FEDERAL MAGISTRATES COURT OF AUSTRALIA
JELLETT & JELLETT	[2012] FMCAfam 683	

FAMILY LAW – Property dispute – whether husband’s payments of almost $1 million to a sister in Serbia were what they were said to be – family trust – sister in Serbia the appointor – whether sister in fact really the appointor or not – finding that husband wholly controlled all relevant entities including family trust – lengthy marriage – husband having substantial assets at commencement – consideration of contribution and future needs – finding that equal distribution of pool just and equitable.	

Family Law Act 1975, s.75(2)	

Applicant:	MS JELLETT	

Respondent:	MR JELLETT	

File Number:	MLC 7550 of 2011	

Judgment of:	Burchardt FM	

Hearing dates:	24 May, 1, 4 and 18 June 2012	

Date of Last Submission:	18 June 2012	

Delivered at:	Melbourne	

Delivered on:	26 July 2012	

REPRESENTATION
Counsel for the Applicant:	Ms M. Smallwood	

Solicitors for the Applicant:	Mcgregor Barristers & Solicitors	

Counsel for the Respondent:	Mr I Mawson SC	

Solicitors for the Respondent:	Lander & Rogers	

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

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT MELBOURNE	
MLC 7550 of 2011
MS JELLETT	
Applicant

