Imagine paying your mortgage and rates for six years, only to realise you do not legally own your house — that is what happened to a Cairns woman who went bankrupt after falling victim to a romance scam.

Key points: Robyn Hausler's home became the Crown's property when she went bankrupt in 2013

Robyn Hausler's home became the Crown's property when she went bankrupt in 2013 The Cairns resident had no idea she'd lost her house until she tried to refinance

The Cairns resident had no idea she'd lost her house until she tried to refinance The Federal Court has now ruled that she can have her property back

Robyn Hausler went broke in 2013, but instead of repossessing the Trinity Beach duplex where she had lived for 20 years, her bankruptcy trustee disclaimed the property, meaning it became the property of the Crown.

Unaware of this, Ms Hausler stayed on at the property and continued making mortgage repayments to her bank, only realising something was amiss when she tried to refinance.

"My mortgage broker rang and said the new bank I had chosen was having trouble registering the loan on the title," Ms Hausler said.

Ms Hausler sought advice from solicitor James Harding from law firm Holding Redlich, who looked into her case to find the property had not been hers for several years.

"Robyn's in our office and she's crying and I'm almost crying and we're handing each other tissues and it was all very full on," Mr Harding said.

"This was the first time Robyn had found out she actually didn't own the property, and it was probably $30,000 to $60,000 at the cheapest to have a chance at getting that property back.

"She told me it's a duplex, her elderly parents live next door and what it would mean to her if she did lose this house.

"I had to go to my colleagues and say, 'guys, this is just a case that we just have to help on.'"

James Harding doubts he'll come across a similar case again. ( Supplied: Holding Redlich )

Mr Harding took Ms Hausler's case on a pro bono basis, describing it as "very strange and very unusual".

"At the time of the bankruptcy there was more owed to the bank than what the property was worth, and because it's a liability to the estate of the bankrupt, the trustee has the power to what's called 'disclaim' the property, and that's essentially cleaning their hands of it," he said.

"Usually where this would happen, which is very rare, the bank would normally take possession of the property, sell it, recover what they can, write off the rest from their insurer.

"Instead of doing that, they let Robyn stay in the property paying down the principal and interest mortgage, and that continued for six or seven years."

Duped by a romance scam

Ms Hausler's financial troubles began when she was contacted by an online scammer at a time when she was suffering from depression.

"He said all the right things and made me feel better about myself, and so I started a 14-month, so-called relationship where I sent a lot of money overseas," she said.

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"I'm not a silly person … but it's just a bad combination when you're depressed and you just want to have a relationship, and then these people find the vulnerable thing in you and they'll just target that.

"They just spin you a whole lot of stories and it's so easy to fall for it when you're in that frame of mind."

The scammer always had an excuse to cancel arrangements to meet and eventually stopped responding to Ms Hausler's messages.

Meanwhile, her credit problems were deepening and she was advised to file for bankruptcy.

"I said to the people who were handling my credit problem that I needed to keep my house," she said.

"If I lost my house I would kill myself because that's the frame of mind I was in."

A case without precedent

Ms Hausler applied to the Federal Court of Australia to reclaim her property.

Section 133 (9) of the Bankruptcy Act 1966 (Cth) gives the court the discretion to grant ownership of disclaimed property to a person where it deems it is "just and equitable".

Twelve months later, with consent from the State Government and the bank, the Federal Court ruled in Ms Hausler's favour.

Robyn Hausler in front of the Trinity Beach home she lived in for two decades. ( ABC Far North: Sharnie Kim )

"As the judge started saying, 'I'm satisfied with this and this,' tears just started running down my face," she said.

"The morning after the court hearing, I walked outside and the sun was shining.

"I was looking outside at my patio and I'm thinking, 'Oh my god, this is all mine again.'"

Mr Harding said it was the first case, to his knowledge, where the court had vested disclaimed property back to a bankrupt.

He said people in financial strife should be careful when dealing with debt consolidation companies.