No.
6587
of
2001
- By a writ filed 5 July 2001 and an amended statement of claim
filed 20 February 2002 the plaintiff seeks orders under Part IX of the Property
Law Act 1958 adjusting property rights as between her and the defendant.
Although the plaintiff's statement of claim seeks a wide range of relief
it
became apparent during the trial that the only asset which could relevantly be
the subject of an order under the Act was a house
and land at 6 Wadham Road,
Ivanhoe, registered in the defendant's name which was purchased by him in 1993
and in which the parties
had lived with their children, whilst they co-habited.
The property is subject to a mortgage to the Bank of Melbourne
Limited.
- Neither party in this case was legally represented at trial,
although the plaintiff had solicitors acting for her at the time of
the issue
of the proceeding. This created immense difficulties, not only for the parties
themselves but also for the Court. Many
issues which might have been live
issues on the pleadings were not the subject of evidence and both parties
resorted to unsubstantiated
assertions in putting their respective cases. The
evidence which was led was confined to the viva voce evidence of the plaintiff
and the defendant, several affidavits tendered by the parties and subpoenaed
documents which related to the defendant's property
and financial resources.
- Having regard to the guidelines expressed in Re F[1] in relation to the conduct of
proceedings involving litigants in person, during the course of the trial I
took steps to ensure that
the parties were aware of the manner in which the
trial would proceed, and provided some guidance as to the law which would be
applied
to the case and the evidence which would generally be admissible.
Further, I sought to clarify the submissions of the litigants and
the orders
which they sought. This process was extremely difficult and made no easier by
the open hostility displayed by each of
the parties to the other, particularly
during cross examination, a forensic process of doubtful value in the hands of
unskilled and
untrained people. In such circumstances it provides little more
than an opportunity for further verbal assault by one party against
the other.
There are well understood limits to the assistance which can be provided by a
Judge in such circumstances in order to
preserve the neutrality and
impartiality of the Court and, ultimately, "the parties retain the primary
responsibility for defining
the issues in the case and presenting/advancing the
relevant legal argument"[2].
The Relationship
- The parties commenced their relationship in what was then
Yugoslavia in 1985. There are two children of the relationship born in
the
former Yugoslavia who are now aged 16 and 17. In 1987, in separate months,
first the defendant and then the plaintiff and the
children migrated to
Australia. The parties lived together in Australia from that time until 20
November 1999 when they finally
separated although there were occasions when,
it is agreed, cohabitation ceased as referred to hereunder.
- The date on which the de facto relationship (if it existed)
ceased was in dispute between the parties. The plaintiff claims the
relationship ceased on 6 July 1999, however she continued to live with the
defendant until 20 November 1999 when she left the house
in Ivanhoe and did not
return.
- The tortured and confused history of this proceeding made it
difficult to identify the defendant's position as to whether he had
a de facto
relationship with the plaintiff and, if so, when it ceased. By his Defence to
the plaintiff's Amended Statement of Claim
dated 20 May 2002, the defendant
purports to "disagree partially" with the pleading of the de facto
relationship from May 1985 to
6 July 1999 and "agree, partially" with the
pleading that plaintiff and he lived together in a de facto relationship
for at least
2 years. No particulars are provided which might identify what
parts of those allegation are in issue. In earlier documents filed
with the
Court, and tendered in evidence at trial[3], the
defendant denied that he lived in a de facto relationship with the plaintiff as
she had stated. In a later affidavit affirmed
10 January 2002 the defendant
asserted that while he and the plaintiff had lived in a de facto
relationship, that relationship ceased
in January 1993.
- It was common ground between the parties that there were two
occasions on which the plaintiff had left the defendant. They were
for a
period of some days in 1992 and for a longer period in 1993. In evidence at
the trial, resiling from the position that no
defacto relationship ever
existed, the defendant asserted that the relationship ceased upon the
separation in 1993. While he admitted
the plaintiff returned to live at the
Ivanhoe house, he denied that they were in a de facto relationship at that
point, but rather
"living together in the interests of the children" as he put
it.
- It is clear on the evidence that the parties lived together as
if they were husband and wife, although not married, for more than
two years.
They thus fall within the definition of de facto partners under s 275
of the Act. The defendant's assertion that the
relationship ended in 1993 is,
however, relevant to the question as to whether the plaintiff instituted this
proceeding within the
time prescribed by s 282(1) of the Act.
