Are We; Aren’t We? Determining whether a De Facto relationship exists
As society and our views about modern relationships change, we have seen fewer people rushing to the alter, with many happy to tackle life side by side as De Facto partners. Whilst for married couples there is little difficulty proving the existence of a marriage (with the help of a Marriage Certificate) it can be harder to determine whether a couple is in a De Facto relationship.
Whilst De Facto relationships can be registered, the reality is that very few people take this formal step.
The Family Law Act sets out the criteria for establishing a De Facto relationship including that it be two people (same or opposite sex) who:
- Are not legally married to one another or related family; and
- having regard to all the circumstances of their relationship, have a relationship as a couple living together on a genuine domestic basis for at least 2 years.
Yet this explanation often causes considerable uncertainty and confusion. Phrases like ‘living together’ and ‘genuine domestic basis’ can be particularly confusing in circumstances where many couples are now choosing to live in two separate households.
To help shed light on whether a De Facto relationship exists, the Court looks at a number of factors including how long the relationship lasted, whether the couple had a common residence, whether they had a sexual relationship, whether they provided financial support for each other, whether they owned or used property together, whether they had a mutual commitment to a shared life, whether they cared for and supported children, and how the rest of the world saw them.
This last criterion refers largely to things such as whether the couple’s family and friends knew of them as a couple or whether their relationship was ‘secret’. Indeed, in this era of social media – photos, posts and comments online can also be indicative of whether people are known as a couple by their community.
Whilst it may seem relatively straight forward, things are not always clear, such as in the 2017 case of Sha and Cham.
Mr Sha, who was married to Mrs Sha, met Ms Cham in a massage parlour where she was working a sex worker. Mr Sha was a regular client of Ms Cham and shortly after meeting, they began a relationship. During this relationship, Mr Sha remained married and living with Mrs Sha.
Less than a month after they first began their relationship on a non-commercial basis, they began discussing having a baby together and Mr Sha asked Ms Cham to stop working at the massage parlour. He began visiting her at her home and stayed overnight on some occasions. He began paying her $2,000 a month to help with her mortgage and other expenses and he bought her a lounge and arm chair.
A few months after that Mr Sha gave Ms Cham $10,000 and then a few months after that they signed a Financial Agreement for de facto couples, which provided significant financial benefits for her.
These benefits included that:
- He would give her half the value of his home within two years of the birth of their child
- He would pay her $400 per week
- He would pay another $400 per week for the living costs of the child.
Mr Sha and Ms Cham commenced IVF and very shortly after that, Ms Cham became pregnant.
While Ms Cham was pregnant, Mr Sha paid her car insurance and paid her another $8,000.
I don’t think anyone will be surprised to hear that about a month later Mr Sha and his wife separated. As part of the property settlement between Mr and Mrs Sha, Mrs Sha received half the value of their matrimonial home.
Approximately 5 months after the birth of Ms Cham’s daughter, the relationship between Mr Sha and Ms Cham broke down. Shortly after that, Mr Sha and Mrs Sha, finalised their divorced.
After the break down of the relationship between Ms Cham and Mr Sha, Ms Cham approached the Family Court to enforce the Agreement that they entered into during their relationship. Mr Sha insisted that they were never in a de facto relationship. The trial judge disagreed and found that there was in fact a De Facto relationship and between Ms Cham and Mr Sha – despite the fact that he had been married to Mrs Sha all along.
During the appeal the Court looked at ‘common residence’ and indeed, Mr Sha was living with his wife. Notwithstanding, the Court determined that it was enough for Mr Sha to have ‘regular and significant’ time at Ms Cham’s residence to satisfy the criterion of common residence.
The Court next looked at the degree of commitment to a shared life and was satisfied that:
- The parties had entered into Agreement (which Ms Cham had relied upon)
- Ms Cham gave up her work as a sex worker
- Ms Cham and Mr Sha had been spending time together for a considerable period of time.
- The parties committed to IVF and intended to have care and support of a child
- Mr Sha had made payments to support Ms Cham
- Mr Sha had purchased furniture for Ms Cham’s home including an arm chair and a lounge
The Full Court concluded that in order to determine whether a De Facto relationship exists, the Court must look at the relationship as a “whole” as “each element of a relationship draws its colour and its significance from the other elements, some of which may point in one direction and some in the other”.
This case is a cautionary tale as it confirms that a person can simultaneously be married to one person and in a De Facto relationship with another – the consequence of which can be double the property settlement. It also proves that ascertaining whether a De Facto relationship exists is not always a straight forward process and accordingly, it is important to obtain legal advice to help you navigate your options.