Understanding the 4 step process of property settlement in the Family Court
Following separation, deciding “who gets what” can be difficult. If you and your former partner are unable to reach an agreement regarding property settlement, the Family Court can determine a just and equitable settlement on your behalf.
The Court adopts a 4-step process in understanding how you and your former partner’s property and assets, as well as your liabilities, are to be divided. The Court will consider the following questions:
1. What is the value of your assets and liabilities?
The Court will consider the current value of you and your former partner’s assets and liabilities. It is important that both parties are able to clearly identify these assets and liabilities so that a “net asset pool” can be determined. A net asset pool includes assets owned by you and your former partner, either jointly or separately, any trusts or businesses owned, as well as each parties’ superannuation entitlements.
2. What financial and non-financial contributions were made?
The Court will consider what financial contributions were made by you and your former partner to the purchase of assets or the improvement or maintenance of those assets. Assets like this include things owned at the commencement of the relationship or which have been brought in during the relationship, including any gifts or inheritances received.
The Court will also consider the non-financial contributions made throughout the relationship. Non-financial contributions include whether a party ceased work to raise and care for children and how the home was maintained or improved.
3. What are the future needs of the parties?
The Court will identify any future needs of you and your former partner, which can include your age, financial resources or earning capacity, health, and any responsibilities for the care of children when determining a property settlement.
4. Is the proposed settlement just and equitable?
The division of the asset pool will be made on what the Court considers to be ‘just and equitable’ in the circumstances specific to you. The Court takes into consideration the long term effect of the proposed settlement on each party and the best way to have the Orders implemented.
We can assist you in understanding the process of property settlement in the Family Court. Contact our office on (08) 9207 1866 to make an appointment.