Key considerations when a Court decides to divide a couple’s assets

The division of a couple’s assets by the Family Court is not simply a case of making a mathematical assessment of their relative financial contributions. The Court’s objective is to try and deliver an outcome that is just and equitable to both parties, so this is not necessarily a 50 per cent split. While each case is decided on its own circumstances, there is a common approach applied by the Court in working out who gets what.

The Court’s approach is broken down into the following steps:

1. Defining the “property pool”
   The Court first assesses all property, regardless of whether owned by one party, or jointly. Each party’s respective superannuation is also considered as property which may be divided, together with liabilities both sole and joint, and financial resources of the parties.
   In many cases, the Court will only have to make adjustments to one pool of assets (generally referred to as ‘the asset pool’), however in more complicated matters, there may be two or more separate pools of assets required the Court to make separate determinations. This is often the case when it has been a shorter relationship and there were pre-relationship assets, or assets were acquired by way of an inheritance.
2. Assessing the contributions of the parties to the asset pool/s:
   Financial contributions, direct and indirect, to the acquisition, maintenance and/or improvement of property:
   before the relationship
   during the relationship and;
   post separation.
   Non-financial contributions, direct and indirect, to the acquisition, maintenance and/or improvement of property:
   before the relationship
   during the relationship and;
   post separation.
   Non-financial contributions, direct and indirect, to the welfare of the family, such as contributions made as a homemaker and parent.
3. Assessing the relative future needs of the parties:
   Such considerations will include the age, state of health, income earning ability, and responsibility to care for children or others.
   Disparity of income (if any) between the parties.

Sometimes, the Court may decide not to alter the existing property interests between the parties. However, in most cases, a judge will make orders to redistribute the property pool, especially in longer relationships.

Judges have a degree of discretion when determining what they see as just and equitable. Non-financial contributions, for instance, are likely to be seen as significant in circumstances where one parent has sacrificed income for parenting and homemaking responsibilities that benefit the family as a whole, particularly over many years. It is also more likely than not, in circumstances where there is a disparity of income or income earning ability, that an adjustment will be made in favour of the party in the weaker financial position.

It is important to get competent legal advice from a specialist when it comes to negotiating property settlements as many mistakes can be made when parties try and ‘sort it out’ themselves or seek assistance from lawyers who do not specialise in this area.

Streeterlaw Accredited Specialist in Family Law, Simone Green, is available to guide you through the process of negotiated settlements for the best outcome. Please contact us on 8197 0105 or email advice@streeterlaw.com.au