In cases where one (or both) spouse(s) might have re-partnered before that spouse has completed formal property division of assets (property settlement) with the first spouse, problems can arise.

In a scenario where Bob is still finalising a property settlement with Mary but has now fallen in love with Jane and wants to immediately commence living with Jane full time, does this mean that Jane’s assets and income might somehow become embroiled in the property settlement between Bob and Mary and what might be done on behalf of Bob or Jane to defend against this?

Once a de facto partner comes onto the scene, the common retaliatory argument which comes up from the other side (in this case, Mary) is to say that because Bob has now formed a relationship with Jane, Mary’s property settlement percentage increases as Bob can rely upon Jane’s available assets and income as a financial resource to assist him in meeting his day to day living costs. If things go down this line, there is plenty that can be done to defend the attacks from Mary. Typically, those defences will be:

• If Jane’s financial circumstances really do not demonstrate that she has much surplus financial capacity to look after Bob beyond what Jane would need (in terms of income and assets) for her own financial support then simply by disclosing Jane’s situation, the “financial resources” argument can be killed off quite effectively.
• The second argument typically available would be to do a brief analysis as to whether or not Bob would be able to successfully mount a claim against Jane for a property settlement or some other form of spouse or maintenance financial support from her if by chance Bob and Jane were to hypothetically separate at the present time. Usually in the early stages of any new relationship where the relationship has not yet advanced significantly past a duration of two years then it is usually relatively easy to argue that Bob would have no such claim and therefore Jane’s financial circumstances are irrelevant.

Things do become a little more complicated if Bob and Jane were to have rushed into creating joint bank accounts or becoming heavily financially intermeshed in terms of, for example, borrowing on a new mortgage for the purchase of a new property or entering into a some other form of joint venture and consequently, wherever possible, this higher level of financial interdependency should be avoided, or at least delayed until the first property settlement between Bob and Mary has been full concluded.

One unavoidable consequence is that, Jane’s financial circumstances, such as her current assets and liabilities and sources of income might have to be produced to Mary in compliance with Bob’s obligations in disclosure and so this will be an inevitable invasion of privacy. If however the level of financial intermeshment between Bob and Jane was zero and each were still maintaining separate residences, then in such a scenario, Jane would have the right to refuse any disclosure to Mary.

Michael Zande is an accredited Family Law specialist at Zande Law Solicitors, Suite 9, Norwinn Centre, 15 Discovery Drive, North Lakes.

The information in this article is merely a guide and is not a full explanation of the law.  This firm cannot take responsibility for any action readers take based on this information.  When making decisions that could affect your legal rights, please contact us for professional advice.