New South Wales Supreme Court CITATION : Keller v Hand [2006] NSWSC 1224 HEARING DATE(S) : 15/11/06, 16/11/06 JUDGMENT DATE : 16 November 2006 JURISDICTION : Equity JUDGMENT OF : Associate Justice Macready at 1 EX TEMPORE JUDGMENT DATE : 11/16/2006 CATCHWORDS : Family Law. Application for adjustment under s20 of Property (Relationships) Act 1984. Orders made. No matters of principle. PARTIES : Eleanor Margaret Keller v Penelope Hand FILE NUMBER(S) : SC 1071 of 2006 COUNSEL : Mr C Simpson SC for plaintiff Mr C Vinden for defendant SOLICITORS : The Argyle Partnership for plaintiff Andrea Wilson & Associates for defendant - 1 - IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION Associate Justice Macready Thursday 16 November 2006 1071/06 Eleanor Margaret Keller v Penelope Hand JUDGMENT 1 His Honour: This is an application for adjustment of the parties property pursuant to s 20 of the Property (Relationships) Act 1984. The parties lived in an admitted de facto relationship from November 1990 until 21 August 2003. They had no children who were part of the household. History of the relationship 2 The plaintiff was born on 29 September 1950 and the defendant was born on 27 November 1960. In 1978 the plaintiff purchased property at 30 Arthur Street, Leichhardt for $31,750 with the assistance of a mortgage. 3 In April 1990 the parties met and in November 1990 the parties commenced to cohabit when the Defendant moved into Plaintiff's home at 30 Arthur Street, Leichhardt. The defendant suggests that it occurred in June 1990 but having seen the plaintiff's evidence concedes that it may have been December. In the circumstances of this case the difference is immaterial. At the time the plaintiff was employed as a teacher as was the defendant. 4 After the move the parties maintained separate bank accounts. The plaintiff paid the rates and insurance on the Leichhardt property. When the defendant moved in she paid no rent and Plaintiff made all mortgage repayments of $600 per month. The plaintiff says she paid rates and insurance on the property and parties shared electricity and telephone. The defendant says she paid all electricity and telephone. 5 The plaintiff says that while defendant lived with her at Leichhardt the defendant carried out gardening and minor landscaping, painted the front bedroom and assisted the plaintiff with paving in back courtyard. The defendant says she and plaintiff collected recycled bricks and laid them as pavers and that she (defendant) equally maintained with the plaintiff the property. 6 By 1 November 1991 the plaintiff had paid off the mortgage on the Leichhardt property. In January 1994 the plaintiff sold the Arthur Street property for $215,500 receiving net $208,152 and the parties began to look for another property to purchase. 7 In May 1994 the parties purchased as tenants in common (Plaintiff 75% and Defendant 25%) property at 29 Gladstone Street, Lilyfield for $275,000 plus stamp duty and legal fees. The plaintiff paid from proceeds of Arthur Street. Stamp Duty $8,119 Legal fees, etc $1,813 Towards purchase $130,000 Total $139,932 8 The balance of purchase monies were made up of a mortgage advance in the sum of $65,000 made by ANZ to the plaintiff and a mortgage advance in the sum of $80,000 made by ANZ to the defendant. From the time of purchase the parties each met their own mortgage repayments. 9 After this purchase and the purchase of a new Hyundai Sonata ($24,000 after trade in) the plaintiff retained $46,000 to be applied to renovations. The renovations ultimately cost $55,127 to which she applied her $46,000 and took out another loan facility in the sum of $10,000 to meet the balance. 10 In May 1994 the parties began to operate a joint account into which they paid monies to meet their living costs being electricity, telephone, rates, gas, minor home repairs and some holidays. In August 1994 the parties commenced renovations to the Lilyfield property. These included the parties jointly painting the kitchen, dining room, bathroom, lounge, hallway, sunroom, French doors and balance of house and were completed in June 1995. 11 In March 1996 the defendant borrowed $10,000. The plaintiff used $1,500 of those monies for the installation of a burglar alarm at the Lilyfield property. The plaintiff repaid the $1,500 to the defendant. The defendant says that the balance of the personal loan was used for the parties living expenses for the parties. 12 Between August and October 1997 the parties carried out further renovations installing a deck and paving. The plaintiff contributed $9,000 and the defendant $4,000 with both parties borrowing the monies contributed. 