FOTHERINGHAM V FOTHERINGHAM SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL POWELL, BEAZLEY and STEIN JJA 20 March 1998, 28 August 1998 [1998] NSWCA 83 Appeal and New Trial — Discretionary Judgment — Interference with — Grounds for — Whether made out Costs — Departing from general rule — Indemnity costs — Offer of compromise — Indemnity costs order made at trial — Relevance on appeal Family Law — Maintenance and property — De facto relationship — Duration of relationship — Adjustment of property interests Powell JA This is an appeal from a Judgment delivered, and Orders made, by Master Macready on 19 December 1996 in proceedings which had been brought by the Respondent ostensibly seeking relief pursuant to the provisions of the De Facto Relationships Act 1984 ("the Act"). I say that the proceedings ostensibly sought relief pursuant to the provisions of the Act for, although what passed for a Statement of Claim filed on behalf of the Respondent was entitled "De Facto Relationships Act 1984", the relief sought in that Statement of Claim included Orders - as, for example, varying a Caveat, extending the operation of a Caveat, "damages for unjust enrichment", and a Declaration that the Appellant held his interest in a property at Dunks Lane, Jilliby ("the subject property") in trust for the Appellant and the Respondent in the proportions 1:3 - which, although it was open to the Court to grant pursuant to the general law, it was not open to the Court to grant that relief pursuant to the provisions of s20 of the Act. In the event, however, that procedural aberration proved to be of little consequence as, prior to the matter coming on for hearing before the Master, Bryson J had made an order referring all matters in issue in the proceedings to the Master for determination (SCR 1970 Schedule D Pt3 r4). For present purposes it is sufficient to record that, by his Orders, the Master directed that the Appellant, within two months, pay to the Respondent the sum of $125,000.00, payment of that sum to be charged upon the subject property and ordered the Appellant to pay the Respondent's costs of the proceedings, those costs to be on a party and party basis until 31 October 1996 - the date upon which there was served upon the Appellant an offer by the Respondent to compromise the proceedings in the sum of $70,000.00 plus party and party costs as agreed or assessed - and thereafter on an indemnity basis (SCR 1970 Pt22 13(5), Pt52A 122(4)). The facts which gave rise to these proceedings are a little out of the ordinary. The Appellant, who is now aged 49 years, and the Respondent, whose age does not appear from the material which is before the Court, but who one would think is of a like age, were married in February 1969 and, as it would seem, lived together until about April 1983 when the Respondent left the then matrimonial home which appears as if it were at Kangy Angy near Wyong - the marriage between the parties appears to have been dissolved by Decree made by the 2 UNREPORTED JUDGMENTS Family Court of Australia at Newcastle during 1985. The Respondent and the Appellant had two children of their marriage, both daughters, Vanessa born 20 June 1969 and Naomi born 7 November 1973. Although the detail of what occurred is anything but clear, it would seem probable that, at some time after the Respondent had left the matrimonial home, she commenced proceedings in the Family Court of Australia seeking an order pursuant to the provisions of s87 of the Family Law Act 1975 for a settlement of property. But whatever may have been the exact details of what occurred, it would seem that, in March 1987, orders were made by the Family Court of Australia at Newcastle approving a maintenance agreement entered into between the Respondent and the Appellant pursuant to which agreement the Respondent transferred to the Appellant all her interest in the matrimonial home in exchange for the payment by the Appellant of the sum of $50,000.00 (AB 11). That sum appears to have been paid by the Appellant's solicitors to the Respondent's solicitors on 22 June 1987 (AB 15) following which the Respondent's solicitors paid to her the sum of $44,581.18 representing the balance of that sum after deduction of the costs of the Respondent's solicitors. The case which the Respondent sought to make out at trial was that she and the Appellant resumed cohabitation on 11 April 1987 and thereafter lived together as man and wife on a bona fide domestic basis until 10 February 1994 at Kangy Angy, then at Wyong and then at the subject property. The Respondent's case in this respect was denied by the Appellant who, in his Amended Defence filed on the hearing before Master Macready, claimed that he and the Appellant had lived together from 8 June 1987 until 24 August 1989 and again from February 1990 until 17 February 1994. In the event, the Master found that there were two disparate periods of cohabitation, the first commencing in June 1987 and concluding in August 1989 and the second commencing some six weeks or so after the first period of cohabitation had ceased and concluding on 17 February 1994 (AB 235-236). Despite the Master's having so found, and despite the fact that these proceedings were not commenced until some five years after the first period of cohabitation concluded, the Master - wrongly, in my view - held that it was not open to the Appellant to submit that the Respondent was not entitled to have matters which occurred during the first period of cohabitation taken into account in the application which she made for an adjustment of property interests pursuant to the provisions of s20 of the Act. I will return to this question later in these reasons. About the time when the parties first commenced to cohabit, the Respondent applied some $9,000.00 of the moneys which she had received from the Appellant to purchase a new motor vehicle and, as well, some $5,000.00, or thereabouts, in payment of miscellaneous debts. In the result, therefore, the Respondent was left with about $30,600.00 as the balance of the moneys which she had received from the Appellant. When the parties first commenced cohabitation they lived for a time in the former matrimonial home at Kangy Angy. However, in about October 1987, the Appellant sold the former matrimonial home for $145,000.00, on completion of the sale applying $30,000.00 to discharge a mortgage over that property which had been granted to Westpac Banking Corporation and $10,000.00 by way of repayment of the sum of $10,000.00 which had earlier been lent to him by his father. After completion of the sale and after those payments had been made the URJ FOTHERINGHAM V FOTHERINGHAM (Powell JA) 3 Appellant had available to him sums in excess of $135,000.00, those sums representing the balance of the proceeds of sale together with savings which the Appellant had earlier made. Following the sale of the property at Kangy Angy the Appellant and the Respondent moved into rented accommodation at 74 Watanobbi Rd, Wyong. While they were there, the Appellant paid the rent and the Respondent, who was employed for a time at the Gosford Newsagency and for a time at the Croissant Cake Shop, paid some of the other expenses. Toward the end of 1987, the Appellant located the subject property which, but for a cow shed which was erected upon it, was otherwise unimproved, and which property the Appellant determined to buy. The Appellant says - and in this regard he appears to have been accepted by the Master - that, prior to his entering into a contract to buy the subject property, the Respondent said to him: "T have $25,000.00 left from the property settlement. I'll put my $25,000.00 in but I want a half share in the property." to which he replied: "No, I'm not doing that. You keep your money, I'll buy it on my own." Thereafter, the Appellant entered into a contract in his name alone to purchase the subject property for the sum of $170,000.00, of which sum the Appellant provided $118,000.00 from his own funds, the balance being raised by way of loan from Westpac Banking Corporation, that loan being secured by mortgage on the subject