to p.33 line 8). As identified by the ICL during the hearing of the appeal, the mother did not identify how any failure to expressly record the provision of services by Ms LL for the mother's self-care and emotional coaching was material to the intermediate findings as to her historical and current mental health presentation and treatment.
The mother has failed to establish how the evidence of Ms LL was material to the final parenting orders as made such that a miscarriage of justice occurred. Sub-ground 1(a) is the product of an armchair appeal and has no merit.
Sub-ground 1(b) was identified by the mother during the hearing of the appeal as a weight challenge. Complaints as to the weight or importance afforded to evidence are matters that were essentially for the primary judge. The mother implicitly accepted during the hearing of the appeal that if an appellate court may have given them some, less, or more weight does not establish error of the kind identified in House unless the outcome is unreasonable or plainly unjust, which is not the case here (Hedlund & Hedlund (2021) FLC 94-065 adopting CDJ v VAJ (No 1) (1998) 197 CLR 172 ("CDJ v VAJ")). Nevertheless, the mother would not abandon the sub-ground. The sub-ground fails.
Sub-ground 1(c) asserts three factual errors as to the impact on the children of the mother's mental health challenges and presentation, being historically, currently, and prospectively. The mother failed to comply with r 13.23(3) of the Rules for the purposes of agitating any of the three factual challenges argued under this-sub ground. The rule provides:

[83]

The mother must establish on appeal that the finding of fact subject to complaint was material and not open on the evidence (Edwards v Noble (1971) 125 CLR 296). Simply because other findings of fact may also have been open on the evidence does not demonstrate that a finding of fact complained of was thus not open or available. That is not the test. To establish an error of fact, it is necessary for the mother, as an appellant, to establish that the impugned finding of fact was either demonstrably wrong by incontrovertible facts or uncontested testimony; glaringly improbable; or contrary to compelling inferences (Robinson Helicopter Company Inc v McDermott [2016] HCA 22; (2016) 331 ALR 550 at [43]).
The consensus amongst Dr M, Ms G and Dr F was that the mother clearly experienced significant mental health episodes for which she had not been appropriately treated until after the commencement of the litigation. Dr M opined that the mother did not "suffer" from any mental health disorder and that it was unlikely that she has a "severe mental health problem" (at [22(c)-(d)]). Nevertheless, Dr M offered a diagnosis of acute stress disorder experienced by the mother at various times since 2017 (at 62(b)]). The challenged finding by sub-ground 1(c) reflects the provisional opinion of Ms G contained in her report (at [29]) that a "more realistic" differential diagnosis of the mother was that she had a delusional disorder (paranoid type) or a paranoid personality disorder (AB p.1,660) as reinforced by Dr F, who expressed a provisional opinion in her report consistent with that of Ms G (AB p.1,784). This expert evidence gives context to the primary judge's findings (at [28] and [67(d)]) as to the complexity of the mother's mental health presentation. The primary judge's use of the term "most likely" (at [67(d)]) is an ineloquent phrasing of Ms G's and Dr F's evidence as to a differential diagnosis.
The mother's complaint as to the finding (at [67(d)]) in reality is that she wanted a different intermediate conclusion as to her mental health by acceptance of the evidence of Dr M rather than the intermediate finding made by the primary judge. Appellate error is not demonstrated by the primary judge coming to a different conclusion than that agitated by the mother. On one view, the complaint ought not have been made in circumstances where the mother accepted during submissions that Ms G's evidence was "balanced" (Transcript 28 February 2025, p.29 line 37 to p.30 line 6) and expressly said she was not asking the primary judge to "reject" Ms G's evidence (Transcript 28 February 2025, p.29 lines 37-40). The mother could not identify or establish how the finding (at [67(d)]) was not open on the evidence, glaringly improbable, or contrary to compelling inferences, to enliven appellate intervention. The complaint fails at that point.
If that conclusion is in error, the focus of the ground would then shift to whether the error impacted the result of the parenting case (De Winter and De Winter (1979) FLC 90-605). The materiality of the error and whether it is to impugn the result would become the heart of this sub-ground. On enquiry at the hearing of the appeal, the mother could not identify any material consequence that flowed from such an error of fact (if made) and did not explain how or why a diagnosis was necessary, having regard to the other unchallenged evidence (at [67(e)-(i)]). Sub-ground 1(c) was always misconceived and fails.
The mother argued a factual error or a specific reasons complaint in her Summary of Argument under the heading of Ground 1 which was not contained in any specific appeal ground. This was that "there was no explanation or basis given as to the finding that there was a necessary causative effect of the mother's alleged mental health difficulties upon the children's presentation". The complaint may be as to a failure of the primary judge to make a finding. In any event, the complaint is not established.
Generally, a primary judge only needs to give adequate reasons for the judgment overall. Such an obligation does not ordinarily extend to giving adequate reasons for individual findings which underpin the ultimate exercise of discretion. The process of the primary judge's reasoning in this case exposed, in chapter and verse, the pathway leading to the determination of this complained point critical to the contest between the parties, including importantly, why the case of the mother was not accepted (Bennett and Bennett [1990] FamCA 148; (1991) FLC 92-191).
The primary judge recorded (at [14]) that "[t]he evidence of the connection between the children's behavioural issues and the mother in the years 2021, 2022 and 2023 was not straight forward". The reasons further record:

[86]

...

Dr [F] identified what she said was the central risk issue in this case being risk of harm to the children in the context of the mother's compromised mental health. Dr [F] said that the children could be impacted by parental mental illness in different ways. Those include -

(a) the children being exposed to high levels of parental stress and/or authoritative parenting;

(b) the affected parent incorporating the children into that parent's inaccurate beliefs and acting in a way that frightens the children or causes them to become confused when it contradicts their own experiences of reality;

(c) parental verbal or physical abuse is often accompanied by paranoia; and

(d) overprotection of the children can lead to schemas about the world as being dangerous and they being vulnerable and parents can act in a dangerous manner towards the children under the guise of allegedly protecting the children.

...

Dr [F] was cross-examined extensively. Her evidence drawn from answers she gave to questions put in cross-examination revealed the following -

(a) from January 2024 the children regressed in their behaviour in terms of emotional dysregulation;

(b) the older child's self-soothing behaviour had settled down after the child engaged with psychologist [Ms N];

(c) the mother has underlying issues which can be triggered by various stressors;

(d) the mother exhibited signs of mental instability in 2017 when the mother smashed an item of furniture causing a piece of wood to break off then strike one of the children;

(e) on that occasion the mother was jealous of a woman with whom she believed the father previously had a romantic relationship;

(f) that incident revealed a disproportionate response and the mother persisted with the rigidity of her view;

(g) in 2017 another event occurred during which the mother accused the father of having a romantic relationship with another woman causing the mother to smash a painting on the end of a bed, such incident causing distress to the father;

(h) in 2017 the mother accused the father of fathering a child with a person called [MM] resulting in the mother demanding the father to terminate his friendship with [MM] and [MM]'s partner indicative of pathological jealousy;

(i) such pathological jealousy from a psychological perspective is often rooted in a person's relationship template formed from early childhood from attachments to important caregivers, the experiences with which impact subsequent relationships to that person's adulthood;

(j) the mother's 2017 pregnancy termination represented a significant stressor and trauma;

(k) unchallenged evidence in this case from one of the mother's high school friends was to the effect that the mother formed the view that she was being monitored in everything she did leading to the mother ending her career as a solicitor;

(l) the same high school friend gave unchallenged evidence that in 2014 the mother saw her boyfriend at the time holding hands with a female friend that led to the mother accusing her then boyfriend of infidelity;

(m) those episodes revealed the mother to be pathologically jealous, lacking in trust and suspicious of others;

(n) Dr [F] said the mother terminated her consultations with a clinical psychologist, Ms [O], after Ms [O] suggested the mother attend upon a psychiatrist;