13 In late 1997 the defendant resigned as a full time teacher and took up part time teaching in order to pursue studies in horticulture at Ryde TAFE. 14 In March 2000 the parties renegotiated mortgage loan facility of $180,000. The parties thereafter consolidated the two individual mortgages by paying out defendant's mortgage of $67,736 and her personal loans of $14,872 (total $82,608) and the plaintiff's mortgage debt of $51,289 and her personal loan of $13,443 (Total $64,732). The parties paid equally the costs of the new loan facility. 15 After paying out the mortgages and loans they had $30,357 over which monies were paid into a joint ANZ bank account. Those funds were used as follows: (a) Plaintiff traded in a motor vehicle she had purchased in 1994 and purchased Toyota Camry at a cost of $20,000 (Plaintiff used trade-in of $8,000 and funds of $12,000. (b) Purchase of various household items (two single lounge chairs, washing machine, outdoor setting, deck chairs and a ladder). The outdoor setting given to parties as a joint birthday present; (c) Various household expenses such as timber for study ($1,054), security system ($625), electrical work ($1,127) pest control ($534) hardware and carpet cleaning ($744) and tree lopping ($187); (d) Wine, golf weekend, Olympic Games tickets, retirement dinner and vet expenses (approximately $11,038 if outdoor setting included). 16 In July 2000 the plaintiff says she commenced and later completed painting the new computer desk, the shelving and filing cabinets in the study. She also painted: (a) Front porch area, windows and gutter, fascia boards. (b) Attic stairwell. (c) Three lounge room doors and architraves. (d) Main bedroom. 17 The plaintiff says she and the defendant painted the kitchen, dining room, bathroom, lounge, hallway, sunroom and French doors. 18 The defendant says the parties jointly painted the newly renovated works and re-painted the study together and that she (the defendant) painted the feature walls, entry hall, exterior back of the house, decking rails and re-painted cedar sunroom doors and windows and the attic area. 19 In September 2001 the plaintiff says her mother gave her $50,500. The defendant says the plaintiff's mother gave the money to both the plaintiff and herself. The monies were deposited into the joint account of parties. 20 In October 2001 the plaintiff and defendant purchased an investment property at 1/44 Boyce Street, Glebe for $201,000 borrowing $200,000 from ING Bank on an interest only loan. The shortfall of $11,557 after payment of solicitor's fees, stamp duty and convection oven for property were paid from the monies given by the plaintiff's mother. The defendant says that the shortfall came from parties' joint account (to which monies from mother had been deposited). The parties thereafter let the property and there was a shortfall of rent over expenses of approx. $150 per fortnight which shortfall was paid from parties' joint account. 21 In November 2001 the plaintiff paid down the joint mortgage by depositing $30,000 of the $50,500 of the monies from her mother. 22 In 2001 or 2002 the defendant sold her Ford Laser motor vehicle and retained the sale proceeds of $500 and purchased a Vespa scooter. She also then used the plaintiff's motor vehicle. 23 In June 2002 the defendant stopped part-time teaching and commenced to run a garden design business. The defendant took out a $50,000 loan by redrawing on mortgage facility. She says this loan was borrowed so she would have funds to live off and she also paid one-half of the mortgage repayments and applied funds towards supporting the parties' lifestyle. 24 In December 2002the defendant commenced to suffer from depression. By April 2003 the defendant commenced to suffer from suicidal ideation and attended Catherine Campbell, psychologist. They parties drew down $2,000 from joint account facility to meet the defendant's costs of therapy. 25 On 21 August 2003 there was the separation when the defendant left the home in which they were living. Thereafter the defendant drew $5,000 from joint account. The plaintiff has received all rental income from tenants residing at the Lilyfield property since separation. The plaintiff says that from this time she met all expenses of the house including mortgage payments ($25,780 to May 2005), rates and insurance. 26 On 29 September 2003 the plaintiff drew $2,000 from joint account and on 8 October 2003 the defendant drew $2,000 from joint account. Thereafter in December 2003 the defendant withdrew $657 and $1000 from the joint account. 27 In June 2004 the parties sold the Glebe investment property for $227,500 receiving net $20,510 which was divided equally between the parties. 28 On 5 August 2004 the plaintiff closed the joint account and transferred the balance of $2,399.35. 