Property Settlement

Property Settlement

Division of property in family law is a vital process that occurs after marriage or the dissolution of relationships. This process involves the division of assets and liabilities between the parties and ensures fair and equitable distribution. Understanding the legal aspects and considerations surrounding this matter is essential for navigating this complex process successfully.

In the division of property, the court has broad discretion in determining the division of assets and liabilities. The court considers various factors such as each party’s financial contributions, non-financial contributions, future needs of the parties, and the care and welfare of any children. It is important to note that property division for separation in Australia is based on a concept called “just and equitable” distribution, not necessarily a strict 50/50 split of assets.

The first step in property division is identifying and valuing the assets, liabilities, and financial resources of the parties. Assets may include:

• Furniture;
• Gifts;
• Vehicles;
• Real estates; and
• Superannuation.

Labilities may include: 

• Housing loans;
• Car loans;
• Student loans; 
• Tax debts; and 
• Credit card debts.

As mentioned earlier, there is no guarantee of equal asset distribution between the parties. There is also no formula for dividing property. However, if you go to court, the judge will decide what is fair and equitable based on the unique facts of your case. They consider the following factors for both you and your former partner:

• Assets and liabilities of both parties

• Financial contributions of each party to the relationship/marriage (such as wages and windfall income)

• Indirect financial contributions of each party (e.g., gifts and inheritance from family)

• Non-financial contributions like childcare and homemaking

• Future requirements, including age, health, childcare, and income-earning capacity

• Whether the proposed settlement is fair and equitable or not

Agreement on Property Division

If you and your former partner agree on how to divide assets, you have several options:

• Informal Agreement: You can have an informal agreement. This type of agreement is simple and easy, but it’s important to note that it’s not legally binding and cannot be relied upon by the court in case of a dispute.
• Legally Binding Financial Agreement: If you want to formalize your agreement, you can create a legally binding financial agreement. This agreement is governed by specific laws and is legally binding, so both parties are required to adhere to it.
• Seeking Legalization of Agreements: You can go to the family court and request that your agreements be made into a court order. In this case, your agreement is approved by the court and becomes legally enforceable. This method is legally very strong, and in case of any dispute, the court can rely on it.

Dispute Over Property Division

If you and your ex-partner did not agree on how to divide assets, you can ask the court to decide on it. The court decides how assets and liabilities should be divided based on the available evidence. Before you can go to court, you must make a genuine effort to resolve family disputes, which is known as pre-action procedures. This involves attempting to reach an agreement through negotiation and other informal methods.

Additionally, it’s necessary to participate in mediation before going to court. This gives you an opportunity to sit down with your former partner and have a conversation to reach an agreement. The court also expects you to demonstrate that you have made all necessary efforts to reach an agreement.

Experience has shown that many parties reach agreements through mediation via dialogue and negotiation. Ultimately, if your efforts to reach a successful agreement fail, the court can make a decision based on the available evidence and issue a final judgment. However, it is recommended to use all possible friendly means to avoid complex and costly court processes.

Does Property Division Include Assets Outside Australia?

In a country like Australia where people immigrate from various parts of the world, owning international property is not uncommon. In matters related to property division after separation, identifying and valuing all assets, including those outside the country, is crucial. The court has the jurisdiction to deal with these assets and include them in the property settlement.

Parties with assets outside Australia may face additional financial challenges when dealing with offshore assets. Managing assets abroad can be complex and may have specific legal and tax implications. In these cases, seeking legal advice from an experienced family lawyer in international family law matters is essential. This helps you understand the legal and tax consequences and ensures that all relevant assets are considered in the property settlement process.

Resolving property matters can be a complex and emotionally challenging process. It is crucial to ensure that both parties have a clear understanding of their rights, obligations, and the available options for property settlement. At Enlight Legal & Migration, we will guide you through the process and ensure you get the property you deserve.