Court Refuses To Split Property After Breakdown Of 5 Year Marriage

walk away separate property

A court declared that a husband and wife were to walk away with their own property after the breakdown of a 5-year marriage.

This left the husband with $80,000 and the wife with $300,000.

Under Section 79 of the Family Law Act 1975 (Cth), the court has the discretion to make property settlement orders if it is just and equitable to do so.

The wife argued that there should be no alteration in the property interest.

However, the husband argued that all of the property should be regarded as jointly owned- meaning a property adjustment for 50/50.

The case of Newbury & Perrill [2017] FCCA 1490 examined how property should be divided following a short marriage.

The issue was whether the Federal Circuit Court should make orders for property adjustment following the breakdown of the marriage.

Newbury & Perrill, Short Relationship Property Settlement

The parties were married in 2007 and had one child together.

Although the wife states the parties separated on 15 August 2010, the financial interdependence between the parties continued until their physical separation on 13 November 2012.

The wife was 36 years old and the husband 41 years old at the time of the decision.

Throughout the relationship, both parties maintained separate bank accounts and accumulated savings in their individual accounts.

At the time of the hearing, the husband’s income was $113,000 per annum.

At times, Mr Perrill has earned $150,000 per annum. Ms Newbury’s income was $70,000 per annum.

Each party cares for the child for equal time, and both incur similar childcare expenses.

The value of the combined property of the parties is approximately $380,000.

Of that sum, $300,000 is equity in a real property in the wife’s sole name.

The other $80,000 is the value of cash owned by the husband at the time of separation.

Decision of the Court – short relationship

Judge Hughes made the decision that it was not just and equitable to make an adjustment of the legal interests of the parties.

The wife was declared sole owner of the property, and the husband was required to remove the caveat registered on the property at his own expense.

Each party was otherwise declared sole owner to the exclusion of the other party of all property and superannuation in their name at the date 30 June 2017.

As the parties never had any joint accounts during their relatively short relationship and the husband could not claim contributions to the property.

Judge Hughes ordered it was appropriate for each party to retain their current property interests with no adjustment.

The degree of financial interdependence shared between the parties was each party paying for day to day living expenses for the benefit of both parties and support during periods of unemployment.

Adjustments under Section 75(2)

The Court did not see that there were any special factors that they needed to make adjustments for.

The parties are of similar age.

There is no evidence to show either party suffers from ill-health and each can adequately support themselves and the child through their full-time employment.

Overall, the court noted that it would not be just and equitable to make a property adjustment in this case.

The wife was to retain her equity interest in the property and the husband was to retain his $80,000 sum in cash.

Impact of the Case – Short Relationship

Sometimes it is not always appropriate to make a property adjustment at the end of a relationship.

This is especially the case for shorter relationships where both parties kept their finances separate, and each party does not show any requirement of adjustment on the basis of necessity.

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