Moving in with a partner does not automatically create a de facto relationship. Conversely, a couple does not necessarily avoid being in a de facto relationship merely because they maintain separate finances or spend periods living apart.
Under Australian family law, the issue is whether the parties had a relationship as a couple living together on a genuine domestic basis.
The Court considers the complete circumstances of the relationship. There is no single decisive factor and no universal period after which every relationship automatically becomes de facto.
What Is a De Facto Relationship?
Section 4AA of the Family Law Act 1975 defines a de facto relationship.
A person is in a de facto relationship with another person where:
- They are not legally married to each other.
- They are not related by family.
- Having regard to all the circumstances, they have a relationship as a couple living together on a genuine domestic basis.
The parties may be of the same or opposite sex.
Whether a de facto relationship exists is determined by its substance rather than the label used by the parties.
What Factors Does the Court Consider?
The Court may consider:
- The duration of the relationship
- The nature and extent of the parties’ common residence
- Whether a sexual relationship existed
- The degree of financial dependence or interdependence
- Financial support arrangements
- Ownership, use and acquisition of property
- The degree of mutual commitment to a shared life
- Whether the relationship was registered
- The care and support of children
- The reputation and public aspects of the relationship
No single factor is essential, and the Court is not required to give every factor equal weight.
Evidence may include financial records, leases, property documents, messages, photographs, travel records, insurance policies, wills, superannuation nominations and evidence from family members or friends.
Is There a Minimum Period?
There is no fixed minimum period that automatically determines whether a de facto relationship existed.
A relationship lasting less than two years may still be legally characterised as a de facto relationship.
The two-year period is primarily relevant to whether the Court has jurisdiction to make property or maintenance orders following the relationship’s breakdown.
This distinction is important: establishing that a de facto relationship existed does not necessarily establish an entitlement to seek property adjustment orders.
When Can a De Facto Partner Seek Property Orders?
Before the Federal Circuit and Family Court of Australia can determine a de facto property or maintenance claim, the applicant must ordinarily establish:
- That a genuine de facto relationship existed and has broken down
- An appropriate geographical connection with a participating jurisdiction
- At least one of the statutory gateway requirements
The gateway requirements include:
- The relationship lasted for a total period of at least two years.
- There is a child of the relationship.
- The relationship was registered under a prescribed state or territory law.
- One party made significant contributions and a failure to make an order would result in serious injustice.
Whether a gateway is satisfied can itself become a contested legal and factual issue.
Registering a Relationship in NSW
Eligible couples may register their relationship through the NSW Relationship Register.
Registration can provide formal evidence of the relationship and may satisfy one of the gateway requirements for de facto financial proceedings.
Registration has legal consequences and should not be treated as merely ceremonial. Couples considering registration should understand its effect on their legal and financial position.
Does Keeping Finances Separate Prevent a Claim?
No.
Keeping separate bank accounts, avoiding jointly owned property or dividing household expenses may be relevant, but those arrangements do not necessarily prevent a relationship from being characterised as de facto.
The Court examines the relationship as a whole, including the parties’ financial arrangements, common residence, mutual commitment, public presentation and other circumstances.
Similarly, registering an asset in one party’s name does not necessarily prevent it from being considered in a later property settlement.
The legal ownership of property is important, but it is not the only consideration under family law.
Protecting Property and Financial Interests
People entering or already in a de facto relationship may consider a financial agreement.
A financial agreement can address how property, financial resources and liabilities will be dealt with if the relationship ends. An agreement may be made:
- Before a de facto relationship
- During the relationship
- After separation
Strict statutory requirements apply. Each party must receive independent legal advice about the effect of the agreement and its advantages and disadvantages.
A financial agreement may be set aside in particular circumstances, including fraud, non-disclosure, unconscionable conduct, impracticability and certain circumstances concerning children or hardship.
It should be carefully drafted for the parties’ actual circumstances and reviewed following major changes such as:
- The birth of a child
- Purchase of significant property
- Establishment or acquisition of a business
- Receipt of an inheritance
- A major change in income
- Relocation
- Changes to company or trust structures
A document described informally as a “prenup” will not necessarily satisfy the requirements of a binding financial agreement.
Are Separate Accounts Still Worthwhile?
Clear financial arrangements and records can be useful, but they should not be treated as a substitute for legal advice or a properly prepared financial agreement.
Practical steps may include:
- Keeping accurate records of property owned at the beginning of the relationship
- Retaining documents concerning inheritances, gifts and significant contributions
- Recording loans between partners or family members properly
- Reviewing company, trust and partnership documents
- Avoiding informal transfers without understanding their consequences
- Obtaining advice before guaranteeing another person’s debts
- Reviewing wills, powers of attorney and superannuation nominations
A person should not avoid making an appropriate will or superannuation nomination merely to create the appearance of financial separation. Estate planning and family law have different legal consequences and should be considered together.
What Happens if a De Facto Relationship Ends?
If the Court has jurisdiction, a former de facto partner may seek orders concerning:
- Property adjustment
- Superannuation splitting
- De facto partner maintenance
- Declarations concerning property interests
- Other financial matters within the Court’s jurisdiction
The property framework broadly requires consideration of:
- Whether it is just and equitable to make an order
- The parties’ property, liabilities and financial resources
- Their financial and non-financial contributions
- Their contributions to the welfare of the family
- Their current and future circumstances
- The economic effect of family violence, where relevant
- Whether the proposed orders are just and equitable
There is no automatic entitlement to half of the property.
Parenting Arrangements
Parenting issues are treated separately from the financial gateway requirements applying to de facto partners.
The Court determines parenting arrangements according to the child’s best interests. The two-year relationship requirement does not apply to applications concerning children.
Parents may formalise agreed arrangements through a parenting plan or consent orders. If agreement cannot be reached, Family Dispute Resolution is ordinarily required before parenting proceedings are commenced unless an exemption applies.
Time Limit After Separation
An application for de facto property adjustment or maintenance orders must generally be commenced within two years after the relationship breaks down.
The date of separation may be disputed, particularly where the parties continued living together or had periods of separation and reconciliation.
A person seeking to apply outside the two-year period ordinarily requires the Court’s permission. Permission is not automatically granted.
Legal advice should be obtained promptly where the separation date is uncertain or the limitation period is approaching.
Speak to a Family Lawyer
Aspire Legal advises clients about de facto relationships, financial agreements, property settlements and parenting arrangements.
Call 02 8806 2299 or email info@aspirelegal.com.au to arrange a consultation.
This article contains general information only and is not legal advice. Whether a de facto relationship exists and whether the Court has jurisdiction depend on the evidence and individual circumstances.