Introduction
Q1: If we kept our money completely separate during the relationship, can I keep everything?
A: In rare cases, yes. If you and your partner never mixed finances, had no joint accounts, and each managed your own assets independently, the court may find it is not just and equitable to make any property order at all. Reference: Chancellor & McCoy [2016] FCCA 53
Q2: Does a verbal agreement to keep finances separate stop the court from splitting property?
A: An informal agreement does not bind the court. It can influence the decision, but only if the agreement was mutual and both parties genuinely acted on it throughout the relationship. Reference: Sutherland & Oxley [2025] FedCFamC1A 115
Q3: If one party has far more assets than the other, will the court always equalise?
A: Not necessarily. If both parties kept their finances completely independent throughout the relationship, the court may find it just and equitable to leave each party with what they have, even if there is a significant gap. Reference: Fielding & Nichol [2014] FCWA 77
When Does the Court Refuse a Divorce Property Settlement?
It does happen, but it is not the normal outcome. In most divorces, the court will make some kind of property order. But section 79(2) of the Family Law Act 1975 requires the court to first ask: is it just and equitable to change anything at all?
If the answer is no, the court leaves everything as it is. Each party walks away with what they currently own.
The leading case on this threshold is the High Court decision in Stanford (2012), which established that the court must not simply assume a property order should be made. The starting point is the existing legal and equitable interests of the parties. The court needs a reason to disturb them.
"It is unfair for Ms McCoy, who has taken steps to maximise her future wealth, to have to share that wealth with Ms Chancellor who did not invest as wisely; especially in regard to maximising her superannuation benefits."
This quote captures the core principle: if two people managed their money independently throughout the relationship, forcing one to share with the other can itself be unjust.
The parties were in a same-sex de facto relationship for 27 years. They had no children. Ms McCoy bought a property in her sole name one year into the relationship. Ms Chancellor bought her own property in 2002. Throughout the relationship, Ms Chancellor paid Ms McCoy $100 to $120 a fortnight, which Ms Chancellor called mortgage repayments and Ms McCoy called rent.
They had no joint bank accounts. Each managed their own debts. Neither knew the specific value of the other's assets until separation. At trial, Ms Chancellor (59) had net assets of $720,391. Ms McCoy (55) had $1,698,664.
Outcome: The court dismissed the application. With no intermingling of finances over 27 years, it was not just and equitable to force Ms McCoy to share wealth she had independently built.
Can a Mutual Agreement to Keep Property Separate Block a Property Settlement?
The court draws a sharp line between mutual agreements and one-sided assumptions. If both parties understood and acted on the arrangement throughout the relationship, the court may treat the existing ownership as fair and decline to intervene.
But if only one party assumed finances were separate while the other expected to share, the court will not give weight to that assumption.
"The primary judge was correct to record that mutual assumptions and agreements which are informed and truly consensual will potentially inform whether it is just and equitable to make any order altering property."
In Oamra & Williams [2021] FamCAFC 117, the wife tried to argue that their separate finances meant the court should leave everything untouched. The couple had been together 18 years and had 4 children. They had no joint accounts and contributed to expenses via a predetermined budget. But the Full Court found the wife was relying on her own unstated assumptions. The husband had never agreed to keep things separate. The 55/45 property order stood.
The parties were in a de facto relationship for 12 years. They had no children. The husband was 74 and the wife was 66. Both were retired. They lived in the wife's property. The husband owned a separate block of land. From the start, the husband insisted that finances remain entirely separate.
The husband argued he deserved a 50/50 split because he had devoted 12 years to the relationship. The wife sought dismissal so each party would keep the property they brought in.
Outcome: The court dismissed the application. The assets still existed in the same form as when the relationship began. The husband had lived rent-free in the wife's home, which offset any maintenance work he had done. Neither party had ever expected an interest in the other's property.
"On the contrary, their relationship had been conducted on the basis that neither would ever have any interest in the property of the other."
| Factor | Fielding & Nichol [2014] | Oamra & Williams [2021] |
|---|---|---|
| Relationship length | 12 years | 18 years |
| Children | None | 4 children |
| Joint accounts | None | None |
| Agreement type | Mutual and consistent | Wife's unilateral assumption |
| Contributions | Minimal intermingling | Significant homemaker contributions |
| Outcome | Application dismissed | 55/45 order upheld |
The difference between these two cases comes down to one thing. In Fielding & Nichol, both parties understood and accepted the separate arrangement. In Oamra & Williams, only the wife assumed it. The court will not let one party impose a separate property regime on the other without genuine mutual agreement.
