De Facto Property Settlement: Section 90SM Explained

What Section 90SM Allows

Section 90SM of the Family Law Act 1975 allows property orders after the breakdown of a de facto relationship. Its framework parallels section 79 for married parties. The court can alter interests in property owned jointly or by either partner, including by ordering a transfer or sale.

The court identifies existing property rights and liabilities, then considers financial and non-financial contributions. Homemaking and parenting contributions also count. It considers current and future circumstances, including income, health and responsibility for children. The court must be satisfied that making an order is just and equitable in all the circumstances.

There is no automatic equal division after a de facto relationship ends. A client’s entitlement depends on the evidence and the statutory considerations. Paying the mortgage does not by itself determine the final percentage. Neither does holding the house in one partner’s name. The property framework for married parties explains the parallel provision.

A former de facto partner can seek property orders affecting inherited assets if the claim meets the statutory gateways. Receiving an inheritance does not give either partner an automatic half share. The court’s property guidance includes inheritances in the assessment of financial contributions. Identify when your client received the inheritance and how it was used.

The same federal rules apply in Queensland, NSW, Victoria, Tasmania and South Australia, as well as the ACT and Northern Territory. The Federal Circuit and Family Court of Australia’s de facto guidance explains the scheme’s geographical and commencement requirements. Earlier separations can involve transitional rules.

Western Australia has a separate de facto property scheme under Part 5A of the Family Court Act 1997, as explained in the WA court’s property guidance. Section 90SM is not the provision for a claim governed by that state scheme. Eligible WA de facto couples can obtain superannuation splitting orders under Part VIIIC of the federal Act. See superannuation splitting for that separate part of a settlement.

Threshold Requirements

A section 90SM claim requires a de facto relationship under section 4AA, a section 90SB gateway and the geographical connection in section 90SK. Those are separate questions. Two years together is one route to a property order, not the definition of a de facto relationship.

Dating alone is insufficient. Calling someone a boyfriend or girlfriend does not decide whether the relationship is de facto. Section 4AA concerns a couple living together on a genuine domestic basis who are neither married to each other nor related by family.

The court weighs the circumstances, including the shared household, financial dependence or interdependence and commitment to a shared life. Duration and the relationship’s public reputation also matter. No particular factor is mandatory. Financial records therefore support the assessment without deciding every aspect of the relationship.

Under section 90SB, at least one of four gateways must apply:

• The relationship lasted at least two years, counting the total of its periods.
• There is a child of the de facto relationship.
• The applicant made substantial financial, non-financial or homemaker or parenting contributions, and failing to make an order would cause serious injustice to the applicant.
• The relationship is or was registered under a prescribed state or territory law.

A shorter relationship can therefore qualify. For the substantial-contributions gateway, identify the contribution and the serious injustice that would follow without an order. A payment alone does not answer both parts of that test.

Section 90SK provides two geographical routes. The first requires either or both partners to be ordinarily resident in a participating jurisdiction when the application is made. It also requires both partners’ ordinary residence in participating jurisdictions for at least one-third of the relationship, or substantial contributions by the applicant there.

The alternative is that both partners were ordinarily resident in a participating jurisdiction when the relationship broke down. Record where each partner lived and when. An account’s branch address alone does not establish ordinary residence. The federal Act contains the full tests.

Proving the Relationship With Financial Records

Bank statements show how partners funded their shared life and when that financial arrangement began or changed. Match each payment to the question it helps answer. A single transfer has less explanatory force than a consistent history of shared expenses.

For the property gateway, identify the period of shared finances and the payments supporting it. The opening of a joint account can support a start date, but the relationship may have begun earlier. Continuing separate accounts can coexist with shared expenses. Avoid treating account structure as a substitute for the section 4AA assessment.

A de facto relationship ends without a divorce or other formal dissolution step. Statements can help locate the breakdown when joint accounts close, shared bills stop or one partner begins paying rent elsewhere. Some financial ties continue after separation. A final mortgage payment does not necessarily mark the end of the relationship.

For a large statement bundle, consolidate transactions by account and period so you can compare recurring household payments across the relationship. FinTrace saves hours of manual statement review by producing a searchable Excel ledger and a clear findings report from supplied PDFs. Each finding cites the source filename and page, so the supporting evidence is at hand when you prepare the chronology.

Time Limit for De Facto Claims

The usual time limit for a de facto property application is two years after the relationship ends, under section 44(5). Establish the separation date early. Ongoing negotiations do not extend that period.

Section 44(5) also permits an application with both parties’ consent. It provides a separate 12-month period after a financial agreement is set aside or found invalid. Keep those routes distinct from the ordinary two-year limit.

Under section 44(6), the court can grant leave outside the standard period if refusing leave would cause hardship to the applicant or a child. Meeting that threshold permits the court to consider leave. It does not make leave automatic. The subsection also has a separate ground for maintenance applications involving inability to support oneself without an income-tested benefit.

The family law time limits guide explains deadlines and leave applications in more detail. For a disputed separation, identify the earliest plausible end date and preserve the statement evidence supporting each chronology before deciding when to file.