And

MR JELLETT	
Respondent

REASONS FOR JUDGMENT
Introductory
1.	This is a property case in which it can fairly be said that there is an enormous amount of factual dispute.  Perhaps the most important matter in contention is whether the property pool is slightly over $2 million or slightly over $1 million, depending upon the view taken as to the almost $1 million sent by the husband to his sister in Serbia between 15 February 2011 and 18 March 2011.  
2.	For the reasons that follow, I think that the money sent to Serbia does form part of the pool of property available for division between the parties and that the pool should be split equally between the parties.  
Uncontested Facts and/or Minor Controversies
3.	The husband was born on (omitted) 1951 in the former Republic of Yugoslavia and came to Australia in 1981 where he became a citizen soon after.  The wife was born on (omitted) 1963, also in the former Republic of Yugoslavia, came to Australia in 1998 and became an Australian citizen in about 2001.  
4.	The parties married on (omitted) 1998.  Their elder son, X, was born on (omitted) 1999 and the younger son, Y, on (omitted) 2002.  
5.	Very unfortunately, X was diagnosed with a brain tumour in 2005 and Y with autism at about the same time.  The extent of their disabilities is a matter in controversy.  
6.	The wife asserts that separation took place under the one roof in 2008, something the husband denies.  He says that the first realisation he had that the marriage was at an end was when he learnt about the wife placing caveats on two properties, one of which was the former matrimonial home, in February 2011. He said rather that while the marriage had its ups and downs, the parties continued to live together as a family until that latter time.  
7.	In my view, it is clear that the wife thought the relationship was not going well by no later than 2008, however, it is not possible on the evidence as it stands to find that separation had occurred at that time.  The parties continued to holiday together and so forth thereafter, and if the wife intended to separate she certainly did not communicate it directly to the husband nor did she act upon that intention.  
8.	The parties bought the former matrimonial home in Property B in late 1999, partly funded by an alleged loan from the Jellett Family Trust and partly from a mortgage with the Commonwealth Bank of Australia (“the Commonwealth Bank”).  
9.	The mortgage to the Commonwealth Bank was paid down by 2009 to the sum of $500, in part by an alleged further loan from the trust in 2001.  On 14 February 2011, the husband redrew on that mortgage facility to its maximum amount of about $350,000.  
10.	Both parties agree that the relationship between the parties was what might be described as a very conservative and conventional one.  The husband worked hard and provided the funds for the family to live on, and in the main the wife stayed at home and looked after the children when they came.  
11.	It was the husband’s practice to give to the wife $2,000 by way of housekeeping money per month, but that started to change when the wife got a job part-time at (omitted) in August 2010.  Because the wife’s pay was going into an account that the husband did not control, he reduced the amount she was being paid to $1,000 a month and when she became a full-time casual in December 2010 he ceased all payments to her in January 2011.  The wife is presently on a one year maternity leave covering position at (omitted) which commenced on 
14 March 2011.  
12.	The husband is a (omitted) who, it seems, draws his clientele mainly from the ethnic group of which he is part, namely Australians from the former Republic of Yugoslavia.  He has operated very successfully over the years (income on occasions in excess of $150,000 per year) and appears to have the capacity subject to some health issues, to continue to do so.  He conducts his business through a variety of trusts and companies with which it is not in my view necessary to deal in detail in this judgment.  
13.	It suffices to say that he is the sole director and shareholder of (omitted) which is the corporate trustee of the (omitted) Property Trust set up in 2001, of which the appointor is a niece of the husband who lives in Serbia.  He is the sole signatory to all the relevant bank accounts and there is no doubt in my mind that while he appears to have conducted his affairs in a lawful manner, nonetheless all the trusts and business entities with which this case is concerned are to all effects and purposes controlled and owned by him.  
The Jellett Family Trust and (omitted)
14.	Much of the argument in this case concerned the Jellett Family Trust.  This is not surprising given that between 15 February 2011 and 18 March 2011 a total of just under $1 million was transferred to the husband’s sister, Ms J, in Serbia allegedly to repay obligations to her arising out of the operation of the trust.  It was the husband’s position that these moneys were properly so transferred and that the amounts concerned were simply not his.  It was the wife’s position that the moneys were in fact his and/or should in any event be included in the pool.  
15.	At this point, it is necessary to deal in rather more detail with what is said to have occurred in respect of this trust.  
16.	In his first affidavit filed on 16 September 2011, the husband says at paragraph 3(ccc) that when he came to Australia in 1981 and left his parents and two sisters in Yugoslavia he “felt enormous guilt at leaving my parents behind and a sense of obligation to continue to financially provide for them, as is the custom in Eastern European countries.”  He went on to say, “Once I obtained employment, my financial position improved, and I began to transfer money when I could back home.”
