Property Settlements

Property proceedings are issued under Part IIIV of the Family Law Act or Part IIIVAB for De Facto claims.

Alteration of Property Interests
In property settlement proceedings, the Court may make such Order as it considers appropriate, altering the interest of the parties to marriage in the property Section 79(1).

Just and Equitable Requirement
The Court shall not make an Order under this section unless it is satisfied that in the circumstances, it is just and equitable to make the Order Section 79(2).

The Four Steps in Determining a Property Dispute
There are essentially four phases of inquiry made by the Court in property settlement Applications pursuant to Section 79 of the Family Law Act.

These steps are as follows:

  1. Identify and value the property, liabilities and financial resources of the parties as at the date of the hearing;
  2. Assess their financial and non-financial and welfare contributions under Section 79(4)(a), (b) & (c) as a percentage of the net value of their property;
  3. Assess any relevant Section 75(2) factors, such as disparative income and earning capacity and the capital costs of having the care of children, as an adjustment of the contribution based assessment;
  4. Consider the effect of those findings and specify what Order should in all the circumstances be made for a “just and equitable” outcome as required by Section 79(2).

In respect of Step 1, it is necessary “to consider the whole of the property of the parties, however and whenever required”. Each party is required to make a full and frank disclosure of their financial circumstances. Property has been very broadly defined and the Court has power to alter the interest of the parties in their property, i.e. all of their property, regardless of when or how it was acquired and in whose name it is owned.

Usually the value of the property at the date of Hearing is considered. Any premature distributions of property made to either party before then, or assets unaccounted for are included by being added back notionally to the asset pool.

In respect of Step 2, a global approach has been applied by the Courts as the guideline in most cases by assessing contributions in terms of a proportion of the total assets of the parties. An asset by asset approach is sometimes used.

Time Limits
For matrimonial property settlements or maintenance, the deadline is 12 months after a divorce order has taken effect.

This time limit does not apply to application to set aside a property Order under Section 79A or the vary, revive, suspend or discharge a maintenance Order.

De Facto Property Claims
A party to a de facto relationship may apply for a property (and maintenance) Order only if the Application is made within two years after the end of the relationship. The Court may grant leave to apply out of time on the same grounds as for spousal maintenance for married parties.

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