What is a property settlement?
A property settlement is the process of dividing the property pool and financial affairs between you and your ex after separation.
A property pool is the total value of the marriage assets, liabilities and financial resources. It is a term used by both lawyers and the court and it includes –
- assets (something owned),
- liabilities (money owed),
- superannuation and
- financial resources.
A basic calculation for the net property pool is calculated as follows –
assets minus liabilities plus superannuation = net property pool (NPP).
It is important to understand that the property pool includes not only assets that are in your sole name but those that are owned individually by your ex, jointly with your ex, with another person or by a family trust or a company or under either party’s control.
Juris-what? Jurisdiction, a legal term which refers to a court’s power to hear and determine legal disputes. In the case of marriage or relationship breakdown when you hear the term jurisdiction it is two-fold. First it refers to the legislation and the venue.
The Family Law Act 1975 outlines how property proceedings are to be conducted. This is a Commonwealth Act which means that it is relevant Australia wide, except in some circumstances in Western Australia which has its own Act (the Family Court Act 1997).
Both the Family Court and the Federal Circuit Court can make decisions (known as court orders) in relation to financial matters following the breakdown of a marriage or of an eligible de facto relationship.
There are several time limits that you you should keep in mind when considering your financial separation or property settlement. Theses are –
- If you were married, you must make your application for a property settlement within 12 months of your divorce becoming final.
- If you were married but NOT divorced there are no legal times limits however sometimes it’s best to sort out and separate your financial affairs sooner rather than later.
- If you were in a de facto relationship, your application for a property settlement must be made within 2 years of the breakdown of your de facto relationship.
If you do not apply within these time limits, you will need special permission of a court. This is an extra step in the process and it is important to know that permission is not always granted.
Where to from here?
- Get clear on your asset, liabilities and financial resources. HERE
- Protect your property.
- Start to gather evidence or what lawyers call disclosure documents. I wrote an article about disclosure “Show and Tell not Hide and Seek”, you can read it here.
- If you need more help you can book in for a free 20 minute call with Nikki. CLICK HERE TO BOOK.