We often meet with older Australians who have separated amicably some time ago but have not taken the steps to negotiate a property settlement or get divorced.
This can be for any number of reasons including:
- The house no longer has a mortgage and the party who remains residing in it is meeting the outgoings;
- The parties are in a self-managed super fund and one of them manages the investments and pension payments to the parties,
- One of the parties has entered an aged care facility
The impact of delaying with a property settlement can be increasingly important, particularly for older Australians.
If you delay in undertaking a property settlement and you jointly own assets, you will continue to be “tied” to your ex-spouse or partner following separation. For example, generally your mortgage balance decreases as you get older or you may have even paid off your mortgage, but have not taken the additional step of having it discharged.
Delaying with your property settlement creates a risk that the other party could redraw on the equity in your jointly owned home for their own purposes (eg. to supplement their own pension). In addition, it may also impact on your eligibility to obtain Centrelink benefits such as the aged pension or other concessions when entering a retirement/nursing home.
Another situation that can arise, particularly for older Australians, is where one party passes away prior to a property settlement being negotiated or formalised. Once a party has passed away you cannot commence property settlement proceedings in the Family Court of Australia or the Federal Circuit Court of Australia. The property owned by the deceased will be dealt with in accordance with their Will, or the rules of intestacy if they did not have a Will. Many complications can arise if this were to happen and it may have a negative impact on your entitlements.
However, if your ex-spouse/partner passes away after the commencement of court proceedings for property settlement, these proceedings can continue. It is therefore important if you are an older Australian that you seek advice early following your separation and notify your solicitor of any potential health issues so that appropriate advice can be given to ensure your rights and entitlements are protected.
For more information read our Property Settlements FAQs article here.
If you would like expert advice on property settlement or other issues relating to family law, please contact our helpful team today on (02) 4929 3995.