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Property Settlement Separation: Can Substantial Financial and Non-Financial Contributions Justify a Finding Other Than Equal Contributions in a Long Marriage?

Divorce House Ownership

Property Settlement Separation: Equality, or Thereabouts?

In the majority of property disputes, especially those involving lengthy relationships, a court will assess the parties’ respective contributions as equal. The Full Court’s decision in Dickson & Dickson (1999) 24 FamLR 460, in contrast, is an example of a case where a finding of equal contributions was inappropriate. This finding was apparently predicated upon the wife’s substantial financial and non-financial contributions.

The parties were married for 26 years and had three adult children. The wife had brought $255,000 into the relationship during the 1960s. She had also inherited the family home which was worth almost $2m at trial. Her ability to build a lucrative property portfolio enabled her to support the family. She had also managed to devote herself to the parties’ children when she was not working.

Although the husband worked as a real estate agent in the family business, he spent most of his time engaged in unproductive activities. This included a substantial amount of time spent betting on horse racing.

The trial judge found that the wife made “overwhelming” financial and non-financial contributions. Accordingly, he assessed contributions 75/25 in favour of the wife. No adjustment was made for s 75(2) factors.

The husband appealed against the trial judge’s orders. His appeal was partly based on a submission that the trial judge’s assessment of contributions fell outside the range of judicial discretion. Accordingly, the husband sought orders that his share of the property be increased to 40%

Property Settlement Separation: The Full Court’s Decision

The Full Court found that the trial judge’s failure to take account of s 79(4)(e) amounted to an appealable error. An adjustment under s 79(4)(e) was appropriate on the basis of:

  • the age of the parties – the wife being 68 and the husband 57;
  • achieving a reasonable post-separation standard of living; and
  • the parties’ assets, income and overall capital positions.

The wife’s contributions were substantially greater than those of the husband. However, the orders gave the wife 3 times as much capital as the husband and, having regard to the above factors, thereby produced an unjust and inequitable outcome.

Accordingly, the Full Court re-exercised the trial judge’s discretion – arriving at a 70/30 division of assets in favour of the wife. While an adjustment of 5% may not ordinarily justify interference of a higher court due to the trial judge’s broad discretion under the Family Act Act, the Full Court determined that it was appropriate. An adjustment of 5% would reduce the disparity of the parties respective capital positions by approximately $660,000.

Property Settlement Separation: Concluding Remarks

It is important to bear in mind that a finding of equal contributions in most cases is referable to any legal principal. There is no presumption of equality under the Family Law Act. The assessment of contributions is determined by reference to the totality of evidence. While this will often result in an equal assessment of contributions, the evidence may justify an alternate outcome. Dickson is an example of the type of factual findings that may result in an assessment of contributions being other than equal. It also underscores the significance the parties’ respective capital positions, post-separation.