Property Division

A property settlement is the formal division of assets and property following a separation, this can be finalised without applying for a divorce.

The Family Law Act sets out terms for property settlements. It is a complex process and is unique to each situation.

When a marriage or relationship breaks down there are several processes for parties to go through. Generally, these processes are divorce, property settlement and parenting arrangements. They are all separate legal processes.

A property settlement is the formal division of assets and property following a separation, this can be finalised without applying for a divorce.

The Family Law Act sets out terms for property settlements. It is a complex process and is unique to each situation.

CONSIDERATIONS FOR DIVISION

Things taken into consideration are:

  1. Net asset pool.
    This considers all assets, liabilities and superannuation of the relationship.
  2. Contributions.
    There are four types of contributions:

    • Financial contributions: all monetary contributions to the relationship including wages, money held by each party at the onset, termination money, winnings or awards;
    • Parenting contributions: who performed the parenting duties in the relationship.;
    • Homemaker contributions: the court will consider who performed the majority of domestic duties in the relationship;
    • Non-financial contributions: this can be anything that has resulted in an increase in the net asset pool, for example renovations.
  3. Future needs and earning capacity of both parties.
    The court can consider any future needs of either party and may make adjustments to the contribution percentage accordingly. This can cover a whole range of factors which the parties might be facing in unequal proportions. An example of this might be if one party has ongoing health issues that will need to be paid for and may prevent them from working.
  4. Whether the division is ‘just an equitable’.
    This is the final step. Though the result may seem appropriate in monetary terms, the practical effect may not be a fair result and further adjustments may need to be made.

WHETHER PARTIES AGREE

If both parties can reach an agreement on the division of assets, this can then be formalised and becomes legally binding. This can be done in two ways:

  • Consent orders: a legal document and is sent and bound by the court;
  • Financial agreements: this is a binding document but can, in some instances, be set aside by the court.

If parties are unable to reach an agreement court proceeding may need to be initiated. Before taking this step people can get specialist legal advice and representation, and participate in private dispute resolution.

CLICK HERE to see our dispute resolution service.

Contact our team today to find out more information about the process and how we can help you.