Divorce ruling likely to leave wealthy husbands with less
NICOLA BERKOVIC
THE AUSTRALIAN
JANUARY 09, 2014 12:00AM
9 COMMENTS
The decision, known as Kane & Kane, signals the end of the "special contribution" doctrine Source: News Limited
WEALTHY husbands who split from their wives after a long marriage are less likely to walk away with the lion's share of the assets following a landmark full Family Court decision.
The decision, known as Kane & Kane, signals the end of the "special contribution" doctrine that has allowed some successful businessmen to walk away with 60-72.5 per cent of matrimonial assets, particularly in so-called "big money" cases.
The Kane case involved a couple who split after a 28-year marriage in 2009. They had an asset pool of $4.2 million and four children.
The trial judge had initially awarded the husband, a retired businessman from the Newcastle area north of Sydney, two-thirds of the couple's $3.4m superannuation fund, and the wife one-third. However, the full Family Court overturned that decision, ruling the trial judge had given unacceptable weight to the husband's "special skill" investing their money in a self-managed super fund.
SPLITTING UP: How the courts have divided assets in previous 'big money' cases
Family Court deputy chief justice John Faulks wrote in the decision, dated December 18 and released on the court's website on Tuesday: "To the extent that the trial judge believed himself to be obliged by authority to determine the division of the property of the parties by reference to some doctrine acknowledging 'special skills' in my opinion ... he was mistaken.
"The act does not require and in my opinion the authorities do not mandate, any such doctrine and if judgments of the Full Court of this court might be thought to have espoused such a principle in my opinion, they should no longer be regarded as binding."
The case has been sent back for re-hearing.
In another recent case, known as Smith & Fields, a wealthy Gold Coast property developer split from his wife of 29 years. The husband was awarded 60 per cent of the couple's $30m-$39m asset pool because of his "ingenuity and stewardship" running the family business, in which both the husband and wife had worked.
This was despite Family Court judge Peter Murphy recognising the parties had a "practical union of both lives and property" both had made exemplary contributions in their respective spheres of marriage.
In reaching his decision, Justice Murphy referred to six "big money" cases involving assets of almost $9m to more than $40m. The wives in those cases had been awarded just 27.5 to 40 per cent of the assets.
The case has since been appealed and a decision reserved, although family lawyers expect it to be overturned.
Family lawyer Paul Doolan said the Kane decision appeared to "sound the death knell" for the special contribution argument.
"There's been a real philosophical and jurisprudential fight in the courts for the best part of 15 years between one camp who says the court should recognise in appropriate cases contributions of a special or exceptional nature," Mr Doolan said. "There are others who say no, that kind of labelling tends towards gender bias and invariably favours males who are predominantly those who produce income."
Mr Doolan said it did not mean that in a particular case a court could not rule that one partner deserved more of the assets because of their financial contribution. However, each case had to be examined on its own facts.
He said while many people presumed property was split equally between couples following a divorce, the reality was there was no rule of thumb.
Lawyer Gayle Meredith, who acted for the wife in Kane, said her client was pleased with the decision, but distressed the case would now be retried.
She welcomed the Family Court resolving uncertainty over the "special contribution" doctrine, which she said had tended to discriminate against mothers.
NICOLA BERKOVIC
THE AUSTRALIAN
JANUARY 09, 2014 12:00AM
9 COMMENTS
The decision, known as Kane & Kane, signals the end of the "special contribution" doctrine Source: News Limited
WEALTHY husbands who split from their wives after a long marriage are less likely to walk away with the lion's share of the assets following a landmark full Family Court decision.
The decision, known as Kane & Kane, signals the end of the "special contribution" doctrine that has allowed some successful businessmen to walk away with 60-72.5 per cent of matrimonial assets, particularly in so-called "big money" cases.
The Kane case involved a couple who split after a 28-year marriage in 2009. They had an asset pool of $4.2 million and four children.
The trial judge had initially awarded the husband, a retired businessman from the Newcastle area north of Sydney, two-thirds of the couple's $3.4m superannuation fund, and the wife one-third. However, the full Family Court overturned that decision, ruling the trial judge had given unacceptable weight to the husband's "special skill" investing their money in a self-managed super fund.
SPLITTING UP: How the courts have divided assets in previous 'big money' cases
Family Court deputy chief justice John Faulks wrote in the decision, dated December 18 and released on the court's website on Tuesday: "To the extent that the trial judge believed himself to be obliged by authority to determine the division of the property of the parties by reference to some doctrine acknowledging 'special skills' in my opinion ... he was mistaken.
"The act does not require and in my opinion the authorities do not mandate, any such doctrine and if judgments of the Full Court of this court might be thought to have espoused such a principle in my opinion, they should no longer be regarded as binding."
The case has been sent back for re-hearing.
In another recent case, known as Smith & Fields, a wealthy Gold Coast property developer split from his wife of 29 years. The husband was awarded 60 per cent of the couple's $30m-$39m asset pool because of his "ingenuity and stewardship" running the family business, in which both the husband and wife had worked.
This was despite Family Court judge Peter Murphy recognising the parties had a "practical union of both lives and property" both had made exemplary contributions in their respective spheres of marriage.
In reaching his decision, Justice Murphy referred to six "big money" cases involving assets of almost $9m to more than $40m. The wives in those cases had been awarded just 27.5 to 40 per cent of the assets.
The case has since been appealed and a decision reserved, although family lawyers expect it to be overturned.
Family lawyer Paul Doolan said the Kane decision appeared to "sound the death knell" for the special contribution argument.
"There's been a real philosophical and jurisprudential fight in the courts for the best part of 15 years between one camp who says the court should recognise in appropriate cases contributions of a special or exceptional nature," Mr Doolan said. "There are others who say no, that kind of labelling tends towards gender bias and invariably favours males who are predominantly those who produce income."
Mr Doolan said it did not mean that in a particular case a court could not rule that one partner deserved more of the assets because of their financial contribution. However, each case had to be examined on its own facts.
He said while many people presumed property was split equally between couples following a divorce, the reality was there was no rule of thumb.
Lawyer Gayle Meredith, who acted for the wife in Kane, said her client was pleased with the decision, but distressed the case would now be retried.
She welcomed the Family Court resolving uncertainty over the "special contribution" doctrine, which she said had tended to discriminate against mothers.