Clearly there is no way of determining how long you will live for. Nonetheless, in the matter of Fontana & Fontana [2016] FamCAFC11, the full court of the Family Court was asked to consider whether a husband’s potentially reduced life expectancy, caused the wife to receive an adjustment in her favour, thereby providing her with a greater share of the matrimonial pool of assets.
In property proceedings, adjustments in one party’s favour take into consideration not only financial and non-financial contributions made during the relationship, but also what are referred to as “section 75(2) factors”. For instance, the age, health and “future needs” of the parties to the marriage may be relevant factors.
The facts of Fontana & Fontana were as follows:
- The matrimonial pool of assets was valued at $1.72 million, which comprised mainly real property and excluded superannuation assets;
- The husband was 49 years of age and the wife was 43 years of age;
- The parties were married for approximately 15 years;
- There was one child, aged 15 at the time of the proceedings, who was in the care of the wife;
- The husband suffered from diabetes and renal failure, and required dialysis three times per week, as well as being on a waiting list for a kidney transplant;
- In respect of income, the wife had capacity to earn over $200,000 per annum and the husband received income protection insurance worth $150,000 per annum
At the trial, the court awarded the wife 56.4 % and the husband 43.6% of the net pool. The trial judge gave reasons for making an adjustment in the wife’s favour as follows:
“I am satisfied that the husband’s needs, whether he has a transplant or not, are likely to subsist for a shorter time than are the wife’s needs. With some regret, this is a matter that I must take into account in the wife’s favour.”
The husband appealed the division based on the trial judge’s adjustment made on his reduced life expectancy and his special needs, which the trial judge said would “subsist for a shorter time”.
On appeal, the full court determined that the trial judge was incorrect in giving weight to husband’s life expectancy in the circumstances that the judge had no ability to make a conclusive finding on the husband’s life expectancy.
The court found that a 4.5% adjustment in favour of the wife was made in error, and accordingly the property orders in the original trial were set aside.
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