Defacto (domestic)relationship now have rights almost akin to that of a married couple

Often, whenever you hear that a friend or a family member is moving in with their boyfriend or girlfriend, you often get the explanation “we’re giving it a go to see how it works.” A road well travelled - a lot of couples move in and test the waters and by implication, if things “work” the couple might eventually dive right in and enter into the marriage club.

The irony of this scenario though is that while some couples may think they are basking in a dress rehearsal before marriage, with little or nominal legal consequences, the legal reality is now far different.

On 1 March 2009, significant amendments to the Family Law Act 1975 (“the Act”) were introduced. Effectively, changes have now been incorporated into the Act, which has seen parties to a “de facto” relationship, now have rights almost akin to that of a married couple.

While in a social context people may view the commitment of a couple living together as less than that of a couple who marries, the difference in the eyes of the law is now fairly nominal. Rights which were historically quarantined to parties that were married are now legal rights which are automatically vested in parties to a domestic relationship.

In the context of a relationship breaking down, the law for domestic couples also includes the right for the more financially vulnerable of the two parties to apply to have a lump sum or ongoing maintenance paid to them by the other party.

For example, this may include an order that a party continue to pay a regular rent or mortgage repayment or provide a periodic cash sum to the other side to enable them to fund their living expenses. This all can occur before the parties’ assets are formally divided.

After that, in determining the actual distribution of property between the parties, the legislation now pays more significant consideration than it had previously, to a party’s non-financial contributions, giving parties the cheers for any homemaker or parental roles.

Furthermore, unlike previous legislation governing domestic relationships, party’s can now also apply and seek a portion of the other party’s superannuation entitlements in any ultimate property division.

So what distinguishes a couple as being “domestic” regarding the law is concerned? Previous legislation had more strictly required that a couple had to live together in a domestic relationship for at least two years to qualify.

This requirement was only exempted in the event the couple had a child, or the couple had made significant financial commitments between themselves. Nevertheless, legislation now in 2010, is far more vague in defining what a “domestic relationship” actually is.

No longer does the law stipulate that parties have to clock a certain timeframe of living together before they qualify - nor is it an absolute requirement that the parties be in a sexual relationship.

Rather, Section 4AA(2) of the Act sets out nine broad factors which assist the Court in determining whether a domestic relationship is in existence.

Interestingly, case law is demonstrating that these factors are not co-dependent upon each other and relationships are qualifying as being domestic, even when only some of the factors are found and satisfied.

As the amendments relating to domestic couples only came into force and effect in March 2009, the Court’s interpretation of the law is still in its infancy.

What we do know, is that parties don’t necessarily have to live together for two years before their rights under the Act are activated; the Act makes no distinction between heterosexual or homosexual couples.

And the Act has left the door open to a Court finding that a person can coexist in more than one domestic relationship at a time, which feasibly means parties don’t necessarily have to live together on a full-time basis for a relationship to qualify.

So what should people do with this knowledge? Parties should just be aware of the significant changes to the law, have their eyes wide open for how this may apply to their circumstances and use this knowledge to reflect on their intentions may be.

Given that the law governing this area is still novel, we are still waiting to see whether parties to a domestic relationship actively exercise their rights under the legislation. While many parties may reassure themselves by the comfort of thinking in their current happy relationship, there is “no way” they or their partner will pursue these rights if things go pear-shaped.

Possibly this may be true? People also need to put their minds to the scenario that the awareness of these rights is still infiltrating out into the public and it may be a very different picture in a few years time.

Further, many relationships don’t necessarily break down all that amicably and a party’s hope that matters can be worked out civilly and without things getting “all legal” at the end, is one that a party cannot control.

If you are currently living with your partner, whether part or full time or contemplating same, it is recommended that you give real consideration to what your intentions are by this new phase in your life.

An increasing number of couples are now seeking to proactively manage this dramatic change in the law and instead, contract into Financial Agreements whereby the parties themselves can personally control what does and doesn’t happen, in the legal sense, if the relationship ultimately breaks down.

If you intend that both you and your partner will continue to coexist with financial independence from each other until you otherwise agree, this should be documented by way of a Financial Agreement.

If you intend that you and your partner will merge your finances and evenly divide all that you have at the end, this should be documented by way of a binding financial agreement.

If you intend that you or your partner retains all the assets and money they initially had at the beginning or continues to have throughout the relationship, then this should be documented by way of binding financial agreement.

Further, if you intend that you or your partner is not financially responsible for the other, in the event one becomes unemployed or an injury or illness prevents them from seeking employment, then this should be documented by way of a financial agreement.

Ultimately, while some partners who live together, jeer at the marriage suggestion by prying friends and family, citing “we’re not ready,” the reality is, in the eyes of the law, their relationship holds the same ground to that of a married couple.

Accordingly, if your intentions are different to this, it is recommended that you obtain the advice from one of our family lawyers who will be able to assist you with deciding whether a financial agreement is correct for you.