property. After the completion of the purchase of the subject property the Appellant commenced to gut the cow shed with a view to converting it into a residence. After the cow shed had been gutted, the Appellant then erected a steel frame over it, effectively doubling its size and, with the assistance of friends who were builders, commenced to construct the new residence. Some of the materials which were used in the construction were obtained, and some of the labour necessary to carry out that construction was provided, under an arrangement made between the Appellant and his friends whereby the Appellant, who was a truck driver by occupation, would carry out work for his friends upon a barter type system. As might have been expected, the work of constructing the new residence extended over some time. At some time during the course of the construction work, the Appellant decided that the work was not progressing quickly enough and he purchased a "Millard''* caravan intending to move to live on the subject property. At the time the Appellant had a conversation with the Respondent in which he said: "T have bought a caravan and I'm going to live in it at Jilliby." to which the Respondent replied: "T've spoken to my solicitor Geoff Gersbach and he says its okay for me to put money into the farm as long as I keep all the receipts. I'll put some money in to do up the cow shed and I'll move to the farm with you." In an Affidavit sworn by her on 16 August 1995, the Respondent swore (inter alia): "14. In about August 1988 I received an inheritance of approximately $27,500.00 from my late aunt Annabel Buchannan. At about this time I received a further inheritance of $10,000.00 from the estate of my late step-brother Allan Morris. 4 UNREPORTED JUDGMENTS 15. As a result of being paid the $50,000.00 by the Defendant, the two inheritances, and my work, I having been in constant employment all this time, I had savings of over $50,000.00. 16. Using my funds, the Defendant and I engaged various qualified and some unqualified tradesmen to do building alterations to the cow shed as a result of which it was converted into a home. 17. Annexed and marked with the letter C is a list of moneys that I spent on the property totalling $38,610.47." A number of comments might be made about the "list of moneys" set out in the annexure marked "C" they are: 1. some, at least, of the payments - as, for example, sums said to have been paid to the Sydney County Council for the supply of electricity to the property at Watanobbi Road - are clearly not sums spent in respect of the subject property; 2. sums described as payments "for telephone service" made prior to the installation of a telephone line to the subject property would seem also not to have been paid in respect of the subject property; 3. sums said to have been paid for the purchase of two cows and for "B Moffitt Deed of Assignment (Mazda truck) and (Mazda utility)" could hardly be described as "building costs"; 4. some of the payments which the Respondent claims to have been made were made to a David Parkinson, who appears to say that he was paid in cash by the Appellant (see Affidavit D E Parkinson sworn 13 November 1996); 5. the last item making up the list of "building costs" is: "possibly $8,000.00 by way of deposits" a description which hardly gives one any confidence in its accuracy. In the event, the Master held (AB 245) that the Respondent in fact contributed amounts totalling some $25,000.00 or thereabouts. Although the evidence does not clearly establish it to have been so, it would seem probable that the work of constructing and fitting out the residence on the subject property occupied the period between about April 1988 when the purchase of the property seems to have been completed and August 1989. As I have earlier recorded, in August 1989 the Respondent left the subject property, remaining away for a period of some six weeks or thereabouts. As the Master noted in his Judgment (AB 236) "(The Respondent), when she left the house occupied by the parties, intended to remain away. She took a fridge and a number of other items and moved hersey from the premises. In the circumstances it would seem that there are two period of what one might term 'a de facto relationship'"'. Despite the fact that the first period of cohabitation came to an end over five years prior to the commencement of these proceedings (see Act s18(1)) the Master (AB 240) held that it was open to him to have regard to the contributions said to have been made by the Respondent in respect of each of the two periods of cohabitation. Although the evidence which was tendered on the hearing before the Master does not clearly demonstrate that this was so, the material which was tendered would seem to indicate that, even if it had not been so before, then, at least from about the time of completion of the construction of the residence on the subject property, the Appellant, in addition to continuing in employment as a truck driver, commenced to raise cattle on the subject property and commenced trading in cattle, a fact the significance of which does not appear fully to have been appreciated by the Master. URJ FOTHERINGHAM V FOTHERINGHAM (Powell JA) 5 As well be apparent from what I have earlier recorded, each of the Respondent and the Appellant was, with the exception of several short periods of illness, in constant employment during the period from June 1987 until 17 February 1994. In the Affidavit to which I have earlier referred, the Respondent deposed (inter alia): "18. Annexed with the letter "'D' is a schedule setting out my employment history and income that I have been able to determine for the relevant period." Schedule D took the following form: EMPLOYMENT HISTORY PERIOD OF EMPLOYMENT EMPLOYER INCOME to 30.06.87 Gosford Newsagency Not known 01.07.87 to 31.07.87 Gosford Newsagency 1,477.84 04.08.87 to 23.02.88 Croissant Cake Shop 6,983.00 03.08.88 to 30.06.89 In Time Watchmakers & 18,382.03 Jewellers 01.07.89 to 28.02.90 In Time Watchmakers & 13,926.55 Jewellers 01.03.90 to 07.03.90 Firemyth Pty Ltd 1,826.39 13.03.90 to 30.06.90 Goldmark Jewellers Pty Ltd 6,935.36 01.07.90 to 30.06.91 Goldmark Jewellers Pty Ltd 23,726.70 01.07.91 to 30.06.92 Goldmark Jewellers Pty Ltd 24,948.70 01.07.92 to 30.06.93 Goldmark Jewellers Pty Ltd 25,996.75 01.07.93 to 30.06.94 Goldmark Jewellers Pty. Ltd 25,573.00 Although in his Judgment (AB 246) the Master appears to have treated the various sums - totalling $149,776.32 - appearing in the column entitled "Income" as nett income after tax a conclusion which clearly had an affect on his assessment of the Respondent's "contributions" to the relationship - I would take leave to doubt whether this was so; on the contrary, I am disposed to think that the several amounts shown as "income" represented the Respondent's gross income from her employment and before the deduction of tax. In the Affidavit (AB 34-46) which he swore in opposition to the Respondent's Affidavit, the Appellant deposed (inter alia) as follows (AB 42): "39. My income in relation to the tax years commencing 1 July 1998 to date were as follows: - TAX YEAR ENDING TAXABLE INCOME 30th June $ 1988 29,998.00 1989 24,263.00 1990 28,330.00 1991 62,493.00 1992 33,977.00 1993 34,183.00 1994 47,000.00" Although, on the hearing before the Master, it seems to have been accepted (AB 127) that the Appellant's taxable income for the taxation years 1987-1988 and 1988-1989 was $29,998.00 and $24,263.00 respectively, the Respondent's 6 UNREPORTED JUDGMENTS taxable income as shown in his income tax returns for the taxation years 1989-1990 to and including 1993-1994, was other than as was stated in the column headed "Taxable Income". Although this fact does not provide a complete explanation for the divergences 5 between the figures shown under the hearing "Taxable Income" in para39 of the Appellant's Affidavit and the figures returned as taxable income for the years in question as revealed by the copy returns or the draft returns (Exhibit "B" AB 170-228) which were tendered in evidence, it is the fact that, during those years, 10 