Separating is hard, not just emotionally but also financially. Once a couple separates, there’s a need to divide their assets and properties, including any debts. This is known as property settlement. Sometimes, such an event is already decided through pre-nuptial agreements whilst most people decide on them after the separation.
But not all separations are financially difficult. Decisions on sorting properties can be done without court involvement. If you and your former partner reach an agreement, it can be formalised by applying for consent orders in the Family Court. However, if that is not the case, you and your ex can apply for financial court orders that relate to the division of properties and the payment for your former spouse or de facto partner’s maintenance.
In most cases, parties don’t need to ask the Court to divide their properties for them. Many division of properties were made by the parties with the help of their lawyers. Once they’ve reached an agreement, they can make an application for consent orders, which is a relatively straightforward procedure.
Once the Court has made a consent order, the parties have the benefit of knowing that their agreement is legal with tax benefits as an add-on.
There’s no real formula for dividing properties between partners. No one can exactly tell you what the judicial officers’ order will be. Decisions will be based on all the evidence presented and the unique facts of the case.
The Family Act of 1975 is the main law that governs matters regarding divorce and property settlement after the marriage or de facto relationship breaks down. Jurisdiction with these matters are under two courts, namely the Family Court of Australia and the Federal Circuit Court of Australia.
The Family Act of 1975 lists the general principles that serve as the basis for resolving financial issues after a de facto relationship or marriage breaks down. The rules governing a de facto relationship or a marriage are the same.
When settling finance disputes after a couple separates, the court wworks out the couple’s possessions (assets, including superannuation), their debts or liabilities, and their financial assets. Unless a pre-nuptial agreement has been made, the court takes everything that the couple has in consideration for financial settlement in the Family Court. The debts incurred during the marriage or the de facto relationship will also be settled and divided between the two parties.
In addition, the court also considers both partners’ past contributions during the marriage or relationship, which includes the following:
The Court also takes into consideration the future possible financial difficulties of both parties, along with their health, age, and income, as well as their future needs, such as the care of children and their financial resources.
As long as it’s practicable, the Court will make a decision that will settle the financial duties and obligations of both parties.
The primary step in applying for a court settlement is the identification and valuing of all the assets, liabilities, and financial resources of both parties, whenever and however such were acquired. In most cases, the first step is the easiest one; however, some hire experts if the valuation is quite complex and big.
The second step involves the appraisal or assessment of the parties’ contributions during their relationship.
In many cases, the Court will form the view that the parties have contributed equally, especially where the relationship lasted a long time. However, these are the following instances when the Court may discover that the parties’ shares were unequal:
The third step includes the assessment of possible future needs that you and your partner may have.
Once the Court has considered these factors, a decision will be rendered on whether an adjustment for either party is needed to make reparations or compensation for any deviation in their future circumstances.
The Court will examine whether the parties’ proposed division of assets is fair to each other. This is done after completing the assessments in the first three steps and includes an analysis of the case’s circumstances.
If you were married, then you should apply for property adjustment within twelve months of your divorce’s finalisation. On the other hand, if you were in a de-facto relationship, then you should apply for property adjustment within two years of the relationship’s breakdown.
Failure to file the application within these time limits will require you to obtain a special court permission, which may not always be granted.
Separating properties can be difficult. However, applying for property settlement becomes easier and more bearable when you have a legal counsel by your side whom you can ask about everything pertaining to your case.
If you have more questions about your property settlement case and other related concerns, contact us today to discuss. We will take the stress out of the tedious property settlement procedures.
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