Do You Think a Property Settlement Cannot Happen While You are Together?

Think Again!
The issue of property settlement between married and de facto parties is complex and technical. Generally speaking, the Court cannot make a property settlement order unless it is satisfied that, in all the circumstances, it is ‘just and equitable’ to do so.

In a recent High Court decision the Court found that Orders could be made for division of property, even though the couple had not separated, but such division must be ‘just and equitable’.

In that case the husband and wife were married for over 40 years. Both parties had been previously married and had adult children. The family home was registered in the husband’s sole name. During the relationship, they each made Wills basically leaving their estates to the children of their first marriage, except that the husband, in his Will, also allowed for the wife to remain living in his property until her death.

In 2008, the wife suffered a stroke and was admitted into full time residential care. The wife also developed dementia and did not return to live with the husband. However, the parties never formally ended their relationship.

The husband also put some money into a bank account to provide for the wife’s medical needs/costs.

Sadly, the wife then passed away while litigation was still pending. Her daughter from a previous relationship continued the case on her mother’s behalf.

The High Court found that they did have the power to order a division of property notwithstanding the fact that the parties had never actually separated. However, on the basis of the principle of ‘just and equitable’, the Orders the Court made resulted in the husband retaining 100% of the assets in his name. This meant that the wife’s daughter from her first marriage in effect received nothing.

The High Court found that once it had concluded that it was just and equitable to make a property settlement order, the Court should then proceed to take the other steps associated with property settlement being the assessment of each party’s contributions and a consideration of the financial resources, means and needs of the parties and other relevant matters.

In this particular case, the husband was the sole proprietor of the home and the parties had not actually ended their relationship. Accordingly, in the circumstances of this case, the High Court chose not to alter the existing interests in property.