A De Facto relationship is a relationship where a couple that lives together on a mutual understanding basis. This does not require any legal bonding, for example, a marriage. But whether the relationship exists or not is something that needs consideration from case to case. In such a relationship a partner will be able to apply for a property settlement if:

  • they have lived in a de facto relationship for a minimum period of 2 years
  • they have a child from the relationship, or

Once you commit to your partner and then move in together. This means you both earn together and eventually pay for most of your assets together.

But what if in a few years you want to move out of the relationship? This is where a property settlement will come into frame. The first question that will come to your mind is:

What about the shared assets?

If you have been the one to purchase most of the material things for your home or relationship, you may want to be entitled to 70% of the share. However, it doesn’t work like this. If you have lived together for 2 years or more, you are considered to be a de facto couple under Section 4AA of the Family Law Act 1975.

This means that both partners have an equal right and have equal liabilities, as for married couples.

Under such circumstances, it is best to consult a de facto relationship lawyer in Adelaide for legal advice. This will make sure that the time period is matched with and that if there are any legal concerns, they are handled well.

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How to settle for property?

Another concerning issue is how to settle the shared assets between two partners. There are 5 steps in negotiating and concluding a property settlement, irrespective of a marriage or a de facto relationship. The steps are as follows:

  • To decide if it is fair to make an order.
  • To consider the assets and debts of the partners, respectively. This will include: real estate, cars, shares, contents, savings, business, superannuation etc.
  • To consider the contribution of each partner. This will include:
  • Bringing assets to the relationship
  • Earning an income
  • Caring for their child, if any
  • Receiving an inheritance
  • To consider factors listed in section 75(2) of the Family Law Act of Section 90SF (3) in a de facto relationship. This will include identifying arrangements for children and the income of the partners, respectively.
  • To consider the order that is fair and justifiable.

Out of Court Settlement

If you can come to terms with each other and reach an equitable agreement with your partner without having the need to go to court, it is the best outcome.

But, before settling the dispute out of court, it is important that both the partners make full and frank disclosure. This does not mean you don’t need legal advice. Even during an out-of-court settlement, you will need advice from a de facto relationship lawyer in Adelaide.

A very healthy way to come to terms is being calm and composed. You must be fair and just to each other and move on without creating a dispute in court.

Once you have decided to have an out-of-court settlement, you can inform your lawyers and they will take the proceedings forward. This settlement needs to be formed in a consent order that is made under the Family Court or even through a financial agreement. There are 2 reasons to make this:

  1. A consent letter or financial agreement proves a conclusion, unless any of the parties has not provided full and frank disclosure.
  2. A consent letter or financial agreement provides dispensation from stamp duty for the properties transferred.

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Court Procedure

If there is no mutual understanding and a conclusion cannot be met then one needs to go to arbitration or court.

The judge will then order for the division of assets considering the 5-step regulation mentioned above. However, an arbitrator helps to resolve disputes faster than the court and hence people usually go for arbitration. The cost of both arbitration and court is almost the same.

What are the orders that can be made?

Various kinds of orders can be passed, which include:

  • Home being auctioned and the sale can be divided between the parties
  • One of the parties can retain the house and cover the mortgage and make a payment to the other party
  • There can be a division of the superannuation from one party’s superannuation pool to the other party’s superannuation pool

By Russell Crowe

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