- While the defendant has not pleaded that the plaintiff's claim
is barred by s 282(1), in so far as it is necessary for me to do
so, I
find that the de facto relationship subsisted up until 6 July 1999. The
proceeding was, accordingly, therefore, brought within
time. I make this
finding for the reasons set out below.
- The nature of human relationships outside those confined by a
legally subsisting marriage is such that they do not easily lend themselves
to
legal definition. A de facto relationship is defined in s 275 of the
Act as being:-
"the relationship between de facto partners of living or having
lived together as if they were husband and wife although not married
to each
other".
- The use of marriage as a reference point in such a definition
tends to beg the question. Marriage is defined in law by the taking
of
procedural steps in compliance with a statute. Once the legal status is
obtained, the state of marriage subsists without further
requirement. As has
been previously observed:
"The relationship of marriage, being based in law, continues
notwithstanding that all of the things for which it was created have
ceased.
Parties will live in the relationship of marriage notwithstanding that they are
separated, without children, and without
the exchange of the incidents which
the relationship normally involves."[4]
- There is therefore nothing in the law of marriage which allows
content to be given to the phrase "as if husband and wife", and nothing
to
assist a determination of when such a relationship has ceased.
- Secondly, outside legal definition, while there may exist
various beliefs and attitudes as to how married people should behave,
the idea that there is a definitive mode of living together as husband and wife
or as if husband and wife is insupportable.
It probably always was. It
certainly is in current Western society.
- Nevertheless the legislation must be construed so as to give
it meaning. This has been done in previous cases through the use of
a number
of factors or indicia which may be applied to a factual situation to determine
whether a de facto relationship exists.
They may be enumerated as:
* the duration of the relationship;
* the nature and extent of any common residence;
* whether or not there was a sexual relationship;
* the degree of financial interdependence, and any arrangement
for support between or by the parties;
* the ownership, use and acquisition of property;
* the procreation of children;
* the care and support of children;
* the performance of household duties;
* the degree of mutual commitment and mutual
support;
* reputation and 'public' aspects of the relationship[5]
- The relationship between the parties to this case was a long
term one in which they lived together under the same roof for all but
brief
periods until 20 November 1999. A sexual relationship existed between the
parties and they had children. No evidence of the
cessation of that sexual
relationship was adduced. The parties cared for and supported the children of
the relationship. The defendant
admitted in his evidence that he and the
plaintiff were publicly regarded as a de facto couple during that period during
which he
admits they were living together but claims they were no longer in a
de facto relationship.
- The evidence before me and the conduct of the trial revealed
that the relationship was not a happy one. There is nothing, either
in law or
common experience, which could support the contention that a relationship does
not subsist simply because the parties are
unhappy.
- There was evidence here that the parties did not combine their
financial resources, but that they both contributed portions of their
income to
everyday living expenses and the care of the children. Certainly they each
contributed, in one way or another, to household
expenses and the care of the
children.
- In support of his contention that the relationship ended in
1993 the defendant tendered in evidence two forms dated 18 February
1993 and 3
August 1999 submitted by the plaintiff to the Department of Social Security.
In both documents the plaintiff denies that
she and the defendant are in a de
facto relationship. The plaintiff claims the first document was completed
around the time of the
1993 separation and the second document around the time
of the final separation in 1999 and that the assertion that there was no
longer
a defacto relationship related to the immediate circumstances of the
separations. Any alleged admission contained in those
documents must be seen
in light of their purpose and the circumstances in which the plaintiff then saw
herself as being. It would
be simplistic to regard such alleged admissions,
even if accepted, as precluding the finding of a subsisting de facto
relationship.
I decline to do so.
- Weighing the totality of the factors to which I have referred
and in respect of which I have evidence I find that the de facto relationship
continued up until 6 July 1999. Thus, no question of whether this proceeding
was commenced within time can be raised. It survives
any such potential bar by
one day.
Property Adjustment
- Section 285 (1) of the Act provides that:
"A court may make an order adjusting the interests of the de facto
partners in the property of one or both of them that seems just
and equitable
to it having regard to-
(a) the financial and non-financial contributions made directly
or indirectly by or on behalf of the de facto partners to the acquisition,
conservation or improvement of any of the property or the financial resources
of one or both of the partners; and
(b) the contributions, including any contributions made in the
capacity of homemaker or parent, made by either of the de facto partners
to the
welfare of the other de facto partner or to the welfare of the family
constituted by the partners and one or more of the following:
(i) A child of the partners;..."
