How the court decides property cases

When you apply to the Family Court for property orders, you are commencing legal proceedings and asking the court to make a decision about the division of your property and finances. This can include asking for temporary orders to help with financial matters while you work out a property settlement.

The court’s role is to divide property in a fair and just way, taking into account what property is available from the relationship, what each person contributed to the relationship, and what the future needs of each person are likely to be.

This information will help you to understand how the Family Court deals with a property case.  Find out:

  • who can apply for property orders (including consent orders)
  • what things can be included in property orders, and
  • how the court makes a decision to come up with a fair and just property settlement.

Who can apply for property orders in the Family Court?

After you have separated from your partner, you may want to divide up property and finances. This can be very complicated. If you are unable to reach an agreement, you may want to apply for property orders from the Family Court.

All married couples can apply for property orders after separation.

If you were in a de facto relationship with the other person, you can only start a property case if:

  • you were in a de facto relationship for at least 2 years, or
  • there is a child from the relationship who is under 18 years old and it would be very unfair to the person raising the child if property orders were not made, or
  • the person applying for property orders has made a substantial contributions to the relationship (whether related to money, parenting or other contributions) and it would be very unfair if property orders were not made.

When someone from de facto relationship applies for property orders from the Family Court of WA, at least one person from the relationship must be living in Western Australia and:

  • you must have both lived in Western Australia for at least a third of the de facto relationship before separating, or
  • one of you made substantial contributions to the de facto relationship (whether related to money, parenting or other contributions) while living in Western Australia.

If your de facto relationship doesn't meet these criteria, you can still make a private arrangement to divide up property with your former partner. But you won't be able to apply for consent orders, or start a property case if you can't reach an agreement.

What things can be included in a property settlement?

When you make an application for property orders, the court will consider all the assets (items you own) and liabilities (loans and debts), to work out what property needs to be divided up and how much it is currently worth. This can include:

  • the family home, regardless of who is living in the house after separation
  • other real estate, including holiday homes or investment properties
  • cash and money held in bank accounts and term deposits
  • items or property received as an inheritance or gift
  • shares and managed funds
  • superannuation (in some situations)
  • cars, motor bikes, boats and other vehicles
  • furniture and jewellery, and
  • debts, including mortgages, car loans, credit cards and other personal debts.

It makes no difference who owns the property, who bought the item, who uses the item, or who incurred the debt. All assets and liabilities of each person are considered by the court, though it will take into account the financial position and contributions each person has made before, during and after the relationship.

How is superannuation treated?

For married couples, the superannuation of each person is part of the property that needs to be valued and divided by the court when making a property settlement. This could involve someone keeping all of their superannuation instead of receiving some other property from the relationship, or the court making orders to transfer some of their superannuation to the other person (either now or in the future).

For de facto couples, each person's superannuation is not part of the relationship property, so it cannot be included in a property settlement. However, the court will want to know what superannuation each person has when looking at the contribution each person made to the relationship, and when considering what their future needs are likely to be. The property settlement can take into account that one person has less superannuation because they stopped work to take care of children during (and even after) the relationship.

How does the Family Court make decisions to create a property settlement?

The Family Court follows a four-step process to make a property settlement: 

  1. Look at all the property involved to identify and value the assets and liabilites of each person. This becomes the 'pool' of available property to divide.

    If property is owned by more than one person (including people outside the relationship, such as business partners or family members), the court will work out the value of each party's share.

  2. Look at the contributions each person made to the relationship and decide what percentage of the available property each person should receive.

    Contributions may be direct or indirect, and relate to money, property, parenting or other contributions, such as housework or caring for relatives. The court looks at each person's contribution during the relationship, as well as contribution made before the relationship started (such as bringing property into the relationship) and after the relationship ended (such as continuing to care for children or paying child support). The court does not start with an assumption that property will be split 50:50.

  3. Look at the future needs of each person to see if there needs to be any adjustment to the percentages in order for it to be fair.

    This may include looking at factors such as whether each person works or has the capacity to work, whether there are children involved and who is looking after them, and the age and state of health of each person. The court may make an adjustment to the property division for each person based on their future needs and to try and achieve a clean break in their financial relationship.

  4. Consider whether that result would divide property in a fair and just way, given the particular circumstances of each person.

    The reason for why a relationship broke down is not something the court must consider as part of deciding if a property settlement is fair. The court will also consider how the property settlement should be carried out and whether particular items of property are to be kept or transfered by each person. A property settlement might include making a cash payout to the other person (whether in one amount or over time), or regular payments to the other person.

Unlike in parenting cases, there is no assumed starting point for property settlements. The court does not have to begin with, or even consider, a 50:50 split. The financial situation and contributions of every couple is different. 

I am worried my former partner will hide or try to transfer assets. What can I do?

If you believe your former partner is planning to hide, give away or sell assets to avoid them being included in a property settlement, there are some steps you can take. 

  • You may be able to get a caveat that would stop the property being sold.
  • You can apply to the Family Court for an injunction to stop your former partner (or someone else) from doing certain things, such as using funds in an account or selling assets.

You should get legal advice before taking steps to stop someone dealing with property.

 

More information

Family Court of WA

Disclaimer

The information displayed on this page is provided for information purposes only and does not constitute legal advice. If you have a legal problem, you should see a lawyer. Legal Aid Western Australia aims to provide information that is accurate, however does not accept responsibility for any errors or omissions in the information provided on this page or incorporated into it by reference.