Complex Property Division
Complex Property Division in Divorce: How Courts Decide and What You Need to Know
Dividing property after separation can feel overwhelming—especially when complex assets are involved: business interests, overseas investments, trusts, or high-value debts. Understanding how the law tackles these intricate situations is your strongest leverage. This guide lays out the updated legal framework, highlights relevant case law, and includes realistic examples to help you prepare for sophisticated property disputes.
Understanding the Legal Framework: The Four-Step Approach Post-June 10, 2025
In Australia, property settlements for married couples are governed by Section 79 of the Family Law Act 1975 (Cth), while de facto couples use equivalent provisions under Section 90SM. Since 10 June 2025, the Act mandates a codified four-step approach:
- Identify existing property rights and liabilities (legal/equitable interests).
- Assess contributions—financial, non-financial (like homemaking or parenting), and the effects of family violence.
- Consider current and future circumstances, including caregiving responsibilities, health, capacity to earn, children’s needs, and any financial disadvantages.
- Determine if an order is just and equitable.
- One key addition: courts can now legally make orders about pets. These factors provide a clearer and more structured framework for property cases than before. The emphasis on disclosure, timing of contributions, and future needs is stronger than ever.
Reviews
Why Some Divisions Are More Complex Than Others
- Complex cases often involve:
- Business entities or shareholding structures
- Overseas assets or international trusts
- Discretionary or family trusts
- High-value or entangled debts
- Dissipation or “wasteful” conduct pre-separation
- These scenarios demand deeper scrutiny: valuation precision, timing of contributions, control over assets, and equitable balance. Expert financial affidavits, forensic accounting, and detailed disclosure become essential tools.
Real-World Scenarios
High-Net-Worth Portfolio Resolved
A publicised case saw a billionaire's spouse required to transfer luxury properties and multi-million-dollar settlements, showcasing how precisely courts manage substantial portfolios.
Attempted Asset Freeze Declined
In another scenario, a spouse sought to freeze $450 million in assets, alleging coercion. The court refused, evidencing that legitimate business decisions typically outweigh freeze orders unless a clear risk is proven.
These scenarios illustrate how even outlier cases are grounded in principle—disclosure, fairness, and equity remain central.
Key Legal Cases That Illustrate Complexity
Norbis v Norbis (1986)
High Court rejected rigid formulas; courts must pick global or asset-by-asset approaches depending on fairness.
Muschinski v Dodds (1985)
Equity required a constructive trust where one partner’s contributions justified recognition before sharing residual value.
Kennon v Spry (2008)
Discretionary trusts can count as “property” if one spouse controls or influences the trust; otherwise, trusts are treated as financial resources.
Kowaliw v Kowaliw (1981)
Wastage of assets through reckless behavior can lead to compensation via adjusted settlements.
Stanford v Stanford (2012)
Even with unequal contributions, the final settlement must be just and equitable; fairness is the yardstick.
What the Court Considers in Complex Property Division
Complete Asset Pool
Courts expect full disclosure—from real estate and superannuation to international investments and business interests. Hidden or undervalued assets invite sanctions or adjustments.
In practice, this means you must list everything you own or control, including property held in trusts, companies, or offshore accounts. If you fail to disclose an asset, the court can impose penalties, make adverse findings against you, or adjust the settlement in the other party’s favour.
Even assets you consider “yours alone” (such as inheritances or pre-marital savings) must be declared so the court can decide how they are treated. Full disclosure is a legal duty, and deliberately withholding information can be seen as an attempt to mislead the court.
Contributions Assessment
Includes direct financial inputs and indirect support, such as homemaking, children’s care, or business assistance. Trust or asset structures must be untangled to trace actual contributions.
Courts recognise that non-financial efforts—like managing a household or supporting a partner’s career—can have the same weight as financial contributions. In complex matters, they often need expert evidence to identify the value of a business, the growth of investments, or the impact of one party’s labour on asset accumulation.
For example, if you managed a family business while your partner drew a salary, the court may still attribute part of the business’s value to your efforts. Contributions are assessed across the entire relationship, not just at the time of separation.
Dissipation (No More Add-Backs)
Under Shinohara & Shinohara (2025), courts must not add dissipated or wasted assets back into the pool. Instead, the conduct is factored into contributions or future circumstances.
