All love is not equal in family law

All love is not the same: when does a relationship become a de facto relationship?

For couples navigating modern relationships, the legal distinction between a romantic relationship and a de facto relationship carries profound financial implications. The Federal Circuit and Family Court of Australia decision of, Cizek & Mihov [2024] (“Cizek”), illustrates just how critical and complex this threshold determination can be, particularly when significant wealth is at stake.

A decade together, but not a couple in the eyes of the law

Ms Cizek and Mr Mihov spent over ten years in what appeared from the outside to be a committed relationship. He was a businessman with considerable wealth. She was financially dependent on him, receiving substantial support for herself and her children. They travelled together internationally. They attended social events as a couple. To many observers, they seemed like partners in a long-term relationship.

Yet when Ms Cizek sought property settlement orders claiming they had been in a de facto relationship for 12 years, the Court declared that no de facto relationship had ever existed and determined that Ms Cizek had no entitlement to share in Mr Mihov's substantial wealth, despite over a decade of financial dependence on him.

The legal test: more than just being together

Under section 4AA of the Family Law Act 1975 (“the Act”), a de facto relationship exists when two people have "a relationship as a couple living together on a genuine domestic basis." The Act provides factors courts must consider, including the duration of the relationship, common residence, sexual relationship, financial dependence, property ownership, mutual commitment to a shared life, care of children, and public reputation.

Critically, no single factor is determinative. The High Court in Fairbairn & Radecki (2022) confirmed that parties don't necessarily need to live together to be in a de facto relationship. What matters is whether they are "sharing life” as a couple and are committed to the same shared life.

What went wrong for Ms Cizek?

Despite a decade of involvement, the Court found several fatal deficiencies in Ms Cizek's claim:

1. No common residence

Throughout their entire relationship, Ms Cizek and Mr Mihov maintained completely separate homes in Melbourne. They spent approximately only 10 nights per year together when both were in the city. While they travelled together internationally and occasionally overlapped at a holiday property, they never shared a genuine common residence.

2. No financial intermingling

Despite Mr Mihov's generosity in supporting Ms Cizek financially, the parties did not operate a joint bank account, acquire property in joint names, intermingle- their incomes or assets or make joint financial decisions.

3. Different visions of the relationship

This was perhaps the most significant factor. The Court found that Mr Mihov and Ms Cizek were fundamentally committed to different relationships.

Mr Mihov wanted a monogamous relationship where they would live together, share a common residence, attend events together, and jointly share his wealth. He made his continued financial support conditional on Ms Cizek showing greater commitment to this vision.

Ms Cizek, by contrast, wanted to maintain separate residences, preserve her independence, travel with and without Mr Mihov, maintain the freedom to engage in other romantic relationships, and continue receiving his absolute financial support without the deeper commitment he sought.

The Court found there was "no meeting of the minds" and that each party was committed to a fundamentally different type of relationship. As Justice Austin noted on appeal, "without mutuality of commitment, it is just as difficult to see how the parties could be a 'couple' in a 'genuine domestic' sense."

4. Maintained separate lives

Whilst enjoying a relationship, the parties maintained very separate lives outside of their relationship. They travelled more often separately than together, and the relationship was not monogamous.

The cumulative effect of these factors painted a picture of two people who enjoyed each other's company and were physically intimate, but who were not genuinely sharing life as a couple on a domestic basis.

Critical lessons for couples

Mutual commitment must be to the same vision

The Cizek decision establishes an important principle: it's not enough for each party to be committed to a shared life. They must be committed to substantially the same shared life. While relationships need not be in "entire harmony" at all times, if the parties have fundamentally incompatible expectations about the nature of their relationship, it cannot constitute a de facto relationship regardless of duration or other factors.

Financial support alone doesn't create de facto status

Wealthy benefactors should understand that generously supporting a romantic partner financially, even for many years, may not create a de facto relationship entitling that partner to property settlement rights. The key distinction is whether the financial arrangement reflects genuine partnership versus one-directional support, however generous.

The "composite picture" matters

Courts do not mechanically check boxes against the statutory factors. They form a holistic "composite picture" of the relationship, weighing all circumstances. A relationship might tick several boxes yet still fall short if the overall picture doesn't demonstrate two people genuinely sharing life as a couple on a domestic basis.

Protecting yourself

For individuals in relationships not intended to be de facto relationships, several protective measures warrant consideration:

·            Financial binding agreements - a legally binding agreement prepared pursuant to the Act to protect or quarantine all or some assets from a property settlement claim.

·            Maintain financial independence through separate bank accounts, independent investment decisions, and avoiding joint ownership of significant assets.

·            Seek specialist advice. The threshold determination is intensely fact-specific and consequences for high net worth individuals are substantial. It is prudent to seek advice from a family law specialist about the potential legal consequences of a commencing cohabitation with a partner or developing a committed relationship with a partner.

The bottom line

All love may be genuine, but not all love is the same in the eyes of the law. The law requires genuine mutuality, a shared commitment to substantially the same vision of life together as a couple on a domestic basis before it will make property settlement orders.

Knowing where the legal threshold lies in your relationship could be the difference between financial security and a devastating loss. Don't leave it to chance. If you have any uncertainty about the legal status of your relationship under family law, we encourage you to reach out to Fiona Hoad and the experienced family law team at Bartier Perry for tailored, practical advice specific to your personal circumstances

Authors: Fiona Hoad & Katherine Jian

This publication is intended as a source of information only. No reader should act on any matter without first obtaining professional advice.