What happens to the property when de facto relationships break down?
As we delve further into the 21st century it seems that a greater number of the population are moving away from what would be considered the ‘traditional’ lifestyle choices of the past.
Seemingly gone are the days where young couples remained living with their respective families until they first get married, then move into their own home and then begin a family.
Whilst that is not to say that this is still not the case for a proportion of the community, we are increasingly seeing more and more young couples deciding to purchase a home or start a family before getting married. At the same time, older couples are getting divorced and a number of people, both young and old are choosing to live in de facto relationships rather than making the legally recognised commitment of marriage.
Society is adapting in its acceptance and integration of these new ways and consequently legislation and other regulatory processes have been and continue to be amended to in order to accommodate the changes.
Consequently, as with legislation that determines what happens when marriages break down, it has become necessary to implement laws that govern various aspects of de facto relationship and their break downs as well.
Perhaps the biggest problem to face for de factos who are breaking up is what to do with the property, or sometimes even properties, that they own together. Earlier this year, 1 March 2009, laws governing the division of property for people in de facto relationships that break down were enacted.
Governed by the Family Law Act 1975, the newly introduced laws see separating de facto couples brought under the current federal family law regime for property and spouse maintenance matters. Essentially, this means that de facto couples can now access the Family Court of Australia and the Federal Magistrates Court alongside married couples for these issues. De factos could previously only use the federal family law regime for matters involving their children (since 1988).
The new laws enable the Family Law Courts to order the division of any property that a couple owns, either separately or together with each other, as well as the split of the superannuation held by each partner and spouse maintenance.
In order to have the conditions of the new legislation applied to any post 1 March 2009 break ups, one of the following criteria must be satisfied:
- the period (or the total of the periods) of the de facto relationship is at least 2 years
- there is a child of the de facto relationship
- one of the partners made substantial financial or non-financial contributions to their property or as a homemaker or parent and serious injustice to that partner would result if the order was not made, or
- the de facto relationship has been registered in a State or Territory with laws for the registration of relationships.
What is considered a de facto relationship?
According to Family Relationship Online, an Australian Government website,
“A de facto relationship is a relationship that two people who are not married or related by family have as a couple living together on a ‘genuine domestic basis’.
It can exist between 2 people of the opposite sex, or between 2 people of the same sex.”
Whilst it is a federal family law regime, the new laws apply to relationships that have a geographical connection with New South Wales, Victoria, Queensland, Tasmania, the Australian Capital Territory, the Northern Territory or Norfolk Island.
Previous to the introduction of the new laws these types of matters were handled by the relevant State and Territory laws. As a result, it is important to be aware that relationships that broke down prior to 1 March 2009 and in any State that is not listed above, the relevant State or Territory laws generally still apply to those cases.
Although, for relationships that did breakdown prior to 1 March 2009 couples may choose that the new federal laws be applied to them. In order to do this the choice must be in writing and signed by both parties. This can only happen after each person has obtained independent legal advice and has a signed statement from their lawyer confirming that the advice was given.
Notably, it is also possible for a separating couple to choose not to be governed by the new laws in the event of their break up. In this case, the couple can make an agreement which outlines how they will distribute their property and the details of any necessary maintenance payments that are required if the relationship was to ever break down. Known as ‘binding financial agreements’, this type of arrangement can only be entered into once both parties have obtained independent legal advice and can be done at the beginning or even during the course of a relationship.
Relationship and marriage break downs can be emotional and stressful times especially when property and children are involved. The new federal laws aim to make the system easier to navigate for those that need to make use of it however it is still very complex and every situation is different. If you need advice in regards to property division or other family law matters, contact the lawyers at The Quinn Group by calling 1300 QUINNS or click here to submit an online enquiry form.