Separation often brings about a range of emotional and financial challenges. One question that commonly arises is whether an ex-partner’s new relationship can impact how property is divided after separation or divorce. While property settlements are based on the contributions and future needs of each party, a new partner may become relevant in some cases.

This blog explains how Australian family law treats new relationships when finalising a property settlement, including disclosure obligations, contributions and the concept of future needs.

Understanding property settlements under Australian family law

In Australia, the Family Law Act 1975 sets out how property settlements are to be determined, including the distribution of assets and liabilities between you and your ex-partner.

The Court must first consider whether it is just and equitable to make an order adjusting the parties’ property interests. Then, and only if it is satisfied that it is just and equitable to make an order, the Court will follow a four-step process as follows:

1. Identify and value all assets and liabilities of both parties.
2. Assess contributions made by each party (financial and non-financial).
3. Consider each party’s current and future circumstances, such as age, income, health, and care of any children.
4. Determine the final overall percentage split based on what is considered just and equitable in all the circumstances of the matter.

New relationships can become relevant during steps 3 and 4, particularly when considering current and future needs.

Does a new relationship automatically change things?

No, simply entering into a new relationship does not automatically affect a property settlement with a former spouse. However, the impact depends on timing, financial circumstances, and whether the new partner contributes to the household finances.

How a new partner may affect your ex-partner’s property entitlement

Financial support from the new partner

If your ex-partner’s new partner is financially supporting them (e.g. contributing to or paying their mortgage/rent, bills or other living expenses, or providing income), the Court may consider that this reduces your ex-partner’s “need” and may assess their overall property settlement entitlement as being less, in circumstances where their financial position is no longer as vulnerable as it would be had they not re-partnered.

Shared living expenses

Living with a new partner can reduce your ex-partner’s expenses (e.g. splitting rent or groceries). This shared financial responsibility may lead the Court to assess that your ex-partner has a reduced “need”.

Blended families and new dependents

If your ex-partner now has step-children or subsequent children from their new relationship, the Court may consider their increased financial obligations.

Your obligation to provide full and frank financial disclosure

It is important to note that full and frank financial disclosure is required by all parties in family law matters, irrespective of whether Court proceedings are initiated or not.

If your ex-partner has moved in with a new partner and is receiving financial assistance, it is appropriate that this is disclosed. If you suspect your ex-partner is hiding financial information, you can seek further orders for disclosure or raise any non-disclosure during Court proceedings.

The Court takes non-disclosure seriously, and there is a range of remedies available to the Court, including but not limited to:

• costs orders;
• punishment for contempt of Court (which may include a fine or term of imprisonment); and/or
• taking the non-compliance into consideration in determining what orders (if any) to make in a property settlement.

You can read more about your disclosure obligations in our earlier article, “Duty of disclosure in family law”.

Does it work both ways?

Yes. If you have re-partnered and are living with your new partner, the same principles apply.

Your new partner’s income or assets are not usually considered joint property, but if they are significantly improving your financial circumstances (e.g. paying off your debts or supporting you), the Court may determine that your “need” is reduced.

Additionally:

• If you are now co-parenting with your new partner, and they help care for your children, the Court may factor this in when assessing parenting responsibilities and future needs.
• If your new partner owns property that you live in rent-free, this may reduce your housing needs.

Timing matters when entering a new relationship after separation

If your ex-partner enters a new relationship after your property settlement is finalised, it generally has no impact unless there has been fraud or a significant non-disclosure during negotiations or Court proceedings.

However, if the relationship begins before the settlement is agreed or Court orders are made, it could be relevant. This is especially true if:

• your ex-partner is now living with their new partner;
• their expenses have significantly changed; and
• the new partner is contributing to assets or debts.

In summary

• A new relationship doesn’t automatically affect property division, but it can be relevant to future needs.
• The court may consider whether the new partner is financially supporting your ex-partner or reducing their expenses.
• Full financial disclosure is crucial. If your ex-partner is in a new relationship, this must be disclosed if relevant to their financial situation.
• Each case is determined on its own facts based on what is “just and equitable”.

Tips before negotiating property settlement

• Get legal advice early, especially if you or your ex-partner are in a new relationship.
• Gather evidence of any financial contributions from a new partner that may be relevant.
• Don’t delay settling - the longer you wait, the more likely it is that new relationships and other changes could complicate things.
• Consider mediation before going to court to save time and money.

Get advice from a family lawyer

While an ex-partner’s new relationship might not seem like your concern, it can sometimes impact property settlement outcomes, especially if it changes their financial needs. Getting the right advice and staying informed about your obligations can help ensure a fair result for everyone involved.

Find this article useful or interesting?

You may also like to read:

• Property settlement Consent Orders or a financial agreement
• Superannuation splitting under the family law
• How is property acquired after separation but before property settlement treated?
• Can I claim more after finalising property settlement?