Occupational rent and other post-separation contributions

After a separation it takes time to sort out what will happen to jointly-owned property such as the family home.  In the meantime, the parties may still be paying towards the upkeep and maintenance of the joint property, even if only one of them of them has the benefit of using that property.   What can be done to make things fair?

Post-separation contributions

Where one party has used their separate funds towards the upkeep, maintenance, and/or the increase in value of relationship property, that party may seek compensation for their contribution.

For instance, Jamie’s salary was being paid into a joint the bank account and this continued after the separation.  From the joint account Jamie paid for rates, insurance and the mortgage on the family home, and this continued after the separation for several months.  

Jamie’s ex-partner had his income paid into his own separate account, which he used to pay for his own living expenses after the separation. 

When it came to dividing the joint account, Jamie received a sum of $10,000 more than his ex-partner, to compensate him for the contribution he made towards the upkeep and maintenance of the family home after the separation. 

Occupational rent

If one party has exclusive occupation of the family home, then the non-occupying party, who likely has additional accommodation costs, may be entitled to compensation for the income that could have been generated from renting the family home.

Occupational rent is usually payable for the period of time from separation until the new ownership of the family home is finalised.  Occupational rent is typically equivalent to half of the market rent from the date of separation until the date of settlement.  

Sometimes a claim for occupational rent will be off-set by a counter claim for spousal maintenance from the other party.

In our example above, Jamie’s ex-partner remained in the family home, while Jamie moved out. A market rent appraisal indicated that the family home could be rented for $500.00 per week, so Jamie received $250.00 per week from his ex-partner as Occupational rent compensation, until the sale of the family home was finalised.

Find out more about financial support after a separation.

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