Mullins & Birchmore [2014] FCCA 1297 (20 June 2014)

Last Updated: 26 June 2014

FEDERAL CIRCUIT COURT OF AUSTRALIA

MULLINS & BIRCHMORE

[2014] FCCA 1297

Catchwords: FAMILY LAW – Property proceedings – equal contributions – s.75(2) of the Family Law Act 1975 (Cth) matters favour the wife – significant credit card debt – asset pool negligible, overwhelmed by debt – husband’s application for wife to pay 70 per cent of “matrimonial debt” dismissed.

Legislation: Family Law Act 1975 (Cth), s.75(2)

Applicant:

MR MULLINS

Respondent:

MS BIRCHMORE

File Number:

CSC 431 of 2013

Judgment of:

Judge Hartnett

Hearing at:

Cairns

Hearing dates:

3 & 4 June 2014

Delivered at:

Melbourne

Delivered on:

20 June 2014

REPRESENTATION

The Applicant:

In person

Counsel for the Respondent:

Ms Sinclair

Solicitors for the Respondent:

Sandra Sinclair

ORDERS

(1) The applications of the husband and wife are dismissed.

IT IS NOTED that publication of this judgment under the pseudonym Mullins & Birchmore is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT OF AUSTRALIA AT CAIRNS

CSC 431 of 2013

MR MULLINS

Applicant

And

MS BIRCHMORE

Respondent

REASONS FOR JUDGMENT

1. The relevant facts in this proceeding, which was commenced by the Applicant husband on 31 July 2013 with an Initiating Application filed, followed by an Amended Initiating Application filed 8 October 2013 and Further Amended Application filed 3 June 2014, are these:-
   1. The Respondent wife is aged 38 years, in full-time employment as a (occupation omitted) with (employer omitted) in Cairns and earning, in this financial year, $40,000 gross per annum. Her taxable income in the financial year ended 30 June 2013 was $38,759. Her health is good. She resides, since January of this year, with her de facto partner, Mr L, in a property purchased by them, jointly, in Property B. The purchase price of that home was $480,000 and the deposit, stamp duty and other associated costs of purchase were paid for solely by Mr L. The wife makes an occasional contribution to the monthly mortgage repayment in the sum of $267 per week. The wife’s Financial Statement is evidence that her expenses marginally exceed her income at the present time. Mr L is a (occupation omitted) who had $80,000 to apply by way of deposit to the purchase of the home. In answer to a question asked by the husband of him in cross-examination, his evidence was that he has savings in the sum of approximately $8,000. His average weekly income is currently $600 net.
   2. The Applicant husband is aged 45 years. He is in employment as a (occupation omitted) with (employer omitted), but claimed to be on extended sick leave. His evidence, late in his cross-examination, was that in fact he intends to go on unpaid sick leave commencing the week after the trial. His evidence was that he had used up the entirety of his recreational leave, had no entitlement to long service leave (as he had not completed five years in his employment) and had used up all of his sick leave. The husband, in his affidavit evidence, deposed to suffering from depression and anxiety and to having Asperger’s Syndrome. No medical evidence was put before the Court by him. No medical evidence as to any illness restricting his ability to be gainfully employed was put before the Court by him, in particular, as to his current health and mental health functioning. He claimed, in his Financial Statement, to earn income in the sum of $86,684 gross per annum. In cross-examination, it became clear that the husband’s income exceeds that amount. The husband gave sworn evidence that his gross income is $88,000 per annum, and that he receives an amount of approximately $16,265.34 per annum by way of salary sacrifice benefits before tax. The application of his salary sacrifice is to his rental expense, his electricity bills and other associated household bills and, in the past, his car parking expenses. On 8 April 2014, the husband obtained a lump sum reimbursement of Foxtel payments and car parking payments in respect of which he had claimed, and then sought reimbursement. The child support agency, for child support purposes, determined the husband’s taxable income in the year ended 30 June 2013 to be $98,495. This may have included the additional $1,405.30 the husband receives per annum by way of a first aid allowance which became apparent at trial.
   100. The husband lives in rental accommodation for which he pays $320 a week. His girlfriend, as he refers to her, is now residing in that accommodation with him. She has, however, maintained other accommodation and thus for that reason, amongst others, he does not refer to her as his de facto partner. He seeks no rental contribution from her in respect of her occupation of his rental apartment, on the basis that she is required to fund her other accommodation. Her income, he deposed to, as being approximately $25,000 per annum.
   4. The parties commenced their co-habitation in (omitted) 1999 and married on (omitted) 2011. They separated on 17 August 2012. Their co-habitation period was thus 13 years and 4 months approximately.
