On 1 March 2009, new Commonwealth laws for spousal maintenance and the division of property for people in de facto relationships came into force. The Commonwealth Family Law Act 1975 now applies to both married and de facto couples as well as same-sex couples. Previously, de-facto relationships were covered by State Laws and disputes between de-facto couples were determined by State Courts such as the Supreme Court and County Court- Such disputes are now within the jurisdiction of the Family Court of Australia and the Federal Magistrates Court, as are disputes concerning children of all relationships.
The media has focused on a relatively minor aspect of the new laws referring to "mistress laws". Whilst "mistresses" in some limited circumstances may gain some rights, the main purpose of the legislation is to bring the rights of de-facto couples into line with the rights of married couples.
What is the effect of the new De Facto laws?
The new laws allow de facto couples, when they separate, to apply for property settlements based on the same principles which apply to married couples under the Family Law Act 1975.
The Family Law Courts have the power to order a division of any property that the couple own. Superannuation entitlements can also be split and spousal maintenance orders can be made requiring a former de facto partner to pay maintenance to the other where that other partner has no capacity to support herself/himself.
The Family Law Courts can make these orders if any of the following scenarios apply:
- the period (or the total of the periods) of the de facto relationship is at least 2 years
- there is a child of the de facto relationship
- one of the partners made substantial financial or non-financial contributions to their property or as a homemaker or parent and serious injustice to that partner would result if the order was not made, or
- the de facto relationship has been registered in a State or Territory with laws for the registration of relationships.
A court has the power to make "such order as it considers proper for the maintenance of one of the parties to a de facto relationship". Section 90SF of the Family Law Act 1975 provides that an Order for maintenance must only be made to the extent that the payer is reasonably able to do so and only if the payee is unable to support himself or herself whether:
- by reason of having the care and control of a child of the de facto relationship who has not attained the age of 18 years; or
- by reason of age or physical or mental incapacity for appropriate gainful employment; or
- for any other adequate reason.
What is the definition of a "de facto relationship"?
A de facto relationship is defined in Section 4AA(1)of the Family Law Act 1975 as a relationship between two people who live together on a genuine domestic basis, whilst not legally married or related to each other. It can exist between two people of the opposite sex, or between two people of the same sex.
All the circumstances of the relationship will be considered when determining whether a de facto relationship exists. These include:
- the duration of their relationship
- the nature and extent of their common residence
- whether a sexual relationship exists
- the degree of financial dependence or interdependence, and any arrangements for financial support, between them
- the ownership, use and acquisition of their property
- their degree of mutual commitment to a shared life
- whether the relationship has been registered, in a State or Territory with laws for the registration of relationships
- the care and support of children, and
- the reputation and public aspects of their relationship.
In which States and Territories do the new laws apply?
Currently, the new laws only apply to couples ordinarily resident in New South Wales, Victoria, Queensland, Tasmania, the Australian Capital Territory, the Northern Territory or Norfolk Island at the time when their de facto relationship broke down. (Residents of South Australia and Western Australia are not yet covered but may be in the future.)
Alternatively, the new laws will also apply where court orders are sought if:
- the couple were ordinarily resident in one or more of those States or Territories during at least one third of their de facto relationship, or
- the party applying for the order made substantial financial or non-financial contributions to property or as a homemaker or parent in one or more of those States or Territories
provided that one of the parties is ordinarily resident in one of the States or Territories when the application to the court is made.
Do the new laws apply to the Breakdown of All De Facto Relationships?
No, the new laws apply only when the relationship breaks down on or after 1 March 2009. Any Court Application must be made within 2 years of separation. However, in exceptional circumstances, a court may grant leave to make an application out of time.
For people whose relationship broke down before 1 March 2009, State Laws continue to apply. However, if both parties agree after each having obtained independent legal advice, they can opt in to be covered by the new laws. The choice to opt in must be in writing and each party's lawyer must provide a certificate to confirm that the independent legal advice was given.
Opting out of the new De Facto laws
If a couple wishes to willingly opt out of the new laws so that they do not apply to their relationship, they are able to make a Financial Agreement under the Family Law Act in the same way that married couples can. A Financial Agreement (sometimes referred to as a Binding Financial Agreement) can cover arrangements for Division of property, split of Superannuation and maintenance in the event of a relationship breakdown. Such Financial Agreements can be made before entering into a relationship, during the relationship or following the breakdown of the relationship. Due to the fact that a Financial Agreement results in the substitution of a person's rights under the Family Law Act, stringent legal requirements apply and each party must be independently represented and advised by a separate lawyer.
Does a "Mistress" have Rights to Maintenance and Property Settlement?
The media has created great public interest with sensational headlines such as "Love Rats Cash Trap" and "Mistresses to Cash In on De Facto Laws". So, will mistresses be cueing up to institute legal proceedings? Before the Family Law Courts can exercise jurisdiction, the mistress must prove that she was in a de facto relationship (defined above) and the legislation requires that all the circumstances be taken into account.
For example, in the following scenario, the relationship between Randy and Misty would probably come within the definition of de facto relationship:
Randy, aged 65, is the CEO of a National Company. He is married to Brigid, aged 55, with whom he has two teenage children. The family home is in Brighton. The national company head office is in Sydney and Randy usually works at the head office from Tuesday to Friday staying in Sydney during that period. Randy first met Misty at The Love Rat Nightclub fifteen years ago and Randy has been spending all of his spare time with her when he is in Sydney. Misty is now aged 54. She has never worked and is studying Fine Arts part-time. Randy and Misty sleep together, go out to dinner together and go to both private and business social functions together. Ten years ago, Randy purchased a run-down art deco penthouse apartment in Double Bay. Randy pays all the expenses for that apartment. Misty lives in the apartment full time and Randy lives there when he is in Sydney. Misty does not work as she is supported by Randy. Misty spends her time, preparing gourmet dinners for Randy, arranging soirees for his business associates and refurbishing and decorating the art deco apartment. Randy decides to end his relationship with Misty.
In the above circumstances, Misty would probably have an entitlement to a property settlement and maintenance. However, if we change the circumstances so that Randy and Misty only met a year and a half ago; the apartment was already fully restored and furnished before Misty arrived on the scene; and Misty had her own separate income from her own business- then, Misty would probably not be entitled to anything.
The issues in this type of case, like all other family law cases, will depend on the particular facts of the case under consideration.