Inheritance in Property Settlements
Have you received an inheritance during your relationship or have you received an inheritance after your relationship broke down?
Does the timing of inheritance change the way it is treated by the Family Court system?
Family Court has a wide discretion to make orders
For some time the case of Bonnici v Bonnici  FLC 92-272 has been the authority with respect to how inheritance is dealt with by the Family Court. The case concerned a considerable inheritance that was received by the husband late in the relationship. The Court held that the inheritance would form part of the property pool and the timing of the inheritance did not make a difference.
The principle of Bonnici was recently affirmed by the Family Court in the case of Calvin v McTier  FamCAFM 125. In this case the husband received an inheritance from his father 4 years after the parties separated. The wife brought an application for property settlement and was granted leave to proceed with the application after the statutory time limit.
The case reinforced the fact that the Court has a wide discretion in granting orders that are ‘just and equitable’. The husband argued that there was no connection between the inheritance and the marriage and therefore, the inheritance should not be taken into account. The Court disagreed and included the husband’s inheritance in the property pool. After necessary consideration to contributions and future needs of both parties the property pool was divided 65% to the husband and 35% to the wife.
However, even if an inheritance is included in the property pool, the actual division of that pool will be effected after consideration is given to the contributions of the parties. The contributions with respect to the inheritance will depend on the individual facts of the case but carer responsibilities or expectation of mutual benefit may affect the contributions of each party in relation to that inheritance.
Three points to remember:
The Court has discretion to include an inheritance in the property pool, notwithstanding it was acquired after the relationship broke down.
A connection between the property and the marriage is not a requirement.
As with any property, the contributions of the parties will be taken into consideration with respect to an inheritance.