What is property settlement in family law?
A family law property settlement is in relation to dividing the assets, liabilities and superannuation of couples once they have separated. Property proceedings may be issued if either party is either present or ordinarily resident in Australia or an Australian citizen when the application is filed.
To claim ‘de facto’ and be able to apply for a property settlement, you must:
- Have been living together for a minimum of 2 years; or
- Had a child together; or
- Have made substantial contributions (by one of the parties) to the relationship that if the court did not make orders for a property settlement, there would be a significant injustice.
What is the time limit to commence property proceedings?
The deadline for issuing a property (or maintenance) application is 12 months after a divorce order has taken effect, except by leave of the court or consent of the parties.
For a de facto relationship, a party may apply for a property (and maintenance order) only if the application is made within two years after separation.
Who can commence property settlement negotiations?
Either party may commence negotiations to divide up their assets, liabilities and superannuation after separation has occurred. If married, you do not have to wait until divorce is finalised.
Either partner may do this by communicating with one another whether verbally or in writing or through the assistance of legal representatives.
How is the property divided?
Dealing with property interests under Family Law is largely discretionary.
When the court considers what orders should be made, they will take into account:
- The financial contribution made directly or indirectly by or on behalf of a party or child or marriage to the acquisition, conservation or improvement of any property of either party;
- Any non-financial contribution (made directly or indirectly) as above;
- The contribution by a party to the welfare of the family in the capacity of homemaker, parent or otherwise;
- The effect of any proposed order upon the earning capacity of a party;
- Any other relevant factors under Section 75(2) of the Family Law Act or Section 90SF(3);
- Any other order made under the Act affecting a party or a child; and
- Any child support that a party has provided or is to provide or might be liable to provide in the future.
What is the four-step process?
There are four steps that the court generally considers when looking at or determining a property dispute:
- Identify and value the property liabilities and financial resources of the parties.
- Assess their financial, non-financial and welfare contributions.
- Assess any relevant Section 75(2) or 90SF(3) factors such as disparity of income and earning capacity and (the capital cost of) having the care of the children, and as an adjustment for the contribution-based assessment.
- Consider the affect of these findings and specify what order should be made considering all of the circumstances above and whether this is a just and equitable outcome.
How do I make my property settlement agreement binding?
In circumstances where parties have reached an agreement, it is important to reflect that agreement by way of a Form 11 Application for Consent Orders or a Binding Financial Agreement.
Once either of these documents are signed by both parties and, in the case of a Form 11 Application for Consent Orders filed with the court, then the agreement is binding on each party.
It is important to reflect any Agreement reached formally to ensure that there is a full and final settlement of property proceedings and that each party is now independent to regenerate their wealth or to protect you from the other party’s creation of debt.
What options are there if our negotiations fail?
If negotiations fail between you and partner, whether that be through legal representatives or communicating directly, it is always encouraged that the parties attend mediation prior to the filing of an application with the court.
If neither party is willing to attend mediation or mediation is not appropriate, then an application filed with the Family Court may be the necessary path to take to ensure your matter can be resolved.
It is important to seek legal advice prior to the filing of such an application before a court as the need to provide accurate evidence and comply with the pre-action procedures prior to filing, is often valuable.
Is my superannuation part of the property pool?
In all States save for Western Australia, superannuation is included as part of the property pool for married couples and de facto couples.
In Western Australia, parties are still unable to split superannuation (current as at November 2019).
I settled our property division years ago. Can I ask for a reassessment?
There are provisions in the Family Law Act that provide for parties to seek to set aside previous orders in the circumstances where final orders have been made.
It is important that you seek legal advice as to whether or not this step is appropriate for you and whether you would meet the provisions of the Act to open the door for reassessment.
Working through property settlement after separation is the biggest financial decision-making process. It is often an emotional and difficult time and can, at times, become bitter. Having specialised and highly experienced advocates working with you will assist you in making informed decisions that have security and longevity.