Understanding the intricate process of dividing property acquired during a relationship, often referred to as the matrimonial asset pool, can be challenging from a Family Law perspective. To comprehend this complex procedure, it’s crucial to delve into how courts assess the division of property and how a lawyer approaches each unique situation.

The legal framework for property division in Australia follows a structured four-step process1

  1. Firstly, the court identifies and values all properties. At this stage, full and frank disclosure of financial documents is required to determine the matrimonial asset pool2. This includes a comprehensive consideration of individually or jointly held assets, acquired both before and during the relationship, encompassing real estate, superannuation, financial resources, as well as modern assets like shares and cryptocurrency. It is important to note that recent amendments under the Property Relationships Amendment Act 2023 have expanded the definition of assets to include intellectual property, such as patents and trademarks. 
  2. Subsequently, based on client instructions, lawyers evaluate both financial and non-financial contributions. Financial contributions encompass income, wages, property acquisition, inheritances, or loans, while non-financial contributions involve aspects such as child care, homemaking, housework, and parenting responsibilities. In light of recent court rulings, contributions such as the enhancement of professional qualifications during the relationship are now considered valid non-financial contributions. This list is not exhaustive, emphasizing the need for meticulous consideration to ensure accurate information is conveyed3. Additionally, this step relies heavily on the evidence provided by both parties. In cases where parties cannot agree on the value of an asset, the engagement of valuers becomes necessary to prepare a court-accepted valuation.
  3. The third step involves assessing the future needs of both parties, taking into account factors like age, health, earning capacity, and arrangements for any children from the relationship. This assessment is tailored to the specific circumstances of each case4
  4. Lastly, the proposed percentage split and allocation of assets within the pool are scrutinized for fairness. The legal landscape has evolved, particularly after the High Court’s decision in Stanford v Stanford [HCA] 52, introducing a fifth step: determining whether it is appropriate to divide property at all. This underscores the importance of questioning the fairness of altering interests in property. 

It is essential to recognise that the just and equitable adjustment of property interests may not always be applicable, especially in short-term relationships or if one party hasn’t contributed to the other party’s property. Therefore, the five steps are summarised as follows:

  1. It is just and equitable to make an adjustment to the parties’ property interests, considering factors such as voluntary separation and the common use of assets.
  2. Identify and value property.
  3. Consider financial and non-financial contributions.
  4. Assess the future needs of the parties.
  5. Consider the practical effect of the proposed division and whether it is just and equitable in the circumstances.

Accounting the information presented in this article, it is concluded that successfully managing property division within the evolving framework of Family Law requires expert guidance. Seeking advice from a family lawyer is essential to receive personalized guidance, ensuring a thorough examination of your specific situation. The ever-changing legal environment necessitates the expertise of a professional to achieve equitable outcomes while staying abreast of legislative shifts. Entrusting a legal professional with a nuanced understanding of your rights and interests is vital, making their consultation an essential component in achieving a fair resolution in property division.

  1.  In the Marriage of Hickey (2003) Fam LR 355
  2.  Rule 6.06 Federal Circuit and Family Court of Australia (Family Law) Rules 2021
  3.  S79(4)(a), (b), (c) Family Law Act
  4.  S75(2) Family Law Act

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