Property Settlement

The Court will undertake a four-step process in the division of Assets and Property. This process encompasses the following steps:

1. Identifying the Net Property Pool
2. Financial and Non-Financial Contributions
3. Future Needs
4. Final review of proposed division of assets to ensure it is just and equitable

The net property pool is made up of the property assets of both parties. ‘Property’ assets include real estate, shares, cars, jewellery, savings, furniture and effects. The Court will also add properties to the net property pool, where a party may influence and/or have control over certain assets. The Court will also consider properties which may at a future stage fall under the control of either party involved and as subsequently add that it to the net pool of assets. It is paramount to the Court that all assets are considered in the property settlement process.

In most cases, all property will fall into the net pool of assets, with property purchased before, during or after separation considered. However, superannuation is treated differently at the point of division. Subject to the type and value of funds, the funds may be divided between the parties at the time that a Property Order is made, or an Order made at a later time which splits the funds.

Liabilities, which include mortgages, car loans and other such debts will be deducted from the total net property pool.

Contributions in the relationship are both financial and non-financial. These are all contributions that occurred initially in the relationship, during and after the relationship.

Financial Contributions

The monetary contributions made throughout the duration of the relationship will usually consist of:

• Wages
• Legal Costs
• Lottery Wins
• Assets
• Gifts and Inheritance
• Compensation payouts

In the instance where one party accuses the other of wasting money, the court can take this into consideration. Monetary contributions are considered waste if they are spent on:

• Gambling
• Drugs and alcohol
• Prostitution
  

Non-Financial Contributions

Non-Financial contribution are just as significant as financial contributions, Courts recognise three important non-financial contributions.

1. Homemaker Contributions The court will assess the domestic duties of the parties and whether it was carried out on a full-time or part-time capacity.
   Parental Contribution This is important as it allows one parent to earn a wage and increase the family’ asset pool.
   Property Maintenance If one party has carried out home-improvements on the property this would increase the value of the property and add value to the asset pool, which the courts would take into consideration.

The court assesses future needs with factors including:

1. Age
2. Health
3. Income earning capacity
4. The property of each party
5. Whether the party has the care of or support of the children
6. Duration of the marriage and impact on earning capacity
7. The financial circumstances of any new relationship

Where the Court finds appropriate, necessary adjustments will be made in respect to the aforementioned factors, subsequently resulting in an altered distribution of the net property pool.

Based on the current legislation under the Family Law Act (NSW) the outcome of the property matter must be “just and equitable” in all situations, when making final orders for the property. The court must decide as to who will retain specific assets and liabilities. This step of the process will sometimes include a consideration of the appropriate blend of any settlement between immediately available assets, and deferred but important benefits such as superannuation.

Consent Orders are written agreements that are approved by the Family Court. A Consent Order can cover parenting arrangements for children as well as financial arrangements.

Consent orders have the same legal effect as if a Judge/Magistrate had made them after a court hearing. The Court must be satisfied that the orders you ask for are in the best interest of the child. An Application for Consent Orders can be filed with the Court without initiating any other court proceedings or they can be made during court proceedings if the parties come to an agreement.

If the Court is satisfied that the orders you seek are in the best interests of the child and they comply with the legal requirements they will make the orders. These orders amount to a legally binding agreement between you and your former spouse that is enforceable if either party breaches a term of the orders.