Property settlement is a crucial process following a relationship breakdown, ensuring a fair distribution of assets. In Australia, navigating property settlements can be complex, with legal regulations varying by state. At Reid Legal Group, we aim to simplify this process for you. 

What does property settlement involve?

Property settlement encompasses the division of assets and liabilities between separating couples, which may include:

  • Real estate
  • Bank accounts
  • Superannuation
  • Investments
  • Vehicles
  • Debts (loans, credit cards)

In Australia, property settlements can be agreed upon privately, through mediation, or through a legal process in court if necessary. It’s important to remember that property settlement is not just about the physical property but includes all financial resources and debts accumulated during the relationship.

Eligibility and time limits 

Eligibility for property settlement depends on the nature of your relationship:

  • Married Couples: You can apply for property settlement any time after separation. However, if you are getting a divorce, you must apply within 12 months of the divorce becoming final.
  • De Facto Couples: You must apply within two years of the relationship ending. To qualify as a de facto relationship, you generally need to have lived together for at least two years.

Value assets + liabilities 

Before you apply for a property settlement, make an inventory of all assets and liabilities. This process includes:

  • Listing properties, bank accounts, investments, superannuation, vehicles, and other personal property.
  • Identifying joint and individual debts.
  • Valuing assets at their current market value, not the purchase price.

Engaging professionals such as property valuers, accountants, or financial advisors may be helpful in getting accurate valuations. Providing a comprehensive and accurate list of all assets and liabilities is essential for a fair settlement.

Reach an agreement

Property settlement doesn’t always have to go to court. Couples are encouraged to negotiate and reach an agreement through:

  • Informal Discussions: Discussing division privately.
  • Mediation: A neutral mediator can facilitate discussions to help reach an agreement.
  • Collaborative Law: Lawyers for both parties work together to find a mutually acceptable solution.

If an agreement is reached, it should be formalized through a legally binding document. You can apply to the Family Court or Federal Circuit Court to obtain a consent order that makes your agreement legally enforceable. This step protects both parties and ensures the agreement is recognized by law.

 

Application with the court 

If you cannot reach an agreement, you may need to apply to the court for a property settlement order. Here’s how to proceed:

  • Seek Legal Advice: Before applying, consult with a family lawyer to understand your rights, obligations, and the likely outcome.
  • Complete the Application: You will need to fill out specific forms, such as an Initiating Application and Financial Statement. These documents require detailed information about your financial situation, so be thorough.
  • Submit the Application: Lodge your forms with the Family Court or Federal Circuit Court. A filing fee may apply, although some individuals may be eligible for a fee reduction.

Court Process

If your matter proceeds to court, the following steps generally occur:

  • First Court Hearing: The court assesses whether mediation or negotiation is possible. If not, the matter progresses through further court hearings.
  • Interim Orders: If immediate arrangements are needed (e.g., who stays in the family home), you can apply for interim orders.
  • Disclosure: Both parties must disclose all financial information. Failure to do so can result in penalties.
  • Negotiations: Further negotiations may occur during the court process to avoid a final hearing.
  • Final Hearing: If an agreement is still not reached, a judge will make a final decision based on factors like the length of the relationship, contributions made by each party, and future needs.

Once the court issues its final orders, they become legally binding. Each party must comply with the orders. If a party does not adhere to the terms, you may seek legal advice on enforcement options.

Property settlement is a significant and often complex process. Each case is unique, with outcomes depending on various factors, including the financial contributions of each party, non-financial contributions (e.g., homemaking, child-rearing), and future needs.

Consulting with a family lawyer is crucial to protect your rights and ensure the settlement process is fair and equitable. At Reid Legal Group, our experienced team can guide you through every step, providing tailored advice based on your specific circumstances.