the Appellant's occupation was shown in those returns as "transport driver/primary producer", a fact which enabled the Appellant to claim significant deductions which, had he not claimed to carry on business as a primary producer, would not have been available to him, and also enabled him to claim the benefit of the averaging provisions. Some indication of how significant was the effect of 15 the Appellant's ability to claim such deductions is revealed by the Appellant's income tax return for the taxation year 1990-1991, in which year the Appellant's gross salary, wages and bonuses from his employment appear to have been $65,788.79 (AB 196) and the gross income from his cattle trading - $4,632.00 (AB 201), and yet his taxable income was returned in the sum of $21,184.00 (AB 20 197). I set out below a table which is derived from the Appellant's income tax returns for the years in question, which table shows the Appellant's assessable income derived from both wages and from cattle sales, some - but not all - of the deductions which were made by the Appellant, and the Appellant's taxable 25 income in the years in question. Year ending Assessable Some Deductions Taxable 30 June Income Income Wages Cattle Depreciation Interest Rates Repairs 30 Sales (50%) (50%) 1988 NA NA NA NA NA NA 29,998 1989 NA NA NA NA NA NA 24,263 1990 6560 5540 = 1125 682 3243 536 35 | 1991 65789 4632 4992 3755-1388 «3575 21,184 1992 20055 1690 5712 3126 8756 8=62213_~—s5, 101 1993 23968 5654 4840 2307 833 434 13,609 1994 30429 7504 3405 1999 797 = 2016 = 13,425 CO 147.001 25,020 20.074 11.187 4,456 11.481 108.116 172.021 47,198 45 The table enables one to make the following points: 1. although, as the Master noted (AB 246), the Appellant's taxable income for the seven income tax years to 30 June 1994 totalled $108,116.00, it is clear, first, that the Appellant's assessable income for the five income tax years to 30 June 1994 was far in excess of that sum and, second, that the Appellant's assessable 50 income for the seven income tax years to 30 June 1994 must have been well in excess of $220,000.00 ($29,998.00 + $24,263.00 + $172,021.00); URJ FOTHERINGHAM V FOTHERINGHAM (Powell JA) 7 2. in the five income tax years to 13 June 1994 amounts claimed for depreciation - which amounts, as the Master noted (AB 246), constituted a "non cash item" - amounted to $20,074.00; 3. in the same income tax years the amounts claimed for interest - that is, interest on the mortgage on the property - amounted to $11,187.00 - the total amount of the interest paid in those years thus being $22,374.00; 4. in the same income tax years, the amounts claimed for rates - both Shire rates and Pastures Protection Board rates - levied in respect of the subject property amounted to $4,456.00 - the actual amounts expended by the Appellant for rates thus amounted to $8,912.00; 5. the amounts claimed for repairs and maintenance for the same income tax years - which amounts, on examination, include amounts relating to repair of flood damaged fences, of fences generally, of roads and other similar items, which amounts one would think clearly relate to "the... conservation or improvement of" (Act s20(a)) the subject property - amounted to $11,481.00; 6. leaving to one side the amounts claimed for depreciation, the amounts actually outlaid by the Appellant for interest rates and repairs for the same income tax years amounted to $42,767.00 ($22,374.00 + $8,912.00 + $11,481.00). I have thought it desirable to go into these matters in the detail which I have set out above since it is clear, in my view, that the Master's Judgment and Orders were based virtually in their entirety upon his assessment, or understanding, of what were the parties' respective financial contributions to the acquisition, conservation or improvement of the property of the Appellant or the Respondent or to the financial resources of either of them. That this was so is, I suggest, demonstrated by the following passage in the Master's Judgment (AB 247-248): "When one turns to non financial contributions one finds that the plaintiff has done the majority, of housework. She did the washing, although occasionally the defendant would bring it in and fold it up, and she has done the majority of the cooking. Once again the Defendant would sometimes barbecue meals or prepared (sic) vegetables. Clearly, I think the defendant has done the majority of the work outside and the heavy work involved in running the property. This is not to say that the plaintiff has not assisted occasionally with mowing and bringing in cattle and the like. There is some dispute between the parties as to the extent of help one has given the other in illnesses. I think it is clear that the defendant has suffered some problems and has had some assistance from the plaintiff and similarly, the plaintiff has had some assistance from the defendant when she was ill. So far as the parenting aspects are concerned, this is an area where it must be borne in mind that both parties were working full-time during the period of the relationship. Vanessa was only there fora few months after the parties commenced their relationship and Naomi, who was thirteen when the relationship commenced, left is (sic) 1990. There is no precise evidence of what was involved in the parenting aspects, although it seems from the evidence that the majority of this was done by the plaintiff with some assistance from the defendant." and in the following further para(AB 249): "The defendant, on his part, has contributed his work to the property and in making a decision as to what ultimately has to be paid, one does take into account both the home-maker and parenting contributions. These have to be taken into 8 UNREPORTED JUDGMENTS account on a real and substantial basis. It is, as I have indicated a matter where the parties were both working and there is not a great disparity." At the time when the parties separated in February 1994, the Respondent took with her furniture and personal possessions, which furniture and possessions, together with the motor vehicle which she had bought in 1987, so the Master held, represented her only property. Following the parties' separation the Appellant retained the subject property, the amount due under the mortgage over the property then seemingly being of the order of $45,000.00, what appears to have been a fairly antiquated motor vehicle, a small amount of furniture and farming plant and equipment and cattle. As appears to have been the case with the Respondent, the Appellant had no cash savings. Although, in his Judgment (AB 249), the Master expressed the view that there seemed to have been little work done on the subject property after separation and before the matter came on for hearing, the Master appears to have overlooked the Appellant's evidence (AB 44-46) - which evidence was not challenged during the course of the Appellant's cross-examination - that, after the separation: 1. he completed building a machinery shed on the property; 2. he purchased a cattle crush and installed it at the property having first constructed a concrete pad on which to install it; 3. that he applied to Wyong Shire Council and obtained approval for a boundary realignment of the property which would allow the property to be subdivided; 4. that after the Wyong Shire Council refused the boundary realignment application he lodged an appeal to the Land and Environment Court; 5. that after the boundary realignment was finally approved, he sought and obtained from Wyong Shire Council development approval for the construction of a dwelling upon each of the blocks which would be created if the property was subdivided; 6. that, as part of the conditions of approval, he was required to construct and, in fact, did construct, a roadway, for that purpose, over a period of weeks driving a front end loader, carting fill, leveling fill, mixing road base, laying road base and erecting fencing to enclose the roadway; 7. that, in addition to the work which he himself carried out on the subject property, and the work which he provided under barter arrangement to which I have