Mum's landmack surrogracy victory
Sean Fewster, Court Resporter, The Advertiser 16 April 2011
http://www.adelaidenow.com.au/mums-landmark-surrogacy-victory/story-e6frea6u-1226039960631

After a six-year legal battle, the woman this week became the first Australian to win the right to be officially recognised as the mother of a child carried by a surrogate.

The woman, who cannot be named, is the child's genetic mother - her egg and her husband's sperm were used to conceive the boy in the womb of an interstate surrogate.

Surrogacy advocates praised the Youth Court ruling, calling it "a vital step" in the ongoing struggle for the recognition of genetic parents.

Sam Everingham, secretary of Australian Families Through Gestational Surrogacy, said its importance "could not be understated".

"This finally gives a parent the legal recognition that should always go with the genetic relationship to their kids," he said.

"It's a terrific step forward for the hundreds of families around Australia who have or are using surrogacy.

"It's also important for all the Australian children born of surrogacy, who want and need their genetic parents to be recognised."

The woman and her family have been fighting to have her name placed on her son's birth certificate.

On Thursday, her application was heard by the Youth Court in Adelaide.

Senior Judge Stephen McEwen granted her application under the Statutes Amendment (Surrogacy) Act, which was introduced in 2009.

That act made surrogacy legal in South Australia, provided both the "commissioning parents" and the surrogate are based in this state.

It further states the "commissioning mother" must be recorded on the child's birth certificate as its mother.

Under a special provision, any woman who used an interstate surrogate before November 2010 also will receive the same recognition, provided they seek court action before January 2012.

Senior Judge McEwen used that provision to grant the woman's application.

Yesterday, supporters said the family was "thrilled beyond belief" after more than six years of struggle.

Surrogacy law expert Julie Redman said it was vital that government agencies truly recognised genetic mothers.

"These are the biological parents of their own biological children, but the birth certificate has always named the surrogate instead," she said.

"The need for this (decision) has long been out there."

She urged other families to file action as soon as possible. "This is a nine-month window and, if mothers don't hear the message that this window is closing, they will never achieve what they want to," she said.

Mr Everingham said that "at a minimum", between 500 and 700 heterosexual and homosexual Australian couples had used surrogacy.

The majority of those, he said, had sought help overseas and therefore would not benefit from the Youth Court decision.

"Hundreds of families are left without their names on birth certificates because state governments are uncomfortable with awarding the same status to parents who go overseas," he said.

"This is a great start, but there's still progress to be made and a fight to be had."

Liberal MLC John Dawkins, whose private members Bill legalised surrogacy in SA, said it was vital "we got the first case right".

"Without her name on that certificate, the mother was unable to enrol her child in kindy, or take him on a plane, or anything else that a parent should be able to do," he said.

"To say that they would now be happy and ecstatic would be an understatement."

Changes to Child Support

On 1 July 2008 a new formula to calculate child support came into effect.  The new formula is predominantly based on:

1. the estimated cost of raising children;
2. the income of both parents; and
3. how much of the care of the children each parent has.

There are 6 formulas which are used to calculate child support, although most child support cases will use “Formula 1”.   The formulas are now based on the estimated costs of raising children (a gazetted “Costs of Children Table” is used which takes into account the age of the children and the parents’ combined income) in lieu of the old system where a percentage of the payer’s income was used, regardless of what it cost to raise the child.  

Formula 1 involves applying a number of detailed steps which, simply put, involve calculating what percentage of the combined income of the parents each parent has, working out how much time the child is in the care of each parent, working out the costs of raising the child and from this working out what child support is payable.

An example of the use of Formula 1 is as follows:

Adam and Eve have 2 children, Mark (10 years) and Andrew (7 years).  Adam’s income is $40,000 and Eve’s is $30,000. 
Using the formula:

1. Adam’s “child support income” (his income less the “self support component” of $16,883) is $23,117.  Eve’s child support income ($30,000 - $16,883) is $13,117.
2. Their combined child support income is $36,234.
3. Adam has 64% of the parents’ combined child support income ($23,117/$36,234) and Eve has 36%.
4. Adam has the children in his care for 35% of the time and Eve 65% of the time.
5. Under the formula, having the children for 35% of the time, is recognised as meeting 25% of the costs of the child, and having the children for 65% is recognised as meeting 75% of the costs of the child. 
6. To work out Adams’s child support percentage, his percentage of the costs of the child (25%) is deducted from his percentage of the combined child support income (64%), giving him a child support percentage of 39%. Eve’s child support percentage is -39% (36% - 75%).
7. Using the Costs of Children Table, the cost of raising 2 children under 12 years for parents with a combined child support income of $36,234 is $8,587.30
8. Adam pays Eve child support calculated by multiplying his child support percentage (39%) by the costs of the children ($8,587.30), namely $3,349.05 per annum.  Eve does not pay child Support to Adam as she has a negative child support percentage (-39%).

