The short answer is yes. There are financial requirements for when you and your spouse or partner separate or divorce according to Family law.
Sometimes during a marriage, couples purchase assets or properties jointly or invest in income generating ventures. Some couples pool their assets and properties together or keep them separate. There may also be assets or properties owned individually by a spouse and which may be distinct from the assets/properties gained during the marriage (or defacto relationship). One example could be if the couple lived in a house which was inherited by one of the partners from their parents prior to the marriage. Even though the house was an inheritance of one spouse, after separation, the other spouse may want to be able to continue living in the house as part of their property settlement. When creditors have security over a house or other property, this can also complicate how or whether assets can be transferred as part of any settlement.
In any event, all assets and liabilities (whether owned/owed by one spouse or by both spouses) must be divided between them in the case of separation or divorce. Any agreement to divide assets and liabilities will only be final and binding if confirmed in Court orders or a special type of agreement known as a “financial agreement”.
You can see that it isn’t an easy or black and white process. It is often in your best interest to engage an experienced Family Lawyer to ensure that legal requirements are met.
When a marriage, de facto or same-sex partnership breaks down and the partners decide to dissolve the marriage or partnership, the separation may have an impact on third parties such as their children and their creditors and debtors. Thus, partners and spouses need to make financial arrangements for the payment of bills, debts and spousal and child support out of the assets and properties jointly owned by the marriage or partnership or out of their separate personal properties.
Spouses or partners can agree on how to divide the assets and liabilities amicably and privately and then submit their agreement to the Family Court to ask for consent orders to make it binding on them.
What happens when partners disagree on the division of assets?
When spouses or partners disagree on the division of assets and liabilities, they can open a family dispute on financial matters. When spouses opt for this, they have to comply with pre-action procedures.
First, they need to have a full and frank disclosure of all the assets of the marriage as well its liabilities.
Second, they need either to agree the values of these assets and properties or have those values appraised. Sometimes, properties (like a house, a book collection or a painting) may have sentimental value, and one of the spouses seeks to retain ownership instead of selling it and dividing up the proceeds. Assigning a monetary value to the property will ensure that the other spouse will get some other property that has equal monetary value.
Often the parties may only have assets in Western Australia, however, there are instances when the parties own properties in other states or other countries as well. The division and distribution of those properties need to be formalised.
Third, the spouses or partners need to go through counselling, arbitration or mediation to try and settle financial matters amicably. When this happens, the agreement between the parties which was reached through these alternative dispute resolution procedures can be submitted to the Family Court for its approval and for consent orders to be issued so that the agreement will be binding on the former partners or spouses.
There are times when the spouses or partners agree on the distribution of properties, but a property is subject to a mortgage or other security. If that property is to be transferred as part of the property settlement, then that debt will need to be re-financed.
Financial and property arrangements in the event of separation or divorce are not something to be taken lightly. Not only your own future, but that of your children could be significantly affected.
Note also that there is often a time limit for applying to the Court for property division orders. If that deadline expires, you may well lose your right to seek property division from your former partner.
Legal representation is highly recommended in case of property distribution to ensure that your rights to your personal properties and your right to a share in the properties of the marriage will be adequately protected and asserted.
At Perth Lawyers Macdonald Rudder we have been successfully helping our clients in matters of Family Law for over 29 years. We understand that it is a difficult time and will always treat your situation with sensitivity and understanding while striving for the best outcome. Contact us today to book into to see one of our experienced lawyers and make sure you are protected.