Property proceedings before the Family Court are often complex and can go beyond simple tangible property and financial assets. One such area of complexity relates to receiving, or potentially receiving, an inheritance during the course of a marriage or de-facto relationship.
Despite clear intentions set out in a will to leave property to a particular party, it is possible to argue before the Family Court that such an inheritance should be considered an asset of, or contribution by, both parties – not just a contribution made by the party who received the inheritance.
Ultimately, there are a number of factors which the court takes into consideration. For instance, the court may look at the timing of the inheritance (i.e. prior to co-habitation, during the relationship or immediately after separation); the length of the relationship; the size of the inheritance; and whether the non-recipient party could be said to have made a contribution to it.
In the interesting case of White and Tulloch v White (1995) FLC 92-640, the full bench of the Family Court considered a husband’s claim that his estranged wife had an expectation of inheriting a substantial amount of property upon the death of her mother, and that this should be a factor when assessing the asset pool. The Family Court determined that an expectant inheritance could not be a seen as a financial resource as the wife could not control or be certain that she would receive such property under her mother’s will, because the mother could revoke her will or completely alter how her estate was to be distributed upon her death, at any time.
There is no hard and fast rule when it comes to how the court will view an inheritance in relation to the financial contributions of the parties. Whilst the Family Court in White and Tulloch v White said that a prospective inheritance could not constitute a financial resource, it can still be taken into consideration under the very wide provision of s75(2)(o) of the Family Law Act (1975). This provision requires the Court to bear in mind “any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account”. In other words, the Court will consider facts or circumstances (of a largely financial nature) when assessing the financial pool, which therefore may include a potential or expectant inheritance to one the parties.
Clearly it is always advisable to have a carefully written will which sets out your intentions in relation to the distribution of your estate. However due to the often unpredictable nature of the law you must also be mindful that the contributions made within a marriage or de-facto relationship may extend to inheritances and even to property not yet in your hands.
At Everingham Solomons we have the expertise and experience to assist you with all legal matters associated with Family Law because Helping You is Our Business.
Click here to learn more about Sophie Newham.