- Implementation of the section involves a necessarily imprecise
exercise guided by an overriding discretion to determine what is
"just and
equitable". However, the plaintiff still bears the onus of putting before the
Court evidence upon which findings can be
made as to the contributions she
claims to have made and the resulting interest which she seeks. In this sense,
at least, she carries
the risk of non-persuasion.
- The principal property in question in this case is the Ivanhoe
house of which the defendant is the sole registered proprietor.
The plaintiff
seeks a half share in that property. There are further claims made by the
plaintiff in relation to chattels in the
house and the defendant's
superannuation entitlement.
- The Ivanhoe property was purchased in September 1993 at a cost
of $78,000. The bulk of the purchase price was financed with a loan
from the
Bank of Melbourne, a smaller loan from the defendant's sister and a government
grant.
- The plaintiff made no direct financial contribution to the
acquisition of the house and was not a party to the decision to purchase
the
property. She claims to have made direct financial contributions to the
improvement of the property by way of the purchase of
materials for renovations
such as carpet and tiles and payments made to various tradespeople. She also
claims to have made indirect
financial contributions to the conservation of the
property by the use of her wage to pay for household items and expenses,
allowing
the defendant to apply his wage to mortgage repayments. The plaintiff
tendered taxation returns for the years ending 30 June 1992
to 30 June 1998
inclusive which reveal she had a total taxable income of $123,784 during that
time.
- The plaintiff claims to have made non-financial contributions
to the improvement of the property in applying her labour to cleaning
the house
and creating a garden. She also seeks consideration of the contributions she
has made in the capacity as a homemaker through
the performance of household
tasks such as shopping, ironing and cleaning and as a parent to the welfare of
the family, including
care for the defendant's mother.
- The defendant disputed the extent of the contributions made by
the plaintiff.
- The defendant disputed the plaintiff's claim to an interest in
the house, although the basis for this was misconceived. The defendant
appeared to contend that the plaintiff should not be entitled to an interest in
the house because she was opposed to its purchase
in 1993. The plaintiff did
not dispute that she had no involvement in the purchase of the property, nor
that she was opposed to
it at the time. These matters are considerations
relevant to the exercise which I must perform.
- The defendant might also have been construed as submitting
that the plaintiff was not entitled to an interest in the house as it
was
acquired after the de facto relationship had ended. Even without a
finding that the relationship subsisted until 1999 there
is nothing in the Act
which limits the assets under consideration to those acquired during the
de facto relationship. Further, there
is authority for the proposition
that regard may be had to contributions made by a party before, during and
after the relationship[6].
- I accept the plaintiff's evidence that she made both financial
and non financial contributions to the preservation and maintenance
of the
Wadham Road property and that she has made contributions in her capacity as
homemaker and parent to the welfare of the family.
The order the Court will
make will reflect her contribution in the ways I have found.
- The only evidence before the Court as to the value of the
Ivanhoe property is a valuation as at 1 January 2000 on the Banyule City
Council Rate Notice of $163,000 (Capital Improved Value). The defendant
produced evidence that the amount owing to the Bank of Melbourne
in relation to
the mortgage was $45,437 as at 11 December 2002. He has not made any mortgage
repayments since that time so the amount
currently owing is likely to be
increased by interest. The municipal valuation (and vociferous assertions by
the plaintiff that
it was worth $300,000) does not enable the Court to place a
value upon the property upon which any reliance can be placed. Accordingly
it
will be necessary for a valuation to be obtained.
- There is virtually no evidence placed before the Court
concerning the chattels in the Wadham Road property. This did not prevent
the
plaintiff claiming in her submissions that she wanted half those chattels or
$15,000. In the circumstances there is no basis
for the Court making any order
in respect of any chattels that might be at the Wadham Road property.
- The plaintiff also makes a claim for one half of the
defendant's superannuation entitlements. Although there is evidence before
the
Court that the plaintiff is a member of the State Superannuation Fund (New
Scheme) and that he had made payments of some $8,000
to that Fund up to
February 2002, his interest in that Fund is not property for the purposes of
the Act. Rather, it is a financial
resource. The evidence does not enable me
to reach any conclusion as to the real value of that financial resource and,
more particularly,
as to whether the plaintiff made any contribution, directly
or indirectly, to its acquisition by the defendant. Inasmuch as she
contributed, as I have found, to general household expenses and made
non-financial contributions as a homemaker and parent she inevitably
permitted
the defendant to work outside the home and thus indirectly acquire the
financial resource represented by his interest in
the State Superannuation
Fund. In all the circumstances I shall take that financial resource into
account in reaching the order
which I make in respect of the Wadham Road
property.
