Are you sure you are not in a de facto relationship?

This might sound like an obvious question, but sometimes the circumstances are not that clear. Knowing that you are in marriage is mostly clear. Surely you remember the ceremony?

But some people only discover that they were actually in a de facto relationship when the relationship breaks down, and the other party insists on a property adjustment order!

Why is it important to know if you are in a de facto relationship?

If you are in a de facto relationship, and certain other criteria are met, it means that your former partner can seek a property adjustment order from the Court if you separate.

What does the Court say about de facto relationships?

The case of Spencer & Speight (2014)Fam CA is a good example of a situation where the two parties in a relationship did not agree on whether they were in a de facto relationship, or not.

It is a good illustration of how two people in the same situation can have a very different perspective on the status of their “relationship”.

In this case, Mr Spencer asked for a property adjustment order in terms of which his former partner, Ms Speight, had to pay him $90,000. He argued that they were in a de facto relationship and in that time Mr Spencer paid $142,000 into Ms Speight’s mortgage account.

Ms Speight denied that they were in a de facto relationship. She alleged that the $142,000 was paid for driving services that she provided when his licence was suspended.

She supported this allegation by producing an electronically signed letter stating that Mr Spencer would pay her $500 a day for the six months that his licence was suspended for. The total came to $91,000. However, for various reasons, the letter was not accepted as evidence by the court.

The facts of their relationship were as follows:

• The relationship lasted for less than two years.
• The relationship started in February 2012.
• They shared the same home and bed from November 2012 to June 2013.

Whether the parties had a sexual relationship was in dispute, and the court made no finding on whether they had sexual intercourse, or not. The court found that they had an “intimate relationship”; they shared a bed, showed physical affection towards each other and at least tried to have sexual intercourse.

This was a very interesting finding by the court. It established that you could be in a de facto relationship without having actual sexual intercourse. The court commented that in Family Law the term “sexual relationship” has a wider meaning. It does not have to include physical sexual intercourse; intimate relationship means different things to different couples. Each case will be determined on its own facts.

To make a decision on the property adjustment order the court had to make a finding on the de facto status of the relationship. It considered what an average person would consider a de facto relationship. In this case, the relationship was short-lived, and the couple might not even have had sexual intercourse.

The court still found them to have been in a de facto relationship, it found that Mr Spencer’s $142,000 was financial support and that the relationship had a public aspect.

Once the de facto relationship status was established, the court made a property adjustment order that $75,000 should be repaid to Mr Spencer. Given that the relationship lasted for less than two years, the court needed to find that he made a “substantial contribution” in order to make a property adjustment order.

The court found his $142,000 contribution was more than “usual or ordinary”, and if they didn’t make a property adjustment order, it would be “unjust” towards Mr Spencer.

In Jonah and White(2011)FamCA, the court confirmed that the amount of time you live together does not necessarily determine whether you are in a de facto relationship, or not. If you can be legally married and still be in a de facto relationship with someone else at the same time, it follows that there is no definite “required” amount of time spent together to establish a de facto relationship.

So, be warned, you may think that you are in a “casual” relationship, but you might end up having to pay out an amount of money if the relationship comes to an end.

How can you be sure of your relationship status?

Firstly a de facto relationship can exist between two people of the same or different sex. It can exist even if the one person is legally married to another, or in another de facto relationship with someone else.

What does the law say?

Sec 4AA of the Family Law Act says you are in a de facto relationship if:

• You are not legally married to each other; and
• You are not related by family; and
• You have a “relationship as a couple” living together on a genuine domestic basis.

This sounds simple enough, but when do you have a “relationship as a couple”? What to consider:

• How long have you been in the relationship?
• Is there a sexual relationship?
• To what extent is there financial dependence, or interdependence between you and your partner?
• What is the nature and extent of your common residence?
• Who owns the property? Who paid for it? Who is using it?
• Is there a mutual commitment to a shared life?
• Do you have children together?
• Who cares for and supports the children?
• Is your relationship public?
• What is the reputation of your relationship?
• Is it a prescribed kind of relationship under State or Territory law?