Property and Financial Settlements for De Facto Couples

Which matters can the Family Court decide?

The Family Court can make a decision about a de facto property or fifinancial matter if:

• The de facto partners separated on or after 1 March 2009 ; and
• The Court is satisfied that one of the following applies:
• The parties were in a de facto relationship for a total of 2 years; or
• The parties have a child together; or
• The parties’ de facto relationship was registered on a State or Territory Relationships Register; or
• One partner made substantial contributions during the relationship and that partner would suffer a serious injustice if the Court did not make Orders.

Division of assets, liabilities and fifinancial resources

When the Family Court is deciding on a property settlement, it follows a 4 step process.

1. First, the Court determines the value of the asset pool. The asset pool includes all assets, liabilities, superannuation entitlements and fifinancial resources of you and your partner as at the date of trial.
2. Second,the Court decides what proportion of the asset pool each party should receive based upon their contributions. This can include contributions at the beginning of the relationship, during the marriage or after separation.
3. Third, the Court decides whether the division of the asset pool should be adjusted because of factors set out in section 90SF(3) of the Act. These are often referred to as the ‘future needs’ factors and they include earning capacity, age, health and caring responsibilities for children. A copy of section 90SF(3)of the Act is attached for your information.
4. Fourth, the Court looks at the result of the first 3 steps to determine whether the result is fair and equitable. If not, it can make further adjustments.

As there is no formula to determine the appropriate division of assets, liabilities, superannuation and fi financial resources, there is a range of likely settlement outcomes for each matter.

The Family Court has a great deal of discretion regarding the weight it gives certain contributions and ‘future needs’ factors? As a result, it is not possible to precisely predict the outcome of a Court hearing.

Division of Superannuation

Often in a defacto relationship, one partner will earn more than the other and therefore build up more superannuation. However, the Court usually finds that the other partner has indirectly contributed to the build up of this superannuation (for instance through their own fifinancial and non-fifinancial contributions or because couples can be seen to build up assets and resources during their relationship as a joint effort or endeavour).

There are a number of ways in which the Family Court can deal with superannuation entitlements as part of a property settlement.

The Court considers each person’s fifinancial and non-financial contributions. Non-fi financial contributions include looking after children and the household in general. Types of contributions are set out in section 90SM(4)of the Family Law Act (the Act).  A copy of section 90SM(4) of the Act is attached for your information.

*De facto partners who separated before 1 March 2009 can ‘opt in’ to the Family Law Act provisions for de facto partners if they both agree. Otherwise, their property and fifinancial matters can be determined under the Victorian State legislation; the Relationships Act. There are some minor differences if this applies to you.  We can discuss these with you.