29 In 7 December 2004 ING wrote to the plaintiff relating to loan of $50,000 taken out by the defendant in July 2002 which was secured on the Gladstone Street property noting that defendant was in default of payments. The plaintiff wrote to the defendant offering to make the defaulted payment of $793 so as to avoid legal proceedings. On 10 December 2004 the plaintiff forwarded cheque in the sum of $793 to ING. Since this time up to 7 April 2005 the plaintiff has received five notices from the bank about the loan being in default. Property of the parties at the commencement of the relationship 30 The plaintiff owned the following: (a) Leichhardt property which at that time had a mortgage owing of $5,470 and monthly repayments of about $600. (b) $8,000 cash in bank. (c) Ford Laser motor vehicle which Plaintiff had purchased in June 1982 for $7,600. (d) Superannuation entitlements of $26,355. (e) Furniture and furnishings. 31 The defendant owned the following: (a) Ford Laser motor vehicle (approx. 8 years old). (b) Some furnishings. (c) A small amount of superannuation. Property of the parties at the conclusion of the relationship 32 At the conclusion of the relationship the parties owned the Lilyfield and Glebe properties both of which were subject to mortgages. 33 The plaintiff retained the furniture and effects of $15,000, a car worth $12,000 and investments and cash of $15961. The defendant had her personal possessions and she suggests that the value of the furnishings left in the house was $20,000. Some of these were jointly owned and some were the individual property of the parties Property of the parties at time of trial 34 As mentioned earlier the Glebe property was sold and the proceeds divided equally between the parties. The value of the Lilyfield property was the subject of some debate with the plaintiff providing valuation evidence of $860,000 and the defendant assessments of $1,012,500 and $1,075,000. In accordance with the pre-trial directions in the matter I fix the value of the house at $951,875. The present amounts due to ING Bank are $48,046.23 and $159,127.39 a total of $207,173.62. 35 There are also the personal possessions and furniture and the parties are agreed as to a method of distributing those items between them by way of rotation selection for jointly owned items. Financial contributions 36 This is a case where each party has contributed the whole of their earnings to the relationship and fortunately accounting evidence is available to determine the question of such earnings. 37 The principal purchase was the home at Lilyfield. The unit at Glebe has been sold and the proceeds have been shared equally. Neither party contends that this division should be interfered with so I can concentrate on the Lilyfield property and the non-financial contributions generally in respect of both Lilyfield and Leichhardt 38 The contributions by way of cash and the separate mortgages they financed find the parties contributing in a proportion of 28% to the defendant and 72% to the plaintiff. The title reflects a close approximation, namely, 25% and 75% respectively. 39 There were capital works such as renovations carried out after purchase in 1996 and 1997. In 2001 the plaintiff's mother provided $50,500 at the time of purchase of the Glebe unit. This sum was placed in a joint account and was used as to $11,000 to purchase Glebe; $30,000 to reduce the mortgage; and the balance for the party's general purposes. 40 The question which has been agitated is whether the provision of those funds should be seen as a contribution on the part of the plaintiff or both parties jointly. The question of use has been dealt with in a number of cases both in respect of this Act and the Family Law Act (Cth), 1975. In the Marriage of Gosper (1987) 90 FLR 1, Fogarty J analysed a number of Family Law cases before making a useful statement as to principle. At page 11 he said: "Where there has been a gift or advance by a relative to one or both of the parties to the marriage the first step is to determine the ownership of a benefaction… Confusion often arises at this point because, particularly with gifts of money or in kind, the evidence about it is confused and imprecise and the actual intention of the donor (the critical issue) may have been ill-defined. However, where the evidence enables the Court to determine that it is a gift to one or other or both of the parties that is an important finding. Normally where title to a property is transferred to one or both of the parties that would be the strongest indicator of the intention of the donor." 