The 4 main steps in Property Settlement when you are going through Divorce or Separation.
We understand that when parties separate it is a difficult time for everyone. Not only are you going through separation, but you suddenly realise that the assets and liabilities accumulated throughout the relationship need to be dealt with.
If you have not been able to reach an agreement about property settlement there can be time limits that apply, should you wish to make an application in the Federal Circuit and Family Court of Australia. If you are married there are no time limits. If you are considering making a Divorce Application, you have 12 months from the date the Divorce Order comes into effect. If you were not married, you have 2 years from the date of separation.
When parties cannot agree on how to deal with assets and liabilities of the relationship or the percentages to each, the Family Law Act provides a framework to assist parties on the overall division of the asset pool. Whilst there is no set formula and individual circumstances apply, the Family Law Act provides a four-step approach to property division.
The first step is to identify all assets and liabilities of the relationship and the value of each. Each party must disclosure to the other all assets and liabilities in their sole name or with any other person. Chapter 6 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 set out what documents ought to be exchanged between separated parties in order to identify the assets and liabilities of the parties.
The second step is to determine the financial and non-financial contributions by each of the parties. Non-financial contributions might include caring for children and household duties such as cleaning, cooking, gardening, renovations and improvements in and around the family home.
Step three considers the future needs of each of the parties such as earning capacity, age, state of health, whether one or both parties are supported by a new partner and whether one party has greater care of children to the relationship.
The final step is to consider whether the division of the asset pool is just and equitable in the circumstances.
Shorter Legal understands that each relationship has differing circumstances and we are able to provide detailed advice and assist with all processes relating to property settlement.
Schedule an appointment with Shorter Legal to discuss your matter.
Prepared by Tanya Donald