(o) Dr [F] considered that the mother's termination of her retainer with Ms [O] reflected the mother's lack of insight, that she did not believe she actually suffered any difficulty and that she did not want to receive any help at the time;

(p) Dr [F] agreed that prior to November 2023 the mother did not engage with psychological or psychiatric assistance and only engaged with Dr [M] upon the court ordering the mother to do so;

(q) dialectical behavioural therapy of which relapse prevention is a component is usually targeted to individuals who struggle in the regulation of their emotions; and

(r) the mother's narration of her hearing birds chirping was a form of delusional disorder restricted to the persecutory or jealousy type and it was more than a person's response to a combination of stressful events in a person's life.

(Footnotes omitted)

[94]

The paragraphs of the mother's Summary of Argument directed to these grounds compiled a list of complaints as to her perceptions of the father's conduct.
The mother did not make any submissions directed to sub-ground 2(a) in her Summary of Argument or on the hearing of the appeal. It is rejected.
As to sub-ground 2(b), the mother's Summary of Argument directed her complaint to a factual challenge of the finding (at [17]) that no mental health issues were asserted against the father. It is necessary to analyse the finding. The father was ordered on 23 November 2023 to engage with mental health support services, implementing a recommendation by Ms G. He complied with that order. The evidence of his treating psychologist, Dr NN, as to his positive functioning was unchallenged. The mother on appeal did not identify in the Appeal Book or the transcript any assertion or evidence adduced at trial as to the father encountering current mental health challenges. An error of fact is established if there is no evidence to support the finding. There was no evidence to support any other finding to that made (at [17]). Sub-ground 2(b) was always devoid of any merit.
No prospect existed to establish Ground 2.
The mother's Summary of Argument identifies that Ground 4(a) complains as to findings that "the children had progressed well in the father's care" and that their "presentation had improved as a result of the primary care of the father" (Mother's Summary of Argument at [10]). The mother then illogically couples that complaint regarding the same impugned factual findings as being not reasonably open on the evidence in Ground 5, being a complaint as to inadequate reasons for the same findings, resurrecting the vexing challenges presented by the mother's grounds of appeal.
The first contended finding alleged is not reflective of the reasons. The reasons record:
1. ...The father provides stability, regularity of routine and predictability of behaviour. The same cannot be said of the mother. While it must be acknowledged that her circumstances are improving compared to the events between 2021 and 2023, the mother has yet to immerse herself in the therapy contemplated by [Ms G] and Dr [F]. She must do that forthwith.

[103]

...

Upon [Y] turning six years old, the children will spend time and communicate with the parents during the school term holidays and long summer holidays in a week about arrangement as follows -

(a) with the father, for the first week of the holidays in even numbered years and each alternate week thereafter and for the second week of the holidays in odd numbered years and each alternate week thereafter;

(b) with the mother, for the first week of the holidays in odd numbered years and each alternate week thereafter and the second week of the holidays in even numbered years and each alternate week thereafter, with changeover to occur at 12 noon every seven consecutive days until the commencement of the next school term; and

(c) with the parent in whose care the children are not in, by facetime or similar each Tuesday and Thursday at 7.00pm.

...

Until [Y] turns six years of age, the mother must continue to engage in psychological treatment with a clinical psychologist regularly (no less than once each fortnight) with expertise in the area of trauma and trauma response for trauma focused cognitive behaviour therapy to treat -

(a) [personality disorders/ poor mental health];

(b) trauma and trauma-response, and the impact of stress on the mother; and

(c) any other matters deemed appropriate by the mother's treating clinical psychologist with any such psychologist treating the mother to be provided by the independent children's lawyer (and by the mother for any subsequent psychologist treating the mother) as soon as practicable after these orders with a copy of the family report by Dr [F], the psychiatric report of [Ms G], a copy of these orders and reasons for judgment in this matter.