   5. The parties have two children - X born on (omitted) 2000 and Y born on (omitted) 2004. The children are now 13 years and 9 years respectively. At trial, X resided five nights out of seven with the father, and Y resided with the mother. From the time of separation in August 2012, the children resided, for a brief time initially, with their mother and then between their parents’ households as to four nights with the mother and three nights with the father in each week, although the father’s evidence is that he had four days with the children and thus sought from the child support agency an equal apportionment of time as spent by the children with each of their parents, to which the wife conceded. Such arrangement continued until March of 2014 when the children spent a continuous period of one month in the care of their father. Their father immediately notified the child support agency of the change in care arrangements and sought child support payments from the mother. At that time, the father was in arrears of child support payments in excess of $1,000. The monies that would have been payable to him by the mother, as assessed on 7 April 2014, were deducted from the debt owing by him. There remains still a debt owing by him. The father had accumulated child support arrears because child support payments to the mother had been calculated on an estimate of income provided by him in the absence of an income tax return. When he did file his return he had underestimated his income and owed money to the mother, thus arrears accumulated, and the mother did not receive a child support assessment which truly reflected the husband's income until a later point in time. The husband is now attending to the repayment of arrears and there remains outstanding $250. Last month, and only as this trial was looming, did the husband make a lump sum payment of $650 in child support arrears. The children’s living arrangements between mid-April and the end of May are in dispute between the parties, but it appears on the evidence that the children spent two nights a week with their mother at least. From about 27 or 28 May 2014, the child Y has lived full-time with the mother and the child X predominately with the father. The parties did not put any evidence before the Court as to the ongoing arrangements for the children, save the father claimed the children would both be residing with him. The mother disputed this. The Court has no satisfactory evidence to find what will be the care arrangements in to the future, save to note that for one year and seven months, the children were in the care of each of their parents in a four night, three night arrangement.
   6. The child X has Asperger’s Syndrome, high anxiety disorder and attention deficit disorder. The husband receives a Centrelink carer’s allowance in respect of X’s care at the present time.
   7. The husband proposed in his affidavit material, which he elaborated upon in cross-examination, that he would cease his employment with (omitted) to become a recipient of Centrelink sickness benefits. He proposed to commence studying at university again, and remain a student in receipt of Austudy, for a period of four to five years. He would not, however, resign his employment from (omitted) in case he wished to return to that employment. His evidence was that he saw no current prospect of him being employed as a (omitted) again in any capacity, but his further evidence was that if he remained on extended unpaid sick leave, he would be able to qualify for government sickness benefits. Such benefits would then continue until such time as he received Austudy payments. If he resigned his employment he would not obtain government benefits. If the children, or either or both of them, remain in the care of the wife in to the future, then the husband will make no contribution, save the minimum Centrelink monthly payment to the children’s support over the next four to five years. If the children, or either of them, reside with him, his proposal is to support them through his receipt of Austudy payments, although he was unaware whether he would in fact qualify, and family tax benefits, rent allowance and any child support payments that he might receive from the wife. In that situation, the husband would have no capacity to pay any of the numerous debt obligations that he has, and his evidence at trial was that he would default in respect of such payments. He gave subsequent evidence that he might seek to obtain his superannuation entitlements under hardship grounds, which he could not do presently, but would be able to do when he was on sickness benefits. He also indicated that if the wife paid out 70 per cent of the debt sum claimed by him, he might then be in a position to enter into a debt agreement with his creditors;
   8. This case is about the apportionment of debt with the husband seeking to have the wife pay the majority of the parties’ “marital debt” as described by him.
2. The husband relies upon his Affidavit sworn 20 May 2014, his earlier Affidavit sworn 8 October 2013 and his Financial Statement sworn 31 July 2013. I note that there were aspects of the husband’s Financial Statement which were out-of-date, and that he had not provided an updated position to the Court and the other party about his financial position. The wife relied upon her Affidavit sworn 10 September 2013, together with a further Affidavit by her sworn 22 October 2013 and her Financial Statement sworn 2 June 2014. She also relied upon an Affidavit of Mr L sworn 2 June 2014.
3. The wife, in her Amended Response filed 2 June 2014, sought that each party keep those assets and liabilities they currently each have in their respective possession, and that the husband pay her legal costs. The wife amended that Response by Amended Response filed 3 June 2014 to include a splitting order in respect of the husband’s superannuation entitlements. The order sought by the wife was as follows:-
   • “That in accordance with paragraph 90MT(1)(a) of the Family Law Act 1975, whenever a splittable payment becomes payable in respect of the husband’s interest in (omitted) superannuation fund member number (omitted) the wife is entitled to a base amount of TWENTY THOUSAND DOLLARS ($20,000.00) or such other amount as this Honourable Court deems fit, and there is a corresponding reduction in the entitlement of the person to whom the splittable payment would have been made but for these orders.”

