THE 4 STEP PROCESS
Finalising a property settlement following the breakdown of either a marital or de facto relationship can be complex and involves a review of the 4 step process which is discussed below.
Our experienced family lawyers are able to provide you with expert advice about your property settlement entitlements and the types of Orders a Court may make in your circumstances.
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Step 1: What is the asset pool?
The first step is to identify what property is available to distribute between you and your former partner. Generally, this includes the assets and liabilities held in each party’s name at the time of separation.
You should compile a schedule that lists each asset owned and liability owed by you or your former partner and its current value. It may be that you hold property jointly and also in your individual names. Both jointly held property and property in your individual name and your partner’s individual name should be included in the schedule.
Additionally, you and your former partner should ascertain the current value of your respective superannuation entitlements. The details and values of your respective superannuation entitlements should be included in your schedule of property.
Step 2: What Contributions did each party make?
Next, you should consider in percentage terms, the contributions each of you have made to: –
♦ the acquisition, conservation or improvement of the property in the asset pool; and/or
♦ the welfare of the family.
Contributions can either be of a financial nature or a non-financial nature. They can be further classified as direct contributions or indirect contributions.
Step 3: What are the current and future needs of the parties?
In the third step, the current and future needs of each party are assessed. The purpose is to ascertain whether an adjustment should be made to either party based on their future needs.
The Court, in assessing each party’s future needs, will review a range of factors, including: –
♦ Their age.
♦ Their state of health.
♦ Each party’s income, property and financial resources.
♦ Each party’s physical and mental capacity for gainful employment.
♦ If either party has the care of children who are under 18 years.
♦ Each party’s commitments to support themselves and/or their children.
♦ Either party’s responsibility to support another person.
♦ Whether either party is in receipt of a pension, allowance or benefit.
♦ A distribution that will result in a reasonable standard of living.
♦ The duration of the relationship.
♦ The need to protect a party who wishes to continue their role as a parent.
♦ Whether either party has re-partnered and commenced living with that partner.
♦ Any other factors the Court considers relevant.
Step 4: Just and Equitable
The final step is to consider what arrangement will be just and equitable taking into account all of the circumstances.
What is equitable will vary from case to case. In applying the 4 step process the Court has a wide discretion to make whatever Orders it sees fit.
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