De Facto Property Settlement in Australia: What You Need to Know

A de facto property settlement in Australia can apply to couples who were never married but whose relationship meets the legal requirements for a de facto relationship. If you separate, you may have rights to a share of property, savings, superannuation and other financial interests of your ex de facto partner, even if assets are held in only one person’s name.

The idea that unmarried partners simply “walk away with what they brought into the relationship” is not necessarily correct. Family law can recognise financial and non-financial contributions made during a de facto relationship, including contributions as a homemaker or parent.

The rules are broadly similar to those applying to married couples, although the precise legislation and requirements can differ depending on where you live.

In particular, Western Australia has its own legislation dealing with de facto property matters, so WA couples should take care when relying on general information about the federal family law system.

This article explains what a de facto relationship is, when property settlement rights arise, the two-year rule, and how you may be able to formalise an agreement without becoming involved in contested court proceedings.

Do De Facto Couples Have the Same Property Settlement Rights as Married Couples?

Yes, broadly speaking. De facto couples can have property settlement rights similar to married couples, even though they were never legally married. The court can consider the parties’ financial and non-financial contributions and make orders adjusting their property interests. However, eligibility requirements and the applicable legislation must be considered, particularly in Western Australia.

A property settlement is not simply about whose name appears on the title of a house or whose name is on a bank account.

The property pool can potentially include:

The circumstances of each relationship are different. A person who earned little or no income may nevertheless have made significant contributions through caring for children, running the household or supporting their partner’s career.

Likewise, an asset that was owned by one partner before the relationship does not automatically become an asset that must be divided equally. The court looks at the overall circumstances and contributions rather than applying a simple “50/50” formula.

For separated couples who have already reached agreement, the important question is often not “Can we divide the property?” but “How do we properly document what we have agreed?”

What Makes a Relationship De Facto in the Eyes of the Law?

A de facto relationship is generally a relationship between two people who live together as a couple on a genuine domestic basis, although living together is not strictly required. Courts look at the overall nature of the relationship rather than relying on a single factor such as living at the same address.

Factors that may be relevant include:

• how long the relationship lasted;
• the nature and extent of the parties’ common residence;
• whether there was a sexual relationship;
• the degree of financial dependence or interdependence;
• how the parties owned, used and acquired property;
• whether there were arrangements for financial support;
• the degree of mutual commitment to a shared life;
• whether the parties cared for or supported children;
• how household duties were performed; and
• the reputation and public aspects of the relationship.

Importantly, no single factor necessarily decides the question. Someone may have been in a de facto relationship even where the couple’s living arrangements were unconventional.

For example, a couple may have maintained separate bank accounts, or one partner may have retained another property. That does not necessarily mean they were not a de facto couple for legal purposes.

Equally, simply dating someone, spending substantial time together or having a sexual relationship does not automatically establish a de facto relationship.

The question is whether, looking at the relationship as a whole, the parties were living together as a couple on a genuine domestic basis.

What about relationships lasting less than two years?

The commonly discussed two-year rule is important, but it is not an absolute rule that means every relationship lasting less than two years is excluded.

Family law recognises that some limited circumstances can exist where the Family Court will have jurisdiction despite a de facto relationship being shorter than two years. These can include where the couple has a child or where substantial contributions have been made and refusing an order would result in serious injustice.

Western Australia has corresponding provisions under the Family Court Act 1997 (WA), including circumstances involving children and substantial contributions.

This is one reason it is risky to assume that a relationship lasting less than two years automatically means there are no property rights.

What Is the De Facto Two-Year Rule, and What If You Were Together for Less Than That?

The two-year rule has two different roles that should not be confused. First, relationship length can be relevant to whether a de facto relationship qualifies for property orders. Second, after separation, there is generally a two-year time limit from the date of separation to commence property proceedings.

These are separate issues.

For example, a couple may have been together for five years and therefore clearly satisfy the usual relationship-length requirement to apply to the Family Court. If they then separate, they generally have two years from the ending of the de facto relationship to apply for property orders.

Conversely, a relationship lasting less than two years may still qualify in limited circumstances.’

The important point is that “we weren’t together for two years” does not necessarily end the discussion.

How Long After Separating Do You Have to Apply?

A de facto property settlement application generally needs to be started within two years after the breakdown of the de facto relationship. If that deadline has passed, you generally need the court’s permission to proceed, and permission is not automatically granted.

This makes the date of separation particularly important.

Separation is not necessarily the same as the date one person physically moved out. Depending on the circumstances, the relationship may have ended before or after someone left the home.

Keeping a written record of the date you separated can therefore be useful.

What happens if the two years has already passed?

