When a relationship breaks down it is a very real fact that the property held by the former spouses needs to be divided. This is mostly always easier said than done.
When doing a property settlement pursuant to the Family Law Act 1974 (Cth) you have 2 options:
- Obtain an order of the Family Court; or
- Enter into a Binding Financial Agreement.
Our experienced family lawyers prefer to finalise property settlements by way of an order of the Family Court. This provides the parties with a very high level of surety that the other party cannot make further claims. This is because the Family Court has a requirement to ensure that the order made is ‘just and equitable’.
When making the order the Court will consider a four-step process.
- What is the property pool? That is what assets and liabilities (including superannuation) do the parties have between them?
- What contributions has each party made to the assets or the relationship and what should those contributions be worth today?
- Does either party have future needs that may give rise to an adjustment in the division of the property pool in that party’s favour?
- Does any further adjustment need to be made on the basis of justice and equity?
It is human nature that one party thinks they made a larger contribution to the property pool or they have future needs that warrants an adjustment in their favour. It is sometimes hard for people to consider the other party’s position when there is so much emotion involved.
Sometimes a party to the relationship just want’s out and is prepared to agree to a settlement that is not otherwise ‘just and equitable’. In this circumstance it may be that the Court would find it difficult to make the order as it has to consider the justice and equity component of the legislation. It is in these circumstances that you might want to consider a Binding Financial Agreement. There is no requirement for a Binding Financial Agreement to be considered by the Court but there is a requirement for each of the parties to obtain independent legal advice from a Solicitor. For a number of reasons, a Binding Financial Agreement is often a more expensive way to finalise a property settlement. Evolution Legal will consider whether a Binding Financial Agreement is appropriate on a case by case basis.
Having your property settlement expertly prepared and finalised by Evolution Legal can also avoid unnecessary stamp duty or taxation implications that would otherwise be incurred with properly formalising your property settlement pursuant to the Family Law Act.
The friendly family lawyers at Evolution Legal are here to assist you in this difficult time and to share the burden, stress and hopefully save you a few dollars along the way.