Property Settlement

A matrimonial property settlement is the division of property between a husband and wife following separation. A matrimonial property settlement finalizes the financial relationship between the parties and allows them to move forward in the future. It is important to note that there is a one year limitation period that operates from the date the parties are granted a Divorce within which to commence proceedings in the Family Court or Federal Magistrates Court relating to property settlement. An application outside the one year period will only be accepted if the Court has granted leave to the applying party and is satisfied that the party will suffer a significant detriment if a property settlement is not completed. The Family Law Act encourages parties to reach an agreement without resorting to court proceedings.

One of the procedural requirements set out in the Family Law Act is that both parties engage in negotiations to reach an agreement before filing an application in Federal Magistrates Court of Australia or the Family Court of Australia. In the event that that the parties cannot reach agreement through negotiations or one party refuses to participate in negotiations then a person considering applying to Court must give the other party written notice of their intention to commence a Court case. This notice must outline the issues in dispute, the orders sought, a genuine offer to settle the matter, and a nominated time within which the other party must respond.

The definition of “property” under the Family Law Act includes real estate, vehicles, shares, interests in companies, bank accounts and superannuation. In order to determine how the property is to be divided the court utilises the following approach. Firstly, the Court looks at the financial and non-financial contributions made within the relationship, namely:-

• Financial contributions made directly or indirectly by the parties towards the acquisition, conservation or improvement of any property, for example contributions of income, gifts or inheritance or parent’s contributions towards the purchase of the matrimonial home.
  
• Non-financial contributions made directly or indirectly by the parties towards the acquisition, conservation or improvement of any property, for example full-time care of the children of the relationship, contributions made as homemaker.

Secondly, the Court then takes into consideration other factors outlined in section 75(2) of the Family Law Act. These factors include:-

• The age and health of the parties;
• Income and earning capacity of the parties;
• Property and financial resources;
  Who has the majority care and control of any children less than 18 years of age and the need to protect that party who wishes to continue the role of the parent;
• Responsibilities to support the other party either through child support or spousal maintenance;
• Whether there are any other financial resources such as superannuation, pensions or life insurance;
• The length of the relationship, including the period of cohabitation prior to the marriage.

Thirdly, the Court looks at the overall outcome to determine if it is fair and equitable.