Global v Asset by Asset Approach in Property Settlement 

Global v Asset by Asset Approach in Property Settlement

The Family Law Act 1975 (Cth) of Australia provides a framework for determining the division of assets and liabilities when a marriage or de facto relationship ends. This legislation does not differentiate between “long” or “short” relationships explicitly; rather, it mandates the evaluation of numerous factors, including the length of the relationship, the financial and non-financial contributions of each party, and the future needs of each individual. However, in the assessment of contributions, it is the courts that have drawn distinctions between short and long-term relationships.

The Federal Circuit and Family Court of Australia (FCFCOA) often adopts two predominant methods for the division of property: the Global Approach and the Asset-by-Asset Approach. While both methods are based on an equitable distribution of assets, they differ significantly in how they are applied, especially when it comes to short-term relationships.

The Global Approach

Under the Global Approach, the court considers the total pool of assets accumulated by both parties during their relationship and attempts to make a just and equitable division. This method assesses the combined contributions, both financial and non-financial, made by each party towards the acquisition, conservation, and improvement of all property, irrespective of when those contributions were made. The Global Approach is generally applied in long-term relationships where the assets of the parties are deeply intertwined and the individual contributions to each asset are difficult to discern.

The Asset-by-Asset Approach

Contrarily, the Asset-by-Asset Approach, commonly implemented in short-term relationships, treats each asset as a separate entity for division. The court meticulously evaluates the contributions made by each party to each individual asset rather than considering the total asset pool. This approach is particularly relevant when a party has brought significant assets into the relationship, as it allows a closer examination of the value of these assets and their appreciation during the relationship period.

In short-term relationships, the contributions of each party are easier to identify and separate, which is why the Asset-by-Asset Approach is generally preferred. For instance, if a party owned a property before the commencement of the relationship, and the property’s value has remained relatively stable, that party is likely to retain the asset after separation.

However, it is crucial to note that while these approaches provide a framework, the final determination of property division is inherently discretionary and depends on the unique circumstances of each case. The Family Law Act 1975 stipulates that any settlement must be “just and equitable”. Consequently, the court considers several factors, such as the duration of the relationship, the age and health of the parties, their income and financial resources, and their ability to gain employment.

Key Takeaways

The application of either the Global Approach or the Asset-by-Asset Approach depends on the specific circumstances of the relationship. Neither approach offers a guaranteed outcome, emphasizing the importance of obtaining legal advice tailored to individual circumstances when navigating property settlements under the Family Law Act 1975 (Cth).

Ultimately, it is essential to recognize that the Family Law Act 1975 (Cth) aims to ensure a fair distribution of assets, considering the unique factors of each relationship and providing the court with considerable discretion to achieve a just outcome. Whether a relationship is termed as “short” or “long”, what remains crucial is a comprehensive evaluation of the contributions, needs, and future circumstances of each party.

If you require legal advice or representation in any legal matter, please contact our office on 1300 111 835 or by email The Family Lawyer


Kristdel Bolog

Kristdel Bolog

Founder & Head of Family Law

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