What the Law Says

The law governing property settlement is found in section 79 of the Family Law Act 1975 (Cth) for marriages and section 90SM for de facto relationships. These sections allow the court to make orders that are “just and equitable” after considering the financial and non-financial contributions of each party, as well as future needs and other relevant factors.

Types of Contributions Considered

Initial Contributions

Initial contributions are those brought into the relationship by either party. These might include:

·        Real estate owned at the start of the relationship

·        Savings or other financial assets

·        Shares, investments, or superannuation balances

·        Personal belongings or valuable collections

·        Business interests or inherited wealth

Courts will assess the significance of these initial contributions inlight of the overall length and nature of the relationship. In shorter relationships, initial contributions often carry more weight. In longer relationships, particularly where both parties have made significant ongoing contributions, their impact may be lessened.

Financial Contributions During the Relationship

These include:

·        Income earned and used to support the family

·        Mortgage and loan repayments

·        Financial support for children or extended family

·        Contributions to savings or investment portfolios

Importantly, the court does not automatically reward the higher income earner. Instead, it looks at the use and management of funds to support the family and build up the asset pool.

Non-Financial Contributions

Non-financial contributions can be just as significant as financial ones. They may include:

·        Homemaking and caring for children

·        Renovating or improving property

·        Managing a household or supporting a partner’s career

These are recognised under section 79(4)(c) of the Family Law Act, which explicitly requires the court to consider contributions to the welfare of the family, including those as a homemaker or parent.

Contributions to Superannuation

Superannuation is treated as property under the Family Law Act (section90MC). Contributions made to one party’s superannuation—either directly or indirectly—can be taken into account, especially if the other party sacrificed career opportunities or income to allow their partner to accumulate retirement savings.

Gifts and Inheritances

Inheritances or significant gifts received by one party are generally considered contributions by that person. However, timing matters. Aninheritance received early in the relationship may be treated differently from one received close to separation.

Post-Separation Contributions

A common concern is whether actions taken after separation, such as paying the mortgage, maintaining the property, or caring for children, are taken into account. The answer is yes.

Post-separation contributions are assessed in the same manner as those made during the relationship. For example, if one party:

·        Continues to pay the mortgage

·        Takes on the primary care of the children

·        Maintains or improves assets

…the court will give weight to these efforts when dividing the property pool.

Future Needs and Adjustments

Even after assessing all contributions, the court must consider eachparty’s future needs. Under section 75(2) for married couples (and section90SF(3) for de facto couples), the court examines factors such as:

·        Age and health

·        Ability to earn an income

·        Financial commitments

·        Responsibility for children

These considerations may lead to an adjustment in one party’s favour if, for example, they are the primary carer of young children or have limitedearning capacity.

A Just and Equitable Outcome

The final step is for the court to determine whether the proposed division of property is just and equitable. This overarching requirement ensures that each case is treated individually and fairly, based on its unique circumstances.

Why Legal Advice Matters

Assessing contributions is not just a numbers game. It requires a careful and nuanced understanding of the law, as well as the ability to present evidence clearly and persuasively.

At Stanley & Co Lawyers, our family law experts work closely with clients to:

·        Identify and value all relevant contributions

·        Prepare supporting evidence

·        Negotiate effectively to reach an agreement

·        Advocate in court if necessary

Our team has extensive experience with complex financial arrangements, business structures, superannuation issues, and situations involving long-term homemaking roles.