Many people believe Australian family law is more protective of women, and so assume women will receive a larger share of property after divorce. Others think that if one party commits a serious wrong, such as an affair, the party at fault will be allocated less of the couple’s joint property, or required to pay corresponding compensation. In fact, both of these are misconceptions. Property division after divorce is based on many factors and standards. Today, we will walk through the issue of property division after divorce.

1. Without a property agreement, if the matter goes to court, how is the property divided between the parties?

First, a note: Australia recognises de facto relationships. Australia does not distinguish between pre-marital and post-marital property. Provided the parties are in a de facto relationship or a legal marriage, all property is pooled together and available for division between both parties. This includes overseas property. So how exactly is it divided? It takes the following two steps:

1. Establish the parties’ net assets, including total property value and joint liabilities.

2. Once net assets are established, the share each party is to receive must be determined. Under Australian family law,

two main factors are generally considered: each party’s contributions during the relationship, and each party’s future needs in relation to the property.

Three illustrative examples:

[Example 1]:

Ms Z and Mr R lived together for 2 years and registered their de facto relationship, so they were in a de facto relationship. During cohabitation, Ms Z had an affair. Mr R wants to end the relationship and divide the property. Ms Z believes Australia follows no-fault divorce, so she should still receive half of the property. Mr R believes he made a larger financial contribution during cohabitation, so he should receive more.

[Example 2]:

Ms L and Mr S were married for 5 years and have a 1-year-old child. They separate amicably but cannot agree on property division. Ms L considers that, as a full-time homemaker caring for the child and the family, she should receive more than half of the property. Mr S considers that, because he made a larger financial contribution during the marriage, he should receive more.

[Example 3]:

Ms A, who devoted herself to the family, and Mr C were married for 14 years, giving them a 14-year legal marriage. They have two minor children. Ms A discovered Mr C had an affair and wants a divorce. Mr C provided the bulk of the financial support for buying the family home and for the children’s education, so he is very confident he should receive most of the couple’s joint property.

[Analysis]:

As discussed in our earlier article, Australia follows the principle of no-fault divorce, so affairs during the marriage are not taken into account. If the Meng Meiqi incident happened in Australia: does a mistress actually have legal protection? Is a “Chen Lingtao-style will” legally effective?

When dividing property after divorce, when assessing each party’s contributions to the family, in addition to financial contributions — such as who paid more towards buying the home, who repaid the mortgage, who covered day-to-day expenses — non-financial contributions must also be considered, such as renovating or maintaining the property so that it appreciated in value, or investing significant time in caring for the family: laundry, cooking, cleaning, looking after the children, and so on.

Financial and non-financial contributions carry equal weight in law. However, based on past cases, where the marriage is relatively short — say, five years or less (Examples 1 and 2) — financial contributions tend to have greater influence on the final division. In that case, Mr R in Example 1 and Mr S in Example 2 are likely to receive a larger share of the joint property.

For longer marriages of ten or fifteen years or more (Example 3), the court is more inclined to treat both parties’ contributions as equal. So although Mr C in Example 3 made greater financial contributions, Ms A’s long-standing contributions to family life cannot be ignored.

Once contributions have been considered, the next question is each party’s future needs in relation to the property. In Examples 2 and 3, there are minor children. The party with whom the children live is considered to have greater needs, and may accordingly receive an additional 5%-20% of the property. In addition, in Example 3, if Ms A has been out of work for a long time during the marriage and has lost her employability, making it hard to find work after divorce, she may be found to have increased needs in relation to the property, and may accordingly receive a larger share.

2. The importance of a property agreement

Compared with going to court, a property agreement is a simpler and more advantageous way to divide property. A property agreement clearly lists the parties’ assets and debts, and sets out how the property will be divided after divorce. This not only avoids unnecessary disputes later on, but also protects the interests of both parties. Importantly, a property agreement must be signed after each party has received legal advice and in the presence of their lawyers. A property agreement privately drafted and signed by the parties themselves has no legal effect.

3. If one party commits adultery or family violence, can the other party refuse to divorce or require them to leave with nothing?

Australia follows the principle of no-fault divorce. Regardless of the reason, once the separation requirements are met, the court will grant a divorce. The court will not lean towards the other party when dividing property either, unless that party has been dissipating assets.

4. When should a property agreement be signed?

Before cohabitation, during cohabitation, or after separation; or before marriage, during marriage, or at the point of separation. In short, a property agreement can be signed at any stage of the relationship.

5. If more than 12 months have passed since the divorce, can you still apply to the court for a property division?

Not directly. You must first apply to the court for leave, providing reasons and demonstrating hardship. Only once the court grants leave can the property division proceed.

In closing:

Overall, even though Australian law offers greater protection to women, women will not necessarily receive a larger share of property in every situation after divorce. Although Australia follows no-fault divorce, property division after divorce is weighed against a range of factors — financial contributions, non-financial contributions, each party’s future needs, and the length of the marriage.

Further, because Australia does not distinguish between pre-marital and post-marital property, once the requirements for a de facto relationship or marriage are met, all property (including overseas assets) automatically becomes joint property. Without a property agreement, the other party is entitled to a proportionate share of your assets. A property agreement is also more cost-effective and advantageous than court proceedings, so it is well worth putting one in place.