Dividing Assets – What am I entitled to??
When you separate from your husband, wife or de facto partner, in order to divide the assets that you accumulated during the relationship you need complete a property settlement.
A property settlement is separate from Divorce. Divorce, in effect, means that you are no longer married and are legally free to marry another person. Applying for Divorce is not the process of how assets are divided.
It is important to complete a property settlement and have it properly documented, even if you have very few assets to divide. If you do not complete a property settlement the other party can make an Application to the Court any time in the future for a property settlement. It may be that you have moved on into a new relationship and have accumulated assets with your new partner, this does not stop the previous partner from making an Application to the Court for a settlement.
The legal principles applied to how the assets are to be divided is a four step process.
Firstly you need to identify the asset pool, this means that all the assets that are owned whether in your name, the other parties name or joint names is included in the pool. The assets are the assets as at today not at the time you separated.
Secondly the contributions of each party are assessed, these include;
- What each of you bought into the relationship;
- What were the financial contributions of each of the parties, this includes gifts and inheritances;
- What were the non-financial contributions of each of the parties, such as significant improvements to a house or property; and
- Contributions as homemaker such as caring for children, maintaining the home and paying the bills.
Thirdly the future needs of each of the parties are considered, this includes:
- The income and income earning capacity of each of the parties;
- The care of children;
- Age of each party; and
- The health of each of the parties.
Fourthly, once the above three steps have been conducted, consideration must be given to whether the division of the assets is just and equitable or fair when looking at the circumstances of the relationship.
Consideration is also given to the length of the marriage or the relationship.
You can complete a property settlement immediately after separation, you are not required to wait 12 months after separation as required before you make an Application for Divorce. There are however, overall time limits for commencing Applications.
by Alison Brown