The family law system in Australia encourages people to agree on arrangements without going to court including family relationship breakdown, children, and financial/property issues.
Most family law matters can be resolved through mediation and negotiation. We will take you through this process to reduce anxiety and costs for just and equitable outcome.
If you must go to court, we will fight for your rights!
Productivity Commission in its Report noted that, there is an avoidance in the use of formal services for low value property disputes, lack of access to affordable legal and financial advice and dispute resolution services may be a significant factor that leads to ‘questions about the appropriateness of agreements or outcomes’ reached in these cases. There are often significant power imbalances between separating parties. Such imbalances may arise in respect of parties’ knowledge of the financial assets that may form part of the asset pool or one party’s willingness to prolong a state of conflict. Where there is a significant power imbalance, separating parties are less likely to reach a fair outcome in the absence of proper legal advice, mediators, arbitrators, or court.
The Family Law Act 1975 is the main law on matters involving divorce, property settlement in marriage breakdown or de facto relationship breakdown, spouse maintenance for a party to a marriage, de facto spouse maintenance for a party to a de facto relationship that has broken down and issues relating to parenting arrangements after separation.
On this page
- Family Law Rules, Practice Directions and Guidelines
- Case law
- Here's what sets us apart
- How does the Court decide financial cases?
- Property settlement
- The starting point
- Initial letter [Consent orders] Your family law matter including Brochures
- Ways in which your matter including property settlements are achieved in family law
- Steps to follow
- Exchange of disclosure documents
- Just and Equitable
- Not just and equitable
- Settlement options in family law property or financial matters
- Next Step - what you need to do
01. Family Law Rules, Practice Directions and Guidelines
In the Family Law Act, the Parliament delegated authority to the Chief Justice of the Family Court to make rules, regulations and by-laws connected with the Act. These are known as the Family Law Rules 2004. The Rules deal with the practice and procedure of the Court and apply to all proceedings under the Family Law Act in the Family Court.
The Chief Justice of the Family Court also has the authority to make practice directions and guidelines about the procedures of the Family Court. These are intended to inform everyone who uses the Court about the way cases move through the Court.
02. Case law
Case law refers to previous decisions or judgments made about family law by judicial officers. In the legal profession, these are known as precedents. These decisions become part of the family law which applies in Australia.
03. Here's what sets us apart:
- Experienced Family Law Experts: Our team of compassionate and dedicated lawyers possesses in-depth knowledge of Australian property and financial settlement laws, ensuring you receive the best possible legal representation.
- Tailored Solutions: We understand that every relationship and separation is unique. We take the time to listen to your story and tailor our approach to achieve the outcome that best meets your needs and protects your interests.
- Empathetic & Supportive: Separation can be emotionally charged. We offer a safe and understanding space, providing ongoing support and guidance throughout the process.
- Cost-Effective & Transparent: We believe legal counsel shouldn't come at a prohibitive cost. We offer transparent fee structures and explore alternative dispute resolution options to minimise expenses.
04. How does the Court decide financial cases?
There is no formula used to divide your property and finances. If you cannot reach an agreement at dispute resolution, your matter may progress to a hearing. No one can tell you exactly what orders a judicial officer will make. Still, in many cases, an experienced family lawyer can predict a range of outcomes based on a given fact scenario.
The decision is made after all the evidence is heard, and the judicial officer decides what is just and equitable (fair according to the law) based on the unique facts of your case.
The Family Law Act 1975 sets out the general principles which the Court considers when deciding property settlement cases (see sections 79(4) and 75(2) about marriages, and sections 90SM(4) and 90SF(3) about de facto relationships).
The general principles are the same, regardless of whether the parties were in a marriage or a de facto relationship, and are based on:
- the assets and liabilities of you and the other party individually and jointly (i.e. what you own and what you owe), and what they are worth
- direct financial contributions by each party, such as property you each had when you began to live together and your wage and salary earnings while you lived together
- indirect financial contributions by each party, such as gifts and inheritances from family members
- non-financial contributions to property, such as renovations to a home, management of investments, or running a business
- contributions to the welfare of the family, such as caring for children and doing housework, and
- each party’s future needs – a court will consider things like age, health, financial resources, care of children and ability to earn.
How your assets and debts will be shared between you will depend on the individual circumstances of your family. Your settlement will probably be different from others you may have heard about.
NOTE: You may meet the criteria for Priority Property Pool Cases (PPP Cases) if you are seeking financial orders only and the net value of the property (excluding superannuation interests) is, or is likely to be, less than $550,000. PPP Cases aim to find the most straightforward, quickest, and most cost-effective process to finalise the case. For more information see, Priority Property Pool Cases.
