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22 July 2016

Great Scott! Can the Court order a property settlement after 30 years of separation?

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It is not often that the tabloid newspapers report on family law matters, particularly matters at first instance, however the recent Federal Circuit Court of Australia judgment of Scott & Scott [2016] FCCA 1659 was featured in the Daily Mail Australia on 13 July 2016.

While not a landmark decision, the Scott case is a timely reminder that disputes about ownership of property may not just go away because you want them to and it is usually better to resolve your matrimonial (or de facto) property matters sooner, rather than later.

So, what is Scott & Scott about?

The relevant facts are simple – Mr and Mrs Scott, now aged 91 and 83 years old respectively, met in 1950 and were married in 1954.  They have 4 children together (now aged in their 50-60’s).  In 1951, after the parties’ commenced their relationship, Mr Scott borrowed monies to purchase vacant land, on which the parties’ eventually built the matrimonial home.

The parties separated in 1986, with Mr Scott living between the matrimonial home and another property he purchased around the same time.  Mrs Scott gave evidence that, even after she moved out of the matrimonial home in 1987, she would return on the weekends to clean, feed the pets and mow the lawns. In 1988, Mrs Scott returned to live in the matrimonial home, where she lived until 1994.  Mr Scott moved back into the matrimonial home (full time) in 2000, while Mrs Scott continued to live at a property she owned.  Mrs Scott gave evidence that she helped Mr Scott during periods of sickness and to assist with household tasks.  The parties also travelled overseas together in 2010.

Mrs Scott gave evidence that, since separation in 1986, she had regularly asked Mr Scott to settle their property matters and to sell the matrimonial home.  The home was listed on the market for sale in 2003 and 2006, however it did not sell.

Relations between the parties eventually soured in 2014, and Mr Scott wrote Mrs Scott out of his Will and listed the matrimonial home for sale without Mrs Scott’s knowledge.

Mrs Scott became concerned that she would not receive anything from the sale and filed an application for a property settlement.

The Court was tasked with determining whether it was just and equitable to make property settlement orders.  Her Honour Judge Terry, in referencing the High Court case of Stanford & Stanford, stated at paragraphs 67 and 68 of her judgment:-

The situation in the case before me is that for 32 years the parties worked together to acquire, conserve and improve a property which by mutual agreement they used as their home. They then separated. For most of the next eight years they both continued to use of the property. This tapered off to the point where for the 14 years prior to the husband going into aged care he had the sole use of the property. The wife repeatedly pressed her claim for a share of the property and the husband said things which suggested that he recognised her claim but no settlement between them was ever finalised. No agreement is now possible because the husband is now asserting that the wife should receive no part of the value of the property.

… I am abundantly satisfied that it is just and equitable to make a property settlement order in this case.

In assessing the parties contributions under section 79(4)(a), (b) and (c) of the Family Law Act 1975, and considering the matters is section 79(4)(d), (e), (f), and (g), which include the matters in section 75(2), and the effect of those findings and what orders are just and equitable in all of the circumstances of the case, her Honour determined that Mr Scott, in consultation with Mrs Scott, should sell the former matrimonial home and the net proceeds of sale shall be divided between them in equal shares.

Save for a few chattels located at the former matrimonial home which Mrs Scott could retain, the parties were to otherwise retain all other assets in their respective names, possession or control.

 What does this all mean?

The Scott case may be relatively simple, but there are some important lessons (and some timely reminders) that we can learn from same.  These include:-

  1. There is a time limit for applying to the family law courts for a property settlement – you must apply within 12 months from the date of your divorce. Importantly for the Scott’s, although they separated in 1986, they never divorced and as such, the limitation period had not commenced.
  2. Just because a real property is registered in one party’s name does not necessarily mean the other party to the marriage (or relationship) is not entitled to a share of same.
  3. The Court must first determine whether it is just and equitable in make a property settlement order. The fact that the Scott’s had been separated for over 30 years was not a bar to the Court determining that a property settlement was appropriate.
  4. As with all matrimonial property matters, the Court will then assess the relevant section 79 and 75(2) factors. Generally the Court will assign a percentage division to account for the ‘contributions’ and ‘future needs’ factors.
  5. Lastly, the Court must consider whether, in all of the circumstances of the case, the proposed orders are just and equitable.

If you are separated or are contemplating separation and would like to discuss your property matters, make an appointment with one of our solicitors today.

 

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