The husband sought a transfer of some listed chattels as set out in his final Amended Application from the wife to himself. There is no valuation before the Court as to any of those items, and it appears, and there was not disagreement expressed in relation to this, that they would be of nominal value. They are items of personal property. The parties did divide their chattels at an earlier time, but the husband now seeks some part of the wife’s division. Ultimately, at trial, the wife agreed to give the husband those items that she had in her possession and that he sought. A consent order to that effect was entered into. The husband also sought that the wife pay 70 per cent and he 30 per cent of “the marital debt” which was not further defined by him. Otherwise, he sought the wife pay his costs, albeit he is a litigant in person. Both of the parties filed outline of case documents. Statements of fact in these reasons are findings of fact on the balance of probabilities.

Assets of the parties

4. Below is a list of the parties assets at trial:-
   1. chattels of a value unknown and divided between the parties prior to trial, and by consent order at trial;
   2. a (omitted) watch purchased in 2011 for $8,000 with no valuation provided to the Court. It is agreed it shall remain with the husband;
   100. the wife’s diamond ring purchased by the husband early in the relationship for $6,000 with no valuation before the Court in respect thereto. It is agreed it shall remain with the wife; and
   4. motor vehicles in the husband’s and wife’s names with no real equity.

Superannuation

5. The superannuation of the husband as at 3 June 2014 was $89,394.17. The superannuation of the wife with (omitted) Superannuation is $36,146; and with (omitted) Superannuation is $4,262. The total superannuation of the wife is $40,408.

Liabilities

6. These are set out in the husband’s part O section of his Financial Statement which comprise, he says, $57,172 of credit card debt and $89,177 of overdraft loan and student loan debt. The wife has debt as set out hereafter.

Contribution

Initial Contribution

7. At the commencement of co-habitation, neither of the parties had assets of significance which they applied to the parties’ assets or welfare of the family which would warrant an adjustment, these many years and contributions by both later, in either’s favour. The parties lived at the wife’s parent’s home, rent-free, for a period of six months, but given the duration of this relationship and the other contributions by both the husband and wife, there is no adjustment in respect of that contribution. The wife claimed also that she had a sum of $20,000 which she subsequently applied to the purchase of the parties’ first and only real property. This was an investment property. The husband disputed that the wife had any such sum and considered that claim a fabrication.
8. The Court is satisfied that when the parties purchased the property at Property F in February 2002, the deposit monies of $5,100 came from monies held by the wife prior to the co-habitation period. There is no persuasive evidence before the Court however as to the wife’s application of the remaining sum claimed of approximately $15,000. The Court is satisfied on the wife’s evidence that she had such funds, but not satisfied that the totality of such funds were applied to the purchase of Property F. That property was purchased with the assistance of a first home owner’s grant of $7,000 and was purchased in the name of the wife. A mortgage was required to be taken out to complete the purchase with such mortgage being in the sum of $94,096.52. The purchase price of the property was $102,000. Thereafter, the wife borrowed further funds secured over the property. She had no monies available to her at that point in time from any prior sum held by her. At cohabitation commencement, the wife also was a member of (omitted) Private Medical and, as such, became entitled subsequently to a shareholding which she was not required to purchase. She sold same during the course of the relationship and in 2010, receiving an amount of approximately $1,500 upon sale. The husband also had some shares at the time of co-habitation, although he did not set out in his evidence in what sum. It was the wife’s evidence he had such shares, and further that when he sold them he applied $6,000 to the purchase of her engagement ring. The wife had a Mazda motor vehicle with a loan attached, but with some equity in such vehicle of, she claims, approximately $16,000 and the husband had a motorcycle. There is insufficient evidence before the Court to determine precisely the value of the motorcycle and the equity in the Mazda at the time of commencement of co-habitation. The parties otherwise had some superannuation. The Court determines the parties’ initial contributions to be slightly in favour of the wife, but with no adjustment necessary at this time.

