Winders v Gazzard S113/1998 [1999] HCATrans 58 (12 March 1999)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S113 of 1998

B e t w e e n -

JAMES DENNIS WINDERS

Applicant

and

PATRICIA MAY GAZZARD

Respondent

Application for special leave to appeal

GLEESON CJ

GAUDRON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 12 MARCH 1999, AT 2.16 PM

Copyright in the High Court of Australia

MR G. RICHARDSON, SC: If the Court pleases, I appear with my learned friend, MR B.S. RICHARDS, on behalf of the applicant. (instructed by Turner Freeman)

MS E.A. COHEN: If the Court pleases, I appear with my learned friend, MR W. LLOYD, on behalf of the respondent. (instructed by Ellitt & Law)

GLEESON CJ: Yes, Mr Richardson.

MR RICHARDSON: Your Honours, the proceedings concern the application of section 20 of the De Facto Relationships Act of New South Wales which empowers a court to make such order, if any, as seems just and equitable, having regard to matters listed in subparagraphs (a) and (b) dealing with matters of:

financial and non-financial contributions made directly or indirectly.....to the acquisition, conservation or improvement of any of the property of the partners -

and:

the contributions.....of homemaker or parent -

in relation to the welfare of the family that may be constituted by the parties and children of either of them.

The proposition that section 20 needs to be applied as what might be broadly described in a contribution driven context - - -

GAUDRON J: Why not? Why do you not start, which one would have thought, from the position which the parties had agreed between themselves? I would have thought, in a situation in which the parties have agreed that the properties are to be held equally, that you start from that and it is only in that context that you bring the contributions to bear.

MR RICHARDSON: That may be the case and it is not against the thrust of our argument as to error in so far as we would suggest that the majority misdirected themselves in dealing with, in particular, the assessment of contribution arising from income of the parties during the course of the relationship. Much was made of the notion that the income was dealt with in a joint way or pooled way but that does not deprive from the prospect - from the fact that it was the income of each of them, contributed to the extent that they each could, and that there was a substantial imbalance which, by the terms of the section, would require recognition. The section itself does not invite the court to have regard to the assessment or quantification of contribution by reference to gender, nor does it, for example, ascribe greater weight to contribution by one party or the other or, for example, between direct contributions as opposed to financial contributions. It is a task of assessing weight and fact to the hands of the trial judge.

GAUDRON J: It seems to be a value judgment, is it not?

MR RICHARDSON: It is.

GAUDRON J: And so long as the court has regard to the relevant matters and does not have regard to irrelevant matters, that should be the end of it, should it not?

MR RICHARDSON: And the intermediate court, in the majority, in our contention, did have regard to irrelevant matters in so far as, at page 44, when dealing with the master's findings at trial as to the significant disparity in the earning capacities of the parties - - -

GAUDRON J: Why is that irrelevant?

MR RICHARDSON: The discrepancy, of course, we contend is not a matter of irrelevancy at all, but to bring to account, without evidence, and indeed without it having been an issue either at the intermediate appeal or at trial, what her Honour Justice Beazley describes as the "systemic imbalance" in our society in wages to therefore deprive the factor of the imbalance nonetheless as being taken into account as a relevant contribution - - -

GAUDRON J: I do not see why that is so. It might be one thing, for example, if the wife had had a capacity to earn money, let us say, as a professional and had elected not to do that but to work in some other capacity. That might mean that she did not make the contribution that she could make. But it is quite a different matter where it is clear that her earning capacity was less than that of the husband, is it not?

MR RICHARDSON: The starting point of her Honour Justice Beazley's rationalisation appears at line 31, the genesis where her Honour says:

the parties were each employed in jobs of a manual nature.

Now, I would have no difficulty with what her Honour proposes if, for example, both of these parties had hypothetically been employed as greenkeepers where, for example, there was evidence that they both attended to exactly the same duties, for the same hours on the same weeks, but for which they were paid quite disproportionately.

GAUDRON J: It is the next sentence that you must quarrel with, if you quarrel with anything, is it not?

MR RICHARDSON: Indeed.

GAUDRON J: The rest is just - - -

MR RICHARDSON: But her Honour's starting point is to say, well, they are both jobs of a manual nature. If they have both contributed to the extent of their abilities that should be the end of it. Now, firstly, the value judgment was with the - - -

GAUDRON J: Why should it not be?

MR RICHARDSON: Because the value judgment was with the master at trial in the first place. Has he erred in principle? What her Honour in effect does, at page 44, is to elevate to a matter of principle something that ought affect, she says, the trial judge's discretion in assessing - evaluating contribution at trial for which section 20 provides no warrant.

GAUDRON J: She said that the - what was the error that was identified at first instance? It was not that, was it?

MR RICHARDSON: It is to the extent that her Honour certainly - - -

GAUDRON J: Was she not there exercising her discretion afresh?