17.	He deposed that when war broke out in Yugoslavia in 1990 and sanctions were imposed, it was not possible to transfer funds back to his parents and that his sisters were solely responsible for the care of them until sanctions ended in 1996.  He deposed that he and his sisters discussed how he would best contribute to the care of his parents and that the Jellett Family Trust was established to this end.  It was set up in June 1996 before the husband had met the wife and the trustee was (omitted) of which he was the sole director.  The shareholders of the company were himself and his sister Ms J.  The appointor of the trust was initially the husband but that was changed in 1997 to Ms J.  
18.	The trust deed is exhibit A17.  It records that the deed was made on 
18 June 1996, that (omitted) was the trustee, and that the specified beneficiaries were the children born or to be born of the husband and his two sisters Ms G and Ms J both of whom lived, and as I infer continue to live, in (omitted), Yugoslavia.  The general beneficiaries were the husband and his two siblings.  
19.	At paragraph 3(ccc)(iii) of the husband’s first affidavit, he deposed that:
	“The main purpose of establishing the Trust was to record and reimburse the amounts payable to my family.  An additional included beneficiary was my Daughter, Ms Jellett.  Ms Jellett was 4 when I left the country and beneficiary accounts were established for her as well;”
20.	The husband also deposed at paragraph 3(ccc)(iv) that:
	“At establishment, the assets of the Trust were cash deposits that I contributed of $195,176.  The major liability of the Trust was a loan of $200,265 to Ms J representing the agreed amount that I owed her in respect of the care and financial support she provided to my parents up to the time of establishing the Trust.”
21.	The husband annexed as exhibit MJ7 a true copy of the loan agreement entered into between his sister, Ms J, and (omitted) dated 4 November 1996.  The loan was repayable to the sister, Ms J, at any time it might be requested, but I note that the agreement dated 4 November 1996 is, as counsel for the wife correctly submits, retrospective.  It states:
	“The Borrower acknowledges having received as at 4th November 1996 AUD$200,265 (two hundred thousand and two hundred sixty five Australian dollars) from the Lender as from 28 June 1996 (in six instalments).”
22.	Putting the matter shortly, it is the husband’s case that his sister made loans to the trust from time-to-time and did not want them repaid because of the general security position in Serbia and the possibility of harm coming to her in the event that it became known that she had very substantial amounts of money.  
23.	That position is, to an extent, confirmed by the affidavit of Ms J affirmed on 29 May 2012.  
24.	The sister confirmed at paragraph 3 that in 1981 when the husband came to Australia, their parents were aged 56 and 51 respectively (the figure for the latter number may be 54 as the typing is by no means clear).  
25.	She confirmed that the husband would send money back to his sister for his share of the financial support of their parents and that he did indeed do so from time-to-time once he found employment in Australia.  From the terms of the materials concerned, it would seem that provision continued unexceptionally until 1990.  In other words, there is no suggestion that in any sense the husband was in debt to his sister in any way up until at least that time.  
26.	Assuming there was an interruption of the sending of such moneys, a matter to which I will return, any indebtedness can only have arisen between 1990 and 1996.  
27.	Ms J also deposes that in 1997 as a result of concerns that she might not be able to access the money allegedly owing to her if something happened to her brother, it was agreed that the husband would resign as appointor of the trust and that she would replace him.  Ms J deposed at paragraph 9:
	“It was my understanding that this then gave me the ability to ultimately control the Trust.  This was important to me given that Mr Jellett and I agreed that the assets of the Trust were ultimately mine.”
28.	The sister went on to depose at paragraph 13 that:
	“The Trust made various distributions to myself and to a lesser extent, to other beneficiaries over the years.  I allowed my beneficiary entitlements to remain unpaid until such time as the situation in Serbia became more secure.”
29.	She then deposed at paragraph 14 that she, “called up my unpaid beneficiary entitlements and re-payment of my loan over the period March 2009 to 18th March 2011” and she sets out a schedule showing the said payments.  
30.	A very substantial proportion of the $1 million actually paid to 
Ms J was paid via a company called (omitted).  According to Ms J neither she nor the husband has any interest in that company.  From documents annexed to her affidavit it appears to be a company incorporated in (omitted).  
31.	It is clear from the Jellett Family Trust balance sheet as at 30 June 2011 note 3 that on the books of the trust, Ms J was owed $437,282 by no later than 28 June 2000.  
32.	Putting the matter shortly, it is the husband and his sister’s case that those moneys owing, together with the very substantial amounts that came to be owed by way of distribution, were not paid to her over the years (although she could have demanded them at any time) because of the sort of apprehensions about banking referred to in the affidavit material as to her personal security and also because of related difficulties with the banking structure in Serbia (which would presumably have dissipated upon the ending of sanctions in 1996).  
33.	I should make it clear that I just do not believe a word of it.  It is a completely untruthful description of what in fact has happened.  
34.	All the money that ever got put into the trust in any way whatever came from the husband.  Ms J never contributed one cent.  
35.	It should be noted that in paragraph 3(ccc)(ii) of his first affidavit the husband deposed:
	“However, in 1990, war broke out in Yugoslavia and sanctions were imposed.  It was not possible for me to transfer funds back to my parents.  My sisters were solely responsible for the care of my parents during this time.  When sanctions ended in 1996, my sisters and I discussed how I would best contribute to the care of my parents.  We decided to establish the Jellett Family Trust.”
