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Australia’s Family Court recently rejected an applicant’s claims that the Court should consider the other parties’ lottery win as joint matrimonial property to which the claimant was entitled to a share. In effect, one party walked away from the marriage very wealthy and the other, not so much. In Elford v Elford [2016] FamCAFC 45, the Court ruled that the husband could keep the winnings of a Tattslotto ticket that he obtained twelve months into the marriage. We set out the Court’s findings below as well as some practical tips to protect your hard earned (or fortuitously won) cash.

What Did the Court Consider?

In reaching its decision, the Court considered several factors, including:

  • Who had purchased the winning ticket;
  • Who had chosen the winning numbers;
  • Where the winnings were deposited; and
  • The degree to which the parties’ finances had been intermingled during the relationship.

The Court ultimately decided that the applicant had not contributed to the purchase price of the ticket and had no involvement in its purchase. The respondent had deposited the winnings into his personal bank account to which his wife had no access, and that the couple had at all times during the relationship kept their finances separate. Consequently, the Court was able to determine easily from whose financial resources the ticket had been purchased.

Quick Tips For Keeping What’s Yours, Yours

If you are in a marriage or de facto relationship and are desirous of keeping your finances separate or wish to quarantine a windfall, the case serves as a timely reminder as to practical steps that you can take to protect your finances.

1. Get a Binding Financial Agreement 

A Binding Financial Agreement or BFA can define from the outset what property belongs to which party, and that in the event of a separation, such separate property will become that party’s property to the exclusion of the other.

2. Keep Separate Accounts and Clearly Define Any Joint Spending 

Had the parties finances been mixed, or had they even had a joint account into which the winnings had been a deposit, the Court’s decision indicates that its findings may have been very different.

 3. Keep Accurate Records of Financial Matters

Being able to claim the parties finances were separate, and being able to prove it, are two very different things. To the extent each party made specific and agreed on contributions to joint expenses, these should be documented.

Key Takeaways

The decision not to award the wife any of the lottery winnings was one which has surprised many, including family lawyers. It appears almost a departure from the usual ‘4-step process’ of determining the parties entitlement to property and brings into play a potential new line of argument, whereby assets can be ‘quarantined’ from the pool in certain circumstances.

Please note that LegalVision is a commercial law firm and cannot assist with family law matters.

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