What is taken into consideration regarding asset division?

When going through a separation, the division of assets can be very difficult to navigate without professional legal guidance. The process is to divide the property that was acquired during the relationship in the most just and equitable way as defined under the Family Law Act 1975.

Assessment of Assets and Liabilities

Division of assets in a separation is one of the most common issues that people face when ending a relationship.

The process for dividing assets starts with the separation date. The separation date is the date when both spouses have agreed to separate e. After this point, each spouse should make an inventory of all their assets and liabilities including property, money, investments and superannuation accounts. This will help in assessing how much they are entitled to in the settlement.

It is commonly assumed that when dividing assets, a 50/50 equal split is what is applied, but that is not always the case.

 

All of the assets (and liabilities) available for division, which includes superannuation entitlements need to be listed. Generally, all assets, whether they are owned jointly by the parties or by one of the parties independently, will be taken into account in any family law property settlement. The value of assets is usually the value of that asset at the time the court case is heard by a Judge or at the time of any private settlement, rather than the value of the asset at the time of separation.

Contributions

The next step is to consider the contributions each party has made during the relationship. These include financial contributions (such as salary, initial contributions of assets, inheritances or gifts) and non-financial contributions (such as in the role of homemaker, parent, to the establishment of a business or in performing renovations)

Adjustment considerations

The following step is to consider whether any adjustment needs to be made to take into account the future needs of either party. Factors such as the age and state of health of each person, whether either person has a duty to support or care for a child of the relationship or any other person, the respective employment prospects of each person, whether either person has re-partnered, and the financial circumstances of any new relationship are taken into account.

Property Division

Any division of property must be "just and equitable". In order to assess the justice and equity of a property division, the percentages are normally converted into real dollar values. An assessment is then made as to whether any further adjustment is needed to make the division of property "just and equitable".

Time limits

Time limits apply regarding when parties can apply for a property settlement and/or spousal maintenance.  If no agreement is reached between parties, then court proceedings for property and/or spousal maintenance for parties in a marriage can only be applied for within 12 months following the date of divorce unless the person is granted leave (permission) of the Court to institute proceedings. Proceedings for property and/or spousal maintenance for parties in a de facto relationship can only be applied for within 2 years from the date of separation unless the person is granted leave (permission) of the Court to institute proceedings

Although the division of assets can seem complex, consulting a family lawyer can help make the process easier. Our family law team can help you reach an agreement that you are satisfied with and alleviate any stress you may be encountering.