When a relationship ends, one of the most important and often complicated issues to resolve is how the property could be divided between the couple who are breaking up. In the Family Law Act 1975, “property” includes all assets and liabilities owned by either or both parties, regardless of whose name they are in. The following examples of property can have been acquired before, during, or even after the relationship has ended, in some cases;
- Real Estate: Family homes, investment properties, and land.
- Financial Assets: Bank accounts, cash, shares, and any other investments.
- Pensions: This is considered by the court to be a significant asset and can be divided between both parties in some circumstances.
- Personal Property: Vehicles, jewellery, furniture, and collectibles.
- Business Assets: Ownership or shares in businesses, including family businesses and partnerships.
- Trusts and Estates: Interests in trusts, inheritances, and estates.
- Debts and Liabilities: Mortgages, credit card debts, tax obligations, and loans.
What Property Might Be Excluded from Being Divided?
Inheritances and Gifts: Some assets inherited after a loved one’s death and some that were gifted might be excluded from the property pool and remain with their original owner.
Financial Resources: Inheritances and pensions that are expected to be available in the future, or interests in discretionary trusts, are not considered as property but are defined as financial resources. However, it is possible for them to be accounted for when determining the overall division of property in some cases.
Future Income: Income that hasn’t been earned yet isn’t considered as property. Accrued long service leave or redundancy entitlements are also thought to be future income.
The Duty of Disclosure
In family law property settlements, the duty of disclosure is compulsory on an ongoing basis. Both parties are legally required to provide a full and honest disclosure of all financial circumstances. This duty exists whether the parties are negotiating privately, attending mediation sessions, or involved in a court battle. It applies from the very beginning of discussions and continues until the financial settlement is complete.
The disclosure must include all assets, liabilities, financial resources, and income, regardless of whose name they are held in. This includes property that is owned solely or jointly or even those held through companies, trusts, or additional parties. Overseas assets and minor financial interests must also be disclosed.
Typical documents and information that must be provided during a divorce and financial settlement include:
- Bank statements
- Mortgage documents
- Superannuation (workplace and private pension) statements
- Tax returns and notices of assessment
- Payslips and invoices for work carried out
- Company financial statements
- Trust deeds
- Credit card statements
- Loan agreements and statements
- Details of any significantly valuable gifts, inheritances, or windfalls
If any new assets or liabilities are incurred while the separation or divorce process is ongoing, they must be declared promptly to the other party.
If one or both parties fail to provide full disclosure about property, the consequences can be very serious, and the court will have the power to:
- Cancel or overturn any previously submitted property settlement orders.
- Reopen proceedings to ensure the outcome is fairer and more equitable.
- Impose costs on the party who failed to disclose property in full. They might be required to pay some or all of the other party’s legal costs.
In the most serious cases, deliberately providing false information or choosing not to declare all property can even result in criminal charges such as contempt of court.
The reason that the duty of disclosure exists is to ensure that both parties get their fair share of property in the settlement and that the process is done with honesty and transparency.
At Dam Lawyers, we advise all clients to take their duty to disclose seriously. Not only is it a legal requirement, but doing so protects your interests and strengthens your case so you can achieve the fairest possible outcome.
How Does the Court Determine a Fair Division?
In order to determine a fair division of property between both parties involved in a separation or divorce, the court will consider the following factors:
- Direct Financial Contributions: These include money brought in via wages, investments, and contributions to the acquisition of property.
- Indirect Financial Contributions: These incorporate gifts, inheritances, or other financial contributions not directly related to the acquisition of property.
- Non-Financial Contributions: These are related to tasks that don’t equate to a financial value, such as housekeeping, bringing up children, and other non-financial contributions that were made during the relationship.
- Future Needs: The court will determine whether either party’s age, health, financial resources, and responsibilities, such as caring for children, may affect their ability to support themselves in the future.
How Can Dam Lawyers Help?
Navigating the complexities of property settlements following a separation or divorce can be overwhelming. The emotional strain of ending a relationship is often greater as each party will need to make significant financial decisions that will impact their future security and that of any children they share. That’s why seeking expert legal guidance is essential.
At Dam Lawyers, we understand that every family situation is unique. Our experienced family law team takes the time to listen carefully to your circumstances, explain your rights and responsibilities clearly, and develop a strategy that we believe will achieve the fairest outcome, based on our extensive experience helping many families going through similar situations.
Property settlements involve more than just dividing up tangible assets like the family home or vehicles. They often include complex matters such as:
- Identifying hidden assets,
- Valuing assets within businesses, trusts, and superannuation,
- Managing debts and liabilities,
- Considering non-financial contributions, such as homemaking and parenting,
- Addressing future financial needs, including poor health or childcare responsibilities.
When you hire our legal team to support you during your property settlement, you can not only expect us to resolve your situation effectively but also empower you to move forward with peace of mind as you start the next chapter of your life.
If you’re facing a property settlement, don’t go through it alone. Contact Dam Lawyers today to arrange a confidential consultation and take the first step towards a secure and fair resolution.
