If you haven't already, read our article about Superannuation and family law first to understand how Superannuation interests are treated by the Federal Circuit and Family Court.

In this blog post, we take a lot at how the courts will split parties' superannuation.

Does the Court always Split up Parties’ Super?

No, the court will not always make an order splitting the parties’ superannuation. It is not mandatory for parties to split their superannuation interests. If parties wish to each retain their own superannuation, they may do so.

A party may seek a superannuation splitting order and the court may find that to reach a just and equitable outcome for all parties, no such order be made. The court reached such a decision in Mayne v Mayne (2011); however, this finding was overturned on appeal.

Mayne v Mayne (2011)

This case concerned an appeal from a primary federal magistrate’s property orders. The federal magistrate found that the parties’ property should be split 78% to the wife and 22% to the husband. The federal magistrate determined that the parties should each retain their own superannuation interests. This was significant as the husband’s superannuation had a value of $259, 474 while the wife’s was only $25,300.

The effect of the orders, after the division of the non-superannuation assets and each party retaining their superannuation, meant that husband received 48% of the total property pool and the wife received 52%.

On appeal, the court found that the primary federal magistrate made an error of discretion in reaching such orders, which were seemingly at odds with his own intention that the husband should receive 22% of the asset pool. The appellate court set aside the primary orders and, in another hearing, determined that the wife receive a $104,880 allocation from the husband’s superannuation scheme.

The court in Clives v Clives (2008) held that even if the parties do not seek a superannuation splitting order, the parties’ contributions to both the property and to the superannuation interests should be assessed (more on this later).

How will the Court Split my Superannuation?

When deciding how to split up parties’ superannuation interests, the court will be guided by the principles in the Family Law Act as explained above. The court will look at contributions each party has made as well as their current circumstances.

The court has emphasised, in cases such as Clives v Clives (2008) and De Winter v De Winter (1979) that assessing contributions in a marriage is generally not one to be calculated mathematically or through a strict accounting exercise. Instead, the court must weigh initial contributions against other relevant contributions of both parties.

Clives v Clives (2008)

In this case, which concerned an appeal from a primary judge’s decision, the court found that when determining the initial superannuation splitting order, the primary judge gave insufficient weight to the disparity in the parties’ age and failed to consider the effect of the splitting order he proposed to make in favour of the wife. This failure was exacerbated by his failure to consider the overall justice and equity of the order he proposed to make.

When the parties’ relationship commenced, the husband had a superannuation entitlement of roughly $33,000 while the wife had no superannuation interest. At the date of the hearing, the husband’s superannuation had an agreed value of $310,731 and the wife had a superannuation entitlement with an agreed value of $76,944.

The court assessed the husband’s contribution to the fund to be approximately 62% of the total value and found the wife indirectly contributed approximately 38% of the fund’s value. The husband made direct financial contributions while the wife contributed indirectly through her care of the couple’s children and homemaking responsibilities which allowed the husband to participate in full-time work.

In considering relevant factors under s 75(2), the court noted that the husband, who was 11 years older than the wife and 49 years old at the date of trial, had a shorter working life expectancy than the wife which the court balanced against the husband’s present higher earning capacity to that of the wife who was only 38 years old.

The court also had regard to the fact that the wife had access to an additional $50,000 from the proceeds of the sale of the house.

As such, the court ordered that the wife should retaining her existing superannuation entitlements and a splitting order in the sum of $81,010 be made from the husband’s superannuation fund to adjust the parties’ superannuation interests. This was a reduction from the trial judge’s superannuation splitting order which allocated the wife $93,512.

DISCLAIMER: The information provided above is published for general informational purposes only and is not intended to be nor should it be relied upon as a substitute for legal or other advice.