- Although the plaintiff made various assertions concerning
other property, including property in Yugoslavia, which she claimed the
defendant owned, there is no basis for any finding as to whether any such
property exists and, if it does, whether it is owned by
the defendant.
Accordingly, it cannot be the subject of any order under the
Act.
- Labouring under the disadvantages to which I have referred,
brought about largely by the inadequate way in which the case on behalf
of each
of these parties was presented, and doing the best I can on the evidence which
was placed before the Court, I consider that
it is just and equitable that all
financial matters between these parties be resolved by a declaration that the
plaintiff is entitled
to a 50 percent interest in the Wadham Road property
subject to the amount owing to the Bank of Melbourne under the mortgage (to
which I have referred) as at the date of trial, namely 3 February 2003. As the
defendant currently resides in that house as his
residence the orders which I
will make will give him the option of purchasing the plaintiff's share of the
property at an independent
valuation. In default of his doing so the plaintiff
will be entitled to sell the property. She must divide the net proceeds in
the
proportions which I have indicated.
- Save for the declaration and orders which the Court will now
make, all questions of ownership of property currently in the possession
of
each of the parties to this proceeding is resolved such that neither party can,
in the future, make any claim against the other
in respect of any such
property. All other claims made by the plaintiff are dismissed.
Orders
- The Court makes the following declaration and
orders:
1. That the plaintiff is entitled to a 50 percent interest in
the property known as 6 Wadham Road, Ivanhoe being the whole of the
land in
Certificate of Title Volume 8543 Folio 115 subject only to 50 percent of the
amount which was owing to the Bank of Melbourne
Ltd on 3 February 2003 and
which was secured by registered mortgage No. S863317K over the said
property.
2. That on or before 5 June 2003 the said property be valued by a valuer to be
agreed between the parties or, in default of agreement,
by a valuer appointed
by the President for the time being of the Real Estate Institute of Victoria;
the costs of such valuation to
be met by the defendant.
3. That within 60 days of such valuation being made available to the parties
the defendant be entitled to purchase the plaintiff's
declared interest in the
said property by paying to her a sum equal to 50 percent of the value of the
said property as assessed by
the said valuer less 50% of the amount which was
owing to the Bank of Melbourne Ltd on 3 February 2003 as referred to in the
declaration
contained in paragraph 1.
4. That should the defendant:
(a) fail to pay the cost of the valuation referred to in paragraph 2; or
(b) fail to pay the amount referred to in paragraph 3 within the time specified
(or such further time as is allowed by the plaintiff
or the Court);
the plaintiff be entitled to sell the said property as if she were a mortgagee
in possession.
5. That upon such sale the plaintiff disburse the net proceeds of sale (being
the amount of the sale price less the reasonable and
actual expenses of sale,
including agent's commission and legal expenses) as follows:
(a) by paying out the full amount owing to the Bank of Melbourne Ltd in respect
of the mortgage referred to in paragraph 1;
(b) by retaining 50 percent of the net proceeds of sale less 50 percent of the
amount which was owing in respect of the mortgage
referred to in paragraph 1 on
3 February 2003; and
(c) by paying the balance to the defendant.
6. That pending the said sale referred to in paragraph 4 the defendant be
entitled to retain possession of the property.
7. That pending the sale the defendant make all payments due and payable to the
Bank of Melbourne Ltd pursuant to the mortgage as
and when they fall due.
8. That all other claims made by the plaintiff in this proceeding be
dismissed.
9. That there be liberty to each party to apply to the Court on notice to the
other.
10. That the defendant pay the plaintiff's costs of this proceeding to be taxed.
---
[1] [2001] FamCA 348
[2] Re F [2001] FamCA 348, para 220
[3] Affidavits of Milan Tomasevic affirmed 5
December 2001 tendered as Exhibit 4
[4] Hibberson v George (1989) 12 Fam LR
725 at 740
[5] D v McA (1986) 11
Fam LR 214; Roy v Sturgeon (1986) 11 NSWLR 454
[6] Jones v Grech [2001] NSWCA 208; (2001)
27 Fam LR 711; McDonald v Stelzer (200) [2000] NSWCA 302; 27 Fam LR 304; Fuller v
Taaffe (1997) 23 Fam LR 702
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