How can the law be improved?

The law can be better. We have several ideas and we want to know what you think about them.

To explain our ideas, we want you to read Fergus and Victoria’s story and tell us what a fair outcome would be.

Victoria and Fergus
Victoria and Fergus are in a relationship. Victoria has just graduated from university and works at an accountancy firm. Fergus has been working for a few years.

Two years later Victoria leaves her job to look after their first child. Fergus continues his job and qualifies as a chartered accountant.

Victoria and Fergus have two more children. Victoria stays at home to take care of the children.

Ten years later Fergus becomes a partner in an accountancy firm.

Victoria and Fergus then separate.

They have a mortgage-free house and a few other assets. If Victoria and Fergus divide their relationship property equally, each partner will get property worth roughly $150,000.

Victoria gets a junior job at an accountancy firm. She works part-time so she can care for the children. Victoria’s mother provides childcare the rest of the time without compensation.

Victoria’s salary is $40,000. Victoria’s standard of living drops. She moves to a smaller house in a different neighbourhood. She has less time to spend with her children because she must work.

Fergus earns $350,000 a year. He continues to enjoy the same standard of living the couple had when they were living together. He takes care of the children on the weekends.

What do you think should happen?

Option 1
Victoria should get compensation if she can show two things:

(1) there is a big difference between her income and living standards and Fergus’s income and living standards;

(2) her role in the relationship meant she gave up career opportunities.

Victoria’s compensation would be either a proportion of Fergus’ future income, or a larger share of the relationship property.

Option 2
Fergus’s ability to earn income should be treated as an item of relationship property and divided.

This would require a court to work out two things:(a) the value of Fergus’s income-earning capacity based on his likely future income and (b) the extent to which this income-earning capacity developed during the relationship.

A court would need to consider:

  1. What Fergus could earn when he started the relationship with Victoria and what he could earn when he left the relationship.
  2. How much Fergus is likely to earn in the future – This will depend on how much longer Fergus can work for and whether any risks affect Fergus’s future ability to work.
  3. How it should recognise that Fergus must still work to earn the income.

These are complex questions. Victoria and Fergus will probably need the help of experts. When the court has worked out the value of Fergus’s income-earning capacity attributable to the relationship, it would then divide that value equally between Victoria and Fergus. That would probably mean that Fergus must pay Victoria a sum of money reflecting the value, either from his separate property or from his share of the relationship property.

Option 3
Victoria should get periodic payments from Fergus. The payments should reflect what support Victoria needs and should compensate her for not being able to develop her career. The payments should also take into account what income both Fergus and Victoria earn and reflect the length of the relationship and the number and age of children that Victoria is caring for. Victoria should either get payments from Fergus as long as she needs to become economically self-sufficient, or for a specified period of say 1, 2, 5 or 10 years.

Victoria need not prove that the roles she and Fergus took in the relationship caused the difference in their income and living standards. It is enough that Victoria and Fergus earn different amounts and that Victoria needs support.

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