Property Settlement Basics

Is there a difference between married couples and de facto couples?

All married couples are covered by the Family Law Act (“the Act”).  De facto couples who separated after 1 March 2009 are also covered by the Act.

What property is considered in a property settlement?

All property owned by either spouse will be considered for the property settlement. This can include property purchased before, during or after the marriage/relationship, superannuation, gifts and inheritances received by either party.  All property must be valued.   Property is valued at its current market value (not purchase price or insured value), not at separation.

What are you entitled to?

The Act states the objectives of the Court are to: “finally determine financial relationships between the parties to the marriage and avoid further proceedings between them”. The way they go about determining the financial relationships has been set out in previous cases, and is commonly referred to as the “four-step process”.

Step 1

identify and value the assets, liabilities and financial resources of the parties

The first thing the court wants to do is identify the assets and liabilities of both parties. The court will need to know about things like you and your ex-partner’s incomes, real estate, motor vehicles, furniture, any money you both have saved, superannuation, life insurance, child support payments etc. The court will also need to know about any mortgages you might have, credit cards, loans (personal or from financial institutions).

Step 2

assess the contributions of the parties

The next thing the court will need to be made aware of it any contributions you and your partner have made during the relationship. You should be aware that contributions can be either financial – for example, buying a house, paying for the house to be repaired, paying for the bills or groceries – or non-financial. Non-financial contributions can include home-making duties and child care. Financial and homemaker/parent contributions are generally seen as being equal.

The court will determine your entitlements based partly on the contributions, but will also take into account the weight to be given to the various contributions, pre-relationship or post-relationship contributions, the length of the relationship/marriage, and other factors.

Step 3

consider future needs

The court then goes on to consider the “future needs” of both parties. This will include consideration of the age and health of each party, the income, property and financial resources of each party, care of children or others, eligibility for government pensions or allowances, the earning capacity of both parties and whether this was affected by the relationship/marriage, and a number of other circumstances.

Step 4

is this a just and equitable outcome?

The last step in the process requires that the court be satisfied that, taking into account all the circumstances of the case, it is “just and equitable” to make the court order concerning the division of property.

What information do I need to have gathered to help me?

You should be aware that you have a duty to the Court and to your former partner to give a “full and frank” disclosure of all financial and family information relevant to the case.  Serious consequences may occur if you do not give the Court or your former partner information that is relevant to your case.

You will find this easier to do if you gather together the following information:

  • Any current cases or existing orders about family law/child support/family violence or child welfare
  • Any financial agreements made between you and your former partner
  • Any bankruptcy proceedings
  • Any “proceeds of crime” orders or “forfeiture applications”
  • Whether there is anyone else (“third parties”) who should be joined to this matter

Children

  • Children/s names, dates of birth, who they live with
  • Children/s education and health

Income and Assets

  • Your gross weekly income (how much you get before tax is taken out)
  • Any child support payments you make or receive
  • Any houses or land that you own (record the address, value, and what share is yours)
  • Any vehicles  (cars, motorbikes, boats and other motor vehicles, and what share is yours)
  • Furniture and effects (total value and what share is yours)
  • Money in banks, building societies, credit unions or other financial institutions
  • Any business interests (record the market value of your share)
  • Any investments (stocks and shares)
  • Life insurance policies
  • Any trust funds that you are a beneficiary of
  • Any significant sale or disposal or property in the last 12 months or the 12 months prior to separation
  • Superannuation – you may have a few superannuation funds so make sure you record all of them and their value

Liabilities

  • Mortgages
  • Credit/charge cards
  • Loans (personal loans from financial institutions aswell as from family or friends)
  • Hire purchase agreements
  • Income tax statement

You can use this information to help fill in a Financial Statement, which is a document that the Court will need you to lodge with them before it can hear your matter.  Download a Financial Statement form from the Federal Circuit Court website – www.federalcircuitcourt.gov.au and go to “forms” then “family law forms”.

Please note: This factsheet contains general information only. It does not constitute legal advice. If you need legal advice please contact a solicitor.