Home » Property Settlement
When facing the breakdown of a relationship, each party’s ability to support themselves is usually forefront of the mind. Your likely entitlement to the property of the relationship and how this would affect your standard of living may even impact on your decision to separate or not.
Some of the more frequent questions asked of our family lawyers are:
- What am I entitled to?
- Where will I live?
- How will I support my children financially?
- Can I afford to run a separate household?
- Will I have to change my working arrangements?
- Will there be a division of superannuation?
- Can I afford to start over?
It is difficult to make decisions about separation in a vacuum, so it is important that you seek comprehensive advice about separation and property settlement. Every relationship is unique and there is no cookie cutter or broad brush advice to be applied to every situation. The advice of your well-meaning friends or relatives may be as useful to you as a chocolate teapot.
It is vitally important that you know and observe your limitation dates. A limitation date acts as a bar to prevent the commencement of legal proceedings. If you miss your limitation date you will be required to seek the leave of the court to divide property.
The limitation dates which apply to property settlements are fairly straightforward. If you are in a de facto relationship, you have two (2) years from the date of separation to commence property settlement proceedings.
If you are married, you have one (1) year from the date of divorce to file proceedings. If you have separated, we would strongly advise that you seek legal advice regarding your particular situation as soon as possible.
There is a 5 step process the Court applies to the division of the assets of a relationship as follows:
- The Court decides whether it would be just and equitable to make a property division. If the Court decides it would not be just and equitable to make a property settlement in the circumstances, the Court cannot make an Order to divide the property.
- The second step in the process is to identify and value the property pool. Essentially, this step requires you to ask :
- What property do we have?
ii. How much is it worth?
Property will include real estate, vehicles, household furniture, superannuation, shares, trust funds, interests in a business or partnership, and funds in bank accounts etc. It will also include debts and liabilities including mortgages, tax debts, credit card debt, car loans, charges on property, and any other liability.
It is not unusual for parties to disagree about the value of the family home or other assets and may be necessary to appoint a professional valuer. There may be a need to have a superannuation interest or business valuation by a professional in certain circumstances.
- The third step is to consider the contributions made by each party to the property pool. The contributions are classified as financial contributions, non-financial contributions and contributions to parenting and homemaking.
- The fourth step is to consider the future needs of each party. Relevant factors will be such things as the age difference between the parties, their health, their earning capacity, and the care of young children.
- The final step taken by a Court in property settlement matters is to decide what division is just and equitable. This involves the Court looking at the situation as a whole and deciding what division it considers fair taking into account the property pool, the parties’ contributions, the needs of the parties, and any other factor it considers relevant.
Most property settlements occur by negotiation and without the need to file proceedings. If you are able to agree on the settlement of the property, consent documents can be drafted and filed in the Court to finalise the property settlement. If the Court approves of the agreement it will make an Order in the terms of the agreement. The Order is enforceable by a Court and may provide a stamp duty exemption.