Extra-Marital Affairs and Property settlements

In 2009, amendments were made to the Family Law Act 2009 that meant that de facto relationships were essentially considered the same as marriages in the eyes of the law. These amendments were made in the hope that same-sex couples would have the same rights as married couples under the law. However, these laws were sometimes referred to as the “mistress laws”. This was because it was foreseen that some of the consequences of these laws would be that “mistresses” or parties to extra-marital affairs could have a claim to a property settlement once their relationship ended.

There have been both successful and unsuccessful claims made for property by parties to extra-marital affairs since the introduction of these laws. Whether or not the claims were successful depended upon whether the extra-marital affair met the criteria of de facto relationship. So what are the criteria for a relationship to be considered de facto?

Is an extra-marital affair a de facto relationship?

Section 4AA of the Family Law Act 1975 provides a definition of a de facto relationship. According to that definition, a couple is in a de facto relationship if they are living together on a “genuine domestic basis”, taking into consideration all the circumstances of their relationship and they are not legally married to one another or related by family. The court has the discretion to determine whether a de facto relationship exists and circumstances of the relationship that can be taken into account include:

1. The length of the relationship;
2. Whether the couple reside with one another and if so to what extent and when;
3. Whether the relationship is a sexual one;
4. The extent to which there is financial reliance between the couple;
5. Whether the couple owns or uses property together;
6. Whether there is a mutual commitment to a shared life;
7. Whether the relationship was registered in a state or territory;
8. Whether the relationship involves caring and supporting children;
9. Whether there are any public aspects of the relationship.

Successful claim for extra-marital affair

One case where a mistress successfully claimed against her former partner was settled out of court. The identities of those involved in the relationship were not made public. The mistress was paid $100,000 by her former lover. The circumstances of the case were that the couple had been involved in an extra-marital relationship for more than twenty years. The mistress had accompanied the man on many interstate trips and to many dinner functions. Although the woman had her own home, she was also paid a substantial monthly allowance. The relationship was a sexual one, and the man often gave gifts to the woman. As this case was settled out of court, we do not know if a court would have considered this relationship to have been a de facto one, and if a settlement would have been awarded. However, the relationship did have many of the hallmarks of a de facto relationship such as its longevity, financial reliance, public and sexual aspects. It is therefore likely that if this matter had proceeded to court a settlement would have been awarded.

Unsuccessful claim for extra-marital affair

In the case of Jonah & White [2011] FamCA 221, a former mistress, Ms Jonah, was unsuccessful in making a claim against her former lover. This case was decided by a single judge, Justice Murphy. He did not believe that the relationship met the definition of a de facto relationship and therefore felt that no property settlement needed to be made. The circumstances of the relationship included the following:

1. The couple had been together for about seventeen years;
2. They spent some time living together at each other’s places and travelling together, but they also lived apart;
3. The relationship was not public, and the couple did not socialise as a couple and were not involved in one another’s lives;
4. There was some financial support given by Mr White to Ms Jonah, but they did not mix finances apart from this. Mr White gave money towards Ms Jonah’s purchase of a home and paid her about $2,000 to $3,000 a month so that she did not have to work and could visit him.

So what can be done to protect your property if you are entering into an extra-marital relationship?

If you are in a position where you are contemplating or having an extra-marital affair, protecting your property and assets may not be at the forefront of your mind. However, it is important that you do consider the potential consequences of your actions in light of the laws relating to de facto partners and their ability to claim for a property settlement. A Binding Financial Agreement can protect your assets from a claim that your lover may like to make at the end of the relationship. These agreements are sometimes called prenuptial agreements. However, they are just as legally binding for partners contemplating entering a de facto relationship as they are for partners entering into marriage. In order for a Binding Financial Agreement to be enforceable, both parties to the agreement need to obtain independent legal advice, and there are other requirements that need to be met.

If you require legal advice or representation in any legal matter, please contact Armstrong Legal.