earlier referred, to enable him to obtain the assistance of friends, he expended moneys in connection with the purchase of the cattle crush, the obtaining of approval for the boundary realignment and the development approval and the construction of the road, which moneys appear to have exceeded $10,000.00. Although there had earlier been a dispute between the Appellant and the Respondent as to the value of the subject property, by the time the proceedings came on for hearing before the Master, the parties were agreed (AB 241) that the then improved value of the subject property was $430,000.00 and that the balance outstanding under the mortgage over the subject property was $40,123.00. Before turning to consider the manner in which the Master, in his Judgment, approached the task of determining what, if any, order it was appropriate for him to make in favour of the Respondent and the matters to which he might regard in so doing, it is convenient to record that the Act contains the following (inter alia) provisions: URJ FOTHERINGHAM V FOTHERINGHAM (Powell JA) 9 "18. TIME LIMIT FOR MAKING APPLICATIONS (1) Except as provided by subs(2) and subs(3), where defacto partners have ceased to live together as husband and wife on a bonafide domestic basis, an application to a court for an order under this Part shall be made before the expiration of the period of 2 years after the day on which they ceased, or last ceased, as the case may require, to so live together. (2) A court may, at any time after the expiration of the period referred to in subs(1), grant leave to a de facto partner to apply to the court for an order under this Part... where the court is satisfied, having regard to such matters as it considers relevant, that greater hardship would be caused to the applicant if that leave were not granted than would be caused to the Respondent if that leave were granted. 20 APPLICATION FOR ADJUSTMENT (1) On an application by a defacto partner for an order that this Part to adjust interests with respect to the property of the de facto partners or either of them, a court may make such order adjusting the interests of the partners in the property as to it seems just and equitable 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 of the partners or either of them or to the financial resources of the partners or either of them. As I have earlier (see p3 (above)) recorded, the case which the Respondent sought to make out at trial was that she and the Appellant resumed cohabitation on 11 April 1987 and thereafter lived together as man and wife on a bona fide domestic basis until 10 February 1994, a case which was denied by the Appellant who claimed that he and the Respondent had lived together from 8 June 1987 until 24 August 1989 and again from February 1990 until 17 February 1994. As I have earlier also recorded, the Master found that there were two disparate periods of cohabitation, the first commencing June 1987 and concluding in August 1989 and the second commencing some six weeks or so after the first period of cohabitation ceased and concluding 17 February 1994. Despite his having so found, and despite the fact that these proceedings were not commenced until some five years after the first period of cohabitation concluded, the Master, as I have earlier (see p4 (above)) recorded held that it was not open to the Appellant to submit that the Respondent was not entitled to have matters which occurred during the first period of cohabitation taken into account in the application which was made for the adjustment of property interests. The basis for the Master so holding is recorded by him in his Judgment in the following way (AB 236-237): "Tt was submitted by the Defendant that the earlier period was out of time in that the proceedings had not been commenced as was required by s18(1) within two years after the conclusion of that period The short answer to this submission is that this is properly a matter of defence where the Statement of Claim pleads the contributions and it has not been raised. There is no application for amend and if such an application had been made no doubt there could have been an application under s18(2) and that could have been debated and finally resolved. However, I will not leave the matter just on that 10 UNREPORTED JUDGMENTS basis but I think it would be useful to comment on and deal with the question as to whether or not it is appropriate to have regard to both periods." Later, (AB 238-240) the Master, after referring to the Judgment which I had delivered in Lipman v Lipman! - a case which was not directly in point since the earlier of the two relationships then under consideration had terminated prior to the coming into operation of the Act (see Act s6) - the Master continued: "...clearly, his Honour has not been directed to the express words in s18 of the Act. S18(1) is in the following terms: 'Except as provided by subs2 and subs3, where de facto partners have ceased to live together as husband and wife on a bonafide domestic basis, an application to a court for an order under this part shall be made before the expiration of the period of two years after the day on which they ceased, or last ceased, as the case may require, to so live together.' The important words in that are the words 'the day on which they ceased, or last ceased, as the case may require'. These words certainly, on the face of them, seem to contemplate that there may be several periods in which the parties lived together as a husband and wife on a bona fide domestic basis. $18 is in a group of sections dealing with jurisdictional prerequisites for the making of orders. When one looks at s17(1), one also finds a reference to a period. 17(1) is in the following terms: "Except as provided by subs2(8) a court shall not make an order under this part unless it is satisfied that the parties to the application have lived together in a de facto relationship for a period of not less than two years." It is notable that there has (sic) been used the words 'a period' and there has (sic) not been used alternative formulas such as 'a number of periods of a certain duration' or 'a number of periods totalling a minimum duration'. The Act seems to contemplate as a requirement that there must be at least a substantial period before jurisdiction is attracted. When one turns to s20 of the Act one finds that the power to make an adjustment of interest (sic) is contained therein and the section talks of 'the property of the partners or either of them'. It does not talk in respect of periods of the de facto relationship. Another matter, of course, which his Honour in Lipman is referring to is the very way s6 of the Act is phrased. The way it has been phrased seems to contemplate there may be a number of de facto relationships between people and any pre-1984 relationship is excluded. In my view it is open to the Court in the present circumstances to have regard to the contributions in respect of each of the periods in this case." As I have earlier (p4 (above)) recorded, I am of the view that the Master erred in the approach which he took. As the Master himself recognised (AB 239), s18 is a section dealing with a condition precedent to be fulfilled before a court might make an order under (inter alia) s20 of the Act. That being so, it seems to me that the applicant for such an order bears the onus of establishing that that condition precedent has been fulfilled or, alternatively, bears the onus of obtaining an order of the court granting leave to commence proceedings. If this be so, then it was not necessary for the Appellant in his Defence specifically to raise the provisions of s18(1) of the Act. But, even if the Appellant were to be required to raise the matter, it is clear, as I have earlier recorded, that the Defendant, in his Amended Defence, 1. (1989) 13 Fam LR 1; (1989) DFC 95-068 URJ FOTHERINGHAM V FOTHERINGHAM (Powell JA) 11 specifically pleaded that there were two discrete periods of cohabitation and not the one continuous period of cohabitation which the Respondent, in her Statement of Claim, had asserted and which, at trial she