Garwin & Garwin [2013] FamCAFC 210; (23 December 2013)

Last Updated: 12 March 2014

FAMILY COURT OF AUSTRALIA

GARWIN & GARWIN

[2013] FamCAFC 210

FAMILY LAW – APPEAL – Property – Financial – Contribution based entitlements – Whether the trial judge’s assessment of the husband’s contributions was outside the range of his reasonable exercise of discretion – Whether the trial judge adequately explained his reasons for his findings – Where it was not articulated what else should have been said to further explain the reasons –HELD – Appeal dismissed.

Family Law Act 1975 (Cth): ss 75(2), 79, 79(4)

Bennett and Bennett (1991) FLC 92-191 CDJ v VAJ (1998) 197 CLR 172 Ferraro & Ferraro [1992] FamCA 64; (1993) FLC 92-335 Farmer & Bramley [2000] FamCA 1615; (2000) FLC 93-060 G & G [1984] FamCA 60; (1984) FLC 91-582 Gronow & Gronow [1979] HCA 63; (1979) 144 CLR 513 House v The King [1936] HCA 40; (1936) 55 CLR 499 Mallet v Mallet [1984] HCA 21; (1984) 156 CLR 605 Norbis v Norbis [1986] HCA 17; (1986) 161 CLR 513

APPELLANT:

Mr Garwin

RESPONDENT:

Ms Garwin

FILE NUMBER:

SYC

4531

of

2009

APPEAL NUMBER:

EA

57

of

2012

DATE DELIVERED::

23 December 2013

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Ainslie-Wallace, Ryan & Murphy JJ

HEARING DATE:

30 September 2013

LOWER COURT JURISDICTION:

Family Court of Australia

LOWER COURT JUDGMENT DATE:

4 April 2012

LOWER COURT MNC:

[2012] FamCA 296

REPRESENTATION

COUNSEL FOR THE APPELLANT:

Mr G M Gould

SOLICITOR FOR THE APPELLANT:

Armstrong Legal

COUNSEL FOR THE RESPONDENT:

Mr Julian Millar

SOLICITOR FOR THE RESPONDENT:

Pearson Family Lawyers

ORDERS

(1) Appeal be dismissed
(2) Husband to pay the wife’s costs of and incidental to the appeal. Such costs to be assessed or agreed.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Garwin & Garwin has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY

Appeal Number: EA 57 of 2012
File Number: SYC 4531 of 2009

Mr Garwin

Appellant

and

Ms Garwin

Respondent

REASONS FOR JUDGMENT

1. On 23 December 2013 we published what was intended to be our judgment concerning disposition of this appeal. Unfortunately as a consequence of an administrative error a draft rather than the agreed judgment was delivered. Orders not yet having issued that judgment is recalled and replaced by these reasons. We extend our apologies to the parties for any inconvenience this error may have occasioned.
2. By Amended Notice of Appeal dated 29 September 2013, Mr Garwin (“the husband”) appeals against property orders made by Loughnan J on
   4 April 2012 in proceedings with Ms Garwin (“the wife”). The wife resists the appeal and seeks to maintain his Honour’s decision.
3. His Honour’s orders resulted in a division of the property of the parties as to 62.5 per cent to the husband and 37.5 per cent to the wife. His Honour found that the parties’ contribution-based entitlements were 65 per cent to the husband and 35 per cent to the wife. The husband did not challenge
   his Honour’s assessment of the adjustment made pursuant to s 75(2) of the Family Law Act 1975 (Cth) (“the Act”) of 2.5 per cent.

Background

4. The factual background was largely uncontroversial and none of his Honour’s findings of fact were challenged in the appeal. It is helpful to set out some background facts to give context to the appeal.
5. The husband was born in 1944 and the wife in 1967. They commenced to live together in November 1993. They married in November 1995 and separated in June 2009. They have three children. The husband has two adult children from a previous marriage.
6. At the time the parties started to live together the husband was employed as a professional and had significant assets. The wife was not employed and had little in the way of assets.
7. The husband estimated that at the date on which he and the wife started to live together he had net assets in the order of $5.66 million. There was no challenge to the husband’s assessment of his then net worth and his Honour accepted that figure.
8. At trial, his Honour found that the parties’ joint assets were $13,122,400 together with $20,000 in superannuation. With liabilities taken into account their net assets were worth $12.9 million.
9. As we have indicated, there was no challenge to any of his Honour’s findings of fact. The challenge in this case is to his Honour’s findings as to the parties’ contributions and to the adequacy of his Honour’s reasons.

