Jackpot! Is your partner entitled to your lotto win in your divorce?
Assisted by Carli Heald and Holly Pitt
We all dream of winning the lottery but if a marriage breaks down after your win, your dream could become the stuff of nightmares. Just how much can your soon-to-be ex claim of your good fortune? In a twist, now pretend that you hit the jackpot in the first year of your decade long nuptials…
That’s just what happened in the case of Elford & Elford, where the court heard an appeal from orders of a property settlement at the end of a relationship.
Mr Elford was lucky enough to win more than $622,000 on a ticket he bought about 12 months after the couple’s marriage. Rather than splurge, the financially prudent Mr Elford placed the winnings into a term deposit account, solely in his name. The money remained untouched for the duration of the relationship and formed the majority of the property pool.
When the couple separated, they applied to the Court seeking orders for property division. Mr Elford’s winnings were now worth a juicier $1 million and the judge decided that this money should be seen as a financial contribution made by Mr Elford only.
Mrs Elford appealed and said that after ten years of marriage, the contribution should be considered ‘joint’ and split accordingly.
The Court dismissed the wife’s appeal. It was held that Mr Elford was solely responsible for this financial contribution and Mrs Elford received about 10% of the combined property, inclusive of the lottery winnings.
Why weren’t the lottery winnings split between the two?
What was interesting (and unusual) about this case was that the couple kept their assets and finances separate during their marriage. Mr Elford’s income was used to meet expenses related to his property and utilities while Mrs Elford’s income supported her three children from a previous relationship, and purchased food and groceries for the household.
Additional factors that the court took into account included:
- Mr Elford was solely responsible for purchasing the ticket
- Mr Elford chose the winning numbers himself, using the exact numbers that he had used on a weekly basis when purchasing previous tickets
- The winning ticket was only in Mr Elford’s name
- The winnings were placed into Mr Elford’s personal bank account (the couple had no joint account) and were treated as his sole asset throughout the relationship.
Although unusual, this case sets out the legal principle for how lottery winnings should be treated in property settlements of a similar nature. Importantly, it serves as a warning that your marriage may not necessarily be viewed as a ‘joint financial enterprise’, and that in Australia, there is no concept of ‘community ownership of property’ arising from the mere fact of marriage. There can always be exceptional circumstances where a contribution made by you, or your partner, may be viewed as not having been accrued from your relationship.
If have questions or enquiries on how to protect your assets throughout your marriage or your relationship breakdown, please contact: