If you and your partner have separated and you’re planning on getting a divorce, the first thing to do is a property settlement.
A property settlement is separate from getting a divorce. It is the agreement or Court Order made regarding how your property is to be divided.
You and your partner can agree to a property settlement or failing this, you can make an application to the Family Court of Australia or Federal Circuit Court of Australia for court orders dividing your property.
In determining a property settlement in Australia the courts adopt a 4-step process.
Identify all your assets, liabilities and financial resources, whether they are in joint or individual names.
Assess the contributions both financial and non-financial (such as homemaker duties) made by each of you.
Consider future needs and whether adjustments should be made to the division of property.
Determine whether the property settlement is just and equitable in the circumstances.
Getting the 4 step process right
The devil is in the detail.
Whilst it may at first seem quite simple, this four-step process can be quite complicated. It requires diligence and an eye for detail, which can often be hard when dealing with the emotional turmoil of separation. This is why we always recommend seeking legal advice before agreeing to any property settlement, to ensure your future is protected.
We can’t agree to a property settlement, what happens now?
If you and your partner can’t agree to a property settlement, you should seek legal advice, involving solicitors often assists people to reach an agreement.
If you and your solicitor have exhausted all avenues, you can apply to the Family Court of Australia or Federal Circuit Court of Australia for property settlement orders.
Using the four-step process above, the Court will make a determination and this will be recorded in Court Orders. Once a decision is made, it is very difficult to overturn.
The court process is long, laborious and expensive. It should be your last resort.
We have reached a property settlement; does it need to be documented?
Yes, documenting your property settlement is vital as it brings finality to the agreement. The last thing you want is to implement the agreement without it being documented only to find yourself back before the courts in years to come because your ex-partner wants a bigger piece of the pie.
How should our property settlement be documented?
There are two ways your property settlement can be documented:
This is the most common and effective way to document your agreement. Consent Orders are made by the Court and are very difficult to overturn once made. Prior to making Consent Orders, the Court will need to be satisfied that the property settlement is just and equitable having regard to your individual circumstance.
You do not need to attend court to apply for Consent Orders.
Binding Financial Agreement
For a Binding Financial Agreement to be effective both you and your partner must:
- Sign the Agreement; and
- Seek legal advice on the agreement.
Binding Financial Agreements can be risky. You need to make sure that they have been correctly prepared as they can be susceptible to being set aside by a court.
Don’t be bullied into a property settlement
If you find your partner unwilling to disclose their financial situation, or to acknowledge your contributions throughout the marriage; if you find assets being ignored or purposefully hidden from you; or if you are concerned about supporting yourself in the future, you should consult a lawyer before agreeing to any property settlement proposal.
Our family lawyers at Atkinson Vinden are well versed in the language of family law. They know the details that could save your future. If you’re concerned about your future, you should get in touch with one of them for advice today.