Just and Equitable: what does that mean?

Aside from simply being legally correct, a property settlement should also be ‘just and equitable’, as required by Section 79 of the Family Law Act (Cth).

Justice is a key focus of the law. It is characterised by morality and fairness. Justice requires that the outcomes reached are fair to all parties involved. This involves considering each party’s unique circumstances so that a personalised and fair outcome is reached. In a property agreement, this could mean one party receives a greater split of the assets because they have put more work into maintaining them.

Equity is the branch of law that deals with the justness of outcomes. Equity will intervene where the complex technicalities of the law have led to an unnecessarily harsh outcome which is unfairly harmful to an innocent party. Equity is not concerned with the strict regulations of the law, but rather with ensuring that legal outcomes are fair and just. Equity ensures that parties cannot dismiss the spirit of the law.

Property settlements need to be both just and equitable, meaning they should be morally right and just, as well as fair for both parties.

The law considers lots of factors when assessing whether an outcome is just and equitable. The main two factors considered are:

• Contributions to the relationship by each party
  Relevant contributions include the financial, non-financial, parental and domestic contributions. The weight held by each of these is considered equal, i.e. if one party worked all day while another cleaned and cared for the children, they will be seen to have contributed equally.
• Current and future needs of each party
  Each party will have different needs, and this will be considered by the court as it assesses whether a settlement is just and equitable. Details considered include whether the parties have any dependants, and the earning capacity of each party. Children have a significant impact on assessing the future needs and hence what might be considered just and equitable in a property settlement.

For a court to approve a property settlement and make it enforceable it needs to be just and equitable. This is the last step of the process in creating a property settlement.

When constructing a property settlement, you should consider whether the arrangements you are proposing would be considered just and equitable by the courts.

If you have further questions please contact us at frank@franklaw.com.au 

This is not legal advice.