Family Law Property Settlement

Shan Lawyers specialises in family law, so we understand all matters pertaining to family law property settlement both here in Australia and abroad. Our Principal and Director of our family law firm Thirumalai assists various clients with overseas connections, so she is experienced in assisting you with your family law property settlement.

Family Law Property Settlement: What You Need to Know

Numerous factors can influence the process of property division following a separation. These factors encompass the duration of the relationship, the characteristics and valuation of the assets involved, and the willingness of both parties to engage in collaborative efforts to achieve a resolution.

In cases where a long-term relationship ends and significant assets or business interests are involved, the process of dividing property can be quite complex. Many families have complex financial affairs and require expert advice on how to navigate these complexities as part of their family law property settlement.

Some of the complex asset structures that are regularly dealt with include family and unit trusts, companies, partnerships, joint ventures, businesses, property developments, self-managed superannuation funds, share options, jewellery, and overseas trusts and assets.

Helping You Navigate Family Law Property Settlement

We provide you with specialised and strategic advice for navigating complex asset structures in family law property settlements. Working hand-in-hand with accountants, financial advisors, and tax lawyers, we ensure that settlements are designed to avoid unnecessary tax issues. Plus, we support clients who haven’t been involved in the family’s financial affairs, helping them understand and navigate these financial arrangements with confidence.

It’s important to note that property division arrangements can be initiated as soon as you separate, regardless of whether the divorce is finalised for married couples. In fact, early discussions and agreements on property division can often streamline the overall divorce process.

For married couples, there’s no requirement to wait until the divorce is finalised to begin this process. In some cases, obtaining a divorce can actually help expedite the property settlement, especially when complex assets are involved.

Making Claims To The Court and Time Limitations

It is important you understand the time limitation involved when it comes to making a property or spousal maintenance claim to the court. As it currently stands the following apply:

If you were married: You need to make your applications within twelve (12) months of your divorce becoming effective.
If your marriage was declared null and void: Applications must be made within twelve (12) months of the decree of nullity being issued.
If you were in a de facto relationship: Property adjustment applications should be filed within two (2) years of the breakdown of your de facto relationship.

You need to seek leave from the Court to make your applications for property settlement or spousal maintenance outside these time limits. In limited circumstances, the Court may consider an application made outside these time limits. It’s important to adhere to these timelines, but if you need to discuss an out-of-time application, we’re here to assist you through the process.

Spousal (or De facto) Maintenance

Spousal maintenance is financial support paid by a financially capable partner to the other in order to assist with covering living expenses and maintaining a reasonable standard of living. This support is particularly important if the receiving partner is unable to adequately support themselves due to circumstances such as disability, unemployment, caring for children, or other factors.

To make a claim, a spouse or de facto partner generally needs to demonstrate that they are unable to meet their financial needs and that the other partner has the capacity to provide support. If you’re considering applying for or challenging a spousal maintenance claim, speaking to Shan Lawyers will help you understand your options and guide you through the process.

Four Step Process for Family Law Property Settlement in Australia

When you apply for a property settlement, the Court uses a ‘4-step’ process to determine your property application as follows:

1. Identification and Valuation of Assets

The first step involves identifying and valuing the assets, liabilities, superannuation and financial resources of the parties.

All property of the parties must be considered. Property includes all potential interests of the parties, regardless of when or how they were acquired.

Even if an interest or expectancy is not considered property, it may still be considered a financial resource of a party.

Debts are typically shared between parties unless one party has irresponsibly depleted marital assets, such as through gambling or intentionally reducing the asset pool. In such cases, these debts are not treated as normal liabilities and aren’t deducted from the assets.

The property must be identified at the date of settlement, not at the date of separation. Both parties have an ongoing obligation to exchange full and frank disclosure of their financial circumstances from the date of separation until the final property settlement is completed.

With respect to valuation, different types of assets are valued to ensure a fair division. Here’s who typically provides the valuations for various items:

Motor Vehicles: The value of motor vehicles is usually determined by an automotive valuer or appraiser. Alternatively, recent sales data or valuation guides such as RedBook or Glass’s Guide can be used to estimate the value.
Real Estate Property: The valuation of real estate is typically carried out by a sworn independent licensed property valuer or real estate appraiser (for example, kerb-side valuation to identify estimation). They assess the market value of the property based on comparable sales, market trends, and property specifics.
Business Interests: Valuing a business can be complex and often requires a business valuator or accountant with expertise in business valuations. They will consider factors such as financial statements, market conditions, and business assets and liabilities.
Defined Superannuation: For defined benefit superannuation funds, the valuation is usually provided by the superannuation fund itself or a specialist who can interpret the fund’s actuarial report. These funds have a predetermined payout structure, and their value can be more complex to determine compared to defined contribution funds.
Other Assets: For other assets like antiques, artwork, or collectibles, specialists in those specific areas (for example art appraisers, antique dealers) can provide valuations.

In family law proceedings, qualified and independent valuers are essential to ensure the accuracy and fairness of the asset division process. Each party may also have their own valuers to assess the assets and ensure transparency.

2. Contributions of Each Party

The second step is to assess your respective contributions since you and your partner began living together. This includes both financial contributions (such as wages, inheritance, savings, redundancy payments, gifts, lottery winnings, windfalls, and other income gained through specialised knowledge) and non-financial contributions (such as house renovations, gardening, and household duties).

Additionally, consider contributions to the family’s welfare as homemakers or parents, as well as any post-separation contributions such as paying family home expenses, utilities, and family medical insurance premiums and post-separations contributions to primary caregiving for the children.

3. Assessment of the Parties’ Future Needs

The third step involves assessing the future needs of each party. This means evaluating whether an adjustment is necessary based on several factors outlined in section 75(2) of the Family Law Act (see our resource page for more details). Some of the factors are listed below:

The age and health of each party. Each party’s income, property and financial resources are taken into account. Physical and mental capacity for gaining employment. Whether one party has the care of a child under the age of 18. Commitments to support oneself or others, such as a dependent parent or a disabled adult child. Eligibility for pensions, allowances, or benefits. The standard of living is considered reasonable in the circumstances. The financial impact of one or both parties living with a new partner.
How the relationship has affected one party’s ability to earn money, and to what extent?

4. Whether the Property Division is Just and Equitable

The fourth and final step is to decide whether the division of assets is just and equitable (fair and reasonable) for both parties. The Federal Circuit and Family Court of Australia will only make a property division if it is fair to both parties. The Court will take into account all circumstances of the parties and the above steps 1 to 3 to determine whether the property order is just and equitable.

It’s always advisable to seek legal advice to understand the best approach for your specific circumstances. Our team is here to provide the necessary guidance and support to help you navigate through these challenging times.

Contact us today to discuss all your family law property settlement matters. Call, email or schedule your appointment with our family lawyer Thirumalai (Shelvi).