Contribution during the marriage

9. Although much material was dedicated in the parties respective affidavits to their financial and non-financial contributions during the course of their co-habitation and marriage, in the running of the trial they agreed that their contributions were fairly equal. They were equal in overall terms. Until March 2009, a period of almost 10 years, the wife earnt significantly more income than the husband. Commencing in 2009 when the husband became employed as a (omitted), the husband earned considerably more income than the wife. Both parties applied their income toward the benefit of the family and its advancement, and both parents cared for their children.
10. Whilst the parties were together, the husband endeavoured to obtain a (omitted) licence, which ultimately he was unable to achieve. He spent some time on that pursuit. He was engaged in part-time employment and in 2002, completed a (omitted) course. He cared for the children. Significantly he commenced a second degree course in 2006 being a (omitted) course, wherein he remained a full-time student in receipt of Austudy payments for three years. During that period of time, the wife worked four and a half days each week. The husband applied his Austudy payments toward his travel to and from university, his lunch money, his text books and other course expenses. Very little of those monies came into the household. When the course finished in November of 2009, the husband then remained unemployed until March of 2010 when he commenced employment as a (omitted), moving to (employer omitted) in July 2010 in receipt of a starting salary of approximately $95,000. He has been consistently employed by (omitted) as a (omitted) since that time, which is almost four years. If he completes a further year there, he will be entitled to a partial long service leave payment. This has accumulated and is currently 25 days by reference to his payslip of 30 May 2014. Throughout the husband’s studies, he and the family were supported in the main by the wife’s income.
11. In late 2010, the parties sold the only home that they had purchased during the course of their relationship, being their investment property, and in early 2011, they received net approximately $35,000. This money was controlled by the husband and it was applied by him toward paying out the parties’ credit card debts and the family having a holiday in the (country omitted). Thus, at that time the parties had no credit card debt.
12. When the parties separated in the following year, the husband determining the marriage was over, he departed the rented former matrimonial home and removed approximately $1,400 out of an account in his name to which both parties had access. He left the wife with approximately $120 to support herself and the children. A direct debit of $110 came out at about the same time for medical insurance, leaving the wife with $10. She was not due to receive her weekly wages for another four days. The husband refused to provide the wife with the family motor vehicle, and further objected to her hiring a vehicle. She did hire a car for three days to drive into work, to explain what had happened, and to organise meetings with Centrelink to make sure she could pay the bills. She paid for the hire car on her own credit card which had been open for four years but which she had never used. The husband two days after separation cancelled the wife’s access to his credit card. In about October 2012, the wife purchased a car for transport for the children and herself. She bought a Toyota Corolla for $12,000. She borrowed the entire purchase price. She later extended the loan to pay for repairs to the car, and a personal credit card debt of about $1,500 for the hire car, and a loan from her mother that her mother had given her after separation to assist her. The husband had taken the family car on the basis that he was the owner of the vehicle; required to make the payments; and thus needed it in his possession. Two months thereafter, without the wife’s knowledge or consent, the husband used the frequent flyer points accumulated in the wife’s name and the points applicable for the family, to take himself to (country omitted) in a business class seat for a four week holiday. He also sought and received a repayment of one half of the bond money on the rented former matrimonial home in the sum of approximately $600 which the wife had then to find. The husband also, after leaving the family home, took his name off the electricity account of the property, without first informing the wife. He sent a text message to this effect after he had done it. The wife was required to pay $150 fee to have the electricity account established in her name.
13. The account from which the husband withdrew the $1,400 referred to in the preceding paragraph was an account into which both parties paid their salary. At separation, both parties were in full-time employment. I do not accept the husband’s evidence that he could not recall if the wife’s salary was paid into such an account. That is something he well knew. He had access to all the accounts and he, effectively, left the wife with no funds and no transport for herself and the children. The day after separation, the wife used the husband’s credit card, she being a secondary card holder, to purchase some $827.18 worth of items. She purchased $93 worth of liquor, $504.26 for groceries for the household, and a small amount for the purchase of a pasta pot. She also expended $79 to replace the internet the husband had cancelled. The wife’s expenditure outraged the husband and he requires reimbursement of such sum to this day, nearly two years later. The husband’s approach to financial matters upon his departure, in circumstances where he was then the significant income earner of the household, with the need to support two young dependent children, was mercenary in the extreme. And insightless.
14. The husband now seeks that the wife pay 70 per cent of the credit card (in the sum of $29,000) and loan debt (HECS and the car loan) outstanding at the time of separation, together with 70 per cent of the $400 each week, he says, he has been required to pay in the intervening period by way of minimum monthly repayments on the credit cards.