36.	That reference was to both of the two sisters, not to Ms J alone.  Clearly her assertion that she was made the appointor in 1997 on the understanding that the funds in the trust were hers alone cannot be correct.  That this is so is shown by a more detailed look at the Jellett Family Trust financial accounts.  
37.	It should be noted that there are references in these accounts to what are described as distributions.  It has emerged, however, during the running of the trial that the fact that distributions were made does not mean that any money was actually paid to those who were nominally to receive it.  Indeed, in the first set of records for the year ending 30 June 1997, it is recorded that at a meeting of the directors of (omitted) in (omitted), Yugoslavia, the profit for the trust be “equally divided and distributed between Ms G and Ms J”.
38.	It needs to be noted that of course Ms J was not at any time a director of (omitted).  It is also noteworthy that in the notice to beneficiary dated 28 June 1997 to Ms G, it is recorded that the sum of $3,669 “be distributed, applied for your benefit and set aside for you.”
39.	If one looks at the balance sheet note 2, one sees that a distribution to each of the two sisters at $3,669 was indeed recorded but underneath that in each instance there is an amount described as a minus “payment of entitlement” in the sum of $6,700 for each sister.  Nothing was said during the trial about what this meant but it can only mean, given that I have been informed without challenge that these accounts are audited externally, that each sister was in fact paid a total sum of $6,700.  
40.	The following year (see exhibit R2) nominal distributions of $4,215 were made to each sister but the entitlement is recorded as having been paid at $4,800.  In 1998 to 1999 a payment of entitlement of $4,820 was made to each sister and in the year 1999 to 2000 some $9,200 was paid to each sister.  In 2000 to 2001 the payment of entitlement to each sister was $7,312.  That figure jumped substantially in 2002 to $39,640 and minor amounts were made by way of distribution (but no payment) to each of the parties’ children.  
41.	In 2003, the books record payments to Ms J of $11,300 but to Ms G of $37,500.  In 2004, however, each of the sisters received a payment of entitlement of $12,000.  In 2005, the two sisters were paid $1,333 each.  Ms J’s daughter, Ms M, was paid $5,000 and in 2006 the figure of $1,333 was paid to Ms J with nothing to Ms G and a further $4,333 to Milina.  Thereafter, it does not appear that Ms G received any amounts of money at all, although both Ms J and Ms M received money in 2007 and 2008, albeit in relatively small amounts.  Ms G was paid out the balance of her nominally owing distributions of $6,926 in 2009 during which year Ms J was paid $19,766 and in 2010 Ms J was paid $8,820.  
42.	It should be noted that the amounts nominally distributed but not in fact, it would appear, paid did not by any means correspond with the amounts described as “entitlement” which I infer were amounts actually paid during this period.  
43.	Nonetheless, this analysis of the books of the company, assuming that they are correct at least as to the amounts actually paid, shows that the husband’s earlier assertion that his sisters both looked after his parents is more probably true than otherwise.  This is important because it is immediately apparent that the sum of $200,000 agreed originally, it was said, in 1996 as being owed to Ms J for looking after the parents from 1990 to 1996 cannot possibly be correct.  The story is hardly credible.  The amounts involved are enormous (in circumstances where it is possible to buy a parcel of land for $2,000 in Serbia as the husband indeed owns one of that value).  
44.	The amounts distributed in the main seem to me to be consistent either with the husband simply being generous to his sisters given his considerable wealth (in comparative terms) in Australia and/or reimbursing his sisters over many years for the assistance that they gave to his parents.  
45.	It should be noted that in 1990 when it became impossible for the husband to provide further financial support to his parents, they were only 65 and 60 respectively.  This is scarcely likely to have been advanced senility and there is no evidence before the Court that the Jellett parents suffered from any particular debility or ill-health.  Indeed, they had not even reached what I would anticipate would be retirement age.  I also know because the evidence emerged during the hearing that the husband’s mother died in 1999 and his father in 2008.  Ms J at one stage appeared to suggest in her oral evidence that the father was alive but this is plainly wrong.  
46.	Accordingly, when the mother died, she was no more than 70 years old.  One must infer from this relatively youthful demise that her health had been poor but the thesis that, as the husband put it, his sisters were paying other people to look after his parents (a further refinement to the picture otherwise painted) cannot have been for any great length of time.  I note also that at paragraph 11 of her affidavit, Ms J deposes:
	“A further $106,145 was loaned by me to the Trust over the period August 1997 to January 1998 (being moneys owed to me by Mr Jellett for the care of our Father during this time).”
47.	This is an amount of over $105,000 for care of the father alone (the mother is not mentioned although she was alive) for a period of only some five months.  I simply do not believe the figures.  
48.	There is no methodology used to describe how it was that the original alleged loan of over $200,000 was fixed as the figure allegedly appropriate to be owed to Ms J in 1996.  The care provided seems far more probably than otherwise to have been provided by both Ms J and Ms G at least in earlier years.  The story bristles with absurdities at every point.  
