There are many mistaken beliefs about property and financial entitlements on the breakdown of a relationship. These cause confusion and often make it difficult to reach a fair and just settlement. Some of the most common misconceptions are:
I'll lose my rights if I leave
Many people believe that the person who leaves the family home will lose rights to a share of the property. Behind this is the idea that whoever abandons the marriage or de facto relationship deserves nothing. This is wrong. Each person in the course of the marriage or de facto relationship has earned a share in the property and does not lose it simply because she or he decides it is no longer possible or desirable to remain in the house or the relationship.
I owned it before marriage, so it's mine!
Just because a person owned a property before the marriage or de facto relationship does not mean she or he will automatically have total rights to that property or its value when the relationship ends. The property will be considered a contribution by its owner, but over time it is assumed that both contributed directly and/or indirectly to its maintenance or improvement. In other words, the longer the marriage or de facto relationship, the less important are pre-relationship contributions in the final division of property.
I can keep inheritances and gifts
A spouse is not always entitled to keep gifts and inheritances from her or his family. Generally there is little difference whether the gift was for one spouse or both. In either case it will be seen as a contribution made on behalf of the person whose family made the gift. As with pre-relationship assets, the importance of gifts and inheritances decreases as they become mixed with other property and as the other spouse contributes directly or indirectly to their maintenance or improvement. Where the gift or inheritance was received shortly before the separation, the spouse who received it will have a good argument for receiving its full value in the division of property.
I worked hard for this business and it's mine
People who work hard during a marriage or de facto relationship to build up a business may consider the other spouse is not entitled to a share of it. They claim that the other spouse never worked in the business or only worked as an ordinary employee and should only be paid the equivalent of wages. But where the other spouse has answered the telephones, arranged work for the business, kept the books or entertained business associates, the court will consider this a contribution to the success of the business. Even if the other spouse has never worked in the business but instead cared for the house and children, this will be regarded as an indirect contribution by freeing the other spouse to put more time and effort into the business. Often the other spouse will have worked in another job to provide family income at times when the business was not as profitable and this too will be regarded as a contribution.
This does not mean that the business will have to be shared equally between the spouses. The court usually gives greater weight to the business spouse's direct contributions.
Women always get the best deal
What is not recognised by those who make this statement is that the amount women receive often has to cover both themselves and their children. In the short term this may mean that the actual amount awarded to the women and children will be greater than the man receives but studies here and overseas show that men do better in the long run. A man may have a greater income earning and borrowing capacity. Without children to care for he is able to build quickly on his share of the property. A woman with children may not wish or be able to secure full-time employment. If she has been involved in full-time child care during the marriage, she may not have the necessary skills to find a good job. A divorced or separated woman's capacity to support herself may be a long way below her husband's and the court will often give women marginally more than men to compensate for this and to meet the greater needs of women with children. In the case of younger couples where women do have job skills or careers and where there are no children, women may not receive more than men in the division of property.
The content of the Law Handbook is made available as a public service for information purposes only and should not be relied upon as a substitute for legal advice. See Disclaimer for details. For free and confidential legal advice in South Australia call 1300 366 424.