15. Dealing firstly with the husband’s claim that the wife should contribute 70 per cent to the repayment of his HECS debt. Until late in the proceedings, the husband claimed the amount owing was $50,000. It was not until he was required to produce some documentation that he conceded that the amount owing as at 30 June 2012 (two months before separation) was $42,000 and that an amount had been paid off during the period of co-habitation in the sum of $11,692 in respect of an earlier HECS debt of the husband. The husband had earlier obtained his first tertiary qualification, namely a (qualification omitted).
16. The husband’s HECS debt now is $26,406. The husband’s claim in respect of this debt is ludicrous. Firstly, the debt at trial is not $50,000, nor was it at separation, as claimed by the husband in his Affidavit sworn 31 July 2013. The debt at trial is $26,406. The husband omitted to mention in his sworn material, and it did not become apparent to the court and the other side until trial, that in fact he had managed to pay off a HECS debt of $11,692 during co-habitation. The husband has been the beneficiary of his studies. The wife worked to support him and the children whilst he engaged in such studies. The family enjoyed the increased income resultant for a period of two and a half years, and no longer. The wife has already assisted in the paying off of his first HECS debt.
17. The husband’s evidence is that he will no longer earn an income as a result of that qualification, and that it is his intention to resume the student life for another period of four to five years. The wife and children will receive no financial benefit in respect of the husband’s completion of this qualification. This debt in these circumstances is a debt which is personal to the husband, and the repayment of same will be dependent upon his receipt of income. If the husband elects to not exercise his earning capacity in the years to come and be in receipt of an Austudy allowance, then no call will be made for repayment of this debt. It is only when he again re-enters the workforce, and receives a minimum prescribed amount by way of income, that deduction from income in respect of the debt will become applicable. That, on the husband’s evidence, will be a long way off. The husband has enrolled in a full-time (course omitted) at (omitted) University commencing July 2014. He anticipated in enrolling in a (course omitted) degree in 2015.
18. It would be unjust and inequitable in the circumstances of this case to require the wife to make any contribution to the husband’s repayment of such debt. The husband was not honest in his presentation of that debt in his affidavit material and the court will not make any order for the wife to participate in the repayment of such debt. Furthermore, the husband could not say what amount of the debt he claimed related to the law degree. His answer was that he simply did not know what that had cost. He conveniently answered that he had no knowledge as to many aspects of his financial circumstances when pressed in cross-examination. The Court does not accept that he had no such knowledge and finds instead that he was evasive in answering questions put as to his financial circumstances. His responses were non responses for the most part.
19. Dealing secondly, with the car loan. The husband sought that the wife make repayments with respect to a car loan to (omitted) Finance. This car loan related to the family’s car, which was a (omitted) model vehicle, which was purchased by the husband subject to finance. In 2003, the parties had traded in the wife's Mazda vehicle which she bought into the relationship, and in relation to which her parents had paid out the loan for $12,000, borrowed a further $10,000 secured by mortgage on their investment property; and purchased a BMW. Soon after the wife obtained her full-time employment in March 2011 (upon her and the children joining the husband in Cairns from (omitted)), the husband wished to upgrade the parties’ motor vehicle. He traded in the BMW, registered in the wife’s name, on a Holden (omitted) sports vehicle, registered in the husband’s name. This vehicle was purchased with finance obtained in the sum of $35,060. The husband determined some one year after separation, that he would trade that vehicle in, as the car loan (of $35,000 approximately) was costing him $180 each week and he wished to reduce that commitment. Accordingly, he traded the vehicle in for the sum of $28,500 and purchased, subject to a lease arrangement, another vehicle for $42,950 in relation to which he is required to pay $120 each week in lease repayments. In three years’ time, the payment outstanding then to purchase the latest motor vehicle will be $22,000. He can, at that time, purchase the vehicle or hand it back, according to his evidence. The husband’s evidence was that in September 2013, in the trade-in, he suffered a loss of $6,562 and that he required that debt to be paid as to 70 per cent by the wife. Such debt was attributable to the relationship, as he saw it. The fact that he had for 12 months had possession and use of the car, whilst the wife was left initially without a car with two small children made no impact upon him. His evidence that he wished to save money in the trade-in of the vehicle, does not sit with the purchase price of the subsequent vehicle.
20. Had the husband been looking to save money at the time, he could easily have purchased a vehicle for a significantly lesser sum, and had money in his pocket after the trade in. The husband did not consult with the wife as to the purchase price of his new vehicle, but requires her to now suffer the shortfall that he determined he would take. His use of the vehicle in the 12 month period and his use of it to purchase another vehicle of his choice should not impact upon the wife, whom the husband now calls to account for the debt incurred in relation to that transaction. The Court will make no order that the wife bears any responsibility for the actions of the husband in respect of the motor vehicle.
21. Dealing thirdly with the credit card debt. The husband has obtained further credit cards since separation and spent further monies, accruing further credit card debt upon them. This is despite his ongoing receipt of income in the vicinity of $100,000 per annum and taking into account his ability to salary sacrifice. This is a matter to which I shall return, save to say here, it is concerning that the husband would be able to access credit card funds in his position. When Counsel ask him as to whether he was telling credit card providers that he had the capacity to pay, there was no response. He claimed to have no knowledge of the credit limit with regard to a number of his credit cards.