41 Having regard to the facts in that case, that the gift of property was given jointly to the two parties, he went on to decide that there was an intention to give to the parties jointly. He said at the conclusion of his review of the authorities: "The critical case is where a relative of one of the parties gifts property to both of the parties to that marriage. Dependent upon the circumstances of the case it is, in my view, open to the Court in such a case to look at the actuality and treat that as a 'financial contribution made directly...on behalf of the' spouse relative or (see for example Rainbird, Matthews, W Underwood, Abdullah, Freeman; cf Cleary, Hogan J. in Freeman, and Antmann ). In many such cases that gift was made only because of that relationship and in reality as a means of benefiting that relative in that marriage. It was made because she was a daughter of that family as was said in W's case (1980) Fam LR 538 at 548. It is clearly "a financial contribution' and one 'made directly' to the acquisition, conservation and improvement of property. In such cases it is open to the Court to conclude, if the facts justify it, that it was made 'on behalf of' one spouse. In other cases the evidence, including evidence that the donor intended to benefit both spouses, may not justify that conclusion. If so, the application by the parties of that property to the marriage would, at least at that point, be an equal contribution by them." 42 In the Marriage of Kessey v Kessey (1994) 18 Fam LR 149; (1994) FLC 92-495, the Full Court of the Family Court approved Fogarty J's comprehensive review of the authorities and his conclusions in Gosper mentioned above. After referring to these conclusions the Court said (p.160): It was submitted by counsel for the appellant husband that Gosper was concerned with the matter of gifts and in the present case there is no evidence of a gift. In our opinion the application of the principles enunciated in Gosper should not be so limited. Rather, those principles should be regarded as being applicable in all cases where there has been an advance of money or property by a parent (or perhaps even by some other relative) of one of the parties, to one or both of the parties (or to their property), and the circumstances of the advance cannot be categorised as a loan, or as any other recognised commercial transaction." 43 Evidence was given by the plaintiff's mother that her intention was to benefit her daughter and not both parties. She was cross-examined on the point and although she expressed some indifference as to whether it was to be used for the benefit of both of them, she steadfastly maintained her evidence that her intention was to benefit only her daughter. As this is the critical matter, it is appropriate that so much as was contributed to the Lilyfield property should be seen as a contribution by the plaintiff. 44 It is useful to also take into account the subsequent capital contributions to the property by each of the parties. The immediate ones, taking into account the purchase price of the price of the capital works between 1994 and 1995, was as follows: Principal Capital Works: 1994 to 1995 Plaintiff Defendant Total On account purchase price, stamp duty and legal fees from proceeds sale 30 Arthur Street. $139,932 On account purchase price by mortgage advance. $65,000 On account purchase price by mortgage advance. $80,000 On account renovations from proceeds sale of 30 Arthur Street $46,000 On account renovations by mortgage advance. $10,000 $260,932 $80,000 TOTAL (76.3%) $260,092 is 76.3% of $340,934 (23.7%) $340,934 $80,000 is 23.7% of $340,934 45 The subsequent capital works provided the following changes: 1996 Cost of burglar alarm and other works (disputed by Plaintiff). Plaintiff says $1,500 only which she repaid. $260,932 $80,000 (23.5%) $340,932 (75.3%) 1997 On account renovations by borrowings. $9,000 On account renovations by borrowings $4,000 $269,932 $84,000 $353,932 (76.3%) (23.7%) 46 Until 2000 the parties had their own separate borrowings which each of them serviced from their own income. The refinancing so that they had joint borrowings provided funds of $12,000 which the plaintiff used to purchase a car. As a result of this refinancing the parties changed from a differential in the amount of their borrowings to a position where they each have equal liabilities in a capital sense in respect of the borrowings. 47 In 2001 the plaintiff contributed from her mother the $30,000 and that had the following effect: 2001 Part mother's advance paying down mortgage $30,000 TOTAL ALL CAPITAL CONTRIBUTIONS $299,932 $84,000 $383,932 (78.2%) (21.8%) 48 Both parties worked during the relationship, with the defendant working part time while she was re-training so she could change jobs. However, she had an unfortunate illness which prevented her from working in the last year or so of the relationship. A calculation of their non-capital contribution to the relationship is as follows: 1996 Plaintiff Defendant Total Loan to extent not allowed as a capital contribution. $10,000 2006 Portion of personal loan repaid not being part of capital expenditure repaid from joint mortgage. ($10,872) 2000 Balance of joint mortgage loan $15,178 Balance of joint mortgage loan $15,178 Sept.2001 Balance mother's advance of $50,500 not used to reduce mortgage $20,500 2002 Loan $50,000 Net Wages $478,091 $335,915 $513,769 $40,196 $915,735 (56%) (44%) 49 There is not a substantial difference between the contributions in this respect and the differences really are accounted for by the parties accommodation of the defendant's change in career direction and her support during the illness which was natural commitment which each party had in what was obviously a committed relationship and to which they committed themselves for some 13 years. 