Trial judge’s reasons

10. His Honour listed the husband’s assets that he held at the time when the parties commenced their relationship.
11. His Honour said:
    78. The husband contends that his net initial contribution was of the order of $5.66 million. The task under section 79 is not entirely mathematical and therefore it is not critical that there be a precise figure found for initial contributions. Doing the best I can, I find that the husband had assets at the commencement of the parties’ relationship which had a value of the order of the husband’s claim.
    79. During the marriage the husband earned income from his [professional] practice and from his assets. Properties were bought and sold, others were rented out and I take it that there was some income from loans. The husband and the wife both made financial contributions by agreeing to be liable for debts associated with real estate and corporations.
    80. The husband conceded that during the marriage he financially supported his older sons from time to time and his mother and siblings. In particular the husband gave $100,000 to each of his older sons. That support was a diversion of funds from purposes of the parties’ family.
12. His Honour found at [86] that each of the parties made non-financial contributions pursuant to s 79(4)(b). Turning to the contributions to the family, his Honour set out the evidence in this regard and concluded:
    95. It follows that the main parenting load has continued to fall to the wife since separation. There are issues in respect of [the eldest child] but later this year he will cease to be a child.
13. From [96] his Honour makes his findings on the parties’ contributions. He said:

The parties agree that the contributions by and on behalf of the husband exceeded those by and on behalf of the wife. It is submitted for the wife that the contributions were made in the proportions 62.5% by the husband and 37.5% by her. The husband contends that his contributions were 80% compared to 20% by the wife. There were few relevant disputes in relation to the balance sheet but in each case I accept that the submissions were made on the basis of the different pools contended for by the parties.

97. The husband came into the marriage with assets of very significant value.
98. Each of the parties made valuable contributions during the marriage, the husband largely as bread winner and the wife as parent and homemaker.
14. His Honour, considered the dollar effect of the husband’s proposed contribution findings and said that 80 per cent to the husband compared with 20 per cent to the wife would result in a difference of $7.8 million which, he said at [99] “...seems to me that such an outcome is outside the legitimate range of discretion available to the Court in this case where the parties cohabited for nearly 16 years and contributions spanned about 19 years.”
15. The trial judge concluded that the appropriate finding was one as to 65 per cent to the husband and 35 per cent to the wife. He noted that this put the husband’s contribution at “nearly twice” those of the wife and would reflect a difference in dollar terms between the parties of $3.9 million at [100].
16. The trial judge then considered the provisions of s 75(2). He noted that the husband submitted that there should be no adjustment in the wife’s favour, but he also submitted that in the event there was to be an adjustment, it would be in the order of 2.5 per cent. The wife contended for an adjustment of 5 per cent at [140]. His Honour concluded that a further adjustment of 2.5 per cent in the wife’s favour was warranted.
17. The effect of his Honour’s findings was to provide the husband with $8,090,894 and the wife with $4,854,537.

The appeal

18. The appellant raises two grounds challenging his Honour’s determination.

Ground 1. That the trial judge erred in the exercise of his discretion by concluding that the Husband and the Wife’s contribution-based entitlements were 65% and 35% respectively in that such conclusion was plainly wrong and inadequately recognised the quantum and impact of the husband’s initial capital contributions as found by the trial judge to have been made by the husband.