Evidence

22. The husband's evidence was vague and contradictory with respect to his superannuation contributions over time and, in fact, the superannuation benefits accrued to his account at the present time. That which he deposed to in his statement of financial circumstances was an understatement of his current balance. He claimed in respect of his superannuation in his outline of case filed 3 June 2014 that his superannuation entitlements at the time of separation on 17 August 2012 were with (omitted) Super in the sum of $10,801 and with (omitted) Super in the sum of $12,766. A total amount of $23,567.
23. In his Affidavit of evidence-in-chief sworn 20 May 2014, the husband swore his HECS liability to be $50,000 and his superannuation entitlements to be in the same sum. In his financial statement sworn in July 2013 he claimed his superannuation interest in (omitted) Super to have a gross value of $68,993. That was September 2013. It is now June 2014 and his superannuation has increased by some $20,000 in less than 12 months.
24. The husband provided conflicting and not truthful evidence with respect to the accumulation of his current superannuation balance, and it was only at trial that the accurate balance was before the Court. In response to questions asked by counsel as to what the deductions in respect of superannuation contributions on his payslip were, he responded that he did not know. When pressed he thought that perhaps the fortnightly deductions of $437.98 were his employer contribution to his superannuation, and the sum of $171.76 was perhaps the compulsory amount contributed in addition by him. He then thought perhaps $437.98 was a voluntary contribution of super made by him and that the $171.76 was his employer's contribution. His evidence was that he had at the commencement of his employment asked his employer to deduct additional voluntary amounts by way of personal contributions to superannuation, and that he had forgotten that he had made such a request and provided such authority. He ceased these additional contributions being deducted from his salary approximately one year ago, he claims, when notified by the solicitor for the wife that he was, in fact, making voluntary contributions at a time when he was claiming an incapacity to pay down the outstanding credit card debts.
25. The husband's superannuation balance has increased significantly since separation. When asked why that might be so, the husband described it as aggressive investment in the share market which had seen a growth in return to him. But, and as conceded by him, the evidence that was before the Court was that the husband had made significant contributions to superannuation in addition to that of his employer’s contributions, and that had been the main cause for the resultant growth in his entitlements.
26. When asked what were the husband's voluntary contributions over a three year period to his superannuation fund, his response was that he did not know. Further, he did not notice that such voluntary contributions were being deducted from his salary despite reference to same on his payslips. The husband initially gave evidence that he could not remember the percentage of his income that the employer made by way of contributions to his superannuation fund, but later gave evidence that the employer contributions were at 9.5 per cent of salary, and that, in addition, the employer paid a further 4 per cent of contributions to match any voluntary contributions made by the husband.
27. On 1 July 2012, the husband's superannuation balance was $29,133.49. On 30 June 2013, the amount in the husband's account with (omitted) Super was $64,415.83. In the 11 months following that amount increased to $89,394.17.
28. The husband has as part of his superannuation entitlement, income protection, but he provided no evidence to the Court as to the benefits that might be provided to him in respect of that. He indicated that he had an intention to go on sickness benefits, and in doing so noted that he could access his superannuation entitlements. He has income protection as part of his superannuation fund entitlements and pays a regular fortnightly sum in respect of this coverage, but he provided no particulars of same to the Court in circumstances where he claims an inability to work due to ill health. He also pays a total permanent disability premium.
