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Just and Equitable: A Condition Precedent to Making a Property Order Under the Family Law Act

Section 79 of the Family Law Act provides for a Court exercising jurisdiction under the Act, to make an Order altering the interests of parties to a marriage in property to which one or both of those parties are entitled.

In exercising that jurisdiction, the Court takes a tour step approach. Firstly, it assesses the extent of the property of the parties and determines its value. Secondly, it considers what contributions have been made by the parties including direct and indirect contributions of a financial character and non-financial character and contributions to the welfare of the family including contributions as homemaker and parent. Thirdly, it considers the circumstances which relate to the present and future needs of the parties and their means and resources, earning capacity both actual and potential. Fourthly, it considers, in relation to the findings in the first three steps, what Order is just and equitable in all the circumstances of the particular case.

Note that the last step requires that the finding is just and equitable. However, Section 79(2) of the Act provides that the Court shall not make an Order under Section 79 unless it is satisfied in all the circumstances that it is just and equitable to make the Order.

The High Court has held that Section 79(2) must be satisfied first before the Court can embark on the four-step exercise.

This means that there is not an absolute right to an Order altering property interests at the end of a marriage or a de facto relationship. In a short marriage the circumstances may be such that it would not be just and equitable to alter the parties’ property interests, for instance, where one party entered the marriage with all or most of the property and the other party contributed little during the course of the marriage. Alternatively, where in a long marriage, the conduct of the parties is such that may have kept their property and financial resources separate and not have made contributions towards the others parties’ property.

In many cases however, the requirement of being just and equitable is readily satisfied, for instance, where the parties have been together, jointly acquired and used the property and because of the breakdown of the marriage or the de facto relationship, the joint use is no longer possible.

Posted in: Derek Legal Blog at 06 December 17

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