Property division is governed by the Property Relationships Act 1976 (“the Act”) and covers de facto relationships (same sex and heterosexual), married and civil union couples, as well as relationships ended by the death of a spouse or partner.

How is relationship property usually settled?

The easiest way for relationship property to be settled is for the parties to come to an agreement themselves. In this situation the parties will instruct different lawyers, who will offer independent advice, draw up the agreement and arrange for the parties to sign it.

However when the parties are unable to agree, then settlement will be attempted through letters, or a meeting between the parties and their lawyers. If an agreement still has not been reached, then one or more of the parties can apply to the Family Court for assistance. The settlement of disputes without having to resort to the court is encouraged, so assistance is provided to achieve this.

We strongly encourage our clients to settle out of Court where possible.

Division of Property

1. Marriages, civil unions or de facto relationships of more than 3 years

Where a marriage, civil union or de facto relationship has lasted more than 3 years, generally relationship property will be divided equally between the parties. An exception to this would be where the Family Court considers there are extraordinary circumstances which make equal sharing unfair.

2. De facto relationships of less than 3 years

Most de facto relationships which last less than 3 years will not fall under the Act, however there may be exceptions where there is a child or children, or where one party has made a substantial contribution to the relationship.

Exceptions to equal sharing

The Court has the power to address economic differences that exist between couples after separation which would make equal sharing unfair. The income and living standards of one partner might be much lower than the other’s after separation, so the court has the power to award compensation for that inequality. An example might be where one partner had made sacrifices by staying home to raise children or run the household, so the other partner could further their career.

Section 15 of the Act allows the court to divide relationship property unequally, in order to compensate for these situations.

De Facto Relationship Criteria

A de facto relationship is between two parties who are over the age of 18 and are living together as a couple.

Generally to be covered by the Act, the parties will need to have been living together as a couple for at least 3 yearshowever there may be occasions where the Act applies for a shorter cohabitation period, such as if there’s a child, or one party made substantial contributions to the relationship.

In deciding whether two people live together as a couple, the Court will consider all the relevant circumstances.

Classification of Property

The Act creates an important distinction to be aware of between “relationship property” and “separate property”. This is important because the rules for property division contained in the Act only apply to relationship property.

Relationship property includes:

  • The family home;
  • Family chattels (property), such as furniture and vehicles;
  • Life insurance or insurance over the family home;
  • Any Superannuation scheme if it is based on the fact of the marriage or relationship;
  • Property owned jointly by the parties;
  • Property acquired by either party during the relationship;
  • Property which parties agree is relationship property;
  • Debts;
  • Gifts or inheritances which have become mixed with other relationship property;
  • Property acquired by one party before the marriage in contemplation of the relationship;
  • Trust property: if a trust was formed after the relationship began, it may be the case that some or all of that trust is relationship property;

Separate Property

Separate property is made up of property which is not relationship property. Usually this will include property that a person owns before entering into a relationship, which will remain separate as long as it is not shared during the marriage, civil union or de facto relationship.

You can protect your separate property by entering into an agreement with your spouse or partner (see below).

“The information posted on this website is prepared for a general audience, without investigation into the facts of any particular case. This information is no substitute for legal advice and does not create a lawyer-client relationship; you are advised to consult with a lawyer on any legal issue.”

Death of a spouse/partner

The Act applies in the event that your spouse or civil union partner dies. You will have a choice of taking what is left to you under the deceased’s will, or receiving a half-share of relationship property under the Act. This decision must be made within 6 months of the death, or at the latest, 6 months after administration of the estate is granted.

Marriages or civil unions of less than 3 years

Where a marriage or civil union is of short duration, the general rule is departed from and property will be divided according to the contributions made by each party. If the couple lived together prior to the marriage/civil union, that period may be counted toward the length of the marriage/civil union (which may put the marriage/civil union over the 3-year mark).

Making alternative arrangements

If you do not want the Act to apply to your relationship, you can enter into an agreement to ‘contract out’ of the provisions of the Act. This will set out how you will own the property, how it will be managed and how the property will be divided if your relationship breaks down.

A contracting out agreement usually enables the relationship property to be settled more easily, quickly and with less legal costs, if a break up occurs.

How can we help?

Please call us to arrange an appointment. In our first meeting with you, we will explain the law, your options and the outcome you can reasonably expect. We will also advise a fixed fee for your case and the likely time it will take to settle.

“The information posted on this website is prepared for a general audience, without investigation into the facts of any particular case. This information is no substitute for legal advice and does not create a lawyer-client relationship; you are advised to consult with a lawyer on any legal issue.”