Don't assume your partner will get half of your asset's increase in value!

It is a prevailing shorthand for many family lawyers that a starting point in a property division for clients is to work out what each party had at the beginning of the relationship, apply a percentage to what they have now, and estimate that your contributions otherwise during the relationship are '50/50'. However, a new case has emphasised the risks in taking this shorthand approach in some situation.

In the matter of Anson & Meek [2017] FamCAFC 257, the trial Judge found that the Husband had brought in a property worth about $1,000,000 at the beginning of the relationship. That property had increased in value to almost $2,000,000 at the time of the family law trial. The assessment of contributions during the relationship, although not linked explicitly to this calculation, meant that the Wife was treated as having contributed half of the increase in value.

The Full Court took issue with this outcome, and identified that in fact the increase in value of the property was not solely due to the financial and non-financial contributions of the parties during the relationship (including homemaking duties), but also to prevailing market factors. In fact, a very large proportion of the increase in value was connected to the increase in the land value of this rural property, rather than the increase in value of the home itself. It would stand to reason then that the Husband should have a greater percentage contribution attributed to him, as without his initial capital to buy the property, the parties would not have been in a position to profit so handsomely.

The case seems to indicate that the Court should not neglect the concept of 'springboarding' when looking at assets such as these. It is important that you have a lawyer who understands these concepts and is able to dig into the detail of your assets, rather than treating your assets generically. Our lawyers at Nevett Ford Lawyers Melbourne are fully across this issue and will be able to provide you with the advice you need to get the outcome that is appropriate. You can call us now for more information on 03 9614 7111.