49.	The thesis that a person owed almost half a million dollars would be happy to forego it for the better part of a decade merely because of concerns that its receipt might make them vulnerable to some form of criminal attack (bearing in mind that funds had been transferred to bank accounts without any difficulty in 2010 to 2011) is just not sustainable.  
50.	All these are objectively verifiable issues.  The position is only confirmed by the findings I now have to make about the credit of the various witnesses.  
The Wife
51.	The wife gave evidence first.  She gave her evidence in a careful and assured manner.  She was an excellent witness whom I have no doubt was telling the truth.  Her answers were careful, considered and responsive.  She readily accepted that she and her husband would be under obligation to support parents in Serbia and this concession is one I mention merely as an indication of the generally very satisfactory and competent way in which she gave her evidence.  She was not swayed in cross-examination in any way to qualify her affidavit material.  
The Husband
52.	It is always regrettable to have to make findings about a party or a witness which are likely to be distressing or hurtful to them.  Unfortunately, it is not possible in this case to avoid such findings.  
53.	While I approach demeanour findings with caution, it has to be said that the husband was as unconvincing a witness as I have seen in all the many decades I have been listening to and seeing people give evidence.  He was aggressively unresponsive, domineering and he bordered on the discourteous to counsel.  His evidence was in some instances extremely unconvincing and in relation to his endeavours to explain how it was that he was still living in the property owned by his superannuation fund in Property C, it had every appearance of being made up on the run.  When pressed as to how he could still be living there when he had earlier asserted he was unable to do so as it would involve a breach of the law, his answer to the effect that the tax officers had advised him it was a technical breach only and that he would be moving out soon but had no idea where, I have no doubt was being made up impromptu to explain away an awkward circumstance.  
54.	In a sense, the husband’s demeanour and unbelievability as a witness walks hand-in-hand with the inherently improbable and ridiculous proposition that the story about the trust constitutes.  I have already dealt with the improbability of the alleged original $200,000 loan by Ms J.  I have also already dealt with the improbability of somebody who is really owed over $400,000, and indeed a lot more by way of distributions, knowingly eschewing it for essentially a decade.  
The Sister
55.	The sister’s affidavit was admitted over objection.  I gave my reasons for permitting it to be received at the time.  The sister was telephoned in Yugoslavia in what was undoubtedly the middle of the night.  She said it was 3:00 in the morning and I have no doubt that it was.  Every allowance has to be made for the fact that this was a witness giving evidence via an interpreter to a Court of which she was, according to her own material, very apprehensive.  One has to make every proper allowance for these kinds of personal and cultural sensitivities.  
56.	Having said that, the sister was a very bad witness also.  She was combative to the point of rudeness.  She refused, in effect, to answer questions directly and embarked without any prompting on lengthy monologues in support of the proposition that it had always been agreed that moneys belonged to her and were to recompense her for looking after her parents.  
57.	The witness was so difficult and her evidence was given in such an off-putting style, being furthermore plainly uncontrollable, that I ceased cross-examination after some three or four attempts at questions only.  
58.	The one thing one can say from what the witness, the sister, did say is that she has no idea whatever of what an appointor is.  The affidavit sent to her from Australia prepared by Lander and Rogers was clearly drafted by the husband who caused the sister to say what he wanted her to say.  
Findings about the Trust
59.	I will never know quite why the trust was established in 1996.  It may well have been the husband’s intention to provide a vehicle to enable benefits to be distributed to his family in Yugoslavia in a fashion that was tax effective to him in Australia.  It seems to me more probable than otherwise that this was so.  The modest scale (in the main) of moneys actually paid to the two sisters suggests that this may well have been a combination of both bounty and possibly a reward for some assistance to the husband’s parents.  
60.	Nonetheless, I totally fail to accept that this trust is anything other than a creature wholly controlled by the husband.  He is the only director of the corporate trustee, and the assertion that his sister in some way has always been intended to be the ultimate beneficiary of all of the funds put into it is plainly wrong.  It does not accord with the payments actually made which were, until what I infer was a falling out with Ms G, more or less of even amounts to the two sisters.  
61.	The $900,000 advanced to (omitted) are moneys clearly wholly at the disposal of the husband and while I accept that the funds expended up until 30 August 2010 are more likely than otherwise simply to have been normal distributions, i.e. real payments in accordance with past practice, for reasons that I will come to momentarily, all of the rest of these funds should be included in the pool.  
62.	That will mean that of the $1,002,239 transferred to Ms J, all but the payments of $9,901 made on 17 March 2009, $9,865 made on 
18 March 2009 and $7,377 made on 30 August 2010 will be included in the pool.  
63.	There is a further aspect to this evidence, namely the timing of the payments.  
The Lodging of the Caveats and the Transfers of the Funds
