Property Settlement

The property may be divided between you and your ex-partner when your marital or de facto relationship ends or about to end. This is called a property settlement.

The similar law relating to property settlement applies to de facto couples when they separate, if you separated from a de facto partner before 1 March 2009.

It is not necessary for married couples to wait for divorce to work out a property settlement. It is usually best to get a property settlement before you apply for a divorce because there is a strict time limit to organise a property settlement after divorce.

Property Definition

Property includes assets (things you own) and liabilities (things you owe money on). These can be owned individually, jointly (with another person or persons), or by a family trust or family company.

It is not exhaustive list, but some may include the following:

• Real estate, including the family home
• Money
• Investments
• Insurance policies
• Inheritances
• Shares
• Superannuation
• Any other assets, such as cars, furniture or jewellery
• Debts, such as mortgages, loans, credit cards and personal debts

All items may be considered in the property settlement. It does not matter:

• Whose name is on the documents
• Who bought an item
• Who made the debt

You should arrange valuations of all the assets of the marriage or relationship.

Steps in Property Settlement

Step 1: Identify and value assets and liabilities and both parties must disclose all their assets and liabilities to get a full picture of the financial situation.

Step 2: Consider contributions and the Court considers both direct financial like salary and paying for the mortgage and non-financial contributions like homemaking and child-rearing.

Step 3: Consider future needs and the Court also factors in the future needs of each party like age, health and ability to earn income and who has primary responsibility for the care of children.

Step 4: Achieving a fair and equitable division and the court ensuring that the settlement is just and equitable. The division is based on fairness after considering contributions and future needs and not on 50/50 split.

Factors Considered

The Court considers a variety of factors when determining property settlements including:

• The length of the marriage or relationship
• The age and health of both parties
• Income and earning capacity
• Children’s care and who has primary responsibility
• Any financial or non-financial contributions made during the relationship, such as homemaking or child-rearing

Importance of Full Disclosure

Both parties are required to fully disclose their financial circumstances. Failure to disclose assets or hiding assets can result in penalties and may cause the settlement to be overturned later.

Right to Family Home

In Australian property settlements following a divorce or separation, the decision about who keeps the family home is not predetermined and depends on various factors. The family home is treated as part of the overall property pool, along with other assets and liabilities, and its division is based on principles of fairness and equity, rather than an automatic right for one party to keep it.

Protecting Property until Settlement

You may be able to do the following:

• Caveats

A caveat is a legal notice on your property at the Land Titles Office. The caveat tells people that you have an interest in that property. The property can’t be sold until the caveat is removed.

• Injunctions

An injunction is a court order that stops someone from doing certain things. It may be possible to get an injunction from the court to prevent assets being sold.

If assets have already been sold, it may be possible to get an order to ‘freeze’ (stop the use of) the sale money.

Marriage Annulment

Annulment happens when a judge decides that there was no legal marriage. If a judge grants an annulment, the marriage is void.

Marriage is something that you need to agree to without being tricked, pressured or forced to marry. You can apply to court to have your marriage annulled if:

• You were tricked or forced to marry someone
• One person married was under 18 at the time
• You were not able to understand what the marriage ceremony was
• The person you married was already married to someone else
• The person you married is a close relative (parent, grandparent, child or sibling)
• Forced marriage

Family Dispute Resolution

You can try family dispute resolution at any stage of your separation, even if you have started court proceedings. The court can also order people to go to family dispute resolution at any time throughout the court process.

If you want court orders about children (parenting orders), you must try family dispute resolution first, except in some situations.

Sometimes it is not appropriate to do family dispute resolution if there has been family violence.