05. Property settlement
The Family Law Act provides the family courts with broad powers to adjust property interests and make orders for spousal maintenance between current or formerly married couples, and between former partners from de facto relationships. The provisions relating to married and de facto couples are very similar, though not identical.9 In a recent High Court case, Gordon J summarised the property settlement provisions of the Family Law Act in the following terms:
In property settlement proceedings, s 79 in Pt VIII provides that a court may make such order as it considers appropriate altering the interests of the parties to the marriage in the property. However, the court must not make an order under s 79 unless it is satisfied that in all the circumstances it is just and equitable to make the order and, in considering what order (if any) should be made in property settlement proceedings, the court must take into account certain matters. Those matters include the financial and non-financial contributions, both direct and indirect, by the parties to the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage; the effect of any proposed order on the earning capacity of either party to the marriage; any other order made under the Family Law Act affecting a party to the marriage; and the matters referred to in s 75(2), so far as they are relevant.
06. The starting point
The starting point under Australian law is that legal and equitable interests prevail on separation unless the court is satisfied that, in all the circumstances, justice and equity require an adjustment.
In summary, in considering an application to alter property interests, the court must:
- identify the existing legal and equitable interests of the parties in the property;
- consider whether it would be just and equitable to make an order altering those interests; and
- if it is just and equitable to do so, consider what orders should be made, taking into account the factors listed in s 79(4),21 which incorporate the ‘future needs’ factors set out in s 75(2).
Section 79(4) of the Family Law Act includes seven key factors to be considered including:
- the financial contributions to the acquisition, conservation or improvement of property;
- the non financial contributions to the acquisition, conservation or improvement of property;
- the contributions to the welfare of the family including any contribution made in the capacity of homemaker or parent;
- the effect of the proposed order on any earning capacity of the parties;
- the relevant matters contained in section 75(2) with respect to the future needs of the parties;
- any other order under the Act affecting a party to the marriage or a child of the marriage; and
- any child support assessment.
Section 75(2) sets out a list of factors to be considered in respect of the future needs of the parties including:
- the age and state of health of the parties;
- income and financial resources;
- care of a child;
- duration of the marriage;
- provision for a standard of living that in all the circumstances is reasonable;
- parental responsibilities; and
- any other fact or circumstance that the interests of justice require to be taken into account.
The complexity of these provisions, particularly the lengthy list of factors with no clear hierarchy, does not assist readers to understand the process that a court would use to arrive at a just and equitable division of property.
While the courts provide individual justice in cases, as required by law, such a discretionary approach does not provide guidance to separating couples on how such issues are routinely to be considered as a matter of law.
We will clarify to make it easier and cheaper for you to work out your entitlements and come to fair agreements about their division property.
Unrepresented litigants are more likely to take a matter to trial:
Source: Family Law for the Future — An Inquiry into the Family Law System - The Australian Law Reform Commission (ALRC) Final Report 5 March 2019.
The vast majority of matters that enter the family law system will settle:
Consent order applications were lodged in the Family Court six times more than applications for final orders,5 and up to 84% of final order applications in the Family Court settled before judgment.6 In the Federal Circuit Court, 70% of finalised matters in 2017/18 resolved through settlement.7
Over one-third of all matters that proceed to trial will settle on the ‘steps of
the court’: In 2017/18, 41% of matters that proceeded to trial in the Family Court settled at trial, meaning that at some point during the trial, but before judgment, the parties came to an agreement.9
Source: Family Law for the Future — An Inquiry into the Family Law System - The Australian Law Reform Commission (ALRC) Final Report 5 March 2019.
07. Initial letter [Consent orders] Your family law matter including Brochures.
Your Settlement/Property Affairs
We refer to our conference.
Attached:
- Brochure -Marriage, families and separation
- Brochure - Duty of disclosure
- Brochure - Before you file pre-action procedure for financial cases.
- Superannuation information kit
- Central Practice Direction - Family Law Case Management
- Enclosure - Parts 6.1 and 6.2 of the Family Law Rules 2021
- Enclosure - Schedule 1 - Pre-action procedures - Parenting proceedings
Financial Settlement: Instructions
What you need to do:
Please download and complete the documents below, in Word format and the Summary of assets and liabilities and email them back to us ASAP.
- Retainer instructions - Property settlement
- Summary of assets and liabilities [spreadsheet]
- Summary of assets and liabilities [word]
08. Ways in which your matter including property settlements are achieved in family law.
As family practitioners, we are regularly advising clients that property settlement reached between separated husbands and wives or de facto spouses, as the case may be, must be documented in the appropriate legal manner. This is usually done via an Application for Consent Orders or, depending on the particular circumstances, via Financial Agreement pursuant to ss 90UC, 90UD, 90C or 90D of the Family Law Act.
