I recently wrote about Sean the whirlwind. He wanted an annulment, rather than wait for a divorce, because his marriage ended after only 18 months. He was also concerned that his ex, Amanda, may bring a relationship property claim to half the home he owned before their marriage and that they had both lived in together.
Sean is not alone in having his marriage or de facto relationship falter in the early stages.
Marianne thought that her de facto relationship with Hugh was “for life”. When they decided to move in together 2 years ago, with talk of marriage being on the cards, it made sense that they lived in Marianne’s home rather than in Hugh’s small rental. She imagined that an engagement ring would likely be presented to her at her next birthday and was devastated when, instead, Hugh ended the relationship and told her he believed he was entitled to half her home.
Sean and Marianne were understandably concerned about what relationship property claims their exes may have. Each were adamant their exes should be entitled to nothing of what they had worked hard to acquire before their short lived relationships.
The Property (Relationships) Act 1976 is the law that sets out how property should be divided between a couple after they separate. This law applies to couples who are married, in a civil union or de facto relationship. Most people know about the presumptions of “equal sharing” of relationship property under the Act.
Less people are aware that, with a few exceptions, the situation is different when a relationship or marriage is one “of short duration”. A marriage of short duration is defined under the Act as one of less than three years.
You could see Sean’s relief when I explained to him that because his marriage to Amanda was less than three years, their family home isn’t automatically divided equally. Because their marriage was less than three years and Sean had owned their family home prior to the marriage, the presumption that the family home be equally shared did not apply.
This didn't mean Amanda had no claim to the home. Her and Sean’s shares in the family home are to be decided based on their respective contributions to the marriage. Contributions to the marriage aren’t merely financial but also include non-financial contributions. For Sean, this meant that when he and Amanda negotiated their property split, they had to take into account not only the contributions she made of her income but also her time and effort spent on making contributions to the marriage, such as improving the gardens and attending to domestic chores and errands.
You may now be thinking that Sean’s situation would also apply to Marianne’s situation but it doesn’t.
Although the Act applies to couples in a de facto relationship, there is a difference between how the Act applies to marriages of short durations and de facto relationships of short duration.
It was probably fortunate for Marianne that she never got her wedding to Hugh. Because her relationship with Hugh was a de facto relationship that lasted less than three years, no orders can be made under the Act! This essentially leaves Hugh out in the cold in respect to the family home and certainly far from having the half share in the home that he claimed he was entitled to.
However, there is an exception to this that Hugh could call upon. If Hugh can show he had made a substantial contribution to the de facto relationship (financial or non financial or both) and that the failure to make an order would result in a serious injustice, he could bring a claim. However, successfully proving this wouldn’t automatically entitle him to half the home. Instead, as with Sean’s situation, Marianne and Hugh’s shares would be decided based on their contributions to the de facto relationship.
In talking with Marianne about their respective contributions it became clear that Hugh didn’t have any real claim because, aside from contributing to the power and grocery bills and splitting the bill for social activities together, he had kept the rest of his income for his own use. Marianne had carried on meeting the mortgage, rates and insurances. It also appeared that their non financial contributions were relatively equal.
Marianne decided she didn’t have to do anything further. Sean was relieved that Amanda wouldn’t be entitled to half the home and he was comfortable about her being recompensed for her contributions so set about negotiating this with her. Although they had different outcomes, both Sean and Marianne realised that in any future relationships or marriages, a Contracting Out Agreement would be in order so that there was greater clarity and certainty about what happened to their assets if the relationship faltered.
Got a relationship property issue you want clarity on? Book a free initial consultation with us so we can discuss how we may assist you.
Names and any identifying information have been altered to protect the privacy of individuals. The information in this blog is current at 21 June 2021. The information in this blog is general, educative information only. As such, it should not be relied on in place of getting your own legal advice.