MR RICHARDSON: No, she here is examining principle and then it is clear from the reasoning that her Honour's judgment follows that she identifies this as being an error of principle made by the master against which she then proceeds, on the re-exercise of discretion, she certainly then - - -

GAUDRON J: Where does that appear?

MR RICHARDSON: Her Honour is examining the factors relevant to the case, starting at page 43, and then goes through the five points that her Honour says are relevant in purporting to assess what a proper order should be. At page 45 line 35, after examining those five points, her Honour then concludes that:

the Master failed to give proper weight to any of these matters.....His discretion, therefore, miscarried.

So her Honour is certainly identifying at that point the foregoing as having been matters constituting error upon which then her Honour says that gives rise to the question of what adjustment - - -

GAUDRON J: Those are the matters at page 43.

MR RICHARDSON: Those are the matters at 43 that her Honour then examines between 43, concluding at line 31 on page 45.

GLEESON CJ: Just take the fourth matter referred to on page 45 at line 15. Why is not that a matter that would be regarded as of compelling significance having regard to the position in life of these people?

MR RICHARDSON: It flies contrary to the manner of contribution that has been applied by courts to the interpretation of section 20 so far. It flies contrary to the manner in which, for example, the Family Court has applied section 79 - - -

GLEESON CJ: But all it says is that these parties have treated themselves as being equally entitled to whatever their joint earnings enabled them to acquire; not an unusual situation, especially people in the position of these parties.

MR RICHARDSON: Not an unusual situation, but not indeed the thrust of argument in this case all borne out by the facts, save for the fact that certainly the applicant did provide the funds for the acquisition of a home that was then purchased in the joint names of the parties. Now, that consumed, I think, $146,000 or thereabouts of approximately $216,000 that he had received on the termination of his employment, the balance remaining with him. It is not suggested that he put the remaining funds in a joint account or applied those in any circumstances for the joint benefit of the parties.

But the notion that without more, in terms of examination of what contributions were made to an asset, then elevates the presumptions arising from how that asset be held at the time of any particular application or hearing.

GLEESON CJ: Why do not the third and fourth factors referred to on the top of page 45 amply justify the discretionary conclusion referred to on the bottom of page 45?

MR RICHARDSON: Because section 20 still leaves scope for the legitimate application of assessment of the quality of the contribution and that is consistent with, for example, Justice Wilson's decision in relation to section 79 of the Family Law Act where his Honour says that, in assessment of contributions, it is legitimate none the less to examine quality. Just as there may be varying degrees of quality as between someone who is an adequate - - -

GLEESON CJ: That might be a discretionary consideration that would appeal to one mind but not another, but why was not Justice Beazley entitled to form that view?

MR RICHARDSON: If her Honour was sitting as the trial judge and starting afresh, that may be a different proposition, but these are matters that her Honour - in particular the matter that she describes as "Secondly" on page 44, that go together to constitute what leads her Honour to the view of error, that then leads to the re-exercise of discretion. The effect of what she says at the bottom of page 44, which is our substantial dispute, is to say there is this systemic imbalance, therefore I - - -

GLEESON CJ: That is a remark that she made in the context of dealing with the second relevant consideration. It was apposite for the consideration she was dealing with, but what you seek to do is to elevate it to some principle of law that requires determination in this Court.

MR RICHARDSON: It is our submission that in so far as her Honour - if the statement in the second sentence is a guiding factor to the weight that her Honour sought to apply to the assessment of the contribution of income during the course of the relationship, then her Honour is elevating that, with respect, to a statement of principle.

GAUDRON J: What her Honour said was, each party contributed the whole of his or her salary. That was relevant.

MR RICHARDSON: Certainly it is. But her Honour, by the examination, by saying the disparity should not, by that reason alone, be assessed as a factor in the respondent's favour or as a matter of advantage to the appellant, is thereby saying, well, in the context of these people having been together for 14 years, if there is a disparity in the quality of their direct financial contribution, that is a matter that ought not be taken into account in his favour or her disfavour, and that - - -

GLEESON CJ: You seem to be overlooking the words "by that reason alone" in that second sentence.

MR RICHARDSON: But her Honour does not, for example, follow that by some greater explanation as to what reasons, if any, it is that causes her to form that view, in this case independently of the statement.

GLEESON CJ: Her reasoning is fairly simple, is it not? She says these people pooled the whole of their earnings during this period of 14 years. Their earnings were not large. They were people engaged in manual work. They contributed the whole of their respective salaries to their joint purposes. They treated themselves as being equally entitled to whatever their joint earnings enabled them to acquire. As a matter of discretion, notwithstanding the fact that his salary was more than hers, the position of equality should be preserved. Now that is not a startling discretionary proposition.

MR RICHARDSON: No. But in terms of assessment of contribution it means, with respect, no more than he contributed more than she did to provide her with a benefit equal to that which he derived.

