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family law court

Risks in delaying property settlements

Risks in delaying property settlements

Parents, children and or family members who have endured or witnessed a relationship breakdown can certainly attest to the challenges and intimidation separated parties face as a result. Not only are they emotionally challenging, they involve life-changing and confronting decisions, particularly adjusting to the severance of any financial ties and or resolving care arrangements for the children.

It is not uncommon to come across clients who have separated and left finalising their property settlement for many years. Empathetically and understandably so, property negotiation with a former partner is probably the last detail on the minds of separated parties, given the need to also address emotional issues resulting from separation – however it is imperative that you know the considerable risks associated when discussions surrounding a family law property settlement are left for a significant period.

It is important to be aware of the time limits under the Family Law Act 1975 in bringing proceedings for property settlement or spousal maintenance before the Court, which is designed to promote property settlements within a practical time frame.

  • For married couples, you have 12 months from the date of divorce;
  • For de facto couples, you have two years from the date of separation.

For married couples, we do not recommend applying for divorce until property settlement has been finalised or proceedings commenced seeking property orders. For de facto couples, we commonly run in to the issue of being out of time and we see parties expending legal costs to argue the exact date of separation – therefore reiterating the importance of finalising your property settlement at the first available opportunity following separation.

These time frames exist under the Act to provide certainty to both parties and is beneficial in cases where one party is deliberately skirting the negotiation process (usually the party required to pay maintenance or the party who has smaller future needs) and delaying a property settlement.

In the event you wish to pursue a property or maintenance claim outside the designated time frame, you can only do so with the Court’s permission, that is, leave must be sought from the Court to begin proceedings. The Court must be satisfied that hardship will be caused to you or a child if leave was not granted. In maintenance proceedings, you must demonstrate that at the time the ordinary time limit expired, you were unable to support yourself without an income tested pension, allowance of benefit.

Another significant risk associated in delaying a property settlement is that values of assets, liabilities and or superannuation, as well as the parties’ financial circumstances may change between the date of separation and when negotiations begin and or the matter is brought before the Court –the law looks at and considers the asset pool at the time of any trial, not at the date of separation. This means that any lottery wins or inheritances accumulated may be included as part of the asset pool for division. Similarly, delaying a property settlement whilst meanwhile disposing of any matrimonial assets prior to a settlement can be treated by the Court as that the person has already received part of their property settlement entitlement, thereby reducing their entitlement in the final settlement.

When property settlements are left for a significant period, this also increases the risk that one party may die before proceedings are initiated. Any property owned as joint tenants such as the matrimonial home will be transferred automatically to the surviving tenant (usually the ex-spouse), regardless of what the deceased’s Will states and regardless of whether the parties have separated.

It is for these complexities and risks involved in determining the parties’ entitlements after a long period of separation that we advise you to speak to one of our experienced family lawyers post-separation. Or, if you are in a position where the ordinary time limit has lapsed, we can tailor our advice to you accordingly taking into account your circumstances.

On the same note, if you have managed to reach an agreement with your former partner about a property settlement, we encourage you to document it in a legally binding and recognised manner, either through Consent Orders or a Binding Financial Agreement. The risks you face otherwise is that your partner later decides to change the agreement, which was never formalised in the first place. Putting the terms of settlement in a legally enforceable way would save considerable amount of time and costs in the future if the “informal” agreement was challenged.

Please do not hesitate to contact us on 03 9614 7111 or email us out of hours on melbourne@nevettford.com.au.

Preventing unlawful removal of children from Australia

Do you have concerns that your child may be removed from Australia against your permission? Have you agreed to your child traveling overseas with the other parent but there is a genuine fear that they may not return your child to Australia?

We understand that this would be a stressful situation for any parent.

If so, it may be important that you act immediately to prevent this. You will need to obtain a Family Law Watch List from the Family Law Courts preventing or limiting your child from travelling outside Australia. A Family Law Watch List is also otherwise known as an Airport Watch List. If the situation is urgent, the Courts may make an Order on an ex parte basis.

The Family Law Watch List directs the Australian Federal Police to put your child’s name on the Watch List which in effect, operates at all international departure points including sea ports until discharged by the Courts. It is crucial to note though that the Family Law Watch List does not restrict interstate travel. The Australian Federal Police will not place your child’s name on the Family Watch List without a Court Order, unless in very limited circumstances.

If a child does not have a valid passport, Australia requires the other parent’s signature on the Passport Application form. If this is the case, and you suspect the other parent may fraudulently make an Application, you may, at first instance, consider whether a Child Alert Request will suffice. A Child Alert Request is a warning to the Department of Foreign Affairs and Trade not to issue an Australian Passport for a child without first making further enquiries (https://www.passports.gov.au/passportsexplained/childpassports/Pages/childalerts.aspx).

If the other parent has an international passport, you can make enquiries with embassies/consulates about the possibility of the other parent obtaining an international passport for your child. If there continues to be a real risk your child could travel on an international passport, you can make an application for your child’s name to be placed on the Family Law Watch List.

When facing with an application for a Family Law Watch List, or an application for the child to travel overseas, the Courts uphold its primary consideration being the child’s best interests – Will a travel abroad be in the child’s best interest? What is the time period and reason for the intended travel? Is there a real risk that the child will not be returned to Australia? Is the intended/likely travel destination a Hague Convention country? To find out whether a country is a Hague Convention country, go to https://www.ag.gov.au/FamiliesAndMarriage/Families/InternationalFamilyLaw/Pages/HagueConventionontheCivilAspectsofInternationalChildAbduction.aspx.

On the other hand, if you are a parent considering removing a child from Australia without the other parent’s consent, or relocating overseas, you should think twice as your actions may constitute an offence punishable with imprisonment up to three years. If you wish to relocate with your child, you should consult the other parent seeking an agreement in writing, or seek Court Orders allowing your child to travel or relocate.

If you have a pressing fear that your child may be removed from Australia unlawfully, or you simply wish to know more about international travel arrangements, you can contact our attentive Family Law team on 03 9614 7111 or Melbourne@nevettford.com.au.