Does Keeping Most Finances Separate Mean the Court Will Not Split?
Not necessarily. Even if both parties managed their own money for most of the relationship, the court may still make a property order if there was any substance to the shared life — a shared home, ongoing contributions from one party to the household, or joint use of assets. An informal understanding is not the same as a binding agreement, and the court is not bound by it.
The parties were in a de facto relationship for 22 years. The husband owned 8 properties at the start. Throughout the relationship, they kept most of their finances separate — separate incomes, separate accounts. But they shared one property as the family home, and the wife made substantial contributions to the household over 22 years.
The husband argued there was an informal understanding that each would keep their own assets. The wife applied for a property settlement.
Outcome: The primary judge awarded 22% to the wife. The husband appealed. The appeal court upheld the order, making clear that an informal agreement can at best be taken into account but does not bind the court in any way.
"If the parties do not take that step [a binding agreement], they remain free to enter into any agreement they wish as to the division of property, but it does not bind the court in any way. At best, as here, it may be taken into account in determining whether or not an order should be made, but no more."
Sutherland & Oxley stands in sharp contrast to Fielding & Nichol. In Fielding & Nichol, there was no shared property, no shared home, and the assets remained unchanged from start to finish. In Sutherland & Oxley, despite mostly separate finances, 22 years of shared living, a shared home, and the wife's sustained contributions were enough for the court to find that leaving everything untouched would be unjust.
The lesson is straightforward: for the court to refuse to split, the financial separation must be total and absolute. Any trace of shared life gives the court grounds to intervene.
Can Past Promises Stop a Property Settlement Claim?
This is extremely rare, and only arises in very unusual factual circumstances. The court calls this the principle of representations and reliance, but its conditions are stringent: one party must have made a clear and specific promise, the other must have fundamentally restructured their life in reliance on it, and that state of affairs must have persisted for many years. A casual remark in everyday conversation will not trigger this principle.
The parties were married for 22 years. In 1994, the husband moved to England and told the wife she could keep all Australian property while he built a new life overseas. The wife relied on this and managed the property as her own for nearly two decades. The couple continued to holiday together until 2004, funded by the wife.
The husband waited until 2011, near the end of the limitation period, to file a property application. The net asset pool was approximately $1,069,000. He argued for a 60/40 split in the wife's favour.
Outcome: The Full Court dismissed the husband's application. The existing state of affairs was created by his own voluntary representations. He failed to show any principled reason for the court to disturb the wife's property interests.
"The onus is on the husband to show some principled reason for the Court to interfere with the wife's interest in property."
It is important to stress that the facts in Bevan and Spalla were highly unusual — one party permanently left the country, or signed a formal legal document. These are not everyday situations. In the vast majority of divorces, the court will not refuse to split property simply because of something one party once said.
The Reality for Most Families
Every case above shares a common thread: both parties kept their finances completely separate from start to finish. Short relationships, no children, separate accounts, separate debts.
But most families do not operate this way. In long-term relationships, finances naturally become intertwined — joint mortgages, shared household expenses, one partner caring for children while the other earns. When the court sees deeply entangled finances, it is nearly impossible to argue that leaving everything as-is would be just and equitable.
Rather than hoping the court will refuse to split property, a more realistic approach is to plan and negotiate early in the relationship. If the court has already made a property order and you disagree with the outcome, find out whether you can appeal a property settlement decision.
Summary
The court can refuse to split property, but it almost never does. Section 79(2) requires the court to find that an order is just and equitable before it changes anything. In the rare cases where the court declines, the parties had kept their financial lives completely separate for the entire relationship.
Separate finances must be mutual. If only one party assumed finances were separate, the court will not give weight to that assumption. Both parties must have understood and acted on the arrangement.
Informal agreements do not bind the court. Even if you shook hands on keeping things separate, the court can still make an order. Only a binding financial agreement under Part VIIIA has legal force. Some people consider using a family trust to protect assets, but the level of protection depends on the specific control and beneficiary arrangements.
Most families have intertwined finances. When finances are deeply entangled, the court will almost certainly make a property order. Rather than hoping the court will refuse to split, seek legal advice early and plan accordingly.
