Legal Hypothetical: De facto property settlement: two-pool approach Hypothetical - A Legal Look Property/Sports/Opinion - popup ad by News Of The Area - Modern Media - August 18, 2023 GREG and Mary have been in a de facto relationship for 13 years. There are no children to the relationship. Greg purchases their Smith Street home in joint names early in the relationship and they live there together until their relationship breaks-down. A dispute arises in relation to the division of their property and proceedings are commenced in the Federal Circuit and Family Court of Australia. The parties concede that apart from their Smith Street home, they kept their financial affairs separate and each maintained their own business and bank accounts. Greg discloses that he has $3 million worth of investments in managed funds in his sole name. Greg argues that Mary is not entitled to a share of the investments because he had set-up these funds prior to entering-into a relationship with Mary. He says that Mary should receive no more than half of the value of their Smith Street home. The Court states that while a “global approach” may be preferred in circumstances regarding the assessment of contributions by a home maker and parent, in some cases, justice and equity may be best served by treating some assets separately. In the circumstances, the Court adopts a “two-pool approach”. These pools consist of the assets that existed prior to cohabitation on one hand and the Smith Street home on the other. The Court accepts that Mary made contributions as homemaker, ultimately deciding that Greg’s contribution to the Smith Street asset was 80 percent and that neither party made any significant contribution to any of the parties’ other assets. On the basis that both parties were in good health and gainfully employed, no further adjustments are made and the Court accepts Greg’s proposal that Mary receive 50 percent of the proceeds of sale of the Smith Street property, despite the Court assessing her contributions towards that asset at just 20 percent. Email Manny Wood, Principal Solicitor at TB Law at manny@tblaw.net.au or call him on (02) 66 487 487. This column is only accurate at today’s date and is not legal advice.