50 Utilities were always paid in accordance with arrangements between the parties in approximately equal proportions. The mortgages were paid separately until the refinancing when they were paid equally up until the separation. 51 I turn now to consider the non-financial contributions. There were contributions to the Arthur Street property at Leichhardt by the defendant. She worked in the garden along with the plaintiff and things were done and they probably made the house more presentable for its ultimate sale. The evidence does not, of course, address any question of quantum in respect of that amount and it seems to me there is not a substantial difference in the parties' contributions in this respect. Each did different things in this relationship. 52 In respect of Lilyfield much the same sort of things occurred. The plaintiff had a substantial hand in organising the renovations and both the parties were involved in the painting after the place was completed and it was subsequently altered by various renovations. 53 As far as household contributions are concerned, the plaintiff suggests that initially they were equal and the defendant agreed to that up until the period in 1997 when she only worked three days a week. She estimated 75% was the proportion which she worked and thereafter, in the year she was at home, she contributed some 95%. 54 The plaintiff suggested that 60% might be a better figure. However, the thing about this is that it is quite difficult to form an accurate view. The parties' perceptions about who actually does the housework are different and there are variations when it comes to this type of work. However, I think it is plain that the defendant has contributed more towards the housekeeping and domestic contributions in the latter part of the relationship. 55 Further, it should be borne in mind this is not a case where the parties had children of the relationship. Quite often one finds in these cases where there are children they have to be cared for and there is a very substantial contribution made towards the parenting which reflects in a very large award. This is not that relationship but one where the parties live together and shared the work somewhat unequally towards the latter part of the relationship. Discussion 56 At the time of the purchase the parties entered into an agreement on August 1994 which dealt with their ownership issues. That agreement recorded the purchase and the provisions in relation thereto, and proceeded in clauses 1 through to 4 to give various options in case either party wished to sell after a period of 12 months. Para 5 of that agreement provided: "In the event that either party or both parties wish to dispose of their interest in the said property and neither party wishes to purchase the other party's interest in the said property as provided in Clauses 2 and 3 hereof, the property shall be placed on the market with a real estate agent as agreed between the parties and the net proceeds shared between the parties in accordance with each party's shareholding." 57 The agreement did not, of course, have any of the certificates required under s 47 of the Act. The Act provides in s 47 (2): "Where, on an application by a party to a domestic relationship for an order under Part 3, a court is satisfied that there is a domestic relationship, agreement or termination agreement between the parties to the relationship, but the court is not satisfied as to any one or more of the matters referred to in subsection (1) (b), (c), (d) or (e), the court may make such order as it could have made if there were no domestic relationship agreement or termination agreement between the parties, but in making its order, the court, in addition to the notice to which it is required to have regard under Part 3, may have regard to the terms of the domestic relationship agreement or termination agreement." 58 The Court can, of course, have regard to such an agreement. However, in my view, it is not appropriate in this case to do so. Many things, such as further contributions, have occurred which were not contemplated by the parties at the time when the agreement was entered into. Accordingly, I put it to one side. 59 Before taking into account all other factors and contributions the interest of the defendant based upon the total ownership of 25% is as follows: Current Value $951,875 2000 ING Mortgage balance $159,127 BALANCE $792,748 Defendant's 25% share $198,189 Less $48,046 2002 ING Mortgage balance BALANCE $150,143 60 The defendant also concedes that she should allow the following amounts: there are mortgage payments made by the plaintiff of $6,478 and there is supposed separation drawings of $5,457, amounting to $11,935. This reduces the amount to $138,208. 