sought - unsuccessfully as it turned out - to establish. This being so, and no application, and still less any order, for leave to commence proceedings having been made, it was, in my view, not open to the Master to adopt the course which he did. This notwithstanding, it is, perhaps, as well that I consider the matter upon the basis that it was open to the Master to have regard to the earlier period of cohabitation and such contributions - whether financial or non-financial - which each of the Appellant and the Respondent made during the two periods of cohabitation have made to the acquisition, conservation or improvement of the property or either of them - I have set to one side the contributions which each may have made whether in the capacity of homemaker or as parent to the welfare of the other, or to either of their two daughters, since, as I have earlier recorded, the Master (AB 247-249) proceeded upon the basis that, in these respects at least, there was no great disparity between the contributions made, on the one hand, by the Respondent and, on the other, by the Appellant. Before recording the manner in which the Master dealt with this aspect of the matter, it is, in my view, appropriate that I record first what I understand since the decision of this Court in Evans v Marmont? are the principles to be applied on an application for a property adjustment order made pursuant to the provisions of s20 of the Act, and, second, what are the principles to be applied by this Court when dealing with an appeal in respect of an order made on such an application. Those principles are as follows: 1. in determining whether any, and, if so, what, property adjustment order should be made pursuant to the provisions of s20 of the Act, the Court is exercising a judicial discretion, which must be exercised solely on the basis of the respective contributions of the parties and in the light of such other circumstances as might properly be regarded as relevant, and which seek to produce a result which, in all the circumstances of the case, is just and equitable; 2. for that purpose, the Court is required to identify, and value, the property of the parties to determine whether any, and, if so, what, contributions of the type contemplated by s20(1)(a), s20(a)(b) of the Act have been made by each partner and to determine whether, in all the circumstances of the case, the contributions of the applicant have already been sufficiently recognised and compensated for; and finally, to determine what, if any, order is called for in order that the applicant's contributions be sufficiently recognised and compensated for (Evans v Marmont3; Wallace v Stanford*); 3. since what is involved is the exercise by the Master of a discretionary judgment, the circumstances in which this Court may set aside the judgment of the Master are limited. In this regard, it is as well to repeat the well known passage from the Judgment of Dixon, Evatt and McTiernan JJ in House v The King5 which is to the following effect: 'The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that if they had been in the position of the primary judge, they would have taken a different course. It must appear that some 2. (1997) 42 NSWLR 70 3. supra 4. (1994-1995) 35 NSWLR 1 5. (1936) 55 CLR 499, 504-505 12 UNREPORTED JUDGMENTS error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he has not taken into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so" 4. to that statement of principle might be added the caveats which may be found in the authorities as to the approach to be taken to submissions made upon the basis that, although the court at first instance took into account all relevant factors, it failed to give adequate weight to one of those factors. Thus, in Gronow v Gronow® Stephen J said: "The constant emphasis of the cases is that, before reversal, an appellate court must be well satisfied that the primary judge was plainly wrong, his decision being no proper exercise of his judicial discretion. While authority teaches that error in the proper weight to be given to particular matters may justify reversal on appeal, it is also well established that it is never enough that an appellate court, left to itself, would have arrived at a different conclusion. When no error of law or mistake of fact is present, to arrive at a different conclusion which does not of itself justify reversal can be due to little else but a difference of view as to weight: it follows that disagreement only on matters of weight by no means necessarily justifies a reversal of the trial judge. Because of this and because the assessment of weight is particularly liable to be affected by seeing and hearing the parties, which only the trial Judge can do, an appellate court should be slow to overturn a primary judges discretional decision on grounds which only involve conflicting assessments of matters of weight." In his Judgment, the Master dealt with the parties' respective contributions to the subject property in the following way (AB 244-247): "T turn to the contributions to the property. As I have indicated, the defendant provided $118,000 in cash and he took the liability under a mortgage initially of $52,000, which mortgage has been reduced down to $40,000. This has been repaid by him except in respect of one payment of $700 by the plaintiff. The defendant himself of course apart from his case contributions to the property, has contributed a substantial amount of labour. The work on the property involved the building the house or, rather, converting the cow shed into an approved house. To do this, he did work for friends and arranged for friends to come and work on the property in return for the labour which he put into their projects. There has been evidence given by a Mr Parkinson of an estimate of the amount of work that was done on the construction of the house. He estimated that the total cost of the construction of that dwelling, assuming that second hand materials were used and no Council fees paid, would be the sum of $28,590. All this does is to give some rough idea of the type of costs involved in the alterations to the cow shed. Apart from that, the defendant has also built a machinery shed on the property. There is evidence in that regard. As I have mentioned, the plaintiff herself came to the property on the basis that she would contribute to the renovation work, and she did in fact contribute amounts of some $25,083.94. The amount advanced was some $700 higher but I am satisfied that this was an inadvertent over-counting of two mortgage payments. 6. (1979) 144 CLR 513, 519-520 URJ FOTHERINGHAM V FOTHERINGHAM (Powell JA) 13 Since the initial work on the property, there has been some other work done around the property which includes things such as mending fence (sic), erecting cattle yards, desilting dams, doing general, what might be described as farm work on the property. This substantially has been done by the defendant with some assistance, but not a great amount, from the plaintiff. So far as vehicles are concerned, the defendant has brought his existing ones to the relationship and he admits that the plaintiff purchased a Mazda truck for $2500 and a utility for $800 and these have been retained by the defendant. The plaintiff, of course, has her vehicle which she purchased at that time of the original settlement. The other areas of financial contribution obviously relate to the way the house was managed and the parties' contribution to the expenses and development of the property. There is evidence that the plaintiff's income for the period from July 1987 until 30 June 1994 was $149,776.32. There is evidence of the defendant's taxable income. In this regard I note that the defendant cannot explain how substantially more was set out in his affidavit than is actually disclosed in his returns. His relevant taxable income for the years in question are as follows: 1988 - $ 29,998 1989 - $ 24,263 1990 - $ 536 1991 - $ 21,184 1992 - $ 5,101 1993 - $ 13,609 1994 - $ 13,425 There is a total of $108,116. They are figures for taxable income and if one looks at the tax returns that