64.	In February 2011 the wife, having sought advice, lodged caveats over the property in Property B and the property in Property C, which she thought until that time were jointly owned by her and the husband.  It appears that she discovered for the first time that she was not on title to the Property B property and that the Property C property was in fact owned by the husband’s superannuation fund.  A letter was sent to the husband dated 7 February 2011 informing him of these caveats and annexing copies (see exhibit A20).  
65.	It is the husband’s case that he did not receive notice of those caveats until about 16 February 2011.  That is not probable.  The post does not take that long.  
66.	I have absolutely no doubt that the drawing down on the (omitted) line of credit to $350,000 on 14 February 2011 was done as a direct result of the husband finding out about the caveats.  He knew at that time, as I find, that his relationship was at an end and took the first of a number of steps to ensure that the wife would be significantly financially disadvantaged.  
67.	Additionally to drawing down on the (omitted) line of credit, the husband also embarked upon the expatriation of the almost $1 million that he sent ostensibly to his sister.  
68.	It should be noted that the material supplied by (omitted) suggests that it has received (see exhibit R3) the funds with which we are concerned, “for and on behalf of Ms J”.  I suspect that this is because the person who holds that account is a man and I suspect that that man is the husband.  Whether that suspicion is correct or not is neither here nor there because as I find all those funds are controlled one way or the other by the husband.  The documentation surrounding the (omitted) transfers (including the alleged demand for payment by Ms J (exhibit A16)) suggests a certain sophistication in financial affairs.  The husband has it and Ms J clearly does not.  I note that the demand that allegedly caused the transfers to (omitted) (the vast bulk of the funds transferred) is dated 19 February 2011 (exhibit A16), just days after the date even the husband admits he received the caveats.  
The Pool
69.	Having thus dealt with the issue that occupied most of the Court’s time, it is appropriate to attend to the pool more generally.  
70.	Both parties agree that the former matrimonial home is worth $780,000 and it appears that the mortgage on the (omitted) line of credit is around about $363,000.  
71.	Each of the parties own a car worth $1,000.  The husband owns a car valued by the wife at $21,000 but is said by him to be leased and in any event, unroadworthy.  Neither party adduced any expert evidence about this car and I am not able to allot it any value whatsoever.  It should be noted that the wife claims, and I accept, that she has no knowledge of the husband’s business affairs and in this regard, his assertion cannot be dismissed out of hand.  
72.	The husband admits to owning a parcel of land in Serbia worth $2,000.  The wife has a one-third interest in a property in Belgrade.  
73.	The wife’s evidence is that this is worth $40,000 to her, the property being one in which her mother, her brother and his family have lived for many years.  
74.	The husband has filed an affidavit of a real estate agent, Ms R in Belgrade.  She says that she values the property at €200,000 but it seems to be accepted by the husband that at the most, the wife would only be entitled to one third of it.  
75.	It should be noted that while parts of Ms R’s affidavit material and annexures have been translated, not all has been.  The parts that I suspect are the operative parts, namely pages 11 and 12 of the material annexed to her affidavit, have not been translated and I am not able to say on what basis this estimate was made in any event.  
76.	Furthermore, the report notes that:
	“I wish to note that the co-owner Ms N has not shown good will to cooperate, that is, to allow the examination of documentation and the inside of the house.”
77.	Counsel for the wife submitted that this showed a partiality on the witness’ part but I think that goes too far.  
78.	In circumstances where Ms R has not actually attended Court to give evidence, nor has it been apparent the basis upon which she made the valuation that she asserts, I will do as counsel for the wife submits and accept the estimate of $40,000 by the wife as an admission against interest.  
79.	It was the husband’s case that he would have to repay $45,000 that he had borrowed to put into superannuation from his business.  I accept the submission for the wife that this is not money owed in any meaningful way to anybody.  
80.	I should interpolate at this point and make it clear that I entirely accept the submissions made on behalf of the wife that the various business entities that the husband owns and controls simply passed the money around at his direction to suit his interests.  The various transfers and alleged loans made from time-to-time are no more than book entries undoubtedly undertaken for various taxation reasons.  
81.	The husband has a business, (omitted).  Nobody has put any value on this but I accept that that is appropriate.  While notionally there may be some goodwill in it, I accept the husband’s evidence that this business is effectively him and I also accept his evidence that he is not expanding it by employing a third party.  In this regard at least, I found his evidence believable.  
82.	Accordingly the business cannot be valued at anything.  
Superannuation
83.	The husband’s superannuation fund bought the property in Property C and it appears to be worth $485,000 or thereabouts.  He also has (omitted) Superannuation in the sum of approximately $220,000.  The wife’s (omitted) Super is worth $6,182 but in her trial affidavit, she omitted to mention that as at 30 June 2010 she had $15,000 in the (omitted) Superannuation Fund.  I wish to hear further submissions as to what I should make of this discrepancy.  
Suggested Other Liabilities
84.	The husband says that the parties will have to repay about $15,000 in Centrelink repayments.  He said he got on the internet and noted that the parties had received two sorts of payments, one of which should not have been made during periods the wife worked.  He said that he had himself calculated the amount.  