This is around $2,000 less than Adam would pay under the old child support formula.  

Confused?  Check out the Child Support website at http://www.csa.gov.au/ and do your own online calculations

Property
Advising client’s of family property settlements is one of our areas of specialty.  A common question is:

When determining how to divide the property of a married couple after separation, the Court applies a four step process:-

1. What is the value of the relevant assets and liabilities
2. What contributions have the parties or extended family made in a financial and non financial way to the build up of assets
3. What will be the future needs of the parties considering age, health, children and other factors
4. Does the proposed split look just and equitable 

Often parties separate but do not finalise property settlement until years after separation.  This can be a very real problem. 

In determining what assets are available to be divided, the Court considers the value of the assets as at the date of trial (and not as at the date of separation) and takes into account assets acquired after separation.

It is well established by Court decisions that where one party has increased assets after separation, and at the same time the other party (as “homemaker”) has contributed to the care of the children of the parties, they will be considered to have also contributed to the acquisition of those assets.  The question for the Court to decide is the quantum of the contribution by the homemaker.  An increasing number of cases deal with post separation assets. 

In the case of Spiteri, the parties had 3 young children and separated after 9 years.  The matter came to trial 4 years after separation, during which time the husband increased the value of the assets from nearly $.5M to $1.60M.  However, the husband did not contribute significantly to the care of the children during this time. The Court offset the increase in the asset pool against the wife’s homemaker contribution and awarded her 40% of the entire asset pool.

In Zalewskithe time between separation and trial was nearly 7 years.  The parties had entered into an informal agreement after separation, but the wife wanted more. The marriage was a long one and the children were adults.  The husband had substantially increased the asset pool.  The Court decided that up to separation, the parties’ contributions to the assets were equal.  While the Court gave the husband a 30% adjustment for his post separation contributions, as a result of the increase in the value of the assets, the overall effect was that the wife received more money.

It is important that property matters between parties are formally finalised without delay after separation.  This involves the parties either entering into a Binding Financial Agreement, or having Consent Orders made in the Family Court, or if necessary issuing proceedings for property settlement in Court if the matter cannot first be settled.  An informal agreement between the parties will not be binding on the Family Court.

Children’s Issues

Can I take my child to the country to live for a better lifestyle?

Corrichio v Corrichio (2008) The Family Law Act, subject to a few exceptions, requires children to spend significant time with each parent. Significant is now defined as time not only on weekends but during the school week. Five days in fourteen is a ‘rule of thumb’ for significant time. This must be balanced against the rights of an adult to live where they choose.

The parties had been married for twelve years and there was one child aged 8. Both parents lived in West Sydney and they both wanted the child to live with them. The mother wanted to relocate out of the city and reduce the father's time to alternate weekends and half of school holidays. The mother wanted to relocate for a lower cost of living, a slower lifestyle and to be nearer to work. A family report recommended that the child live with the mother and spend up to but not equal time with the father. The Judge found that equal time was not in the child's best interest but substantial and significant time Friday to Monday each alternate week and two nights in the intervening week was appropriate. He further found that living considerable distance apart would not allow the father to take this amount of time. He therefore restricted the mother from moving more than 20 kilometres from the father and thereby prevented her from moving to the country.

The Judge found that the consideration of freedom of movement was secondary to the best interest of the child.

Alderman Redman has had a case similar to this in 2008 where our client, a father having equal time with his children, prevented the mother from moving from a country town to Adelaide. His Honour Justice Strickland determined it was important to ensure the children continued a meaningful relationship with their father.

Continuing Conflict and Toxic Attitude Prevents Shared Care

Rixon v Brenner (2008)

In this case the Judge denied a mother significant time with her child due to her "attitude", both parties made allegations against the other. It was alleged the father had threatened to shove the child off a cliff, and that the child had sustained injuries falling off a horse whilst in the father's care. The Trial Judge was very critical of the mother who he found not to be a credible witness.

The mother admitted her personal feelings were an impediment. There was a high level of animosity on the part of the mother. The Trial Judge found this prevented a meaningful relationship between both parents and Ordered that the child live with the father in the United Kingdom and spend time with the mother for half of the long school holidays and all of the short school holidays.

