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Property Settlements: Marriage and De Facto Relationships

Posted on 11th May 2020
Catherine Henry Lawyers
Catherine Henry Lawyers

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Property Settlement

One of the most difficult things about separating can be dividing your assets.

When to start the process

You don’t have to wait until you’ve been separated for a certain period or divorced before you sort out a property settlement. We recommend sorting out a property settlement as soon as possible.

There are time periods in which you must take action. Married couples have 12 months from the date that the divorce order takes effect to apply to the court for a property settlement.  De facto couples have 2 years from the date of separation to apply to the court for a property settlement.

De facto relationships – a preliminary point

A court can only make a property settlement order in relation to a de facto relationship if one or more of the following provisions applies:

  • Your de facto relationship lasted for at least 2 years in total;
  • You have a child with your de facto partner;
  • You have made a substantial contribution to the relationship (for example this could be by way of a financial contribution and/or a home making contribution and/or a parenting contribution) and the failure to make an order would result in serious injustice to you; and
  • The relationship was registered under a state or territory law.


There are also some geographical requirements before the Court can make a property settlement order in relation to a de facto relationship, but that is rarely an issue.

How to work out a property settlement

Whether you are/were married or you were in a de facto relationship, the law sets out 5 steps in working out the division of property. The 5 steps are:

  1. Determine whether it is just and equitable to make an order.
  2. Identify the assets and debts of each party. This includes real estate, cars, shares, contents, savings, business, superannuation etc.
  3. Assess the contributions made by each party. Contributions include:

– Bringing assets to the relationship

– Earning an income

– Caring for children

– Receiving a lump sum during the relationship e.g. an inheritance

  1. Consider the factors listed in section 75(2) of the Family Law Act (section 90SF(3) in a de facto relationship). This includes considering the arrangements for children and the income of each party.
  2. Determine whether the Order which is proposed is just and equitable.


Making an agreement out of court

The best possible outcome is if you can reach a fair agreement with your ex partner without going to court.

Before doing so, it is essential that each party make full disclosure of their financial position.  Also, it is important that you get legal advice.

Going to mediation is a good way of trying to come to an agreement. It is particularly effective when each party is represented by an experienced family lawyer.

A settlement should be formalised by way of a consent order made by the Family Court or by way of a financial agreement.  There are 2 reasons for this.  Firstly, a consent order or a financial agreement provides finality, except in very limited circumstances (such as if a party has not made full financial disclosure).  Secondly, a consent order or a financial agreement provides exemption from stamp duty for assets transferred pursuant to the consent order or financial agreement.

Court Proceedings

If agreement can’t be reached, then the matter will need to go to Arbitration or Court. The Arbitrator or Judge will determine the division of property in accordance with the 5 steps. Arbitration is becoming increasingly popular, as it resolves the matter much more quickly than Court. The cost of Arbitration and Court is similar.

What orders can be made

In a property settlement many different orders can be made. They commonly include:

  • The home being sold and the proceeds of sale divided
  • One person retaining the home as long as they discharge the mortgage and possibly make a payment to the other person
  • Splitting superannuation from one person’s superannuation fund to the other person’s superannuation fund
  • Orders relating to personal property, such as one person retaining a motor vehicle, contents etc. or the division of these items


*This information is supplied as general advice only. For expert advice relating to your specific family law issue, contact one of our experienced and professional family law solicitors on 02 4929 3995.





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