are tendered from 1990 on, it is clear there is a non-cash item in them, namely, depreciation of some $21,000. This puts a contribution of about $130,000 by the defendant over the period. Apart from these contributions from income, one also has the plaintiff having put $9274.59 from an inheritance into the joint funds, and this occurred some time after late 1989. The plaintiff, of course, started with the balance left over from the property settlement at the commencement of the relationship and also $27,500 from her aunt, to which I have referred. What is notable is, of course, that both parties ended up at the relationship with no cash savings. Accordingly, one can conclude that all of these funds have been contributed by each of the parties to the joint endeavour, namely, the relationship over the period." his conclusion, later (AB 248-250), being as follows: "If one then turns to a consideration of factors, one has a situation where the property, which is the major asset, was substantially purchased by the defendant. The amount that the plaintiff put in - if one added to this the purchase price of $177,000 - is approximately 12 per cent. The defendant took out the mortgage, was responsible for it and no doubt will have it in the future if the property is not sold. The plaintiff, on the other hand, of course put in the amounts I have mentioned, the cars and she has contributed substantially more to the household over the period in question. 14 UNREPORTED JUDGMENTS Though there was some suggestion that the plaintiff might have purchased jewellery, there was nothing in the evidence which leads me to think that she had led an extravagant lifestyle and that the parties have not simply used the funds which they had put into the relationship in a way which was generally, suitable to both of them. Importantly, there has been a substantial increase of the property from a purchase price of $177,000.00 in 1987 to a figure of $430,000.00 at the present time. I note that there is no evidence of the effect the defendant's work has had on the increase in value and, in particular, there seems to be little work that has been done after the date of separation. Accordingly, it would seem that on what little evidence I have I should substantially regard the increases as having occurred during the period of the relationship. Since April 1994 the defendant has been in occupation, had the benefit himself of making payments. In all, in my view, the appropriate orders to adjust the interest of the parties is that the defendant pay the plaintiff $125,000.00." I regret to say that I have considerable difficulty in discerning the process by which the Master reached the figure of $125,000.00 which he ordered the Appellant to pay to the Respondent. As best as I can judge it, the matters upon which the Master relied to reach his conclusion were: 1. if one added to the amount paid by the Appellant - from his own funds and from the amount raised on mortgage - to purchase the property, the amount - $25,000.00 - which the Master found that the Respondent had contributed toward the cost of construction of the residence on the subject property, one reached a total of a little in excess of $200,000.00 - which sum, one assumes, the Master then treated as the then improved value of the property - of which sum the Respondent's contributions represented approximately 12%; 2. at the time of the hearing - which was the better part of three years after the parties had separated - the value of the subject properties was $430,000.00; 3. since - so the Master said - no, or virtually no, work had been done on the subject property after the parties separated, the whole of the increase in value must be treated as having occurred during the period from the time of the purchase of the property until the parties separated; 4. although the parties' non-financial contributions to the subject properties might be regarded as approximately equal, the respondent's financial contributions "to the relationship" far exceeded those made by the Appellant; 5. in the circumstances, the respondent was entitled to receive a sum representing 12% of $430,000.00 together with a sum representing the difference between the Respondent's contributions "to the relationship" and those of the Appellant. If this be the manner in which the Master arrived at the order which he finally made - and | have been unable to conceive of any other approach - then it seems to me that the Master's process of reasoning cannot be supported, as, not only has he overlooked evidence which was unchallenged, but he has misunderstood evidence and, further, his process of reasoning was, in my view, fallacious. Thus: if, as seems to have been the case, the Master concluded that the improved value of the property after the erection of the residence was $200,000.00 he completely overlooked any normal increase in value which might have occurred URJ FOTHERINGHAM V FOTHERINGHAM (Powell JA) 15 in the period from the date of the acquisition of the property by the Appellant and, as well, he completely overlooked the value of the work which the Appellant himself had contributed to the erection of the property and the value of the work of others who contributed their labour pursuant to the barter scheme to which I have earlier referred. Further, the relevant figure would have been, not, the improved value of the property at that time, but, the value of the Appellant's equity in the property, which have been about $50,000.00 less; 2. the relevant date for determining the value of the subject property for the purposes of an application under s20 of the Act was, not, the date of hearing before the Master - November 1996 - but the date of separation - 17 February 1994. Further, the relevant figure would have been, not, the improved value of the property at the relevant time, but, the value of the Appellant's equity in the property - which figure would have been some $44,000.00 or thereabouts less than the improved value of the property at the relevant time; 3. as I have earlier recorded, the Master overlooked the uncontested evidence of the Appellant as to the works which he had carried out to the subject property in the period of some 2% years or thereabouts which had passed after the Respondent had left the subject property and before the application came on for hearing before the Master, a fact which led the Master, erroneously, in my view, to conclude that the whole of the increase in the value of the property had occurred in the period between the date of its acquisition and the date of separation. The Appellant's uncontested evidence would seem to indicate that at least $10,000.00 or more of the value of the subject property at the time of the hearing had been the result of the work carried out by the Appellant in the period in question; 4. as will be apparent from the extract of the Master's Judgment which I have set out above, he concluded that the Respondent's overall financial contributions "to the relationship" were "somewhat more by a substantial amount than that of the (Appellant).". As I have sought to demonstrate by reference to the table which T have earlier set out (p12 (above)), the Master's conclusion in this respect was, in my view, erroneous and, upon a proper understanding of the evidence, it was the Appellant's financial contributions to "the relationship" which exceeded those of the Respondent by a substantial figure. In the light of these matters I have concluded that the Master's exercise of the discretion invested in him miscarried and that it is for this Court now to exercise that discretion for itself Although I appreciate that other minds might differ, it seems to me that the approach which, in all the circumstances. would produce an order which was just and equitable as between the parties, is one which would provide to the Respondent a sum of money which represents that proportion of the value of the Appellant's equity in the subject property as at the date of separation which the financial contributions made by the Respondent to the cost of construction of the residence on the subject