29. The wife does not cavil with the quantum of credit card debt in the husband’s name at separation being in the sum of $29,320 and nor, generally speaking, that the application of funds were for the benefit of the family. Since separation the husband has acquired three further credit cards. The wife has since separation continued to have the debt she had at separation, save that the (omitted) Finance debt of $2,000 has been reduced by her and is now in the sum of $1,599. The wife's total credit card debt in her name is $2,658.
30. The husband's evidence is that following separation he was unable to pay child support payments and reduce the credit card debt of $29,320. The husband initially did not pay any child support pending the obtaining by the wife of an assessment, and thereafter he fell into arrears in respect of such payments. He claims that on his salary he could not pay his living expenses and that his credit card debt increased as he added to his credit card some of these living expenses. They included taking the children to (omitted) for a holiday, although when asked how he managed to pay for the airfare for himself and the children, his response was that he could not remember.
31. The husband proposes to live in the future on Austudy receipts, family tax benefits receipts and a rental allowance. His evidence in respect of his employment was that he had not told his employer yet that he intended to not return to the workplace. He is able to remain on unpaid sick leave whilst he provides medical certificates, though for what period of time is unknown to the Court. When asked how it is that he would repay his credit card debt currently outstanding, he responded that he would default.
32. The husband claimed that his medical certificates run out on 26 June 2014. He claimed to have no outstanding leave owing to him and claimed to be in receipt of no income commencing in the days following the trial. He has obtained an application for sickness benefits, but he has not applied for such benefits. His evidence in relation to this was contradicted by his payslip. Although he claimed to have no recreation, nor sick leave owing, his payslip for the period ended 30 May 2014 exhibited otherwise. In that payslip he was said to have recreation leave owing of 16.15 days, sick leave of 1.74 days which the Court notes may well have run out, and an accumulated balance of 25 days in respect of long service leave, which on his evidence he would not be in a position to take until July 2015. His evidence was further that if he quit his employment as a (omitted), he would not be eligible for Centrelink benefits and so would not do so. The husband has made inquiries as to the making of a hardship application in respect of release of his superannuation fund monies. Throughout the husband made no reference to his entitlements in respect of his income protection payments which appeared on his payslip. The husband has income protection. He pays premiums for death and total and permanent disability and for income protection. The husband, as a benefit, would receive, with a total and permanent disability, his superannuation accumulation benefit plus an insurance benefit of $162,000 or more. His income protection would be a fortnightly pension of 75 per cent of his fortnightly salary. Other than the documentary evidence tendered by the wife, the Court had no other evidence as to the precise circumstances of any payment. The husband was not forthcoming in his evidence. He was asked “are you entitled to any lump sum payment when you leave there?” and his reply, tellingly was: “I don’t know”. He was then asked “you haven’t enquired into that?” and he responded “no, well, that will obviously go towards paying off the debts”.
33. The husband had at commencement applied for the wife to pay 40 per cent of the parties’ debt and loans at the time of separation. He amended that application to seek that she pay 70 per cent. His reason for doing so was that the children were now in his full-time care - which is contrary to the evidence at trial - and that he has future needs which are specifically his ongoing illness and its impact on his ability to earn income. As said earlier in these Reasons, no medical evidence was provided in respect of that claim. Even if there existed any illnesses, despite them, the husband has been continuously and gainfully employed as a (omitted) for the last nearly four years. As to such illness, the husband in his Affidavit sworn 20 May 2014 at [3], said that he was of poor health and on extended sick leave due to severe high blood pressure. He said:-