11. Until [Y] turns six years of age -

(a) the mother must provide the father with a written report from her treating clinical psychologist about her attendance, treatment and progress every six months, at the mother's expense;

(b) such report must be provided by the mother's treating psychologist directly to the father's nominated email no less than 14 days before the children's time with the mother is due to increase pursuant to paragraphs 5 and 7 of these orders;

(c) the children's time with the mother pursuant to paragraphs 5 and 7 of these orders will not commence until the report is provided to the father by the mother's treating psychologist; and

(d) the children's time with the mother pursuant to paragraphs 5 and 7 of these orders will proceed subject to the mother's compliance with paragraphs 10 and 11 of these orders.

(As per the original)

[147]

It has always been self-evident that any property of the parties, or one of them, that was owned at some time in the past but no longer exists at the time of trial, cannot be adjusted or divided. This was perceived to present a vexing transparency issue in s 79 litigation as to how the use of the now disposed of property would be adequately considered in achieving the mandate of justice and equity required by s 79 of the Act. Jurisprudence developed the concept of notional property, or add backs, in s 79 litigation as a reasoning device to remedy perceived injustices in considering that property that was owned prior to trial but no longer existed, in a mathematical way, by putting those items in the balance sheet as an asset or notional asset of the parties or one of them and considering those items on that basis. That said, a discretion existed to include notional property or add backs as if they were a current asset in the balance sheet, said to be "the exception rather than the rule" (Cerini & Cerini [1998] FamCA 143).
The Full Court in Omacini & Omacini [2005] FamCAFC 104; (2005) FLC 93-218 ("Omacini") identified that "add backs" fell into three clear categories, being where a party has expended money on legal fees (Chorn & Hopkins [2004] FamCA 633; (2004) FLC 93-204), where there has been a premature distribution of property (Townsend & Townsend [1994] FamCA 121; (1995) FLC 92-567 ("Townsend") or when there has been a waste of property (Kowaliw v Kowaliw [1981] FamCA 70; (1981) FLC 91-092 per Baker J). The reasoning as to add backs was anecdotally described as identifying property that ought to have been available for adjustment "but for" the payment of legal fees, the predisposition, or waste. The overarching principle that guided the exercise of the discretion as to the "adding back" of property that no longer existed as an item in the balance sheet identifying the current property of the parties, or in the alternative considering those matters in the contributions assessment or any adjustment thereto pursuant to s 75(2) of the Act (as it then was), remained to achieve justice and equity in the circumstances of the case.
The High Court in Stanford & Stanford [2012] HCA 52; (2012) 247 CLR 108 ("Stanford") confirmed the necessity of the court in s 79 proceedings to identify existing legal and equitable interests of the parties in their property. An analysis of the Full Court judgment in Bevan & Bevan [2013] FamCAFC 116; (2013) FLC 93-545 ("Bevan"), after the High Court determination in Stanford, promoted that it may no longer be appropriate to notionally addback property that no longer exists at the time of hearing. In Bevan, the majority of the Full Court stated the following regarding add backs (at [79]):

[153]

