How Does the Federal Circuit and Family Court of Australia divide property? Rowan Skinner is an experienced property settlement lawyer in Melbourne who can guide you through this process and help you achieve the best possible outcome.
How Does The Court Divide Property? | Property Settlement Lawyer
Step 1: Assess the Total Value of your Property
In Australia, the principles which apply are the same for married couples and de facto couples.
The first step in the process is to calculate the total value of all existing property owned by both parties. This includes assets held in both joint and individual names. Property in this context is broadly defined and includes real estate, cash, shares, cars, businesses, trusts, boats, caravans, a windfall like a lottery win, or the value of a partnership.
Next, deduct the value of any existing debts, such as mortgages, loans, and credit card balances, that are tied to the property or are stand-alone. It’s important to note that these debts should be those incurred during the relationship.
Step 2: Evaluate Contributions
The next step involves assessing the direct and indirect financial and non-financial contributions, including homemaking contributions, which each party has made to the acquisition, conservation and improvement of the property referred to in the first step above. This includes:
- Financial Contributions: Deposits, mortgage payments, and any cash used to purchase property.
- Non-Financial Contributions: Contributions such as labour and time spent improving an asset, like renovating a house or building a business, are also considered. Additionally, homemaking contributions, such as caring for children and maintaining the household, are recognised as valuable non-financial contributions.
Step 3: Consider Section 75(2) Factors
After evaluating contributions, the court may make further adjustments to the percentage split applied in the second step, based on what are known as section 75(2) factors. These factors used to be referred to as ‘needs’ factors. The needs factors look at how the marriage might have affected the parties and the party’s current financial status. For example:
- The desire of a party to maintain their role as a parent
- Financial commitments of the parties
- The extent to which a party has contributed to the earning capacity of the other party, which can include considerations such as child support and private school fee disputes
- The earning capacity of the parties
Step 4: Ensure a Just and Equitable Outcome
Finally, the court will review the proposed property settlement to ensure it is just and equitable. An important factor that can impact this process is whether there has been a prior attempt at resolving the dispute through ‘family dispute resolution‘. This process can be an effective way to manage conflicts and come to a fair resolution without the need for court intervention
Contact A Property Settlement Lawyer Today
Dividing property after a relationship ends is rarely straightforward. If you’re facing a property settlement and want expert advice, consult with Rowan Skinner who is a qualified and highly experienced property settlement lawyer. Contact our office at (03) 9995 9155 for a non-obligatory discussion about your case. We service clients in Melbourne, Melbourne Northern Suburbs, such as Northcote, Alphington, Carlton, Fitzroy, North Fitzroy, Kew and Heidelberg, as well as South Melbourne and South Yarra.
For more insights into the financial aspects of divorce, including cost implications, check out our blog post. We also offer detailed information on how spousal maintenance is calculated in Victoria in our latest article.
Rowan Skinner is a highly skilled family lawyer with over 35 years of experience across various legal roles and jurisdictions. Rowan specialises in resolving family law disputes such as divorce, financial settlements, child custody and domestic violence cases. Through his diverse and extensive experience, Rowan has a deep understanding of the complexities and nuances involved in family law. Rowan is a skilled negotiator and litigator who follows a compassionate and client-focused approach which prioritises helping you navigate what can be an emotional and challenging time.