What is a de facto relationship, and why does it matter?
If you’re in a de facto relationship, there can be significant financial implications if you separate or one partner passes away. So how do you know if you’re in one?
Those who are quite content having their relationship within the realms of casual and relaxed may be shocked to hear that it has, in fact, become a relationship that may be recognised as de facto.
Contrary to popular belief, the definition of a de facto relationship is broader than just living in the same residence with your partner. Rather, the Property (Relationships) Act considers whether both parties, who must be over the age of 18 years, (gender is irrelevant) are “living together as a couple”.
To determine this, the court will consider a number of factors including, but not limited to:
- the duration of the relationship
- whether they live in one house
- whether they have a sexual relationship
- the degree of financial dependence or interdependence
- the ownership, use and acquisition of the property
- the degree of mutual commitment to a shared life
- the care and support of children
- the performance of household duties
- the reputation and public aspects of the relationship.
A relationship will not be classed as de facto due to any one particular, or particular combination of these factors. In one case a single factor may be decisive, in another, a cumulative approach may be called for.
Of course a couple may be friends, lovers, boy/girlfriend, landlady and boarder, companions and so forth without being de facto partners. There are many relationships in which the participants could genuinely claim to be uncertain as to whether or not they come within the statutory definition.
One of the key things the Court will consider is if there is a mutual commitment between the parties to a shared life, whether they are both of the same mind or view as to where their relationship is at and how that is held out to the world. For example, the Court has in the past looked at such factors as:
- sharing holidays
- attending family functions
- being in attendance at the other’s office functions
- choosing pets together
- appointing the other party as a director or shareholder of a company
- attending the other’s sport events
- attending seemingly mundane events with the other party.
Clearly, the more independent the parties are of one another the more likely there is to be a finding that there is an absence of mutual commitment to a shared life, and perhaps the more likely they’ll be seen as no more than friends with benefits.
Living in separate homes – Sharing a common residence is not a necessary condition of living together. It is possible that a couple could maintain two separate residences, yet because of their financial interdependence, the presence of children (whether that be children of the relationship or children of just one of the partners), and the way they hold themselves out as a couple, they could be regarded as being in a de facto relationship.
A non-sexual relationship – It is possible to have a de facto relationship without having a sexual relationship.
How do you define the start of a de facto relationship?
It is less important to determine precisely when the parties started to share the same accommodation or the same bed as it is to drill down on when the relationship assumed a significant degree of mutual commitment and permanency; the point at which their lives became significantly intertwined and shared.
Case law reveals that human beings have an apparently endless ability to involve ourselves in all manner of tangles and circumstances. If you are in or starting a new relationship, and you have assets that you want to protect, the best time to seek advice from your lawyer is now.
WRMK Lawyers has a highly experienced, specialist relationship property team who can discuss whether a contracting out agreement is right for you. Please give us a call and we will be happy to assist. You can view our relationship and family property lawyers here.