Property settlement is the process of dividing the matrimonial asset pool between parties of a marriage. The property settlement process has varied outcomes depending on your relationship type, income, assets and liabilities.
There is a popular misconception that married people and de facto couples are treated the same when it comes to property settlements. Suffice to say they are not. De facto couples are treated less favourably. Where married couples separate they need to consider the following:
>> Spousal maintenance
>> Property settlement
Property settlement occurs when the matrimonial asset pool is divided up between the parties to the marriage. It takes into account all income, all assets and all liabilities. Sometimes real difficulty may be experienced in determining what is property as it contemplates both possessory and reversionary property. Essentially the courts look at the parties’ financial and non-financial contributions and future needs. In many cases the contributions of homemaker are important particularly for long term marriages. Obviously this is nowhere near as important in short term marriages and particularly where there are no children. Although property matters may be dealt with between the parties this may be unwise and it is always best to formalise any agreement by consent orders. Where independent legal advice and consent orders are not sought then it is highly likely that one party to the arrangement would be significantly disadvantaged. In these matters the court always takes into account what is fair and reasonable and it is always best to obtain independent legal advice before doing so as it is the best method available to ensure that both parties are properly protected.
As a general rule although parties have to wait at least 12 months prior to the time they divorce they do not have to do so in the case of either spousal maintenance or property settlement. Spousal maintenance can sometimes be worked out prior to the time that the parties separate but in the case of a property settlement it is usual for the parties to apply their minds to this once the break has occurred. The property settlement contemplates not only a division of the assets but also the right to spousal maintenance as appropriate. Child maintenance is a separate issue and is almost without exception a matter for the child support agency. Where child support remains unpaid it is up to the child support agency to follow that matter up. There are few exceptions which justify obtaining your own lawyer to recover outstanding child support payments.
Once a party has obtained a divorce (decree absolute) then they only have 12 months from that time to make an application for a property settlement and/or spousal maintenance. Although applications can be made out of time this is an extremely foolhardy and expensive way of dealing with such important matters. The Family Law Court has extremely extensive powers in the area of property settlements and can make orders to adjust the interests of parties in any property. In fact when the court is asked to make an order it requires that it has all information before it so that it may do this fairly and reasonably. As a result the court requires all information about all income, assets and liabilities both here and overseas so that proper consideration can be given to the adequacy of any property settlement including income derived from assets held in or on trust. Superannuation is one of those assets which now falls into the matrimonial pool and may require to be split.