There are some common misconceptions in relation to property settlement which resonate around the community, often prompting fear or hesitation when there is no need. To start the New Year, I thought there may be value in discussing the most prevalent of these myths:
- Assets within companies or Trusts are protected from property settlement. This is a significant myth, and in all but the most unusual cases, there is no protection afforded by an entity controlled by one spouse.
- If you leave the family home you abandon any rights in relation to the asset. This is not true, and your right to seek an entitlement remains intact.
- Assets are valued, and balances taken at separation date. The assessment takes place at date of negotiation, mediation, or court determination and is constantly updated.
- Putting an asset in the name of my new partner, friend, Mother or neighbour will ensure its protection. Unless the third party is genuinely entitled to the asset and has contributed, this will afford no protection at all.
- That de facto property settlement rights arise from the moment you move in together. Other than where a child has been born, or there are exceptional circumstances, rights do not arise until parties have enjoyed a de facto relationship for a two year period, and even then, in a short relationship, the actual financial contributions are likely to drive the assessment of percentage division (so an automatic 50% entitlement does not arise at the 2 year anniversary of cohabitation).
- You will get back what you’ve put in, dollar for dollar. This is rarely the case, although financial contributions are weighed against other contributions.
- There will be a financial penalty if you are responsible for the demise of the relationship. This is an inaccuracy, and it is a `no fault’ jurisdiction.
- If you financially contributed you’ll receive more than your spouse whom remained at home caring for the family and domestic duties. In most instances these contributions are weighed equally.
- That superannuation is not available for division between married or de facto spouses. It most certainly is.
I commonly encounter clients at an initial attendance who talk about the experience of a family member, friend, or the bloke at the pub who only got 30%, so they’re “prepared for the same outcome”. There is a significant discretion which accompanies the determination of property settlement entitlements, and a myriad of factors to take into account. For this reason no two cases are the same, and the advice of an experienced practitioner is required. It is a mistake to assume a percentage entitlement because of the experience of another.
Accredited Family Law Specialist