De Facto Relationships

Heterosexual couples and same sex couples

Since 1 March 2009 the Family Law Act 1975 (Cth) has applied to the majority of de facto couples.

Commonly asked questions about de facto relationships include:-

Heterosexual couples; and
Same sex couples.

Heterosexual and same sex couples in a de facto relationship are treated equally under the Family Law Act 1975 (Cth).

Pursuant to Section 4AA of the Family Law Act 1975 (Cth) a person is in a de facto relationship with another person if the couple:

have never been married to each other; and
are not related by family; and
having regards to all the circumstances of their relationship, they have a relationship as a couple living together on a genuine domestic basis.

The Court has wide discretion as to what circumstances it takes into account in determining whether a couple is in a de facto relationship, including:

The duration of the relationship and the nature and extent of common residence;
If there was a sexual relationship;
The degree of mutual commitment to a shared life;
If the relationship was registered under State law;
Reputation, public aspects of the relationship; and
All other factors set out in section 4AA of the Family Law Act.

My de facto relationship rights

Many States, New South Wales included, conferred their power to make laws concerning de facto relationships to the Family Law Act.

The Family Law Act allows couples who have:

been in a de facto relationship;
lived in a participating jurisdiction such as New South Wales for two years or more; and
have not been separated for more than two years.

to bring a claim in the Family Court or the Federal Circuit Court of Australia for a property settlement.

De facto couples can also apply for parenting orders and child support and are also eligible persons under the Succession Act 2006 to bring a family provision claim upon the death of the other.

The fact that you may be eligible to bring a claim under the Family Law Act does not automatically mean you will be successful in that claim. It is important that you obtain specific legal advice about settlement options and the range of outcomes, costs and risks you face in commencing Court proceedings.

Property applications that can be made, include property applications to divide property and maintenance whereby one de facto partner pays monies to the other by way of ongoing support or maintenance.

Time Limit

De facto couples have two years to bring a claim for the division of property or maintenance.

Separation

Separation requires that the couple no longer live together as a de facto couple. Consequently, they would, if one of them chose to separate from the other, communicate their intention and act on it. For example, moving out of the home, informing family and friends, working towards separating finances, obtaining legal advice etc.

As the two year time limit for de facto couples commences from the date of separation, it is sensible to carefully document that date as disputes may arise later about the date of separation. This is particularly the case as separated couples edge closer toward the two year time limit.

You could consider a letter from your solicitor to your former partner confirming that you have separated. Alternatively, you could send an email or letter confirming separation or, both of you might sign a document to confirm that as of a particular date, your de facto relationship has come to an end and you both consider yourselves separated.

Keep that document in a safe place in case there is a dispute down the track as to the date of separation.

In Australia, there is no requirement to justify or give reasons for separation.

Long term de facto relationships and the Family Law Act

Yes, it does.

The Family Law Act will apply if you meet the criteria under the Family Law Act (which is more likely than not) including that you separated on or after 1 March 2009 and that you lived together for two years or more in a participating jurisdiction.

Asset entitlement

Simply being in a de facto relationship with another person does not guarantee that that person will have a right to property owned solely by you.
In determining whether orders should be made to divide property, the Family Law Act considers:

all of the assets including superannuation that each of you have in your own names and with any other person, including a third party or spouse;
How each of you have contributed towards the assets, including by financial or non-financial means. This can include, for example the care of children.
Whether factors exist which require interests to be adjusted including such things as ongoing care of the children, earning capacity and obligation to care for a third party.
Whether making orders to divide property is just and equitable in the circumstances.

Each property case will vary depending on its own facts. Some couples do keep their assets separate, bringing assets into the relationship, or have such a short relationship that they have not had the opportunity to contribute to the assets owned by the other. It is not always appropriate for the Court to make property settlement orders.

Asset protection

Some couples enter into financial agreements setting out how the couple will manage their financial affairs during the relationship, how for example they might use or share assets, how they may for example contribute towards the purchase of any other assets together in the future, and how if they were to separate assets would be retained and/or divided.

Financial agreements are complex and require careful drafting. Each party requires independent advice on the agreement. They may not be suitable for everyone.

It is prudent to obtain specific advice about such an agreement, and be aware of any limitations arising from or in connection with any agreement.

Trusts and asset protection

In property cases, the Family Law Act looks at each de facto party’s interest in any trust, whether it be as trustee, an appointor, director of a corporate trustee or beneficiary. It also looks at distributions that have been received in the past, or may be received in the future including, for example under any testamentary trust.

It is not uncommon for individuals or couples to hold assets, either individually or from the relationship in a trust structure, and the interest in the trust may need to be valued and dealt with by way of a Property Order similar to any other asset. It is important to consider that holding assets in trust does not quarantine them from any family law claim.

Claims on my assets

A de facto spouse is an eligible person under the Succession Act 2006.

The Succession Act is New South Wales legislation that deals with Wills and sets out the law concerning family provision claims.

A family provision claim is a claim by an eligible person, which includes:

A de facto spouse or former de facto spouse, or a person who was a member of the deceased person’s household (for example, stepchildren) who have not been provided for adequately or at all under the deceased person’s Will.
Some couples in finalising a property settlement consider finalising any such claim that may be made against their estate. This may be particularly important for de facto couples who re-partnered later in life and had children of a previous relationship to whom they wish to leave their assets.
An option may include entering into an agreement whereby no such claim would be made, and having that agreement approved of and made enforceable by way of an Order from the Supreme Court.

This is called a mutual Deed of Release under the Succession Act.

If you need any help in this area please contact any member of our family law team.