19. In essence, it was argued for the husband that his Honour’s assessment of the husband’s contributions was “plainly wrong” and was outside the range of determinations reflective of a reasonable exercise of discretion.
20. The determination of a judge in a discretionary decision is often spoken of as being “in” or “outside” the range. That is a shorthand expression that acknowledges the fact that the court’s determination pursuant to s 79 involves a discretion that is “wide indeed” (Norbis v Norbis [1986] HCA 17; (1986) 161 CLR 513 at 540 per Brennan J) and that, as a result, there is a “ ... generous ambit of reasonable disagreement [which] marks the area of immunity from appellate interference”. (Norbis, above).
21. Axiomatically, the fact that any of us (or any other judge) may have reached a different result based on precisely the same findings as those made by the
    trial judge does not result in a conclusion that the trial judge’s conclusion was “plainly wrong” (House v The King [1936] HCA 40; (1936) 55 CLR 499; Gronow & Gronow [1979] HCA 63; (1979) 144 CLR 513, esp. at 519-20; CDJ v VAJ (1998) 197 CLR 172, particularly per Kirby J at [186]).
22. In this case, while arguing that his Honour’s determination that the husband’s contributions represented 65 per cent was “outside the range”, neither before us nor before the trial judge did counsel for the husband express a view about where the proper range of findings in this matter lay; it was simply asserted that the husband’s contributions should be assessed at 80 per cent.
23. The argument advanced on behalf of the husband before us was that his initial contribution represented 80.9 per cent of the assets of the parties considered by the trial judge. It was submitted that of the net assets considered by the
    trial judge, some $10.66 million came either from the husband’s assets at the commencement of the cohabitation or acquired using those assets.
24. The thrust of the argument advanced by the husband was that the wife’s contribution during the relationship and to the date of trial could not have had the effect of reducing the husband’s contribution to 65 per cent.
25. We do not accept the premise on which this submission is based. First, the assessment of contributions is not a matter of mathematical computation or correlation. (See, for example, G & G [1984] FamCA 60; (1984) FLC 91-582, especially at 79,697; Norbis, above at 523, per Mason and Deane JJ). Secondly, the
    trial judge was bound to analyse and weigh all of the contributions of all types made by the parties, including indirect contributions and s 79(4)(c) contributions which, as the High Court makes clear in Mallet v Mallet [1984] HCA 21; (1984) 156 CLR 605, are to be given significant weight. Here, both parties made relevant contributions. In particular, the wife made indirect contributions to the acquisition of those assets and indirectly contributed to the conservation of other assets which should not be undervalued. (See, for example, Ferraro & Ferraro [1992] FamCA 64; (1993) FLC 92-335, particularly at 79,568-9). Contributions are not required to be tied to particular assets. The court’s role is to evaluate the significance of the various contributions (see Farmer & Bramley [2000] FamCA 1615; (2000) FLC 93-060).
26. In our view, that is exactly what his Honour did in this case.
27. It is not asserted that his Honour wrongly applied any principles nor otherwise erred in law. It is not asserted that his Honour erred in fact. It is not said that his Honour failed to take account of any relevant considerations or took account of any irrelevant considerations. Nothing to which we have been taken by the husband suggests that his Honour’s assessment was “plainly wrong”.
28. The husband has not established error and this ground is not made out.

Ground 2. That the trial judge erred in principle by failing to adequately reveal the process of reasoning which lead his Honour to conclude that the contribution-based entitlements of the parties should be as he assessed them.

29. For the husband it was asserted that, although his Honour found at [81] that the husband had made the “overwhelming financial contribution” he did not then indicate how these “overwhelming” contributions were reduced and ultimately to reflect an entitlement of 65 per cent in the husband.
30. The written submissions of the husband accept that his Honour considered the
    s 79(4)(c) contributions “adequately” and that his findings were reasonably open to him. The challenge to his Honour’s reasons was articulated thus:
    16. It is accepted that the trial judge was not required to explain in great detail why he concluded that the husband’s massive, and overwhelming initial financial contributions should result in his contribution-based entitlement exceeding that of the Wife to the extent that he concluded that they did. It is also accepted that, no matter how detailed the trial judge’s reasons were, there was inevitably a final step which was necessarily subjective, and less than empirically based. In this case, however, it is respectfully submitted that the trial judge’s conclusion was reached by a leap, rather than by taking the final step on a pathway of revealed reasoning. It might be asked (rhetorically), “What happened to the 15% difference between the husband’s initial financial contribution, and the ultimate finding of the Court?”
31. Elegant though the submissions might be, they did not nor could counsel for the husband articulate orally what more could or ought to have been said by the
    trial judge so as to meet the requirement of adequacy of reasoning explained in the well-known authorities such as Bennett and Bennett (1991) FLC 92-191. His Honour’s findings and in particular the passages extracted in these reasons, provide ample exposure of his reasoning process to his final determination. This ground is not made out.
32. The appeal will be dismissed.

Costs

33. As is usual we sought submissions from the parties on the question of costs at the conclusion of the appeal hearing. Counsel for the husband conceded that if the appeal failed, he could not resist an order for costs in the wife’s favour. That is an appropriate concession and we will order the husband to pay the wife’s costs of and incidental to the appeal.

I certify that the preceding thirty three (33) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Ainslie-Wallace, Ryan & Murphy JJ) delivered on 23 December 2013


Associate:

Date: 10 March 2014