GAUDRON J: He contributed what he was able to and she contributed what she was able to.

MR RICHARDSON: I have no difficulty with that proposition, other than the conclusion that arises from it.

GAUDRON J: Your argument, if it were to be followed to the logical conclusion, would be that women must always be in an inferior position because of their inferior position in society.

MR RICHARDSON: No, we do not contend that.

GAUDRON J: It sounds like it.

MR RICHARDSON: Because, for example, as the decisions of the Family Court demonstrate - - -

GAUDRON J: In one respect, one might think that the fact that women were able to learn less might justify their getting more in a case of this kind.

MR RICHARDSON: This matter was never an issue at trial. It was never an issue - - -

GAUDRON J: It was not an issue in the Court of Appeal either.

MR RICHARDSON: It was not an issue in the Court of Appeal. We do not know whether they worked, for example, whether he was working double shifts or triple shifts regularly. We do not know whether there was a vast disparity in the inherent danger that might have been applicable to his work or her. I do not contend or accept, with respect, your Honour Justice Gaudron's conclusion that the logic of our submission must led to the conclusion that women are always worse off because in many cases - - -

GAUDRON J: Is not your proposition that one has to deal with it on a precise mathematical basis?

MR RICHARDSON: Not at all. One has to deal with it as the master did - - -

GAUDRON J: If you do not have to deal with it on a precise mathematical basis, what is wrong in dealing with it on the basis that each contributed the whole of his and her salary.

MR RICHARDSON: That is fine, as long as one recognises with some proportionality or some weighting that there was, within the whole of each of their salaries, some disproportionate sums involved. In many cases, as the decisions of the Family Court demonstrate, whereas there might be a case where a man has in his favour an economic contribution that outweighs his wife's, there may be a finding that her contribution as a home maker or in the home making and parenting activities was greater than his and often, whilst there is no presumption, often that then leads to a conclusion of equality of their contributions.

But in this case, there were no children and the master had made some clear findings that there was not any vast disparity in the contributions being made by each of these people in their home-making activities. So whereas in a lot of cases the party in the position of the respondent in this case may have seen some equalisation derived from that, she did not, and it comes back to the notion - and Justice Stein, indeed, at page 52 perhaps elevates my argument that their Honours are espousing a statement of principle of perhaps general application higher to the extent that, at line 45 his Honour says:

In this regard, I agree with the remarks of Beazley JA that systemic imbalance in wages should not be used to entrench inequality in the adjustment of property interests under the Act.

GAUDRON J: And it well could be. If you adopted a straight mathematical formula, it would.

MR RICHARDSON: I am certainly not contending that it need be a precise mathematical formula, but part of a weighting exercise.

GAUDRON J: No, but if you did, it would.

MR RICHARDSON: Just as a wife who carries out all of the work in the home totally to her husband's exclusion, perhaps if he says, "Well, I couldn't do any cooking and I couldn't do any cleaning. I didn't have talents for that. I did the gardening so I did all that I could at home." And she says, "Well, each and every day I did all the cleaning, all the cooking, all the caring for the children." Each would not come to court and say we each did what we could and expect to be treated as having made an equal contribution in that regard.

GAUDRON J: It is a long way from this case.

MR RICHARDSON: And that, with respect, all I seek to preserve from the bland statement in absence of evidence - - -

GAUDRON J: As a matter of discretion, would you not accept that in exercising a discretionary power of the kind here involved it should not, as a general rule, be exercised to entrench inequality?

MR RICHARDSON: It certainly ought not be exercised with that intention. But it ought be exercised by having regard to the facts of each individual case.

GLEESON CJ: One of the relevant facts about this case is that these are people of modest means.

MR RICHARDSON: Oh, indeed, at the end there was modest assets to be divided between them.

GLEESON CJ: Who do not need their day in front of the High Court to do justice, if justice has been done in the court below by preserving the equality that they agreed upon between themselves.

MR RICHARDSON: That, with respect, your Honour, evades section 20 to the extent that the issue of assessment of contributions must come as part and, to take up your Honour Justice Gaudron's earlier point, I have no issue with a finding that says each of them has contributed all that they can and I take that into account, but within that the fact is he has made a greater contribution than her. I cannot put it any higher or stronger than that. I do not seek to add to the submissions.

GLEESON CJ: Thank you.

The outcome of this case turned upon discretionary considerations which involved the application to the facts and circumstances of the individual case of well established discretionary principles. The case raises no issue that warrants the grant of special leave to appeal. The application for leave to appeal is refused.

Do you resist an order for costs, Mr Richardson?

MR RICHARDSON: No, I do not wish to put anything, your Honour.

GLEESON CJ: The applicant must pay the respondent's costs of the application.

AT 2.35 PM THE MATTER WAS CONCLUDED