property bore to the value of the Appellant's equity in the subject property after the completion of the construction of the residence in 1989. Because of the paucity of the information conveyed by the evidence, one is, regrettably, obliged to resort to a degree of approximation in the endeavour to attain that figure. If, one adopts what appears to have been the Master's view as to the improved value of the property on the completion of the evidence (approximately $200,000.00) and subtracts from that the amount then owing under the mortgage (approximately $52,000.00) one achieves a figure of about $150,000.00 as representing the value of the Appellant's then equity in the 16 UNREPORTED JUDGMENTS subject property. The moneys contributed by the Respondent to the cost of the construction (approximately $25,000.00) are thus seen to be about one-sixth of the then value of the Appellant's equity in the subject property. If one then takes the improved value of the subject property at the date of separation to be the value ($430,000.00) of the property at the date of the hearing before the Master less the moneys expended by the Appellant (about $10,000.00) between the date of separation and the date of hearing before the Master and deducts from that sum ($420,000.00) the amount outstanding under the mortgage at the date of separation ($45,000.00 approximately) one produces as the value of the Appellant's equity in the subject property at that date the sum of $375,000.00. The approach which I have suggested as appropriate would thus produce as the amount which the Appellant should be ordered to pay to the Respondent the sum of $62,500.00. However, because I am only too conscious of the potential inaccuracies of the figures which I have set out above, I would be prepared to "round up" that figure to $70,000.00. I would therefore propose the following Orders: 1. ORDER that the appeal be allowed. 2. ORDER that O1, O2 and OS made by the Master on 19 November 1996 be set aside. 3. IN LIEU THEREOF ORDER (a) that by way of adjustment of their property interests the Appellant/Defendant pay to the Respondent/Plaintiff the sum of $70,000.00, that order to take effect from 19 November 1996; (b) that the lands the subject of Folio Identifier 1/65866 and Folio Identifier 22/251953 stand charged with the payment by the Appellant/Defendant to the Respondent/Plaintiff of the said sum of $70,000.00; (c) that the Appellant/Defendant pay the Respondent/Plaintiff's costs of the proceeding up to and including 19 November 1996. 4. ORDER that the Respondent pay the Appellant's costs of the appeal. Against the possibility that the other members of the Court, although of the view that the appeal should be upheld, do not agree with the Order for adjustment of property interests which I propose, it is necessary that I should add some observations as to the question of the costs of the appeal. The need for me to make these observations arises from the fact that, shortly before the hearing before the Master, the Respondent/Plaintiff served upon the Appellant/Defendant an offer of compromise which offer was to the effect that the Respondent/Plaintiff was willing to accept the sum of $70,000.00 plus reasonable party/party costs, but which offer was not accepted by the Appellant/Defendant prior to delivery by the Master of Judgment in the proceedings. In the light of the making, and failure to accept, that offer, counsel for the Respondent has submitted that, even if the appeal be upheld, the Respondent would be entitled to receive her costs of the appeal on an indemnity basis so long as the order which is substituted for that made by the Master was an order for the payment of some of more than $70,000.00. I do not consider that submission correct despite the fact that I am aware that in an ex tempore Judgment delivered by the Court - Cole, Beazley, Stein JJA - on 5 September 1998, in Ditton v Whitton the Court awarded a successful Respondent, who had, prior to a trial in the District Court, served an offer of compromise the amount of which was less than that awarded at trial, indemnity costs of the appeal. However, in Commercial Union Assurance Company of Australia v Pelosi (No 2) a reserved Judgment delivered by the Court (Handley, Sheller, Powell MA) on 27 February 1996, the Court, which had earlier upheld an appeal and cross-appeal from a Judgment delivered by Barr AJ URJ FOTHERINGHAM V FOTHERINGHAM (Stein JA) 17 (as he then was) but left the Respondent/Plaintiff with an award greater than she had, in an offer of compromise, earlier indicated she would accept, declined to award the Plaintiff her costs of the appeal on an indemnity basis. That approach, as it seems to me, appears to accord with the approach taken by this Court (Gleeson CJ, Kirby P, Clarke JA) in an unreported Judgment delivered on 13 October 1993 in Australian Consolidated Press Ltd v Ettingshausen. Beazley JA I agree with Stein JA that the Master's Order should be varied and that an award in the sum of $90,000 should be made in favour of the respondent. As the appellant has been successful in his appeal, in the ordinary course he would be entitled to an order for costs. In accordance with this Court's usual practice, an order that the respondent have a certificate under the Suitor's Fund Act 1951 (NSW) if so entitled, would be made. However, at the conclusion of the appeal, the respondent made an application for indemnity costs should she be awarded an amount greater than $70,000, being the amount offered by her in an offer of compromise made prior to the hearing at first instance. Since judgment was reserved on the appeal, it has come to the Court's attention that there are inconsistent decisions of the Court on the question whether a respondent, in circumstances such as these, is entitled to an order for indemnity costs. The first is Commercial Assurance Company of Australia v Pelosi (No 2) (unreported, New South Wales Court of Appeal, 27 February 1996), under which the respondent would not be entitled to an order for indemnity costs. The second is Ditton v Whitton (unreported, New South Wales Court of Appeal, 5 September 1997), under which the respondent's application would be successful. In Ditton v Whitton, the Court was referred to Ettingshausen v Australian Consolidated Press Ltd (1995) 30 NSWLR 404, but was not referred to Pelosi. After the appellant's counsel had an opportunity to consider Ettinghausen he did not argue against the award of indemnity costs against his client. The Court delivered a short ex tempore judgment dealing with the issue. Because of the inconsistency in the two decisions, I am of the opinion that the Court should not make an order in respect of the application for indemnity costs without the benefit of further argument. There is also the added difficulty that the Court may need to give leave to reargue Pelosi if the respondent wishes to pursue her application for indemnity costs. I consider, therefore, that the respondent should be given an opportunity to consider whether she wishes to proceed with her application. Accordingly, I agree with the orders proposed by Stein JA. Stein JA I have had the benefit of reading the draft judgment of Powell JA and will not repeat the facts he recites therein. I agree with his Honour that the Master's discretion miscarried, although I am unable to agree with the result his Honour arrives at when re-exercising the discretion under the De Facto Relationships Act 1984 (the Act). I will return to this later. The miscarriage of discretion arose from the Master's treatment of the respective incomes of the parties. In this regard the Master said: There is evidence that the plaintiffs [respondent's] income for the period from July 1987 until 30 June 1994 was $149,776.32. There is evidence of the defendant's [appellant's] taxable income. In this regard I note that the defendant cannot explain how substantially more was set out in his affidavit than is actually disclosed in his returns. His relevant taxable income for the years in question are as follows: 18 UNREPORTED JUDGMENTS 1988 - $ 29,998 1989 - $ 24,263 1990 - $ 