If you have been involved in family law matters, then you may be familiar with the section 75(2) factors. This section of the Family Law Act relates to adjusting a property settlement based on the contributions of the parties. It also considers factors which can “soften” the effect of looking at a property settlement. In this article, we break down what section 75(2) factors are and explain what they mean for you.

What is Section 75(2)?

This section of the Family Law sets out numerous factors that the Court may take into account in deciding how to distribute property in property settlements.

What are the Factors?

Section 75(2) of the Family Law Act 1975 (Cth) sets out numerous factors that may be taken into account by the Court in property settlements when determining whether there are any special circumstances that require adjustment to the property settlement amount.

The factors are:

  • The age and state of health of each of the parties Income, property, finances and ability to earn an income.
  • Whether either party has the care or control of a child of the marriage who is under 18.
  • Commitments relating to support of themselves, a dependent or other person.
  • Eligibility for a pension, allowance or benefit.
  • Whether the parties have separated or divorced.
  • The extent to which payment of maintenance could enable further education and therefore increase one of the parties earning capacity.
  • The effect of any proposed order on the ability of a creditor of a party to recover a creditor’s debt.
  • The extent to which one party has contributed to the income, earning capacity, property and financial resources of the other party.
  • How the length of the marriage affected the earning capacity of the party seeking maintenance.
  • The need to protect a party who wishes to continue their role as a parent.
  • Financial circumstances of any current cohabitation by either party.
  • Orders made under Section 79 of the Family Law Act, if any. This section regulates how assets are to be divided.
  • Any child support that one of the parties is liable for.
  • Any fact or circumstance which the court feels needs to be taken into account for reasons of justice.
  • The terms of any financial agreement binding on the parties to the marriage.

What Do They Mean for You?

If you are going through a separation, it is important to understand what these factors mean for you. These factors are important for the court’s consideration and assessment of what each party’s ‘future needs’ are likely to be.

This requires the court to anticipate what each party’s life is likely to look like in the future and award a percentage uplift to the party with the greater ‘need’. As seen above, there are many factors that the court will take into consideration when deciding who gets what portion of the assets. It is therefore important to understand that property settlements can become quite complex.

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