A de facto relationship or just “friends with benefits”?
If you are in a de facto relationship with a person of the same or another gender and you separate, you can claim a property division under the Family Law Act 1975 (Cth).
What then when two people share many aspects of their lives but do not live together?
There is a common misconception that without cohabitation there can be no de facto relationship. Nonetheless, when the relationship ends one party may allege a de facto relationship and have an expectation of ongoing support or a property settlement. The other party may deny that such a relationship ever existed and argue they were just “friends with benefits”.
The legal position is that living together is merely one factor to be considered in determining whether a de facto relationship existed.
A Court will examine the nature and quality of the relationship – rather than only the quantity of time together.
Every relationship is unique and the Court has a discretion to attach such weight to any of the following factors, and others, as it considers fit:
the duration of the relationship;
the nature and extent of the common residence of the parties;
whether a sexual relationship existed;
the degree of financial interdependence, and any arrangements for financial support between the parties;
the ownership, use and acquisition of their property;
the degree of mutual commitment to a shared life;
the care and support of children;
the reputation and public aspects of the relationship.
In the case of Martens & Bocca [2016] Fam CA 1044 the Court found that although the parties had maintained separate homes and had never formally lived together, they had been in a de facto relationship for 13 years. The parties had spent a couple of nights together each week and taken overseas holidays together.
There was only some financial interdependence; the parties had a joint bank account and one party was the sole beneficiary of the other’s will. Nonetheless, the Court observed on the other hand:
there was a “breathtaking” number of affectionate text messages and emails exchanged – up to 100 text messages in a day;
the nature of the relationship was very public – it was well-known to the families and the parties were invited to family weddings, funerals and other social functions as a couple;
the parties referred to each other publicly as “partner” or “better half”;
the parties had plans to have a family and for retirement; and
the breakdown of the relationship was highly emotional, being more like a marriage separation than a friendship breakdown.
The Court found that these latter factors meant there was no doubt the parties had “merged their lives” resulting in a de facto relationship. As a result, the provisions of the Family Law Act applied, and the Court had the power to order a property settlement between the parties.
If a relationship has the potential to be characterised as a de facto relationship, then one way to protect your assets is to encourage your partner to enter into a Financial Agreement under the Family Law Act (sometimes colloquially referred to as a “pre-nup”).
This strategy is commonly considered by couples who commence a relationship later in life. This group often want to preserve assets accumulated over their lifetime for estate planning purposes and to ensure adult children from an earlier relationship inherit upon the death of their parent. A Financial Agreement can seek to protect those assets and provide peace of mind to all, enabling parties to comfortably enjoy their relationship.