It is safe to assume, and is certainly the writer’s experience, that most property settlements formalised with the assistance of solicitors are affected via an Application for Consent Orders and Minute of Consent Orders filed in the Family Court.
There are fundamental requirements associated with such an application if not the Court will reject such applications. The recent case of Hale & Harrison [2014] Fam CA 165 where consent orders were ostensibly consented to by the parties but were not made by the court is one such example. His Honour concluded that the parties have reached an agreement was not a basis upon which the court should ‘waive away what is, in reality, its subjective judgement about what is fair’ and ultimately dismissed the Application for Consent Orders.
If parties cannot agree, litigation can be commenced to manage issues effectively. Courts will encourage parties to settle matters via agreement, even within the Court process, via conciliation and mediation.
09. Steps to follow;
The first step is to identify and value the net property of the parties. We note that you will provide us with a list of assets and liabilities together with their values. We will seek similar details from your spouse or their lawyers in due course.
The second step is to identify the contributions, both financial and non-financial, that each of you has made to the acquisition and maintenance of those assets [ paragraphs (a)–(c) of s 79(4)];
The third step is to identify those factors that need to be considered other than contributions, such as the responsibility to care for children if applicable. [ s 79(4)(d)–(g) (In the Marriage of Lee Steere (1985) 10 Fam LR 431; (1985) FLC 91-626) including s 75(2) factors] ; and
Last step, we must consider whether the order proposed is just and equitable: Hickey v Hickey (2003) FLC 93-143 at 39; Omacini v Omacini (2005) FLC 93-218 at 46 and Manolis v Manolis (No 2) [2011] FamCAFC 105; BC201150283 at [65].
10. Exchange of disclosure documents
After the exchange of disclosure documents, we will discuss and advise what a Court would accept as a Just and Equitable division in the circumstances to divide the net asset pool.
A letter can be sent to your spouse to initiate a discussion. We will seek to resolve the matter without going to court by embodying the agreed arrangements in a binding financial agreement or settlement terms through consent orders.
If negotiations fail to produce the necessary agreement within a reasonable time, it will be necessary to apply to the Federal Circuit Court.
11. Just and Equitable
The Court cannot make orders for the alteration of property interests unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
Section 75 and Section 79 and Part VIIIA of the Family Law Act 1975 (if you were married) or in Section 90SF and Section 90SM and Part VIIIAB of the Family Law Act 1975 (if you were in a de facto relationship) outlines Just and Equitable factors.
In addition, the Court, as far as practicable, is to make orders which will finalise the financial relationship between the parties (Section 81 of the Family Law Act).
12. Not just and Equitable
In circumstances where it appears on the face of the orders that they are not just and equitable, a requisition can be expected to issue from the registrar seeking further clarification, and it may then be necessary to file an affidavit of the parties setting out why they have agreed to the orders and the terms as they appear.
Proof of the value of the interest is required to be filed with the application.
13. Settlement options in family law property or financial matters
You can agree on how your property should be divided without any court action. You do this through either:
01. Consent orders
The Family Court of Australia has the power. Full and frank disclosure is required.
02. Financial Agreements (also known as Binding Financial Agreements - BFA)
The court is not involved.
Financial agreements can be entered into;
-
- before marriage: FLA s 90B;
- during the marriage (before or after marriage breakdown): s 90C; or
- after divorce: s 90D.
It may be set aside by the court on grounds set out in s 90K or for de facto couples, s 90UM of the FLA (FCA s 205ZV) as such this is strongly discouraged. Recent Court challenges have adequately highlighted issues with financial agreements.
It could also challenge after many years. It is strongly recommended that every settlement be appropriately documented by consent orders.
We will discuss and advise to decide what a fair answer to divide the net asset pool whether equally or a certain percentage to you and your spouse.
A letter can be sent to your spouse to initiate a discussion. We will seek to resolve the matter without going to court by embodying the agreed arrangements in a binding financial agreement or settlement terms through consent orders. If negotiations fail to produce the necessary agreement within a reasonable time, it will be necessary to apply to the Federal Circuit Court.
For more information: https://dlegal.com.au/articles/family-law/property-settlement-financial-agreements/consent-orders-or-binding-financial-agreements-in-family-law-property-settlement-financial-agreements/
14. Next Step - what you need to do.
If you are happy to proceed, please let us know, and we will email you an instructions sheet for you to complete and email us. Once we peruse the instructions, we will provide you with a fee estimation.
There is no obligation for you to retain us.