Property Settlement
Money. It’s one of the few things in life that can drive us to act irrationally and in a way we never thought possible of ourselves. This is especially the case when our financial security feels threatened in any way.
Back to our practice AreasNow, if we combine that fear with the natural feelings of anger, betrayal, and sadness experienced at the breakdown of a relationship, along with the friend of a friend of a friend that “lost everything in the divorce” and ”‘got cleaned out”, we could end up with quite the situation.
Thankfully, our family law system is far more sophisticated, fair, and reasonable than it is given credit for.
With the right experienced family lawyer on your team, your property settlement can be a far more productive, swift, and amicable process than you ever dreamed possible.
What is a property settlement?
A property settlement in a family law context deals with the financial dissolution of a relationship or marriage. It takes into account all of the financial elements to be dealt with after separation, which includes more than just physical property.
- Cash
- Real property, including the family home and any investment properties
- Shares
- Business interests
- Superannuation
- Vehicles
- Other assets and liabilities
All of these assets and liabilities are collectively referred to as the “property pool”.
Who can access a property settlement?
De facto couples can access the family law system in the same way as married couples. The major difference between married and de facto couples is the time limits that apply after the breakdown of a relationship. Any court application for a property settlement must be made within 12 months of a divorce order coming into effect, or within 2 years of the date of final separation for de facto couples.
How is my entitlement to a property settlement determined?
There is no hard and fast rule about the percentage division of property following separation, and it would be a mistake to assume an outcome for your property settlement based on the experience of that friend of a friend of a friend, or the popular myth that everything will be split 50/50.
Determining a fair and equitable division of assets in a family law property settlement follows a four-step process.
Step 1: What is the net value of the property pool?
The first step is to gather all of the relevant information to be able to identify the value of each asset or interest, identify any debt attached to each asset or property interest, and then determine the net value of the property pool (also referred to as an “asset pool”).
Step 2: What did each party contribute to the relationship?
These contributions and factors include financial and non-financial contributions at all stages of the relationship, including parenting and homemaking contributions; as well as gifts, inheritances, and financial assistance and support from family members.
Step 3: What are the future needs of each party and any children?
This is where the more discretionary aspects come into play when considering things such as the length of the relationship, the age and state of health of each person, and the income and financial resources of each person.
Further factors are also considered, including the physical and mental capacity of each person for future employment, the care arrangements and needs of any children, the eligibility for any benefits or superannuation, child support payments, and any other factors relevant to ensuring a just and equitable division of property.
Step 4: Is the division “just and equitable”?
Without the legal jargon, this step essentially ensures that the final deal is fair for both of you.
Is it realistic and achievable in a real dollar sense, considering the value of the property pool, the contributions of each party, and the future needs of each party?
Spousal Maintenance
Spousal maintenance, popularised as “alimony” through the influence of US TV and media, is still a part of the Australian family law scene.
Spousal maintenance is essentially a payment made from one spouse to another in situations where one person is unable to adequately meet their own reasonable needs and the other person has the capacity to contribute to these needs after meeting their own.
Unlike what we are led to believe in TV shows and movies, there is no automatic right to, or presumption of, spousal maintenance. Like everything in family law, it will very much depend on your unique circumstances and there are situations where separating couples may have an obligation to provide ongoing financial payments to their former spouse or de facto partner.
Will I have to pay spousal maintenance?
When the Federal Circuit and Family Court of Australia is determining who is responsible for paying spousal maintenance, they will generally consider:
- who has care for and control of any children;
- the age and state of health of both parties; and
- the ability of both parties to obtain appropriate and gainful employment.
It is important to note that even if one party is unable to adequately support themselves, the party paying maintenance is only liable to support that person so far as they are reasonably able to do so.
If you are currently paying maintenance and your circumstances change, it is wise to seek expert legal advice from a spousal maintenance lawyer to determine what this could mean for you.
How is spousal maintenance paid?
Spousal maintenance payments are generally made through periodic payments as defined in your agreement or court order, a lump-sum payment, or directly paying the expenses of the other person (for example, receiving and paying their bills directly).
How do I apply for spousal maintenance?
Arrangements for the payment of spousal maintenance can be put in place by an agreement between the parties, or through a court order. Applications for spousal maintenance must be made within 12 months of a Divorce Order becoming effective or within 2 years of the final date of separation for de facto couples.
Spousal maintenance is an extremely detailed and technical area of family law and one that demands expert legal advice.
CONTACT A LOCAL EXPERT FAMILY LAWYER