You should not assume that you have permanently lost any ability to pursue a property settlement. However, you may need to seek legal advice about whether you will be able to obtain the court’s permission to commence proceedings out of time. There is no guarantee that permission will be granted.

This is why waiting until the last minute can be risky. Negotiating with an ex-partner does not necessarily protect you from a statutory deadline for commencing proceedings.

If you are approaching the two-year mark and have not formalised your agreement, obtaining legal advice promptly is sensible.

How Do You Finalise a De Facto Property Settlement Without Going to Court?

If you and your ex de facto partner have reached agreement, you may be able to formalise the property settlement through consent orders rather than becoming involved in contested court proceedings.

Consent orders are submitted to the relevant court for approval and, once made, have the effect of court orders.

This can be a practical option where both people are genuinely in agreement about the division of their property.

The process generally involves:

1. Identifying the property pool – including assets, liabilities and superannuation.
2. Reaching an agreement – deciding how the property should be divided.
3. Recording the agreement accurately – setting out what each person will receive and what each person will be responsible for.
4. Preparing the required court documents.
5. Submitting the application for consent orders.
6. Waiting for the court to consider the proposed orders.

The key distinction is that consent orders are not the same as an informal agreement.

An informal agreement might feel sufficient when both people are getting along. However, it does not provide the same level of finality or enforceability as properly documented orders.

It makes sense to obtain legal advice before deciding how to formalise a property settlement.

Importantly, “without going to court” does not necessarily mean that a court is completely absent from the process. Consent orders are court orders. Rather, the parties can avoid contested litigation and a disputed hearing where they have already reached agreement.

For people in Western Australia, the process and forms differ from those used in other Australian jurisdictions. For example, WA uses its own Application for Consent Orders process.

What Should You Consider Before Agreeing to a Property Split?

Before signing off on a property settlement, make sure you understand the full property pool and the practical consequences of the proposed division. A settlement is more than deciding who keeps the house and who keeps the car.

Consider whether you have identified:

• the family home and any other real estate;
• mortgages and other loans;
• bank accounts and savings;
• shares and investments;
• businesses or business interests;
• superannuation;
• vehicles;
• valuable personal possessions;
• inheritances or significant gifts;
• credit card and personal debts; and
• any other significant financial interests.

It is also important to consider contributions made during the relationship.

For example, one person may have contributed most of the income while the other cared for children or managed the household. Both types of contribution can be relevant.

The objective is not necessarily to calculate a simple dollar-for-dollar reimbursement of what each person paid. Family law considers the broader circumstances of the relationship.

If you have not yet reached agreement about what the settlement should be, legal advice can help you understand your position before you negotiate.

If you have already reached agreement, the focus may instead be on accurately recording and formalising that agreement.

Can You Prepare Your Own Consent Orders?

Yes, people can prepare and lodge consent order documents themselves, but DIY does not mean you should ignore legal advice.

The court documents need to accurately reflect the agreement, and the court must be satisfied that the proposed orders are appropriate before making them.

This is where a guided document-preparation service can potentially save time and reduce the cost of the administrative side of the process.

Legal Aspirations provides personalised DIY Minute of Consent Orders designed for people who have already reached an agreement and want to formalise it. Our questionnaire gathers the information needed to prepare the documents.

You can learn more about how we help on our Home Page or read our guide for completing an application for consent orders here.

Legal Aspirations provides sample consent orders and consent order templates available for purchase through our Cart.

Whether you are looking for example consent orders, sample consent orders, consent order templates or a personalised consent order precedent, Legal Aspirations is here to help.

The important distinction is that our consent order templates and consent order examples are not a substitute for independent legal advice about your entitlements.

Legal Aspirations recommends obtaining legal advice before formalising an agreement.

De Facto Property Settlement Checklist

If you have separated from a de facto partner and are considering a property settlement, the following checklist can help you organise the next steps:

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Frequently Asked Questions

Finalising Your De Facto Property Settlement

A separation does not have to end with a costly and stressful court battle. Where former partners can reach a genuine agreement, there are options for formalising that agreement and moving forward.

For a de facto property settlement in Australia, the important first steps are understanding whether your relationship qualifies, identifying the property pool, considering both financial and non-financial contributions, and being aware of the two-year time limit.

If you have already agreed on how your property should be divided, the next step may be formalising that agreement through consent orders. A properly prepared agreement can provide greater certainty and finality than simply relying on an informal arrangement.

If you and your ex have reached agreement and want to prepare your consent order documents yourself, the Legal Aspirations DIY questionnaire can guide you through the information required to prepare a personalised Minute of Consent Orders.