This is a major shift from the old “add-backs” rule, where squandered money could be notionally returned to the pool for division. Now, the court will look at how the wastage affects each party’s overall contributions or needs.
For instance, if one party gambled away a significant sum, the court may adjust the percentage split in favour of the other party rather than pretend the money still exists. This makes contemporaneous evidence of the dissipation even more important.
Future Needs & Equity Adjustment
Courts consider financial disadvantages such as caregiving, shifting earning capacity, child-rearing expenses, or health needs—especially relevant in complex cases.
If you will be the primary carer for children, your ability to work full-time may be reduced, affecting your income over the long term. Similarly, if you or your child has ongoing medical needs, the court may allocate you a greater share of the asset pool to ensure financial security.
The court also looks at age, future earning potential, and any disparity in superannuation. The aim is to ensure that both parties can move forward with a fair financial foundation.
Fairness of the Outcome
The final division must pass the “just and equitable” threshold. Courts can deviate significantly from an even split if circumstances warrant it.
Fairness is assessed holistically, meaning the court weighs contributions, needs, and the overall context of the relationship. For example, if one spouse entered the marriage with substantial assets that remained separate, the court might award them a larger share of the final pool. Conversely, if one party made sacrifices for the family that limited their earning capacity, they might receive more to compensate. The court’s goal is to create a fair outcome—not necessarily equal.
Practical Steps You Can Take
Create a Detailed Asset Inventory
Document every asset: property, businesses, trusts, overseas investments, super. Attach valuations, statements, and records to support your figures.
Include personal property such as vehicles, jewellery, art, and collectibles, as these can hold significant value. Don’t forget digital assets like cryptocurrency wallets or online businesses, which can be easy to overlook.
Regularly update your list so it reflects any changes in value. If your ex-partner controls certain assets, request disclosure through your lawyer and follow up on missing information.
Don’t assume your trust is safe—find out how the court might view it. A family lawyer experienced in trust matters can analyse your role, the trust deed, and your level of control to predict potential exposure. Acting early also allows you to take preventive measures and prepare documentation before any dispute escalates.
Document Contributions Thoroughly
Keep records of mortgage payments, business capital, renovations, parenting work, and homemaking efforts—ideally with dates and supporting documents.
Photographs, receipts, bank statements, and witness statements can all help demonstrate your role. This includes intangible contributions such as organising family finances, providing unpaid labour in a business, or caring for relatives.
Courts often consider the entire history of the relationship, so document contributions from the very beginning. The more specific your evidence, the harder it is for the other party to dispute.
Record Any Dissipation Events
If assets were transferred, gifted, or wasted, retain all transaction evidence—bank statements or correspondence to show the link between conduct and loss.
While courts no longer “add back” dissipated assets, they can adjust the division percentages to account for one party’s reckless spending. This means that proving wastage could result in you receiving a greater share of the remaining pool.
Examples include selling property below market value, excessive gambling, or using joint funds for personal benefit without consent. The more detailed your records, the stronger your case.
Get Accurate Valuations for Complex Assets
Hire experts for businesses, trusts, or overseas property. Independent, credible valuations strengthen your position.
Avoid relying solely on informal estimates or valuations from parties with a vested interest. In complex cases, courts often require forensic accountants, actuaries, or industry specialists to provide detailed reports.
This can help you challenge inflated debts or understated asset values. Professional valuations also help speed up settlement negotiations by providing a reliable starting point.
Plan for Future Needs
Gather evidence—medical reports, payroll, care budgets—that show ongoing or upcoming costs, so the court can factor these needs into the settlement.
If you have children with special needs, keep detailed cost projections for therapies, medical care, and educational requirements. If your career has been impacted by time spent raising children or managing the household, document your current income and potential earning limitations.
These factors can significantly influence the percentage split of the asset pool in your favour. Remember, the law now looks closely at both present and future circumstances to ensure a fair result.
Leverage ADR When Practical
Mediation or collaborative law can resolve disputes more peacefully—especially useful in disentangling assets and crafting sustainable outcomes.
For complex property matters, an experienced mediator can help identify creative settlement options that might not emerge in court. ADR can also reduce legal costs and emotional stress, which is particularly valuable if you need to maintain a co-parenting relationship after separation.
Even if full agreement isn’t reached, partial agreements can streamline court proceedings and shorten timelines. Always seek legal advice before finalising any mediated settlement.