Family Law Act 1975 - Property

Property

Part VIII of the Act is concerned with the distribution of property after a marriage breakdown, and the Court has broad power under section 79 to order property settlement between parties based on a number of factors regarding 'contribution' and 'future needs'.

Until 1 March 2009 a property dispute had to arise out of a matrimonial relationship. After many years the Federal government accepted powers referred to it by the States to include all de facto couples (including same sex couples) under the Family Law Act. The changes passed by the Labor government came into effect in March 2009. Prior to this de facto and same-sex couples did not have the same property rights as married couples under the Act, and so had to rely on their state's de facto relationship legislation. Such claims were often much harder to prove than under the Family Law Act, and did not include all the same considerations as under the Family Law Act,and could result in a more uneven or diminished distribution of property than would otherwise be possible.

It is necessary to bring a property claim before or within 12 months of the divorce occurring or two years of separation for de facto couples, although unlike property proceedings in various other countries, the two usually occur separately.

A standard section 79 property adjustment has 4 steps:

1. Identify the marital assets and ascribe a value to them

The assets which may be distributed under the Act include the totality of the parties' joint and several assets. The amount of property is determined at the date of hearing rather than at the date of divorce, so this can also include property acquired after separation. Superannuation is also considered to be a marital asset under section 90MC, but will not be available for distribution until it 'vests'.

2. Look at each party's contributions to the marriage under section 79(4)

This section of the Act contains a list of factors by which the Court can determine who contributed what to the marriage. Broadly, the contributions can be taken as financial in nature (for example, paying off a mortgage) or non-financial in nature (for example, taking care of the children). The party who can demonstrate a larger contribution to the marital relationship will receive a larger proportion of the assets.

3. Look at each party's financial resources and future needs under section 75(2) and adjust accordingly

4 The court then considers whether the proposed distribution is just and equitable

After the parties' contributions have been established, a final adjustment is made according to their individual future needs. These needs can include factors such as an inability to gain employment, the continued care of a child under 18 years of age, and medical expenses. This is often used to account for a party who has not shown a great deal of substantive contributions, but will require money to live on as a result of factors largely outside of their control.