The Trial Judge did not believe the child should be subjected to the mother's hatred of the father. He preferred the father's attitude, the harmony in his house and the benefit of the child seeing his half siblings and Grandparents. The Judge found the father had better insight into the child's best interest.

Inheritances: Why it’s not always the case of getting back what you put in

It is not uncommon in court applications for property settlement, for a party to claim contributions based upon gifts and inheritances received by them. There are many factual variables that have resulted in courts treating inheritances differently. Each case is decided on its own facts.

In JYJ & DAC & Anor [2004], Federal Magistrate Ryan offered a useful summary of themes running through the cases:-

1. Careful consideration of what stage of the relationship the inheritance was received.
2. Generally where an inheritance is received very late in the relationship or after separation it represents a contribution by the spouse who received it.
3. The size of the total asset pool is relevant.
4. Property does not fall into a protected category merely because it is an inheritance.
5. An inheritance is not a ‘special’ contribution [in the sense of it’s being something more than a windfall].

Figgins v Figgins came before the Court of Appeal in 2002 and involved a large inheritance received early in the marriage. As a result of a helicopter accident, the husband’s parents died just over two weeks after the date of the marriage. The husband then inherited an interest in his father’s business, the ‘Figgins Group’. His net worth at the date of Trial was $22.5 million.

The husband was aged 40, and the wife 38. They had lived together sporadically for 7 years, until their marriage in 1994. They separated some three years later. Both parties had modest incomes at the commencement of the marriage, and their contributions (financial and in the role of homemaker and parent) were relatively equal. The assets of the marriage were, however, almost exclusively comprised of the husband’s inheritance.

The Trial judge found that the Husband’s inheritance was ‘a massive contribution’ which ‘completely overshadowed and outweighed the wife’s otherwise significant contribution’. The wife was awarded $1.1 million in settlement of property maters, and her application for spousal maintenance was dismissed.

The wife appealed seeking $2.5 million in satisfaction of her claim for property settlement and spousal maintenance. The appeal was allowed, and by a majority, the Court upheld the wife’s claim which represented about 10% of the total assets. The reasons for judgement included;

1. It was not open to the Court to simply arrive at a sum meeting the wife’s future needs, and provide her to a similar standard of living to that enjoyed in the marriage, and then give the balance to the husband.
2. The Court was entitled to give considerable weight to a husband’s contribution by way of inheritance, but not to the extent that it undervalued the wife’s contributions, in particular to the role of homemaker and parent, during the totality of the relationship.
3. It was important that the Court gave due consideration to the huge disparity in the parties’ respective incomes and financial resources.

Callen & Callen [2008] Federal Magistrates Court involved an inheritance after the parties had separated. At the time of the hearing the wife was 52 and the husband 63 years of age respectively. The parties were married in excess of 33 years, and had two adult children. They continued to reside together, in the former matrimonial home.

The wife commenced proceedings in October 2006. In January 2008, the husband's came into an inheritance which had not yet vested, but was estimated as being a little over $65,000.

The husband sought to have the inheritance ‘quarantined’ from the asset pool, on the basis that it was received a little less than two years after separation. However, the court declined to take that approach. The Federal Magistrate recounted the view of the Full Court, that the difficult issue is whether an inheritance should be treated differently from other types of property. The answer will, the Court said, depend upon the circumstances of individual cases.

In a case where there are no other assets but the inheritance, and the other party had made significant contributions, by supporting the family financially, or as a homemaker and parent, the Court will make a property settlement in her favour from such an inheritance. As such, property does not fall into a protected category merely because it is an inheritance.

On the other hand, if there are ample funds from which an appropriate property settlement can be made, and made fairly, then a recent inheritance will normally be treated as an entitlement of the party who received it. The other party will not be regarded as contributing significantly to an inheritance received late in a relationship, certainly not after it has terminated, except in unusual circumstances.

In the present case it was argued that the husband’s inheritance, if part of the pool of property available for distribution, should be treated as a contribution made solely by him. As such, it would be unjust to the husband if the wife received more than 50% of the value of the inheritance. The Court accepted as much, which resulted in a split of 52.5 per cent in favour of the husband, and 47.5 per cent to the wife.

These are but two discrete instances of the Courts approach to inheritances. What can be seen is that there is no strict formula the Court will adopt, and it is ultimately a discretionary exercise as to what extent a party will get to keep their inheritance.