Thereafter, in Trevi & Trevi [2018] FamCAFC 173; (2018) FLC 93-858 ("Trevi") the Full Court described the propositions underscoring the notional adding back of property that did not exist to existing interests in property as "unduly simplistic" and that justice and equity can be achieved by taking up the consideration of the use of property that no longer exists as a relevant s 75(2) factor, the latter course being "perhaps, technically more correct". Notwithstanding that Full Court guidance, the conceptually dubious practice of notional add backs generally continued unabated.
The primary judge did not notionally add back the funds that had been expended by the mother or the father from the sale of real properties. While not expressed directly, a reading of the reasons as a whole identifies that this exercise of discretion was in part informed by the funds no longer existing for adjustment, in that only property currently existing at trial would be adjusted, and in part from the evidentiary deficiencies as to the amounts of those funds expended on legal fees in the proceeding and other applications (at [132]-[133], [138]-[139], [142]) and [149]).
The mother's procedural fairness complaint is expressed as being denied "the opportunity to make submissions on the weight of contributions to the actual pool being considered by the primary judge, if it were to be without add backs, rather than the pool they understood had been adopted by both parties" (Mother's Summary of Argument at [30]).
There was no indication that the identification and value of the property of the parties (other than at [122]), including the notional adding back of the proceeds of sale of real properties exhausted by them, was being contemplated by the primary judge. It could not have been reasonably anticipated by the parties, given that construction of the items comprising and valuing the property dispute, that the primary judge would not include the adding back of the notional items of property that no longer existed. To do so fails to afford them, and specifically the mother who appeared without legal representation on the last day of the trial at the time of oral submissions, procedural fairness to make submissions on how those items would be taken into account or considered to achieve justice and equity.
While not every departure from the rules of natural justice entitles an aggrieved party to a new trial (Stead v State Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141), in this case identified procedural unfairness was material to the result, illustrated by the significant distortion between the non-superannuation property pool for adjustment that included the add backs thought to be the subject of consideration, being $1,209,399, and the non-superannuation property pool adjusted by the primary judge, being $616,330. This differential is close to 50 per cent. This directly impacts on contribution contentions and any adjustments thereto, whether expressed as a percentage of the non-superannuation pool of property and any adjustments thereto, or by way of monetary sums for each. The procedural fairness complaint is not without merit.
The primary judge's errors were not confined to the denial of procedural fairness but extended to discretionary errors by failures to consider material considerations and an inadequacy of reasons, being:

[172]

(5) For the purposes of subparagraph (3)(b)(ii), the court is to take into account the following considerations, so far as they are relevant:

(a) the effect of any family violence, to which one party to the marriage has subjected or exposed the other party, on the current and future circumstances of the other party, including on any of the matters mentioned elsewhere in this subsection;

(b) the age and state of health of each of the parties to the marriage;

(c) the income, property and financial resources of each of the parties to the marriage and the physical and mental capacity of each of them for appropriate gainful employment;

(d) the effect of any material wastage, caused intentionally or recklessly by a party to the marriage, of property or financial resources of either of the parties to the marriage or both of them;

(e) any liabilities incurred by either of the parties to the marriage or both of them, including the nature of the liabilities and the circumstances relating to them;

(f) the extent to which either party to the marriage has the care of a child of the marriage who has not attained the age of 18 years, including the need of either party to provide appropriate housing for such a child;

(g) commitments of each of the parties to the marriage that are necessary to enable the party to support themselves and any child or other person that the party has a duty to maintain;

(h) the responsibilities of either party to the marriage to support any other person;

(i) the eligibility of either party to the marriage 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;

(j) if either party to the marriage is eligible for a pension, allowance or benefit as mentioned in paragraph (i) - the rate at which it is being paid to the party;

(k) if the parties to the marriage have separated or divorced, a standard of living that in all the circumstances is reasonable;

(l) the extent to which an alteration of the interests of the parties to the marriage in any property would enable a party to undertake education or establish a business or otherwise obtain an adequate income;

(m) the effect of any proposed order on the ability of a creditor of a party to the marriage to recover the creditor's debt, so far as that effect is relevant;

(n) the extent to which each party to the marriage has contributed to the income, earning capacity, property and financial resources of the other party;

(o) the duration of the marriage and the extent to which it has affected the earning capacity of each party to the marriage;

(p) the need to protect a party to the marriage who wishes to continue that party's role as a parent;

(q) if either party to the marriage is cohabiting with another person - the financial circumstances relating to the cohabitation;

(r) the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:

(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 covered by subparagraph (ii), or of either of them; or

(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii);

(s) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage is to provide, or might be liable to provide in the future, for a child of the marriage;

(t) the terms of any financial agreement that is binding on the parties to the marriage;

(u) the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage;

(v) any other fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account.

