Common Legal Mistakes to Avoid When Splitting Assets in a De Facto Relationship

According to divorce lawyers Perth WA, a de facto relationship exists when two partners are not legally married to each other. However, they must live together and not be related by family. So when this relationship dissolves, resulting in separation, different laws apply regarding property settlement.

This is where couples have several misconceptions regarding the splitting of assets. In this blog, we will discuss those misconceptions while highlighting the core concepts of legal conditions that clear them.

Every De Facto Couple Can Apply for Settlement

Unlike in marriages, financial and property matters for de facto couples are governed by the Family Court Act 1997 (WA). Being in a de facto relationship does not essentially make you eligible for a claim. For it, you must meet any one of the conditions mentioned below:

Minimum Relationship Duration

The partners must be in a de facto relationship for 2 years while meeting the genuine domestic basis clause. This clause includes the presence of a sexual relationship, how the relationship is presented publicly and the degree of financial dependence.

Presence of Children with Serious Injustice

According to a de facto lawyer Perth, simply having a child is not enough. They must satisfy all the other conditions stated below:

• Their child is under the age of 18
• If a proper property settlement is not made, it will cause serious injustice to the partner who cares for the child or takes responsibility for them.

Substantial Contributions to the Relationship

If any de facto partner has made substantial contributions while being in the relationship, the Family Court of WA has the discretion to act. Here, substantial contributions represent real contributions that are significant enough that ignoring them would be considered unfair.

Assuming De Facto Separation Means an Automatic 50/50 Split

Many de facto couples make the mistake of assuming an asset settlement division is carried out mathematically. On the contrary, the court follows the principle of being just and equitable, which ensures fairness in all circumstances. The following factors, which are evaluated to determine fairness, are stated below.

• Financial Contributions

This section considers the financial contribution of the de facto partner in conserving, acquiring or improving properties. Indirect financial contributions that resulted in the other partner being able to buy the assets are also considered.

• Non-Financial Contributions

This includes unpaid labour in the form of looking after the family’s properties. Manual labour in helping to manage the family business and managing investments without any remuneration falls under this category.

• Family Welfare Contributions

If any de facto partner was responsible for homemaking or parenting of their children, they are considered to have made an economically significant contribution. Supporting the household and caring for the children are also included in this section.

• Effect On Earning Capacity

Whether an order from the court will affect a de facto partner’s future earnings is also taken into account in the grounds of fair judgment. Other factors such as age, health and violence inflicted are considered relevant aspects.

Only Joint Assets Will be Distributed in a Settlement

According to the Family Court Act 1997 (WA), the court does not limit property settlement to jointly owned assets. Instead, the best separation lawyers in Perth say the court is allowed to deal with:

• Property owned separately by either party
• Property acquired before, during and after the de facto relationship
• Property subject to legal or equitable interest

Superannuation is Not a Part of Separation Settlements

Superannuation refers to a person’s entitlement to future entitlement schemes. If you are an employee in any job sector in Western Australia, it is mandatory to pay into a fund in the form of a retirement savings account or similar scheme. During separation, the Family Court Act 1997 (WA) treats it as a financial interest with present value capable of distribution. The factors that are considered when splitting the superannuation funds are:

• Contributions made by each party in the relationship
• The length of the de facto relationship
• Each partner’s retirement prospects

Informal Agreements Have a Legal Effect

You and your estranged partner may reach a mutual agreement; however, it’s not legally binding unless you get consent orders from the court. Under WA law, applications for property settlement must generally be commenced within two years of separation. If the deadline is missed, permission to enforce your mutual agreement is not guaranteed.

If the time limit expires, you must obtain permission from the Family Court of WA to apply for a legal settlement. The court may permit for the following reasons:

• The absence of a settlement order is causing significant hardship to any de facto partner
• Special circumstances justifying the application. This includes family violence, lack of legal knowledge or serious illness.

Conclusion

When it comes to obtaining a fair and just settlement, several key aspects must be considered. That is why it is recommended that you consult with affordable divorce lawyers Perth. They will help you draft a reasonable agreement adhering to legal acts. In case of disagreements, they will efficiently present your assets before the court, taking into account all your circumstances and contributions.