This is one of the most common myths that family lawyers are required to dispel. Another myth is that property is divided up 50/50 between spouses.

Sometimes a wife or female partner in a de facto relationship may receive a greater share of the property pool than her husband or male partner after separation and sometimes a net property pool will be divided equally between the parties. Equality is not however the starting point.

There are no hard and fast rules for percentage divisions on property settlement. Rather, Judges in the Federal Circuit and Family Court of Australia have a very wide discretion in making Orders that alter the interests of parties in property.

The Court will not make an Order for property settlement, unless it is just and equitable to do so and it is widely accepted that the four (4) step approach to determining a party’s property entitlements is as follows: –

Step One: 

Identify and value the property of the parties – not only property held by both parties but also any property owned separately by each party. The property is valued as at the date that an agreement is reached or the date of Trial not as at the date of separation.

Step Two:

Consider the contributions of the parties and express these contributions as a percentage of the net value of the property (contributions include the direct and indirect contributions towards the acquisition, conservation or improvement of any relationship property, the non-financial contributions of each party to the relationship and the contribution made to the welfare of the family, and any children of the relationship including any contribution of either party as either homemaker or parent).

Step Three:

Identify and assess the other “future needs factors” set out in section 75(2) or section 90SF(3) of the Family Law Act 1975 (Cth) and determine the adjustment (if any) to be made to the contribution elements at Step Two. Some of the factors that are taken into account include:

  • Age and health of the parties;
  • Resources and employment capacity – this includes the income, property and financial resources of each of the spouses, and the physical and mental capacity of each of them for appropriate gainful employment;
  • A party’s care and control of any children under the age of 18 years;
  • Necessary commitments – the Court must consider the commitments of each spouse necessary to enable that spouse to support himself or herself and any other person whom they have a duty to maintain;
  • Responsibilities to support others – the Court must consider the responsibility of either spouse to support another person;
  • Appropriate standards of living – if the spouses have separated, the court must consider what standard of living is reasonable for each spouse in all the circumstances;
  • Contributions to income and earning capacity made by either party to the income and earning capacity of the other;
  • Length of the relationship;
  • The effect of the relationship on earning capacity – the Court must consider the extent to which the marriage has affected the earning capacity of each of the spouses;
  • The financial circumstances of cohabitation – if either spouse partner is cohabiting with another person, the court must consider the financial circumstances of the cohabitation.
  • Other factors and circumstances that the justice of the case requires to be taken into account.

Step Four: 

Consider the effect of the above and resolve what order is just and equitable in all the circumstances.

The Court must look at each case on its individual facts and circumstances and decide how much weight to place on each factor and what adjustment should be made (if any) in a party’s favour. 

It is impossible for anyone to predict with absolute accuracy what the outcome of any property settlement proceedings will be.  In any matter, there will be a range of possible outcomes that will be considered to be “just and equitable” and one particular Judge’s view may differ slightly from that of another.  Nevertheless, neither view may be considered wrong as long as it is within the range of outcomes considered to be just and equitable.

It is quite possible for a female spouse to receive a greater share of the property pool if for example, she:

  1. Made a greater initial contribution, for example she may have owned a house at the commencement of the relationship that was the springboard to further wealth creation;
  2. Received an inheritance, particularly if that inheritance was received late in the relationship and/or received gifts of significance from family during the marriage;
  3. Has care and control of young children;
  4. Is not capable of earning the income or accumulating superannuation that her male spouse is able to earn or accumulate and will require training to re-skill or gain qualifications to enable her to re-enter the workforce;
  5. Made significant contributions by way of labour or project management towards the renovation and improvement of real properties;
  6. Has health issues that impact upon her capacity to earn an income and/or has significant medical expenses to pay;
  7. Made the greater breadwinner contribution throughout the relationship (in circumstances where neither party made a greater homemaking or parenting contribution);
  8. Made significant sacrifices in relation to her career and future earning capacity during the relationship for example by ceasing work or reducing her working hours to look after children and/or to support her former spouse’s career path;
  9. Receives very little child support from her former spouse and is unlikely in the future to ever receive significant financial support from her former partner for the care of the children;
  10. Made astute financial decisions that increased the property pool or preserved the pool whilst her spouse wasted assets (for example by gambling or engaging in reckless behaviour); or
  11. Made significant non-financial contributions for example to the care, nurture, and support of a former spouse with a medical disability.

It will depend on the facts and circumstances of the individual case.

The above is a non-exhaustive list. It simply highlights some of the matters that a Court will take into account in determining a just and equitable division of your property.

At Tosh Colls Family Law, we understand that every situation is unique. If you’re going through a separation, our experienced team is here to help you navigate the process and can provide clear, practical advice to help you make informed decisions.