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Division of Assets

Our Family Lawyers can assist you in safeguarding your interests whilst negotiating a fair property settlement on your behalf.

 

We understand that dividing assets after separation or divorce can be a stressful experience, and in some cases, you may be willing to accept a less favourable outcome than you deserve, in an attempt to resolve the matter as quickly as possible. Our objective is to assist in making the process easier for you, to avoid such circumstances arising.

 

On your behalf, our Family Lawyers assist you in attempt to negotiate a satisfactory property settlement outcome, without the expense, stress, and costs of having your matter proceed to litigation. However, if the parties are unable to reach a mutually satisfactory position that is just and equitable for all parties, our Family Lawyers are highly skilled in this area and can represent you in Court.

The Courts typically consider a range of factors when determining the division of assets in a property settlement, which include:

  • The financial contribution made by either party before and during the marriage or de facto relationship;
  • Non-financial contributions such as homemaking and care of dependents;
  • The future needs of spouses; and
  • The availability of new sources of financial support (such as family assistance or if you have a new partner).

 

The Federal Circuit and Family Court of Australia have set out a four (4) step process that is used to determine the division of assets, as follows:

  1. Identification of the pool of assets;
  2. Assessment of the contributions of each party;
  3. Adjustment for future needs; and
  4. Determination of whether the division is just and equitable.

 

By utilising the guiding principles of the Court, we can provide you with strategic legal advice on the division of assets, by considering the four (4) step process in greater detail.

Identifying the pool of assets

The first step of the process that is used to determine the division of assets is to identify the asset pool. Assets which are considered by the Court in a divorce property settlement include, but are not limited to, property such as your matrimonial home and investment properties, businesses, companies, investments, vehicles, incomes, and anything else of value.

 

Under the Family Law Act, it does not matter in whose name the assets are held (including companies or trusts). Any asset that is held by an individual party to the separation or divorce will form part of the asset pool, and will eventually be split between the parties.

 

Once our Family Lawyers have identified and ascertained the dollar value of all the assets of the relationship, the next step would then be to determine all liabilities of the relationship, and whether these are held jointly and/or individually. This amount will then be deducted from the total value the assets, with the total then being considered as your relationships asset pool, which the Court will then divide as it determines to be fair and equitable to all parties.

Assessing the contributions of each party

The second step of the process that is used to determine the division of assets is to assess the contributions of each party when the relationship first began, and during the relationship.

 

To assess the contributions, our Family Lawyers will look at the following contribution categories of the relationship:

  • Direct financial contributions – Includes (but is not limited to) savings, wages/income, bonuses, and proceeds of investments;
  • Indirect financial contributions – includes (but is not limited to) inheritances, gifts received by either party, or living rent free with your, or your partner’s parents;
  • Negative financial contributions – Includes (but is not limited to) financial losses arising from one party significantly reducing the potential pool of assets, whether it was done so recklessly, or deliberately (i.e. gambling addiction, alcohol abuse, drug dependency, or domestic violence, etc.) The value of this loss, if significant, may be deducted by the Court from that party’s financial contribution;
  • Non-financial contributions – Includes (but not limited to) the non-monetary contributions made by each party during the relationship (i.e. cooking, cleaning, washing, ironing, collecting groceries etc.), raising children, and other contributions such as renovating your matrimonial home or investment property, resulting in an increase in the value of the property. It is important to note that the Court often considers financial and non-financial contributions equal (i.e. one party may have worked full time whilst the other stayed at home to take care of the children).
  • Post separation contributions – The Court will also consider contributions by each party after separation, such as continuing the payment of the mortgage or rent, caring for the children, or paying the ongoing health insurance premiums.

Adjusting for future needs

The third step of the process that is used to determine the division of assets is to adjust, or consider whether adjustments are required for future needs of each party. This step may significantly impact how the Court divides the asset pool, as future need of each party will need to continue to be fulfilled, given each party’s ongoing responsibilities and obligations.

 

Some relevant factors that the Court will consider relevant to whether an adjustment to the division of assets are required, include:

  • Earning capacity compared to the each other;
  • Age compared to each other;
  • Health compared to each other;
  • Ongoing care of children and who will have primary care of them and to what extent;
  • Ongoing care of other people (i.e. elderly parents);
  • Standard of living and ability to generate income; and
  • Each party’s ability to generate an income, taking into account the length of the relationship, and one party’s sacrifice of their opportunity for career advancement during the course of the relationship.

 

Once our Family Lawyer learns your story, they will be able to assist you in Court to seek the appropriate adjustment.

 

The Court will also consider the financial circumstances relating to any new relationship formed after separation, that either party has entered into, in addition to any cohabitation arrangements.

Determining whether the division is just and equitable

The final step of the process that is used to determine the division of assets is for a Court to determine whether the division of assets is just and equitable to each party.

 

It is more common than not that one party may be financially more stable than the other party, who may require additional funds in the short term due to their limited earning capacity, or increased obligations if they are looking after the children of the relationship.

 

In such cases, the Court may determine that it would be just and equitable to initially provide the party with a lower earning capacity, a larger proportion of the asset pool at the first instance, prior to adjusting the asset pool by way of proceeds from the sale of the matrimonial home, which may be available at a later date.

 

The Court will adopt a subjective basis approach to divide the asset pool, and assess what, if any, percentage adjustment should be made.

Frequently Asked Questions

What if we both agree on the division of assets, do we have to go to Court?

No, there are two options available if this circumstance is applicable to you, neither of which requires attending the Court:

  1. A Binding Financial Agreement setting out the terms of the agreement reached; or
  2. Obtaining a Consent Order from the Court via a joint application between both parties will avoid having to go to Court, if the Court determines that the Orders the parties are seeking are fair and just to each party.
Is it a 50/50 split of the assets?

In most circumstances, you may find that this is not the case, and can only obtain an equal split if there are no children from the relationship, are the same age, and have the same or similar salary. Otherwise, in most cases, one party may receive a higher split of the assets.

Do we have to be married to do a property settlement?

No. If you are in a de-facto relationship which has broken down, you may find that you also need to divide your assets and reach a property settlement with your former partner.

How long do we have to be separated before our assets can be divided?

You can divide your assets from the moment of your separation.

Book your 100% free no obligation consultation call with one of our Lawyers today.

We will:

  • Review your matter
  • Answer any questions
  • Discuss your rights and options
  • Provide steps to resolve your matter