85.	In fact, there is no suggestion that Centrelink has made any demand for overpayment nor is there any proof beyond the husband’s mere assertion that indeed anything inappropriate has taken place.  I am not able to find that any moneys are repayable in this regard.  
86.	A further asserted liability is a possible professional negligence claim that may be made against (omitted).  The husband estimates this at $270,000.  
87.	In his trial affidavit filed 14 May 2012, the husband says that he gave incorrect taxation advice to a client as to whether GST was payable upon the income from a retirement home.  The advice “(which I confirmed after several conversations with the taxation office) was that it was chargeable”.  The husband subsequently sought a private ruling from the Australian Taxation Office who advised that the earlier representations were wrong and GST was not chargeable and accordingly, the client was able to reclaim the GST paid for the previous four years but not for the period from 2000 to 2007.  The husband deposes that he did not have professional indemnity insurance at the time the advice was given.  The husband deposed that while he had a close relationship with the client, her daughter “may pressure her to commence litigation against me.  I have received legal advice that I have no defence to the claim if it is made.”  
88.	The husband sought to rely upon an affidavit sworn by him on 1 June 2012 which annexed a letter to him from Patrick Joyce of Messrs Lander and Rogers.  I declined to admit the affidavit although it has remained on the Court file for the reasons I then gave.  It is noteworthy however that Mr Joyce writes:
	“19.	On the limited information available to me it appears that your former client has at least an arguable claim and perhaps good prospects of success ....
	…
	I think it is possible that you could be found personally liable for $256,158, plus further interest accrued. ....
	That analysis does not allow for legal costs that might be incurred by the former client in pursuing their claim.  Assuming you had an arguable case, you could defend the matter.  
	If the matter ran in the County Court and you were unsuccessful, you would likely be ordered to pay the former client’s costs assessed in accordance with the scale of costs set down by the court of $60,000 to $70,000.  
	Even if we were to ascertain a defence and successfully defend the claim, you might still incur between $100,000 to $130,000 in actual costs allowing for a 5 to 7 day trial with experienced counsel and expert witness’ evidence.”
89.	It is readily apparent from those remarks that the husband’s earlier hearsay assertion that he had been advised he had no defence must be approached with considerable caution.  Furthermore, assuming that the other side were to receive advice in the same or similar terms, the first thing immediately to be noted is that this would be a five to seven day trial with very substantial solicitor/client costs.  Assuming standard recovery rates of between 60 and 70 per cent on taxation, the prospective plaintiff would therefore know that in pursuing a claim for about $260,000 they would be necessarily up against a solicitor/client loss of at least $50,000 to $70,000.  These are not attractive odds.  
90.	It is not clear when the allegedly negligent advice was either given or indeed when it was first known.  There might well be Limitation Act issues as well.  
91.	The person who allegedly gave the advice that there was no defence was not called to give evidence.  
92.	In all the circumstances, and given the heavily qualified nature of the advice received, which I am admitting purely as an admission against interest, it is clear that I should not bring this potential contingent liability into the pool.  Accordingly, the pool consists of (figures rounded off bearing in mind some uncertainties):
Property B property $780,000 less liability of approximately $363,000 (total $420,000);
Husband’s property in Serbia $2,000;
Wife’s property in Serbia, $40,000;
Property C property (owned by husband’s superannuation fund) $485,000;
Husband's Superannuation super $220,000;
Wife’s superannuation $22,000; and
Moneys paid to Ms J $975,096.  
93.	Although each of the parties own some chattels and each of them owns a car of virtually no value, these are not in my view appropriate for inclusion in the pool.  They all balance one another out and are in any event of trivial amount.  
94.	I have included in the pool the sum of $975,096 being all of the payments made to Ms J (or someone else) between 15 February 2011 and 18 March 2011.  
95.	I should interpolate again and say at this point that the husband was completely unable to explain how, in the apparently very reduced financial circumstances he asserts he is in, he was able to afford to be represented by Senior Counsel on a substantial daily fee.  
96.	I should also record that the husband’s reaction to learning about the caveats was extreme.  He rapidly encumbered the house to the maximum amount he could, and he ceased to pay for the mortgage on the home by no later than July 2011.  
97.	He has since then caused the wife to be sent bills ostensibly for rent for living in the former matrimonial home, more particularly since he himself was removed from it in August 2011.  
98.	It should also be noted that the husband has offset these alleged rents owing against his obligation to pay child support and has not paid any.  He will not do so.
Contribution
99.	The husband asserts that he came into the relationship with a real estate property worth $180,000 and superannuation of $110,000.  I accept that that is so.  His estimate of cash deposits with the Bank of Melbourne has not been proved by any records filed with the Court nor has there been any evidence to support his valuation of his share portfolio of $61,132.  He did, however, clearly come into the relationship with something around about $300,000 worth of assets.  The wife had the property in Serbia valued at that time at $20,000.  
