The end of a relationship can be a complicated and emotional time for all parties involved. Whether it’s a de facto relationship or a marriage that has ended, a number of processes need to take place, such as the division of your property and assets.

The division of property can be sorted out between the parties privately, with the help of mediators and/or lawyers, or through the Court system. For some former couples, it can be a simple process, however, for many, it can be challenging as there are many considerations that need to be made and factors that can influence the outcome.

A potential influencing factor in a property division is the issue of gambling wastage. Gambling wastage refers to the amount of money lost by an individual due to excessive gambling and can significantly impact financial resources available for property division, as well as how these resources will be divided.

In this article, we will discuss how gambling wastage can impact family law proceedings in Australia, with a focus on property division. Whether you’re currently undergoing divorce proceedings or considering separation and are concerned about your property settlement, keep reading to learn more.

What is wastage?

Before we dive into gambling wastage, it’s important to understand wastage as a concept in Australian family law.

Wastage is when a party reduces the matrimonial assets pool of a relationship either intentionally or by acting recklessly, negligently or wantonly. This may sometimes be referred to as negative contributions.

In a marriage or de facto relationship, the financial gains and losses are often shared, however, wastage can occur when a party participates in actions or behaviours that are not justifiable for the loss or decrease of the asset pool and may consist of actions such as drinking, drugs, prostitution, adultery, infidelity or gambling.

Examples of gambling wastage in Australian family law cases

The issue of gambling wastage has appeared in numerous cases in Australian family law history. Here are some examples of instances where gambling wastage has been cited in a case:

De Angelis and De Angelis 2003

In this case, the wife had lost $154,000 from gambling during her 33-year relationship with her husband. The court decided that the amount lost would be considered in their property settlement. As a result, the wife had to pay $42,000 to the husband. The calculation was based on the fact that the wife had received $70,000 from her parents during the relationship, which was subtracted from the gambling loss. Then, the wife was held responsible for paying 50% of the remaining $84,000 gambling loss to her husband, resulting in a total payment of $42,000. The court stated that even though the wife’s gambling may have been due to her illness or a form of entertainment, the amount of money lost was very high compared to the total value of their assets, which was around $530,000.

Crampton and Crampton 2006

In this case, the wife’s gambling losses totalled $140,000 from gambling over a year, but it didn’t affect the amount of property she was entitled to in the divorce settlement. This was because she was diagnosed with a mental health condition called dysthymic disorder, which led to her gambling. The husband couldn’t prove that her gambling was reckless or careless given her medical condition. If your spouse has a history of gambling losses, it’s important to get legal advice because every case is different.

Hamilton and Thomas 2008

In this case, the wife gambled $100 per week from 1999 to 2003, which resulted in $20,800 of financial losses incurred. However, the court determined that this amount wasn’t significant enough to affect the property settlement between the couple. The court believed that the losses from gambling weren’t so large compared to the overall lifestyle and contributions made by both parties. They needed to see a greater level of wastage compared to positive contributions made by each of the parties before making any adjustments. The total value of the couple’s assets in this case was $820,000.

Where does gambling wastage get considered in the process?

Losses from gambling are usually taken into account in the property settlement in one of two ways.

The first way is as part of step one when working out the value of the asset pool the loss will be notionally added to the total value of the pool, as an addback and be considered as a sum that the person who gambled that money would retain. The percentage share and value can be based on the total amount inclusive of the loss, and that loss value will be attributed to the final sum the gambling party receives. For example, if the asset pool was valued at $200,000 and included the value of gambling losses of $25,000, and it was decided that each party is to receive 50% of the pool, one party would receive $100,000 while the one who incurred the gambling losses would receive $75,000 in tangible assets as they already “received” the gambling loss.

The second way the gambling wastage could be taken into account is that in step 2 of the property settlement process, the loss could be considered to be a negative contribution and reduce the percentage of the overall property pool the person who gambled is to receive.

As you can see, working out how gambling wastage plays into a property settlement is not simple, which is why we recommend working with a family lawyer to make sure you’re receiving what is fair in your circumstances.

If gambling is an issue for you or someone in your family

Preventing gambling addiction and addressing the issue of gambling wastage can help to reduce the negative impact on families during divorce proceedings. There are several measures that can be taken to prevent gambling addiction, including setting limits on the amount of money spent on gambling, seeking support from friends and family, and seeking help through various counselling services and help groups.

Some of these services for help with gambling addiction in Australia include:

Gamblers Anonymous (GA):

Website: https://gaaustralia.org.au/

Phone: 1300 222 222 (24/7 helpline)

Gamblers Anonymous (GA) is a fellowship of men and women who share their experience, strength and hope with each other to help solve their common problem of gambling addiction. GA provides a safe and supportive environment where people can talk about their gambling problems and support each other in their recovery.

Relationships Australia:

Website: https://relationships.org.au/

Phone: 1300 364 277

Relationships Australia is a not-for-profit organization that provides a range of services to support individuals, couples and families to strengthen their relationships. They offer counseling, mediation and education programs to help people manage the challenges of life, including gambling addiction.

The Salvation Army:

Website: https://www.salvationarmy.org.au/

Phone: 13 SALVOS (13 72 58)

The Salvation Army is an organisation that provides a range of services to support people in need, including those struggling with addiction. They offer counselling, support groups and other services to help people overcome their addiction and rebuild their lives.

Gambling Help Online:

Website: https://www.gamblinghelponline.org.au/

Phone: 1800 858 858 (24/7 helpline)

Gambling Help Online is a national online support service for people affected by gambling addiction. They provide free, confidential support 24/7 through chat, email and phone. They also offer self-help tools, resources and information to help people understand and overcome their gambling addiction.

Lifeline:

Website: https://www.lifeline.org.au/

Phone: 13 11 14 (24/7 helpline)

Lifeline is a national charity that provides crisis support and suicide prevention services 24/7. They offer confidential support and information to people experiencing a personal crisis, including those struggling with gambling addiction.

Financial Counselling Australia:

Website: https://financialcounsellingaustralia.org.au/

Phone: 1800 007 007 (National Debt Helpline)

Financial Counselling Australia is a not-for-profit organisation that provides free, independent financial counselling services to people experiencing financial difficulties, including those struggling with gambling addiction. They offer advice and support to help people manage their finances and overcome their debt problems.