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Family Court Property Settlement

The law regulating property division and spousal maintenance between persons who are married is contained in the Family Law Act 1975 (Cth). Both the Family Court and the Federal Circuit Court of Australia have the power to make orders for property settlement and spousal maintenance pursuant to the Family Law Act.

Property Settlement:

Matrimonial property includes anything owned by either spouse including Superannuation. The Court has broad powers to alter existing rights to property in any way that it considers just and equitable.

The Court adopts are four step process with respect to making orders regarding the division of property. The steps are as follows:

1. To identify and value all assets, liabilities and financial resources of both parties as at the date of hearing.

2. To assess the contributions that both parties have made towards the acquisition and maintenance of those assets and divide the assets accordingly. In most cases the contribution of homemaker and parent is assessed as having the same value as contributions by the primary earner.

3. To determine whether there is any further adjustment that needs to be made as a result of any disparity in the relative financial position/future needs of the parties.

4. To consider whether in the circumstances the orders to be made are just and equitable.

Where spouses agree about the division of their property it will be important to formalise their agreement to avoid claims being made by either spouse in future. Agreements can be formalised by way of a Section 90C Financial Agreement or by lodging with the Family Court an Application for Consent Orders. There are different requirements for Consent Orders and Financial Agreements however both are binding and enforceable. It is important to obtain independent legal advice prior to entering into Consent Orders or a Financial Agreement with regards to property settlement. If spouses are unable to agree it will be necessary that an application is made to either the Family Court or Federal Circuit Court of Australiafor property settlement orders. An application can be made at any time following separation or within 12 months of a divorce.

Spousal Maintenance

Under the law, a person in a marriage has a responsibility to financially support and maintain his or her spouse if the spouse is unable to adequately support himself or herself and the first mentioned party is reasonably able to do so. The Court can make orders for Spousal Maintenance on both an interim and final basis. Unless there is a need for interim maintenance, spousal maintenance claims are often resolved at the same time as a property settlement. A payment can be made in a lump sum or by periodic payments.

Property Settlement and Spousal Maintenance for separating De Facto partners

Property Settlement and spousal maintenance for de facto partners (both opposite or same sex) separating after the 1 July 2010 are covered by the Family Law Act 1975(Cth).

To be covered by the Family Law Act the following conditions must be met:

1. The relationship must have existed for a period of at least 2 years;

2. There is a child of the relationship; or

3. Serious injustice would result if an order were not made under the Family Law Act.

The same principles that apply to Married couples with regards to property division and spousal maintenance apply to De Facto partners (see above). Similarly any agreement reached between de facto partners can be formalised by way of a Financial Agreement or an Application for Consent Orders. State Law applies to separating couples that do not meet the requirements of the Family Law Act.

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