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Which case won?

casea
The case for the wife
  • My husband quite rightly concedes that our contributions during our relationship were equal. Therefore, all our assets, other than Property A, have been divided equally. Given the extent of the financial and non-financial contributions I made during our long marriage, Property A should also be divided equally.
  • By giving my husband a 66% share of Property A, the trial judge effectively gave my husband credit for the serendipitous increase in the property’s value. Property A only increased in value because it was rezoned, not because of anything my husband did personally.
  • In fact, but for me, we wouldn’t have even benefited from the rezoning of Property A. Although we were struggling financially, I agreed to my husband using half of the funds from the sale of Property B to gain sole ownership of Property A.
  • I then continued to support my husband in his decision to maintain ownership of Property A, pending possible rezoning. This was a significant contribution to our marriage. Instead of selling the property as I would have preferred, we had to borrow money from my husband’s family to support our children.
  • The court should order that the proceeds from the sale of Property A be divided equally between me and my husband.
caseb
The case for the husband
  • It’s true that my wife and I contributed equally during our marriage. However, the law requires the court to have regard to Property A’s value at the time of these proceedings, not at the time my wife and I got married. Therefore, I contributed a $9 million asset to our marriage, which I should get the benefit of as I leave the marriage.
  • But for me bringing Property A into our relationship, there would be no property of significant value to divide. In this context, a 34% allocation to my wife seems more than fair.
  • In addition to Property A, I have made other contributions justifying a 66% to 34% split. Prior to our marriage I purchased a property, which I then made available as our family home. I also repaid the $130,000 loan that my mother made to my wife and me. I paid all the outgoings for Property B and C until their sale. I paid for a family holiday during our period of attempted reconciliation, as well as the cost of a holiday my wife took on her own. I also paid child support at a higher rate than required.
  • The court should dismiss the appeal and uphold the 66% to 34% split of the value of Property A.

So, which case won?

Cast your judgment below to find out
Case A Case B

Case A won. You were right!

How people voted
a48%
b52%

Expert commentary on the court's decision

“The danger in looking for a causal relationship between a party’s contributions and what those contributions have produced in terms of a specific property’s value, is that it ignores the significance of the party’s overall contributions to the marriage.”
Family Court rules in favour of wife

In the case of Jabour & Jabour [2019] FamCAFC 78, the Family Court allowed Mrs Jabour’s appeal, setting aside the trial judge’s orders regarding the allocation of property.

The court instead ordered that the net non-superannuation property, being just over $9 million, be divided by giving 47% to Mrs Jabour and 53% to Mr Jabour.

Family Law Act empowers court to re-allocate property

Under section 79 of the Family Law Act, the court has the power with respect to property owned by the parties to the marriage to re-distribute those property interests.

In deciding what orders should be made, if any, the court must consider the factors identified in section 79(4).

Section 79(4) identifies seven factors. One factor relevant to this case is the financial contribution made directly or indirectly by the parties to the marriage to the acquisition, conservation or improvement of any of the property.

Another relevant factor is the contribution made by the parties to the marriage to the welfare of the family, including any contribution made in the capacity of homemaker or parent.

Primary judge erred in interpretation of caselaw on section 79(4)

The court concluded that the trial judge misdirected herself as to the principles of law to be applied to section 79(4).

This resulted in a material error requiring that her orders be set aside.

Court must consider myriad of contributions made by the parties

Mr Jabour argued that because Property A was held by him at the outset of the relationship and had increased significantly in value as a result of market forces, caselaw required that recognition be given to the value of the property at the time of the Family Court hearing.

Thus, any increase in value should go towards measuring the contribution of Mr Jabour.

The trial judge accepted this argument.

The court found that this characterisation of the caselaw was misleading and that the trial judge erred in accepting it.

After reviewing the caselaw, the court concluded that although recognition can be given to the value of the asset at the time of the hearing, it is equally important to recognise “the myriad of other contributions” that each party has made during the course of the marriage.

Increase in value of property considered a contribution by both parties

The trial judge also explored cases in which there was an increase in the value of an asset unrelated to the efforts of the parties, for example with a winning lottery ticket or the rezoning of land. She interpreted this caselaw to mean that Mrs Jabour had not contributed to the increase in value of Property A.

The court disagreed with the trial judge, finding instead that the caselaw was authority for the principle that an increase in value of an asset unrelated to the efforts of the parties, such as in the case of a winning lottery ticket or the rezoning of land, is a contribution by both parties to the marriage.

Wife’s contributions to marriage cannot be quarantined from Property A

The trial judge interpreted the law as requiring her to search for a nexus between the contributions by the parties to Property A and its present value.

This approach meant that Mrs Jabour’s contributions throughout the marriage were isolated from Property A and therefore taken to have a negligible effect on the value of Property A.

The court disagreed with the trial judge’s interpretation, emphasising that it failed to recognise the myriad of contributions that Mrs Jabour made, which even Mr Jabour conceded were equal to his during the marriage.

The trial judge’s approach also overlooked the wife’s contributions in acquiring the full title of Property A.

For example, Mrs Jabour agreed to using $105,000 from the sale of Property B to purchase the outstanding interest in Property A. It might have been preferable from Mrs Jabour’s perspective to use the funds to support their children, since instead they had to borrow money from Mr Jabour’s family to do so.

Mrs Jabour also agreed to her husband continuing to own Property A to await possible rezoning. The court found that her agreement not to push for the sale the land at an earlier stage was a significant contribution by her.

The court ultimately rejected the notion that there must be a relationship between contributions and what they produced in terms of property value.

According to the court, whereas the primary judge weighed the myriad of contributions made by the parties against the contribution made by Mr Jabour by bringing in Property A, the law required that she treat Property A as one of the myriad of the contributions made.

Court orders split of 53% to husband and 47% to wife

The danger in looking for a causal relationship between a party’s contributions and what those contributions have produced in terms of a specific property’s value, is that it ignores the significance of the party’s overall contributions to the marriage.

The court recognised this when it said:

Whatever was the value of [Property A] at the commencement of the relationship its significance has been largely lost given the myriad of the contributions by each of the parties to their various business ventures, through their employment and care of the family over a long relationship, including the contributions made to the retention of the property… Throughout the relationship the parties’ contributions to this property were no different to their other contributions.

The court therefore set aside the trial judge’s orders and instead ordered a split of 53% to Mr Jabour and 47% to Mrs Jabour.

Mr Jabour was also ordered to pay Mrs Jabour’s costs.

NOTICE: This article is accurate as at the time of publication and does not constitute legal advice. Please see our legal notices page for more information. Information related to coronavirus can be outdated very quickly.
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