536 1991 - $ 21,184 1992 - $ 5,101 1993 - $ 13,609 1994 - $ 13,425 There is a total of $108,116. They are figures for taxable income and if one looks at the tax returns that are tendered from 1990 on, it is clear there is a non-cash item in them, namely, depreciation of some $21,000. This puts a contribution of about $130,000 by the defendant over the period. It is correct to observe that, at least in relation to the appellant, the income figures were nett. Although the Master noted that the appellant could not explain how substantially more income was set forth in his affidavit than in his tax return, it is clear that his gross earnings are well in excess of his taxable income for the years in question. He was entitled to a number of large business/rural based deductions and his nett taxable income was well below his actual gross earnings. It is apparent, as Powell JA makes plain, that the appellant's income during the relevant period was in excess of $220,000. Accordingly, it was an error on the part of the Master to conclude that the appellant's contribution over the relevant period was about $130,000. Reverting to the need to re-exercise the discretion, the facts reveal a somewhat unusual twist in that the parties were lawfully married for 14 years before divorcing and later embarking on a de facto relationship. The marriage, which produced two children, was dissolved in 1985, the parties having separated 2 years earlier. The respondent (Mrs Fotheringham) received a family law property settlement in 1987 (around $50,000). Later in 1987 (the Master found the 8" June), the parties resumed cohabitation. This relationship continued until 17 February 1994 save for a 6 week (or thereabout) interruption in 1989. The period of cohabitation of the de facto relationship was approximately 6 years 8 months. Iam unable to agree with Powell JA that this 6 week interruption meant that the first period of cohabitation came to an end over 5 years before the proceedings commenced (s18(1) of the Act). In the scheme of things the interruption was a minor one and the period of cohabitation, starting in 1987, should not be seen to be broken. In addition, the Master was correct in concluding that it was not open to the appellant to raise the issue because it had never been pleaded as a defence or by the denial of the relevance of the contributions made by the respondent in the early period. The Master noted that at no time was any application made to amend. In my opinion, the Master was right to determine that, in these circumstances, he ought not entertain the submission. To have decided to allow the point to be run at that stage in the proceedings would have visited prejudice on the respondent which, it is likely, could not have been adequately met at that time. Accepting Powell JA's conclusion of the approximate net value of the subject property at Jilliby at $375,000, as at the separation, it follows that the Master's adjustment of $125,000 assessed the respondent's interest at one-third. On a re-exercise of the discretion, Powell JA concludes that an appropriate sum to substitute for the order of the Master is $70,000. URJ FOTHERINGHAM V FOTHERINGHAM (Stein JA) 19 In my opinion, the interest of the respondent to be adjusted is in the order of 25% or slightly less, producing a figure of $90,000. This would, in my view, be a just and equitable adjustment having regard to s20(1)(a) and s20(1)(b) of the Act. My reasons for so concluding are as follows. The Master concluded that there was, more or less, an equality of non-financial contributions with Mrs Fotheringham responsible for majority of the housework and Mr Fotheringham for the majority of the work on the property. With both parties working more or less full time and Mr Fotheringham occupied with the work of the property, it is probable that a larger share of the domestic contribution would have inevitably fallen on Mrs Fotheringham. The Master found that the parties were in more or less pen anent work and put the whole of their respective incomes into the relationship as a joint endeavour. Mr Fotheringham's income was, as is invariably the case, in excess of that of the respondent. However, as Beazley JA and I observed in Gazzard v Winders, (unreported, Court of Appeal, 23 July 1998) inequities between the earnings of men and women should not be further entrenched by discounting the importance of the woman's contribution to the relationship. The Master found that the respondent contributed $25,000 to the property. In addition, it is clear that the respondent contributed around $62,000 to the relationship during its 642 years. During 1988, the respondent received $37,500 from two inheritances. When the Jilliby purchase was about to be made, the respondent offered to put in $25,000 which she said was what was left of the $50,000 divorce settlement. The appellant declined this offer. At the end of the relationship in 1994, the Master found that neither party had any cash savings. Accordingly, it appears that the respondent contributed the whole of her inheritance and the balance of the divorce settlement (that is, in excess of $62,000) to the relationship during its duration. These moneys were therefore available to the parties and doubtless meant the appellant was able to invest more into improving the property than would have otherwise been the case. Taking account of the financial contributions to the property, discussed immediately above, and the likely respective income contributions, a proper exercise of the discretion under the Act produces, as I have said, an interest by the respondent in the property of around 25%. Rounding this off to $90,000 leads me to agree with orders | and 2 proposed by Powell JA (save as to costs order number 5) but substituting the sum of $90,000 in proposed order 3. I agree with what Beazley JA has said in relation to the application for indemnity costs. Accordingly, I would direct that unless the respondent within 14 days provide written submissions as to why an order other than the respondent pay the appellant's costs of the appeal and receive a certificate under the Suitors Fund Act should be made, that order be made. Accordingly, I propose the following orders: 1. Order that the appeal be allowed. 2. Order that O1 and O2 made by the Master on 19 November 1996 be set aside. 3. In lieu thereof order: (a) that by way of adjustment of their property interests the appellant/defendant pay to the respondent/plaintiff the sum of $90,000, that order to take effect from 19 November 1996. UNREPORTED JUDGMENTS (b) Order that the lands the subject of Folio Identifier 1/65866 and Folio Identifier 22/251953 stand charged with the payment by the appellant/defendant to the respondent/plaintiff of the said sum of $90,000. 4. Direct that unless the respondent within 14 days provide written submissions as to why an order other than that the respondent pay the appellant's costs of the appeal and receive a certificate under the Suitors Fund Act should be made, that order be made. 1. 2. ORDER that the appeal be allowed. BY MAJORITY ORDER that O1 and O2 made by the Master on 19 November 1996 be set aside IN LIEU THEREOF ORDER: (a) that by way of adjustment of their property interests the Appellant/Defendant pay to the Respondent/Plaintiff the sum of $90,000.00, that order to take effect from 19 November 1996; (b) that the lands the subject of Folio Identifier 1/65866 and Folio Identifier 22/251953 stand charged with the payment by the Appellant/Defendant to the Respondent/Plaintiff of the said sum of $90,000.00 DIRECT that unless the Respondent within 14 days provide written submissions as to why an order other than that the Respondent pay the Appellant's costs of the appeal and receive a certificate under the Suitors Fund Act should be made, that order be made. Counsel for the appellant: E Conditsis (Solicitor) Counsel for the respondent: M R Errington Solicitors for the appellant: Conditsis & Associates (Gosford) by their City Agents Tress Cocks & Maddox Solicitors for the respondent: Taperell Rutledge (Gosford) by their City Agents Pike Pike & Fenwick