[173]

Submissions were sought as to whether s 79(3)(a)(i) of the Act, mandating the identification of the existing legal and equitable rights and interests in any property of the parties to the marriage or either of them at the time of trial in a balance sheet, permitted as part of that identification items notionally added back being property which no longer existed.
Although the mother sought the inclusion by way of adding back the notional property at items 7 to 10 inclusive of the agreed balance sheet, she conceded that this was counterintuitive to the construction of s 79(3) of the Act. She accepted that notional property cannot be divided or adjusted because it no longer exists.
The father submitted that s 79(3) "codified existing principle" as to the notional adding back of property that no longer existed, such that the section does not displace a discretion as to whether the notional adding back of property at items 7 to 10 inclusive ought to remain included in the balance sheet as if it was property which still existed at the time of the trial. His submission was anchored in the Explanatory Memorandum, Family Law Amendment Bill 2024 (Cth), identifying that the amendments to s 79 of the Act sought to codify "existing case law principles". While not expressed by him in such terms, as we understood his submission, the principles he identified were those underscoring the reasoning in Omacini, rather than those expressed by the Full Court in Trevi. The father conceded that the Explanatory Memorandum, Family Law Amendment Bill 2024 (Cth) is silent on the express topic of add backs. Although not identified by the father, each of the Addendum to the Explanatory Memorandum, Family Law Amendment Bill 2024 (Cth) and the Supplementary Explanatory Memorandum. Family Law Amendment Bill 2024 (Cth) do not, by or in themselves, refer to the adding back of property that no longer exists.
The submissions of the father are not accepted.
Statutory interpretation focuses on the plain and ordinary meaning of the words in the section. The text of s 79(3)(a)(i) is clear. Only the existing property of the parties is to be identified and only that existing property is to be divided or adjusted.
This single conclusion is reinforced, when read in the context of s 79, not to permit more than one potential meaning (Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at [69]).
Section 79(4) is headed "[c]onsiderations relating to contributions". Sections 79(4)(a)-(c) encompasses considerations that form part of the history of contributions, including the fact of the legal and equitable interests in property disposed of, and the use and application of the funds produced from the disposal, up until the date of assessment, being the date of trial.
Section 79(5) is headed "[c]onsiderations relating to current and future circumstances". Section 79(5)(d) directs consideration as to whether a party has engaged in wastage of property or financial resources and its impact on the financial circumstances of the parties at the time of the assessment, being the date of trial, and prospectively, being one of the categories of notional add back identified in Omacini. Section 79(5)(n) directs consideration to the extent to which each party has contributed to the property or financial resources of the other party at the time of the trial and prospectively. This could encompass interim or partial property adjustments or payments by way of litigation funding. Section 79(5)(v) replicates s 75(2)(o) prior to the amendment of the section. Longstanding authority has not read down the scope of the considerations falling within that sub-section, described in the Explanatory Memorandum as a "catch all' provision, including but not limited to enabling the current and future considerations of the fact and impact of property that has been the subject of predisposition prior to hearing, being a category of notional add back identified in Townsend and Omacini, or the expenditure of property on legal fees.
So that it is clear, s 79 now directs that the categories identified in Omacini pre-amendment that were notionally added back are to be considered in ensuring a just and equitable outcome, either by way of historical contributions, or by way of their relationship to and impact upon the current and future circumstances at the s 79(5) stage. For the avoidance of doubt, it is open when consideration is given to s 79(2) of the Act, to consider the matters in s 79(3)(a) and s 79(3)(b), together with those in s 79(4) and s 79(5) and conclude it is not just and equitable to make any order (Cosola & Moretto [2023] FedCFamC1A 61; (2023) FLC 94-143).
The holistic approach in assessing and determining contributions and adjustments thereto (Jabour & Jabour [2019] FamCAFC 78; (2019) FLC 93-898 ("Jabour"); Horrigan & Horrigan [2020] FamCAFC 25 ("Horrigan")) remains applicable. Each of the considerations, by either s 79(4) or s 79(5), requires engagement with the circumstances of the disposal of property, the value it achieved, and its use and application being considered and weighed to achieve the mandate of justice and equity that permeates s 79 of the Act.
As notional property does not exist, it cannot be identified to form part of the balance sheet recording the current items of the parties' property. Items 7 to 10 inclusive will be removed from the balance sheet and considered in the contribution findings or the adjustments thereto.
We find that the existing legal and equitable rights and interest of the parties in property and their existing liabilities available for adjustment are:

[182]

(f) During the relationship, the parties had one joint bank account. This account was used to pay for the family's expenses. The parties otherwise maintained separate bank accounts.

