Property Case Studies
There are several ways a court can assess parties’ contributions in determining a property settlement. Here are some case examples which reflect this.
Norbis v Norbis (1986) 161 CLR 513
The 1986 appeal of Norbis v Norbis concerned the correct approach to take when assessing parties’ contributions. The court considered whether a “global” or “asset by asset” approach is more suitable.
The High Court determined that neither alternative was more just or equitable than the other. The court held that the legislation allows the court discretion that does not dictate the use of any particular method in forming an appropriate order for the alteration of property interests. The matters considered will sometimes mean that assets are divided in their entirety, or some of them, based on their individual values, but in other cases, no more than an overall division is required. In some cases, either approach may be wholly or partially adopted.
Further, that although it is natural to assess financial contributions with reference to individual assets, it is also natural to assess the contribution of a spouse as homemaker and parent either by referring to the whole of the parties’ property or to some part of that property. For ease of comparison and calculation, it is convenient to assess the overall contributions of the parties at some stage to place the two types of contribution on the same basis, i.e. on a global or on an “asset-by-asset” basis. The circumstances of the particular case will determine which of the two approaches to use. However, there is much to be said of the view that in most cases, the global approach is more convenient.
Stanford v Stanford (2012) 293 ALR 70
The 2012 appeal of Stanford v Stanford concerned s 79 order altering the interest of parties to a marriage in property. Under s 79(2) of the Family Law Act, a court shall not make a property settlement order unless satisfied it is “just and equitable” to do so.
The husband and wife married in 1971, and each had children from previous relationships. The husband and wife lived together until the wife was too disabled to be cared for at home and required full-time care. The husband continued to provide financially for the wife and provide money for her use. The wife, by then disabled and represented by a case guardian, applied for orders dividing, between husband and wife, the property they owned. Before the final hearing, the wife died and her application was continued by her legal representatives. The court was asked to consider whether, if the wife had not died, would it be just and equitable, and still appropriate to make a property settlement order under s79.
The High Court determined that “just and equitable” is a conclusion reached after the examination of a range of potentially competing considerations. It is not an exhaustive definition. The court isolated three fundamental propositions when determining whether an order is “just and equitable”.
One, it is necessary to consider it is just and equitable to make a property settlement by identifying the existing legal and equitable interest of the parties in the property.
Two, while s79 confers a broad power, it is a power which rests upon the law and not upon a judge’s discretion.
Third, there is no assumption that one or the other party has the right to have the property of the parties divided. There must be a separate consideration of the various matters in s 79(4) and s 79(2) so as not to conflate the statutory requirements. As a result, the court must first consider whether it is just and equitable to make an order, rather than consider whether the orders made are just and equitable.
The court determined had the wife not died, it would have been just and equitable to make an order concerning property, and it could not be found to be “still appropriate to make an order with respect to property” following her death.
Mullane v Mullane (1983) 158 CLR 436
In 1976 two parties divorced. There were three children from the marriage aged 9, 5 and 1. Property consent orders that “until such time as the three children of the marriage have become self-supported or the wife remarry, the wife and children have exclusive occupation of the former matrimonial home, the respondent husband to pay all expenses due under the mortgage and rates of the property”.
The wife applied to vary the consent orders, based on living in the property for 15 years with the children and the husband paying the mortgage and rates. The wife applied to sell the property with the net proceeds divided 2/3 to the wife and 1/3 to the husband.
The High Court held an order which merely limits the right of a person to enjoy property, without actually altering the person’s proprietary interest in the property, is not an order capable of being made under s 79. See Mullane v Mullane.
For advice or representation in any legal matter, contact Armstrong Lawyers.