Property division in short-term relationships: Where do you stand?

Family Law Act s.90SB

Property division in short-term relationships: Where do you stand?

It was meant to be forever. Turns out forever was closer to 18 months. But it’s not always as simple as calling the removalists and downloading Tinder. Even short-term relationships can lead to complex wrangling over property in the Family Court.

But we weren’t married and don’t have kids!

If your de facto relationship (with no kids) lasted at least 2 years, then the Family Law Act applies to property division. This is also the case for same-sex de facto couples. However, the court may be able to make an exception for relationships of less than 2 years duration, provided an Applicant can prove:

1. That there was a relationship

Time is not the only factor used to determine the existence of a relationship (in the absence of official paperwork). The Court can also consider other aspects such as: your living arrangements, whether there was sexual involvement and whether others considered you a couple.

And, (in accordance with s.90SB of the Family Law Act), that:

2. That the party seeking the orders has made substantial contributions

This means the Applicant has to prove that, during the relationship, he or she made substantial contributions to the acquisition, and/or maintenance and/or improvement of assets. This could include real estate, bank accounts, shares, vehicles and superannuation.

And;

3. A failure to make the orders sought would result in serious injustice to that party.

What the Court needs to see is that it would be manifestly unfair not to make an order. This involves providing evidence that not having the matter heard in the Family Court would likely cause the Applicant future suffering. An Applicant may also have to prove that there is no alternative or more appropriate venue to deal with the case.

Assuming a relationship is proven, if the court is not satisfied of points 2 and 3 means the Court does not have jurisdiction under the Family Law Act and the Application will be dismissed. (We’ll get to the issue of legal costs another time!) If the Application is rejected, the case could still proceed in a different jurisdiction, e.g. the Victorian Civil Administrative Tribunal, where different legislation will apply.

If the Family Court accepts the case, then it can proceed through the system as per other cases. However, allowing a claim to proceed, doesn’t necessarily mean a claim will succeed.

A Hypothetical – Are you Sam or Alex?

Shortly after starting a relationship, Alex moves into Sam’s place. Sam and Alex share expenses and mortgage payments initially. Then, Sam’s family law property settlement requires her to re-finance her home (formerly her marital home) so she can buy-out her ex-husbands. Unfortunately, Sam is unable to obtain finance, so Alex kindly offers to obtain the loan.

Alex then begins making all the repayments, and they both share household expenses. After 21 months, sadly, the relationship comes to an end. The house is in Sam’s name, however, the mortgage is in Alex’s name.

Alex wants the money back that he paid towards the mortgage.

Sam doesn’t think he’s owed anything, after all, he had to live somewhere.

Are you Sam or Alex?

This is just one of many examples which we can help you with.

How do I avoid this legal nightmare?

Nobody wants to think about breaking up when they’re giddy on dopamine. But if you’re currently in a new relationship where s.90SB of the Family Law Act could apply, then consider sitting down with David Dudderidge to discuss how to best protect your assets and/or simplify any future split.

On the flipside, contact David if you’re parting ways with a short-term domestic partner and want to clarify what your options are.

Nevile & Co.’s David Dudderidge practices in all areas of Family Law, including cases such as these. With years of experience to draw from, he’s helped clients to preserve property and receive their proper entitlements.

For assistance with your family law matters, whether it be property, parenting or divorce, please contact David on:
03 9664 4700
david.dudderidge@nevile.com.au
0412 621 075 (SMS)