61 There must then be considered the plaintiff's occupation of the property for three years since separation. She received rental amounting to approximately $16,040 and outgoings in respect of profits. The outgoings which the plaintiff has paid are referable to maintaining ownership of the property and amount to approximately $1,500. She has paid the mortgage payments post separation of $49,149, half of which is $24,570. 62 It is not possible to finely balance these benefits because the rent obtained for part occupation of the property was only for part of the relevant period. Any rough approximation does not call for any major adjustments but allowing $18,000 for rental value of part of the house for three years as a benefit against $24,570 and $1,500 provides an adjustment in favour of the plaintiff of $8,000. 63 Also to be taken into account is that of the actual capital contributions to the property there is a slight imbalance in favour of the plaintiff. One then also has to take into account the non-financial contributions. 64 This part of the judgment is one which is not susceptible to exact precision but on the basis that each party keeps there own superannuation, a car, and individual personal items, I think an appropriate figure for adjustment is the payment of $140,000 by the plaintiff to the defendant. 65 The joint mortgage should be dealt with as agreed by the parties and earlier recorded and the plaintiff will need to provide a release. In other words it will probably need to be refinanced. I direct the parties to bring in short minutes in accordance with my findings. I direct the exhibits be returned. (Counsel addressed on the question of costs) 66 There is an offer by the plaintiff to transfer and exchange for $130,000. However, the defendant has in fact done better. I propose to order there be an adjustment by transfer of $140,000 and accordingly I put that to one side. In the circumstances I make no order as to costs. (Counsel addressed further on the question of costs) 67 So far as costs are concerned, I have heard further submissions. The plaintiff in the claim, which was brought in the District Court, suggested an appropriate adjustment would be $80,000 for the transfer of the defendant's interests. In the cross-claim which the defendant filed the defendant suggested the transfer of her interests for repayment to her of $560,000. 68 The next event that happened was on the 22 April 2005 when the plaintiff indicated an intention to reduce the offer which she had made in the statement of claim and contended for a payment of only $50,000. The matter went to mediation in October 2005 and did not settle. Immediately after that the plaintiff made an offer of compromise of $130,000 with each party to pay their own costs and made no reference to personalty. 69 On 9 March this year the defendant filed an offer of compromise in which she suggested there be a transfer and payment to her of $265,000. On 17 November the defendant made another offer in which she reduced the amount she claimed $240,000. What has happened is the parties kept their personalty and can share any jointly owned property for the payment of $140,000. 70 Recently guidance has been provided by the Court of Appeal as to costs in matters under the Property Relationships Act 1984. In Kardos V Sarbutt [No 2] [2006] NSWCA 206 Brereton J, with whom the other members of the Court agreed, dealt with a number of matters: "26. The first is the quantum of the adjustive order, particularly where only a small adjusted order is made, which would have been within the jurisdiction of the Local Court, a successful plaintiff will prima facie not be entitled to costs [SCR Pt 52A, r 34; UCPR r 42.30], and even if the Court otherwise orders, the costs order may still be 'capped', so that the costs are not disproportionate to the result. There are many reasons why the Court might 'otherwise order'. The amount of an adjustment ultimately ordered it may not bear any relationship to the extent of the pool of property in issue in the case; a large pool of property, which involves complex and valuation issues, may nonetheless ultimately produce only a small adjustment. In so far as the rules of Court are intended to promote a selection of the appropriate forum, the wide ambit of the range of judicial discretion in this field means that such a rule should be applied with caution, except in the most obvious cases. The business of the Local Courts is such that they are not well equipped to hear lengthy cases involving large property problems. Nor is it likely that the costs of such a case, if conducted in a Local Court would be significantly less than in the District Court. Although the Deves 'rule of thumb', is of some utility in maintaining proportionality between the costs of proceedings -- and thus of the detail in which and to the extent to which they are litigated on the one hand -- and the value of the interest at issue on the other, it is at best a rough and arbitrary guide; its shortcomings are illustrated by the circumstance that the costs of a successful defendant are not limited, regardless of how little was in the dispute. 