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Property Settlement After Separation: How Does the Court Deal With Post-Separation Contributions?

Divorce Legal Advice

Property Settlement After Separation: The Basics

A property settlement after separation involves an assessment of the parties respective contributions in determining how matrimonial assets should be divided. This often involves an assessment of contributions that continue after the parties separate – sometimes years later. The court’s approach to assessing this particular category of contribution is the topic of this blog post. In particular, this post will examine how the court weighs one party’s domestic contributions against the other party’s substantial financial contributions.

In Marsh [2014] FamCAFC 24, the appellant wife sought to overturn the trial judge’s decision on the basis that it did not accord proper weight to her post-separation contributions. The parties were married for 21 and there were 3 children of the relationship. There was an understanding between the parties that the wife would be primarily responsible for fulfilling various domestic responsibilities. The husband, on the other hand, was solely responsible for the family’s financial support. These arrangements effectively remained in place from the time that the parties had separated until the wife had filed her application. This period spanned approximately 10 years.

How Are Post-Separation Contributions Taken into Account in Context of a Property Settlement After Separation?

The Trial judge held that the parties assets should be divided 60/40 in favour of the husband. It was found that the parties had generally contributed in equal measure during the course of the relationship. However, the trial judge ultimately assessed contributions at 70/30 in favour of the husband. This finding was predicated upon the substantial wealth that the husband had accumulated post-separation. The wife, on the other hand, received a 10% adjustment under s 75(2) of the Family Law Act. This adjustment reflected the fact that she had a low earning capacity which was compounded by poor health.

The Full Court allowed the wife’s appeal, finding that the trial judge had erred in relation to the weight accorded to the wife’s post-separation contributions. The wife had made significant indirect financial contributions post-separation by virtue of having enhanced the husband’s capacity to accumulate wealth by means of his substantial earning capacity. While the husband made substantial financial contributions after the parties had separated, those contributions were the result of the career he had built during the 21 years that he had been married to the wife. Had it not been for the wife’s sustained commitment to fulfilling various domestic responsibilities, the husband would not have the earning capacity he enjoyed post-separation. Accordingly, the Full Court ordered that the matter be remitted for re-trial.

The Connection Between Finances After Separation and Domestic Contributions During the Relationship

This case may be seen as authority for the proposition. Namely, that post-separation financial contributions may relate to the other party’s domestic contributions during the relationship. And to the extent that this is the case, it may be argued that the ‘homemaker’ has indirectly contributed to the wealth accumulated by the breadwinner, post-separation. So, in seeking a property settlement after separation, one party may have a claim upon wealth accumulated by the other party in the post-separation context.