(g) As between the parents, the mother was primarily responsible for the day-to-day care of the children from when they were born until separation, notwithstanding her mental health challenges. The mother remained at home after the birth of the children while the father attended work. The mother returned to work on a part-time basis after 10 months of maternity leave following the birth of the older child in early 2019. The mother continued to have primary carer responsibility for the older child on the days she did not work. She returned to full-time work on 30 March 2020. During the COVID-19 lockdowns both the mother and the father worked from home and shared care of the older child. The mother took 12 months of maternity leave following the birth of the younger child in early 2021 while the father remained working full-time. The mother returned to work on a part-time basis in February 2022. The mother was scheduled to return to full-time work in July 2022. In November 2022 the mother changed jobs so she could continue working part-time whilst caring for the children. As between she and the father, the mother undertook majority of the homemaking.

(h) The contribution by the mother of $400,000 sourced from her father late in the relationship and its use generating the lion's share of the equity realised from the Suburb BB home, attracts significant weight (see Pierce & Pierce [1998] FamCA 74; (1999) FLC 92-844).

(i) The mother's contention that she was responsible for the higher sale price of the Suburb BB property, being $2,310,000 as opposed to $2,250,000, is not supported by evidence attracting weight and is not accepted.

(j) The mother has been renting since March 2023. The father, while having the benefit of occupation with the children, paid the mortgage on the Suburb BB property from separation until July 2024 when a moratorium was granted.

(k) The mother and the father each received $87,648 as a partial property settlement from the proceeds of sale of the Suburb BB home. Of those funds, the mother paid $79,473 to her litigation funding loan and the father paid $27,000 to his litigation funding loan.

(l) The mother received $352,776 from the sale of her pre-marriage property and from the proceeds of sale of the Suburb BB property and the father received $239,992 from the sale of his pre-marriage property and from the proceeds of sale of the Suburb BB property. The gross value of funds received by the parties from the proceeds of sale of real properties that no longer exist is $592,768. That value, subject to the evidence, may be material in considering contributions up until the time of assessment, dependent on the use made by each party of the funds received coming within the ambit of s 79(4)(a)-(c) factors.

(i) The mother applied $344,601 of the funds of $352,776 she retained or received to pay legal fees. The mother did not submit, nor do we accept, that the use of the funds to pay legal fees would equate to a contribution of those funds. She alone benefited from these expended funds. This use and application of property has consequential effects on the assessment of current circumstances, rather than being considered as a negative contribution (Antmann & Antmann [1980] FamCA 64; (1980) FLC 90-908). This in turn directs consideration of this use and application of property that did exist but no longer does away from the history of contributions and to consider and weigh its impact on the current circumstances of the parties as envisaged by s 79(5) of the Act.

(ii) The father used at least $27,000 of the funds he retained or received to pay legal fees. The inadequacy of his evidence as to any further particulars as to what remaining portion of the $239,992 he received was applied to legal fees and what portion was applied to the living expenses of he and the children also directs against consideration of his application of the funds he received as part of the history of contributions up to the date of assessment.

(iii) Justice and equity are shaped from the particular circumstances of each case. These matters conclude that the use and application of the $592,768 sourced from the sale of real properties that no longer exist ought to be taken into account by way of s 79(5) as a consideration of the current financial circumstances of the parties.

(m) The children have lived with the father since the implementation of the family violence intervention order on 21 February 2023. The mother spent time with the children as regulated by the orders. Orders made on 4 October 2024 directed the parties to be equally responsible for the costs of the DD Family Services Supervision. There is an absence of evidence that the father paid his share of this expense. The mother has paid $15,709 to the supervising company.

