Division of Matrimonial Property

July 21, 2011 | Posted by Vesna Pocuca

In a majority of cases spouses or de facto partners divide their assets and finalise their financial relationship soon after the separation. However, it is not uncommon that there is a long period (in some cases years) between the time of separation and final distribution of the assets.  The property and financial resources of the parties are usually valued at the time of the final distribution. The difficulty with this is that after separation one or both of the parties may acquire assets on their own or together with a new partner (or suffer losses).  In such cases what needs to be determined is what were the financial and also non-financial contributions of each party toward those assets.

In the recent case of Coventry & McNamee [2011] Fam CAFC 123 this issue was considered again. The parties were separated for eight years at the time of the trial and their children were aged 14, 12 and 10. There were two main assets in issue, the matrimonial home and the husband's superannuation entitlements.  The husband became a member of his superannuation fund approximately ten years before the commencement of cohabitation. The amount of the benefits accrued during the cohabitation was $134,735.  After separation the husband continued making contributions and at the time of the trial the value of his entitlements had grown to $581,457.

The trial judge, Her Honour Mead, decided that the parties' contributions to the former matrimonial home should be assessed 60 per cent / 40 per cent in favour of the wife and that the contributions to the husband's superannuation entitlement should be assessed at 60 per cent / 40 per cent in favour of the husband.  Her Honour then determined that there should be an additional 10 per cent adjustment on account of s 75(2) factors in favour of the wife with respect to the former matrimonial home, such that this was to be divided 70 per cent / 30 per cent in her favour.

The husband appealed against the decision with respect to the division of his superannuation. He argued that the only amount of his superannuation benefits which should have been taken into account was that amount which accrued during the parties' cohabitation, namely $134,735.  It was confirmed by the Family Court Judge that the wife made indirect contributions toward the Husband's superannuation benefits. The wife's care of the children during the marriage allowed the husband to study, improve his qualifications and as a result improve his rank, his salary and his superannuation entitlements. Her Honour found that this contribution had continued post-separation. The Family Court Judge found that there was no doubt that the husband made a greater contribution to his superannuation than the wife: firstly by making sole contributions before commencement of the relationship, and secondly by making sole contributions after the separation. It was confirmed that the husband's overall contribution to the current value of his superannuation entitlements should be assessed at 60 per cent to the husband and 40 per cent to the wife.  Had the parties completed the division of assets closer to the time of separation the result would have been very different.

Please contact Vesna Pocuca for further information.

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