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Property Cases - Significance of Initial Contributions on Final Outcome of Property Division

22/10/2018

The Full Family Court of Australia recently had the opportunity to consider once again the issue of the significance of financial contributions made by one party at the commencement of the relationship to the outcome of a property division decided by the Court many years later.

In the recently decided case of Jabour the Federal Circuit Court of Australia decided on a property division following the end of a 27 year marriage. In that case:

  • At the commencement of the marriage the husband purchased three blocks of land from his father for $26,000.
  • During the marriage the husband (with some assistance from the wife) changed the land holding which assisted in the land being more suitable for eventual rezoning.
  • The land was later rezoned and sold for over $10,000,000.

The sale proceeds of the land were the significant asset of the marriage. There were other minor assets including some superannuation.

The wife argued that the whole of the property pool should be divided equally.  The marriage had lasted for over 25 years and there were three adult children.

The husband argued that the pool of property should not be divided equally because the initial contribution by the husband (being the three blocks of land purchased from his father) was a significant contribution and that there should not be an equal division.

The Court held the view that the husband’s initial contributions had to be weighed in the context of all the various contributions made by both the husband and the wife over the 27 years of marriage that had produced three children.

The Court found that the wife had supported the husband in his decision to change the landholding and that this non-financial contribution by the wife was a contribution nonetheless which assisted in drastically improving the value of the land.

The Court did take the view that it was the husband’s greater initial contributions that created the opportunity that resulted in the very large pool of property.

The husband therefore received a significantly greater percentage of the property pool at the final hearing despite the marriage being one of over 27 years where the expectation of the outcome may have been thought to have been an equal split.  The result was 60% to the husband and 40% to the wife.

If you have any concerns or queries regarding contributions made by you during the course of your marriage/de facto relationship and how they can impact on the final outcome of the division of the asset pool in your financial/property settlement or you are separated and find yourself in a similar position, please contact Richard Watson Senior Family Law Solicitor or Shereen Da Gloria his Personal Assistant to discuss.

This is only a preliminary view and is not to be taken as legal advice without first contacting Watson & Watson Solicitors on 02 9221 6011.

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