(n) The mother has paid child support as assessed since separation. She currently pays child support to the father of $988 a month.

(o) The mother was responsible for reducing the Centrelink debt, incurred for the benefit of both of the parties, from $39,444 to $21,994.89.

[184]

(a) The father is in good health. The mother lives with the mental health challenges recorded earlier in these reasons.

(b) The father's income is in the range of $250,000 including superannuation. The mother's income is in the range $150,000 including superannuation. The mother's income earning capacity has been impacted upon by her breaks in employment historically and then working part-time. Both parties have the capacity to work full-time in the future.

(c) The non-superannuation property of the parties the mother will receive by way of the contribution findings is more than twice the value of that property when compared to the father, albeit that the value of the pool is modest. The split of the superannuation property of the parties' results in the father having $32,802 greater superannuation than the mother. He has greater future capacity to accumulate superannuation than the mother having regard to his superior income.

(d) The mother retained or received $352,776 from the proceeds of sale of real properties, being $112,784 from this category of sources more than the father, who retained or received $239,992. Not all the funds he received were for his own benefit by paying legal fees, but the absence of satisfactory evidence as to the amount of the funds he spent on living expenses for he and the children, including some particularity of these expenses and the period over which these funds were exhausted, generates challenges as to the weighing of this factor in his favour except as to the consideration of the difference in the value of the funds that have been expended that weighs in his favour.

(e) The mother's paid Centrelink debt will be equally shared when it is established it has been paid.

(f) The father will continue to have the primary ongoing care of the children. The mother's time spent with the children is anticipated to increase provided she complies with her engagement in clinical psychological treatment. The mother will meet the costs of this treatment. No evidence was identified as to what would be appropriate housing arrangements for the children.

(g) There is no suggestion that the mother will not continue to pay child support as assessed.

(h) Each party enjoys a reasonable standard of living. Neither has an obligation to support any other person other than the children.

[192]

As the property orders which have led to the appeal are errors of law, it is appropriate to grant the mother and the father a costs certificate pursuant to the Federal Proceedings (Costs) Act 1981 (Cth) with respect to the costs of the property appeal.
The father sought that the mother pay the costs of the parenting appeal in the fixed sum of $7,500, being broadly half of his scale costs of both the parenting and property appeal. The ICL sought that the mother pay costs fixed in the sum of $3,865. The mother opposed the making of any order that she pay the costs of the father or those of the ICL.
The relevant principles as to costs are well settled. While the starting position established by s 114UB(1) of the Act is that each party pays their own costs, s 114UB(2) allows the Court to make such orders as to costs as it considers just if there are circumstances which justify it doing so. In considering what order for costs, if any, should be made, the Court is required to have regard to the matters set out in s 114UB(3) of the Act and give weight as it considers appropriate to any relevant factor. It is well settled that no single factor in s 114UB(3) has priority, nor must more than one factor be satisfied. Rather, any one factor may be sufficient.
The father and the ICL correctly submitted that the mother was wholly unsuccessful in the parenting appeal. The ICL further submitted that properly advised that appeal ought not to have been brought. Both submissions have merit, as does the observation that the unnecessary challenges presented by the mother's haphazard conduct of the parenting appeal also increased costs.
The mother's submissions focused on her contended difficult financial circumstances. Her contended impecuniosity, without more, is not a sufficient reason for depriving those opposing the parenting appeal of their costs. While the circumstances justify an order for costs on that appeal, the value of the property of the parents and the income superiority enjoyed by the father ought to reflect a reduction in the quantum of costs of his modest costs sought, to be reduced to $5,000. The diffidence in the value of costs sought by the ICL reflects modesty in the value of the participation of the ICL in the determination of the parenting appeal. It is just that the mother pay within 28 days the fathers costs fixed at $5,000 and the ICL's costs fixed at $3,865.

Shinohara & Shinohara [2025] FedCFamC1A 126 (23 July 2025)

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