Property Settlement

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Property Settlement
How is the Division of Property Determined?
What is a likely division of property?
What if I have reached an agreement with my former party?
What are Court Orders?
What is a Binding Financial Agreement (“BFA”)?
What needs to be done to prepare a BFA? What is its effect?
Why choose a Binding Financial Agreement?

Property Settlement     Return to TOP

Whether it is prior to marriage or prior to the commencement of de facto relationship or during marriage, or de facto relationship or following the breakdown of a marriage or de facto relationship Paul and Paul Lawyers can assist you to put in place an arrangement that will settle financial matters between you and your spouse and provide you with your financial independence.

Upon the breakdown of your relationship the adjustment of property interests is governed by Section 79 of the Family Law Act which is titled “Alteration of property interests” (for parties who have been married) or Section 90SM (for parties who have been in a de facto relationship).

The Court has a broad discretion to make orders adjusting the property interests of parties to a marriage and de facto relationship where it is just and equitable.

When making orders for adjustment of property interests the Court where possible does what it can to bring to an end any future financial relationship between the parties.

How is the Division of Property Determined?     Return to TOP

In coming to a decision as to an alteration of property interests the Court adopts a 4 step approach, namely,

1. identify and value the assets, liabilities, financial resources of the parties;
2. identify and assess the contributions of the parties and determine each of the parties contributions as a percentage.
3. Identify and assess (if relevant) the factors in Section 75(2) (for married couples) or Section 90SF (for de facto couples) and whether same require the percentage figure arrived at based on contributions to be adjusted – Section 75(2) factors are broadly concerned with a party’s future needs and means following the breakdown of a marriage/de facto relationship.
4. Consider the effect of those findings as a whole and make orders that are just and equitable in the whole of the circumstances.

What is a likely division of property?     Return to TOP

The High Court has rejected the Family Court’s earlier approach that equality is the “starting point”. Each case must be decided on its own set of circumstances and due consideration given to Section 79(4), an evaluation of the parties’ respective financial and other contributions.

Contact Paul and Paul Lawyers for advice on your rights and entitlement.

What if I have reached an agreement with my former party?     Return to TOP

Property settlement issues may be settled by way of Consent Orders made by the Family Court or by way of a Binding Financial Agreement where the Court need not be involved.

In either case each party is required to obtain independent legal advice.

What are Consent Orders?     Return to TOP

When you have reached agreement with your spouse, your agreement can be formalised and made binding by applying to the Court for Consent Orders.

An Application for Consent Orders can seek orders in relation to:

• the care, welfare and development of a child/children (known as parenting orders)
• the division of property and/or spouse maintenance.

Consent Orders have the same legal effect as Court Orders made after a Court hearing by the Family Court of Australia or the Federal Magistrates’ Court, but Consent Orders do not usually involve any Court appearance.

What is a Binding Financial Agreement (“BFA”)?     Return to TOP

There are six types of BFAs, namely:

1. One entered into during a Marriage but before Separation – Section 90C;
2. One entered into after Separation but before Divorce –also Section 90C;
3. One entered into after Divorce – Section 90D;
4. One entered into prior to the commencement of a de facto relationship – Section 90UB
5. One entered into during a de facto relationship – Section 90UC;
6. One entered into at the end of a de facto relationship – Section 90UD.
   

Each party is required to be independently advised by a lawyer, each of whom must give a Statement addressing the following matters:

1. the effect of the agreement on the rights of that party; and
2. the advantages and disadvantages of entering into the agreement at the time the advice is provided.

What needs to be done to prepare a BFA? What is its effect?     Return to TOP

1. the parties must make full and frank financial disclosure.
2. Once the BFA has been executed and exchanged and a Statement of Independent Legal Advice given by each parties’ legal representative, neither party can make any Application to the Family Court or Federal Magistrates Court to seek any Orders for property settlement, spouse maintenance or adjustment of superannuation interests which would result in any different settlement (other than in certain circumstances).

Why choose a Binding Financial Agreement?     Return to TOP

1. A BFA can enable you to quarantine for the benefit of your children from a previous marriage, or extended family, particular assets including pre-marriage assets or future inheritances.
2. A BFA provides you and your spouse with certainty as to what will happen in the event your marriage breaks down.
3. There is no involvement with a Court – a BFA is strictly a private and confidential arrangement.
4. A BFA avoids potentially costly, stressful and lengthy litigation;

Contact Paul & Paul Lawyers directly for further information as to how we can help you with your Binding Financial Agreement.

Complete the particulars and forward to us for review and advice. A small fee will apply.

It is often a good idea to also enter into a Succession Act Deed of Release in which you and your former partner/spouse both release/waive your respective rights to seek provision out of the other’s estate upon the death of either of you.