100.	I accept that the husband would prima facie be entitled to a considerable loading in this regard, as it is clear that it must have provided a significant springboard for both the $220,000 in the (omitted) Superannuation and been of considerable assistance in relation to the ultimate property purchases that the parties were able to make.  It is not appropriate to recite yet again the well-known law about the diminution that might be said to apply over time to such initial contributions.  
101.	Both parties appear to me to concede that during the relationship itself the parties’ contributions had been equal and I accept that that is so.  
102.	In all the circumstances, it seems to me that the husband should be allotted a 10 per cent loading in his favour in this regard, the amount he contributed at the beginning of the relationship being approximately 15 percent of the pool but affected, as I say, by the process of gradual diminution to which the authorities refer.  
Section 75(2) Factors
103.	Here, it is necessary to deal with the parties’ future prospects and needs.  Although the husband is 61 and says that he is in declining health, he has not proffered any medical evidence to suggest that it would be impossible for him to continue to work.  He did at one stage appear to suggest that he might retire and take superannuation but I accept counsel for the wife’s submission that this rapidly changed when he realised that should he do so the superannuation moneys that he is entitled to might become available for immediate division with the wife.  
104.	As I earlier indicated, the husband took energetic steps to damage the wife’s position.  He expatriated almost a million dollars.  He encumbered the matrimonial home up to the hilt.  He ceased to pay the mortgage and badgered the wife to pay the mortgage as rent.  He has paid no child support.  He never will.  
105.	The husband will, as I find, have access to the moneys sent overseas which will be of considerable benefit to him in re-establishing his circumstances.  
106.	The wife is much younger than the husband and will have a longer period of time (possibly) available to her as a worker.  She makes a modest income of $51,000 a year in her current position and there is no certainty that that position will lead to further work at that or any other level of pay at (omitted).  
107.	Her health is unremarkable but the health of the two children is not.  Another unattractive facet of the husband’s case was his initial affidavit assertion that the children were in fact in perfectly acceptable health. He described X’s brain tumour in effect as being of no moment and flatly denied that Y was autistic.  
108.	At the hearing, the father modified his position suggesting that Y was, as it were, growing out of his autism and that he was likely to be perfectly all right within a few years.  
109.	I have no doubt that this is not the case.  The evidence exhibited by the wife as to the children’s health speaks volumes as does the husband’s denial of it.  
110.	The wife will, on any view, have the major parental responsibility for these two children for years to come.  
111.	Given the disparity in the parties’ earning capacity and given the additional family responsibilities that the wife will have to fulfil, it is in my view entirely appropriate that there be a 10 per cent adjustment in the wife’s favour.  
Just and Equitable
112.	Is a 50/50 division just and equitable in the circumstances of this case?  Counsel for the wife submitted with vigour and at some length that the Court should, so to speak, punish the husband for his misconduct in seeking so wantonly and dishonestly to remove assets from the jurisdiction and place them beyond the reach of the Court.  In my view to do this would be to punish the husband twice. By bringing the expatriated assets back into the pool I have already, in a sense, rectified the wrong that he has sought to perpetrate.  
113.	The fact is that during this relatively lengthy marriage, the husband was an excellent provider for his wife and family and worked long and hard to be so.  I have given a proper weighting, in my view, to his initial contributions and I have given an appropriate adjustment in respect of the future needs issues.  Taking a step back that the law requires, I am quite convinced that a 50/50 outcome is entirely appropriate.  
How is this Result to be Achieved?
114.	As a matter of practical politics, the only things I can actually do are to cause the Property B property to be wholly vested in the wife and to do what I can about superannuation.  
115.	The transfer of the property to the wife is not difficult.  It involves orders that the husband do so forthwith and in default that a Registrar sign any necessary documentation.  
116.	Insofar as superannuation is concerned, counsel for the wife submits that it is lawful, given that the Commonwealth Bank is now in the process of foreclosing on the matrimonial home, to order that the husband transfer his (omitted) Superannuation interest forthwith and directly to the Commonwealth Bank.  
117.	I would indicate that I am prepared to make such an order which would have the net effect of diminishing the mortgage on the property to about $140,000.  That would be a figure which the wife might well be able to fund from her own income.  
118.	I will give the parties an opportunity to consider these Reasons for Judgment and to call any further evidence that may establish whether or not such a course of conduct is in fact practicable, and it would in any event, in my view, require natural justice being granted to the superannuation trustee.  The pool will be adjusted to ensure the 50/50 division I have decided bearing in mind that each party will keep their property in Serbia and the various matters I have detailed.  It will not be possible to formulate final orders until the submissions I have referred to have been received.  
I certify that the preceding one hundred and eighteen (118) paragraphs are a true copy of the reasons for judgment of Burchardt FM

Date:  26 July 2012