
Can my ex claim money from my new partner?
22 July 2024
By Sherlene Heng
After a separation or divorce, one key question that often arises is whether an ex-spouse can make claims over the finances or assets of a new partner you’ve entered into a relationship with.
While it may seem unfair, there are certain legal avenues that could potentially allow this under the Family Law Act 1975 or Family Court Act 1997.
Direct claims over joint assets and income
The court must consider assets owned jointly with your new partner. This can potentially expose joint finances like shared bank accounts, home ownership, businesses or investment assets to claims during a property settlement case.
Section 75(2) / Section 205ZD
Another section relevant to the adjustment in overall property settlements is section 75(2) or section 205ZD. There, the financial circumstances relating to a party’s cohabitation with another person, the duties of the parties to support any other person, and any other fact or circumstances are all relevant, and this may be important considerations arising from a new relationship.
For example, if you’re living rent-free with your new partner who owns their own home, or otherwise receive financial support from a new partner, the court could take that into account.
Relevant factors can adjust the way the asset pool from your former marriage is divided.
Similar adjustments can be made if:
- Your income has increased substantially
- You’ve acquired new assets or made major purchases with assistance from your new partner’s income
- Your new living arrangements have reduced your living costs and financial liabilities
Section 106B considerations
Section 106B of the Family Law Act gives the court powers to reverse transactions entered into which potentially would or do defeat orders the Court would otherwise have made.
If assets or funds have been transferred to a new partner, this would potentially fall under the provisions of this section to ensure that the overall property settlement between former spouses is not defeated by that transfer and to ensure a just and equitable financial outcome following your separation.
Protecting your new relationship’s finances
The best way to protect your new relationship is through careful legal and financial consideration, including
- Having a comprehensive prenuptial-style agreement or binding financial agreement
- Keeping all assets and income from your new relationship completely segregate
- Clearly delineating financial responsibilities and contributions within the new household
- Avoiding any joint financing for major purchases until your previous matters are resolved
- At O’Sullivan Davies, our experienced divorce and family law team can advise you on all the potential legal risks and how to mitigate them when entering into a new relationship during separation proceedings.
Contact us for guidance today.