What is a Property Settlement?
Following the breakdown of a relationship (either de facto or marriage) a decision has to be made regarding how the assets are to be divided. Usually there is mutual agreement that each party is entitled to something but agreeing on what each party is entitled to is not always as simple.
Divorce versus Property Settlement
Property settlements and divorce under the Family Law Act are entirely separate things.
A divorce is simply the deregistration of marriage with the Department of Births, Deaths & Marriages.
To obtain a divorce, your situation must have the following elements:
- You must have been separated for at least 12 months;
- You must consider that the relationship has irretrievably broken down; and
- You must consider that there is no likelihood of cohabitation being resumed.
Unlike divorce, a property settlement determines the division of assets and can be commenced immediately following separation.
What is Included in a Property Settlement?
Any asset accumulated during the relationship up until the date that a property settlement is finalized can be included in the asset pool.
This means that even assets accumulated post separation, but prior to settlement, can be and will most likely be considered at settlement.
Accordingly, alongside determining the distribution to each party, a correctly managed property settlement will end the financial relationship between the parties and ensure that your ex-partner cannot claim any of your future assets.
Options to Formalize the Settlement
Property settlements can be decided either via consent or by court order.
- Settlements by Consent can be formalized through court made Consent Orders or through a Binding Financial Agreement.
- If no consent is reached, an application for Property Orders can be made at either the Federal Circuit Court or the Family Court.
Determining the Distribution
The property settlement broadly includes the following four steps.
1. Identification and valuation of the couple’s assets, liabilities and financial resources
As noted above, this literally includes everything of value held between the parties up until an agreement is reached or court order made. This can include:
- Houses and Properties
- Cash Holdings
- Credit Cards
- Motorbikes/Jet Skis
- Personal Loans
- Superannuation (either in a managed fund or Self Managed Superannuation Fund)
- House Contents
As this is not a conclusive list, you should contact one of our experienced family lawyers to obtain advice regarding what assets will be included in your property settlement.
2. Assessment of financial and non-financial contributions
Financial contributions include direct contributions such as wages and salaries from each party as well as indirect contributions such as gifts and inheritance from family. Non-financial contributions include factors such as caring for children, housekeeping and maintenance.
It is important to note that caring for children and employment are usually considered equal contributions in a property settlement.
3. Other Considerations
Section 75(2) of the Family Law Act 1975 provides a list of matters that should be considered, including the following:
- The age and health of the parties.
- The duration of the relationship.
- The income and financial resources of the parties.
- The physical and mental capacity.
- Care and control of children under the age of 18.
- Employment and commitments necessary to support each party and/or children under their care.
- The standard of living and that the standard of living in the circumstances should be reasonable.
- Payments of child maintenance.
- The effect of any property settlement on any of the above.
- Other relevant matters.
During your initial consultation with one of our family lawyers, you will be advised regarding the above factors and others which may influence your property settlement.
4. Evaluation of whether the decisions taken in the first three steps are just and equitable in all circumstances
Based on all the information provided, the aim will be to determine what a just and equitable division would be for your case. During your first consultation, our family lawyers will advise what your entitlements are based upon the information that you provide.
Property Settlement Advice
The Family Law Team at Pentana Stanton Lawyers has helped numerous individuals obtain favourable outcomes in respect of property settlements with their former partners. This includes both matters resolving via agreement between the parties and matters that are litigated in court.
Our lawyers in Dandenong will ensure that you are provided with practical legal advice regarding how you can negotiate effectively with your former partner and settle disputes amicably and cost-effectively. If things are not amicable with your former partner we will negotiate these matters on your behalf in an effort to resolve the property dispute efficiently and without any unnecessary court costs.
Contact our family law team on (03) 900 22 800 to schedule an appointment to discuss your property settlement and entitlements.