Family LawWho Gets The Family Home After Separation

April 1, 2017

Many people have the mistaken belief that, at the end of a relationship, the property is supposed to be divided between the parties on a 50/50 basis. This is not the case. Under the Family Law of Australia, the Court has a wide discretion in deciding the property settlement entitlements of each party in the event of separation after a marriage or a de facto relationship has broken down.

In determining how the property should be divided in each individual case, the law requires that a 5-step process be applied.
Step 1

The assets, liabilities and financial resources of the parties must be identified and the value of each of them must be established. This includes the assets, liabilities and resources of the parties jointly and of each party individually. Assets are all property or interests owned wholly or in part. Liabilities are debts which are owed. Financial interests are possible future assets, such as superannuation accounts, trusts and inheritances. This step results in a determination of the total value of the property of the parties, which is referred to as the ‘Property Pool.’
Step 2

A determination must be made regarding whether, in the circumstances of the case, it is just and equitable to make an adjustment to the property interests of the parties. In certain circumstances, such as a very short relationship in which the parties maintained separate finances, it may be found that no adjustment to property interest should be ordered. If this is the case, there would be no need to proceed further. If it is determined that an adjustment to property interests would be just and equitable, the remaining steps would be considered.
Step 3

Consider what each party contributed to the relationship. This includes both the financial and non-financial contribution which each party has made to the relationship. Financial contribution includes the property each party had at the start of the relationship, their incomes during the relationship and any substantial gifts or payments received during the relationship, such as inheritances, redundancy payments or compensation payments. Non-financial contribution includes work done which is unpaid, such as homemaker, parent and/or carer. It also includes work which preserves or increases the value of property, such as maintaining and/or renovating property. When contribution occurred, whether before, during or after the relationship, will affect the impact the contribution will have on the final property settlement. This step will result in a proposed adjustment to the property division in terms of a percentage, such as 55/45 to the advantage to one of the parties.
Step 4

Consider the need of each of the parties as they re-establish their financial position after the breakdown of the relationship. This requires consideration of the age and the state of physical and mental health of each party, the earning capacity and financial resources of each party, any background of domestic violence and any commitments either party has to the care of themselves or of any other person, such as children of the relationship. This step will again result in a modified proposed adjustment to the property division in terms of a percentage.
Step 5

The practical effect of the proposed property division is considered to determine if it is just and equitable in all the circumstances of the case. In doing so, consideration is given to both the amount of property which would be retained by each party, as well as the type of property retained by each party. If required, changes may be made to the proposed adjustments to property interests to achieve a division that is just and equitable.

When a relationship breakdown occurs, whether in a marriage or in a de facto relationship, there are time limits within which proceedings for a property settlement must be started. It is important that you get legal advice as early as possible so that you are aware of those time limits and of your rights in reaching an appropriate property settlement.

A.L.F. Lawyers are highly experienced in dealing with Property Separation. If you would like assistance with your matter, please contact our office to organise a consultation.
Tags: Property Division, Property Split, Splitting the Family Home, What Happens to My Property After Separation, Who Gets the Family Home After Separation

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