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Israel: Intended Assets Sharing Presumption Applies to Same-Sex Couples

(Sept. 8, 2015) On August 20, 2015, Israel’s Supreme Court rejected an appeal of a decision of the Tel Aviv District Court recognizing the applicability of the “assets’ sharing presumption” to a same-sex couple who prior to ending their relationship had cohabited while jointly raising the child of one of the spouses and jointly managing their business, economic, and social affairs. (Family Appeal Request 2478/14 Anonymous v. Anonymous (Aug. 20, 2015), THE JUDICIAL AUTHORITY (in Hebrew).)

The “assets’ sharing presumption” had previously been adopted by the Supreme Court in regard to assets acquired during the marriages of couples who married prior to the entry into force of the Spouses (Property Relations) Law 5733-1973 (SEFER HAHUKIM 5733 No. 712 op. 267) on January 1, 1974. The Law applied a “resource balancing presumption” to the distribution of marital assets upon the dissolution of marriage. According to prior Court decisions, couples who married prior to January 1, 1974, as well as those not legally married but recognized as “known to the public” as married, were presumed, unless otherwise proven, to have intended to mutually own assets that were either acquired during their relationship or used on a daily basis by them. A higher burden of proof of intent to co-own assets registered under only one of the spouses, however, was required for the couples who were not legally married. (Family Appeal Request 2478/14, ¶ 21.)

The appellant in this case did not contest that the parties qualified as being “known to the public.” (Id. ¶ 34.) She alleged, however, that the “assets’ sharing presumption” was inapplicable to same-sex couples, who are unable to marry in Israel. (Id. ¶ 29.)

The Supreme Court Decision

Justice Dafna Barak-Erez held that the starting point of the case is that the same rules that apply to the examination of parties’ intent to share property should apply to all spouses that maintain a relationship that qualifies as “known to the public” as married. (Id. ¶ 36.) The examination of the parties’ intent applies to the totality of the circumstances in each individual case, including to consideration of the social and legal conditions applicable at the time. Barak-Erez notes also that the current openness to same-sex relationships does not resemble the social climate during the formative years of the couple’s relationship. (Id. ¶ 37.)

According to Barak-Erez, Israeli legislation that has recognized the status of same-sex relationships for a variety of eligibility purposes – e.g., eligibility for minimum income benefits under the Income Assurance Law, 5741-1980 (43 Laws of the State of Israel 34, as amended) – does not distinguish among couples based on the reasons that made them “choose” to be “known to the public” as married rather than be legally married. (Family Appeal Request 2478/14, ¶ 38.) The inability to marry, accordingly, does not impact the burden of proof required to establish the existence of a relationship that would be subject to the “assets sharing presumption” for assets purchased together or used by the couple on a daily basis. A determination of the existence of intent to co-own other assets, as in the situation of heterosexual unmarried couples who are “known to the public” as married, would require a higher burden of proof. (Id. ¶ 42.)