The ‘D’ word

We often joke about the ‘D’ word (divorce) but for those of us who are, or have, experienced the breakdown of a significant relationship it is anything but a humorous experience. Divorce isn’t fun and there are no winners. A successful divorce, if ever there was such a thing, is not about winning battles but instead about resolving differences.

You may be in the throes of a marriage or relationship breakdown, or at least considering that as an option; either way, this will not be an easy time for you or for those around you. With now close to half of all marriages in Australia ending in divorce, and similar statistics for defacto relationships, more and more Australian adults are themselves experiencing the heartbreak that flows from relationship breakdown.

Every separating family has two main legal issues to finalise:

  1. Firstly, matters relating to the parenting of children; and
  2. Secondly, the division of the personal wealth and income that exists at the end of a relationship.

This article discusses the 4-step approach to determining a property settlement.

The First Step

What do you have?

The Court must first determine what assets, liabilities and financial resources are to be considered in determining the property division.

In essence a list of everything that you and your partner own is created. It does not matter if your home is registered in your name, your partner’s name of even a friend’s name if you own it (or part of it), it will go on the list.

This is also the case for debts and other liabilities. The Court will also take the value of each of the assets as at the date you reach agreement or the date that you appear for a trial – not the date that you separated. This is very important to remember as the value of things you own could change over time.

The Second Step

How did you get it (aka ‘contributions’)?

Secondly, the Court looks at the different ‘contributions’ you each made during your relationship.

There are many different types of contributions such as:

  • Financial contributions such as income or assets that you or your partner brought into the relationship
  • Non-financial contributions such as unpaid work in a family business or an owner builder undertaking renovations to real estate
  • Contributions to the welfare of the family such as the day to day running of the household and care of children. Each relationship is made up of very different contributions and it is for this reason that the Court will look at each relationship on its own facts. There is no hard and fast rule.

The Third Step


What other factors are considered?

The third step involves the Court taking into consideration a number of matters such as:

  1. Your age and state of health and your partners age and health.
  2. Your children, their age, their needs and who will be caring for them.
  3. Your income, your partner’s income and how this may be affected after the property settlement.
  4. The effect (if any) that the relationship has had on your or your partner’s ability to earn an income and obtain employment.
  5. Any other matters the Court considers relevant in your relationship.

The Final Step

Is it just and equitable?

Finally, after weighing up contributions and all the other factors that are relevant to your case the Court will come to a decision (normally in percentage terms) about how your property should be divided between you.

There is no precise science to reaching a decision as every relationship is different, however the Court must be satisfied that the division is ultimately ‘just and equitable’. There is considerable difficulty in predicting with certainty the likely outcome of an application for property settlement without first having a lot of specific information. We encourage you to meet with member of our team to discuss what outcomes might be appropriate for your family.

The decision to separate is not an easy one and everyone deals with this differently. Do consider obtaining professional assistance early into the process from a family lawyer and family counsellors to assist you through this difficult time.

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