“I suffer from recognized mental health disorders: Aspergers, depression and anxiety.”

34. In the immediate early stages after separation the wife was struggling to support herself and the children on an income of $38,000 gross per annum, with no child support payments and no family assistance. The husband was either requesting or demanding that she assist him in the meeting of the payment of the credit card debt. The husband claimed that the wife had frivolously expended funds in December 2012, being shortly after separation, and cross-examined her as to her own credit card expenditure in that month, which was in the sum of $3,251.93. The wife conceded that she used her credit card. However, she purchased furniture to replace items taken by the husband, and other items, including kitchen items, clothing for the children for Christmas, contact lenses, Christmas presents, food, alcohol (in the sum of about $106), and weight loss pills of $112. The husband exhibited a lack of insight and empathy in this cross-examination.
35. The (omitted) Finance debt in the wife's name was for the purchase by the parties of a lounge suite and coffee machine. Both items are retained by her. The husband suggested that as the wife had those items, she should be solely responsible for such debt. There are various items in the husband's possession purchased with his credit cards, including computer equipment, bedding, kitchen and crystal ware, but he seeks the wife be responsible for 70 per cent of the debt owing with respect thereto.
36. Following separation, the husband opened a credit card account with (omitted) Bank to purchase a tv and stereo, interest free over 50 months. He opened a credit card with the (omitted) Bank and transferred credit card debt to the interest-free card with the (omitted) Bank, and opened a credit card with (omitted) Bank and transferred credit card debt to the low-interest (omitted) Bank credit card. He has made the minimum monthly credit card repayments since separation. The wife has not contributed toward such liabilities, and nor has she had, nor does she have, the capacity to do so. The husband commenced, in the month following separation, to seek of the wife that she assist him in the repayment of the credit cards. He claimed to have an inability to afford to make the repayments on his income.
37. The wife’s evidence is that he harassed her, in respect of the debt, and that he made, not a request but a demand, for her contribution which she was unable to satisfy. The sum, which the husband was discussing with the wife, was about $90,000 of debt, which he determined, should be apportioned between them.
38. When the husband filed his initiating application on 31 July 2013, he sought that the wife pay him the sum the $722 each month to meet minimum loan repayments on joint marital debt, until a final property settlement was finalised, and further sought, by way of interim orders and final orders, that the wife pay him $54,343. The husband amended that application by amended initiating application filed 8 October 2013. At that time, the husband sought that he keep all assets in his possession, that the wife keep all assets in her possession, save a number of chattels to which he referred, and that the marital debts be distributed to the husband 60 per cent and the wife 40 per cent. He sought the wife pay his costs, and that the wife’s solicitor pay the applicant’s costs personally, under section 43 of the Federal Court Act 1976 (Cth). Amongst other interim orders sought, the husband sought that the wife pay him $303 a week, being half the minimum repayments to maintain the current joint marital accrued debts as claimed by him, until the matter finalised.
39. At the time, the wife was paying $300 a week in rent. Her income, at the time, was about $675 after tax each week, approximately half of what the husband earned before any government benefits were paid to either of them. The husband was assessed to pay $520 a month in child support ($130 a week) but as at 23 August 2013, was in arrears of more than $800.
40. As has the husband, the wife, since separation, has accrued credit card debt which was as at 27 October 2013, about $8500. Such credit card debt has been used to pay various expenses including the children’s day care, basketball fees and clothing, groceries and other living and household expenses. In her Amended Financial Statement filed 2 June 2014, the wife’s loan with the (omitted) Bank was in the sum of $28,237 with such loan being for her motor vehicle ($11,000), her legal fees ($15,000) and credit card debt ($6,000). She also had a (omitted) Bank Visa card debt of $11,000 and a (omitted) Bank debt of $1600, both of those being further credit card debts.
41. The husband’s actions, as described above, have caused an extension of the credit card debt of the parties at separation. He has, the Court finds, had a capacity to eradicate that debt over this intervening period. Instead, he has increased his superannuation entitlements, purchased a new car and expended further sums on newly obtained credit cards. No probative evidence was before the Court as to his expenditure on credit cards, nor the reason for him to claim a minimum monthly repayment of $400. $29,000 a year at 15 per cent is $83 a week. At 24 per cent it is $133 a week. There was no transparency in the husband’s presentation of his financial position. Precisely what sums might be made available to him from his current employer should he claim and be able to establish medical incapacity for ongoing employment is unknown. The husband’s various demands of the wife over nearly two years have been entirely unrealistic.
42. The wife, by contrast, has never had such capacity. She now has considerable debt. She will not be able to access her superannuation entitlements. The husband is seeking to, and with such sum will be able to eradicate considerable debt.
43. In the circumstances of this case, orders which are just and equitable as between the parties will provide an outcome where each party pay that debt in their respective names. Each party shall pay their own costs, the husband not incurring solicitor costs in any event. Each party shall retain their respective superannuation entitlements, the husband’s being far greater. They can be applied by him, if he chooses, to credit card debt. Given his evidence, he might instead default in respect of such debt. Or perhaps his ongoing income, and his choices pertaining thereto, will be applied by him. The matters set out in s.75(2) of the Family Law Act 1975 (Cth) favour the wife. She has less income and less earning capacity than the husband, and she contributed to the earning capacity of the husband. She has a requirement to manage her own not inconsiderable debt on a small income. The justice of this case requires the fact of the husband’s refusal to pay down the credit card debt following separation to be taken into account. It was a financially destructive approach. The Court also of course takes into account those other matters as referred to in these Reasons to determine the husband’s application as to the wife being responsible for any debt in his name, should be dismissed.

I certify that the preceding forty-three (43) paragraphs are a true copy of the reasons for judgment of Judge Hartnett

Associate:

Date: 20 June 2014