27. The second consideration is the analogy with matrimonial proceedings, in which the starting point is that each party bear his and her own costs. In this respect, 30 Law Reform Commission Report (NSWLRC 36 [1983]), 'De Facto Relationships", which a presage the introduction of the predecessor of the Property (Relationships) Act 1984, although containing extensive reference to provisions of the Family Law Act, by way of comparison and contrast with the proposed jurisdiction to adjust financial relations between de facto partners, has no specific discussion of costs. There appears to have been no consideration as to whether the approach of the Family Law Act, s 117 should be adopted. In respect of the enforcement of orders, The Law Reform Commission Report envisaged that the rules of Court relating to the enforcement of its ordinary judgments and orders would cover the enforcement of judgments given or orders made pursuant to the adjustive property jurisdiction; it may be inferred that the question of costs in such proceedings was likewise not seen as requiring special consideration, but would fall in the Court's gentle discretion as to costs. 28. However, the costs of adjusting property interests consequent upon the failure of the domestic relationship are an incident of the failure of a joint relationship, usually without attributable fall. In this sense, there is an analogy with the partnership disputes. In partnership proceedings, it was once the rule that no costs would be given up to the decree, directing of the account, a position that was not departed from, except in cases of gross misconduct [ Hawkins v Parsons 91862)8 Jur (NS)452; Parsons v Hayward (1862) 4 De GF&J 474]. The prevailing rule nowadays is that the costs of both parties of an action for dissolution are paid out of the partnership assets, unless there is some good reason to the contrary [ Hamer v Giles (1879) 11 Ch D 942], except where the action is one which in substance is to try some disputed right, in which case the unsuccessful party will be ordered to pay the costs [ Hamer v Giles; Warner v Smith 91863) 9 Jur (NS)169]. The costs of taking accounts, although disputed, are usually defrayed out of the partnership asset's [ Butcher v Pooler (1993) 24 Ch D 273; Newton v Taylor (1827) 19 Eq 14]. Similarly, in proceedings under the Conveyancing Act , s 66G, for the appointment of trustees of sale of jointly held land, the costs are usually paid out of the proceeds, the rationale being that the costs of such an application are an incident of joint ownership. 29. In this type of litigation, it is artificial to resolve liability of costs according to the accident of who is plaintiff and who is defendant, so as to leave a plaintive free to litigate confident that he will receive costs. However unreasonable his claim, unless the defendant betters her offer. There is no reason why the defendant should bear the risk of costs to the exclusion of the plaintiff where neither makes a realistic offer. Similar views have been expressed by his Hislop J, with whom Mason P and Ipp JA agreed, in Vollmer v Hauber Davidson [2006] NSWCA 79… …. 33. The third consideration is whether any party has been wholly or substantially (in the sense already described) successful (in obtaining the order sought), or has 'bettered' an offer of compromise. 34. A fourth consideration is the conduct of the parties in the proceedings, and in particular whether one has been disproportionately responsible for the incurring of costs through the manner in which he or she has conducted the proceedings. 35. The second and third consideration support the view that, except where one party has been wholly or substantially successful, or has ' bettered' its offer of compromise, the starting position should be that each party shall bear its own costs. The first consideration suggests that that will be all the more where the quantum of the adjustment is within the jurisdiction of the Local Court." 71 It seems to me that both parties have taken positions which are outside the ultimate achievement. In some respects the plaintiff has been closer but when one looks at the amount of actual adjustment which has finally been awarded there were substantial discrepancies, particularly in the position taken by the plaintiff. 72 Plainly the defendant has sought substantially more. It seemed to me that this litigation was one where each party took a position outside what was ultimately found by the Court. In the circumstances the order I make is each party pay their own costs. ********* DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.