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As a party to a marriage or a de facto relationship, you have the right to a property settlement on the breakdown of your relationship.

Property settlement is governed by the Family Law Act 1975 (Part VIII for matrimonial and Part VIIIAB for de facto partners) which is a Commonwealth legislation and hence the laws that apply in property settlement are the same throughout Australia*. Although the provisions relating to de facto partners almost mirror those of matrimonial spouses, we will concentrate on married couples for the purposes of this article.

We often hear rumours that on separation, each party is automatically entitled to 50% of all assets of the marriage. This is not quite correct, and although in many cases, the result may well be 50/50 (particularly in lengthy marriages without children), all cases are different and the courts outline that a four step process must be followed when assessing property settlement as follows:

  1. Identifying and valuing all property owned by the parties. This includes assets, liabilities and financial resources regardless of whether they are in your name, your partner’s name, or in joint names, and whether they were acquired prior to the start of the relationship, during the relationship, or after separation (note: some post-separation assets/liabilities are excluded).
  2. Evaluating the contributions made by each party to the marriage. There are basically three types.  These contributions are categorised as follows:-
    • “financial” contribution such as receiving wages and bringing assets into the marriage;
    • “non-financial” contribution such as conducting renovation works, doing the books of account within a family business;
    • “contribution to the welfare of the family” (as a parent or homemaker).
  3. Assessing the future economic needs of each party. These relevant factors are listed under section 75(2) of the Family Law Act, and some adjustment factors taken into consideration would be the age and health of each party, which party has the care and control of any children of the relationship under 18 years of age, any disparity in income and earning capacity, and payment/non-payment of Child Support etc.
  4. Reviewing the proposed division of assets to ensure it is just and equitable. The court takes into account any further adjustments if necessary, to ensure that a fair settlement is achieved.

By way of an example, if you both entered into the marriage with minimal assets, made equal contribution over a long marriage, and you become the primary carer of a number of young children on separation, you are likely to receive a larger distribution of property over and above that of your partner’s.

Property settlement is a complex area of law, and there are countless other factors that must be considered, such as where a party receives personal injuries compensation payout, redundancy package, inheritance or gifts during marriage, and where a party causes damage to property, squanders money, or otherwise reduces the value of assets or where third parties are involved in the ownership of assets, etc. These and other factors can potentially affect property settlement and cannot be overlooked.

It is prudent to obtain legal advice prior to entering into any negotiations with your partner, so that you have a clear understanding of your entitlements, and you are in a much better position to set the boundaries for negotiation.

*defacto partners ordinarily resident in a “non-participating jurisdiction” such as South Australia and Western Australia are not covered by the Family Law Act and hence laws of those respective States apply.

Readers are reminded that the purpose of this article is to provide general information only and is not to be taken as a substitute for independent legal advice.

Resource: Daichi Okamoto – Family Lawyer

For any enquiries regarding Attwood Marshall’s Family Law Department, please contact the Department Manager Donna Tolley, on direct line 07 5506 8241 or by email on

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Donna Tolley

Donna Tolley

  • Wills & Estates Department Manager
  • Wills and Estates
  • Direct line: 07 5506 8241
  • Mobile: 0423 772 555