Family Law Property Settlements are Not as Simple as Drafting an Agreement
When a married or defacto couple make the difficult decision to separate, one of the most important things to consider is how the assets and liabilities will be divided. It some cases the couple reach a decision about property, even before seeking legal advice. We are often then contacted by clients in this position who are seeking to have a written agreement drawn up to reflect the terms they have already agreed with their former partner.
Unfortunately, property settlement under the Family Law Act is not as simple and straightforward as many expect. Even where a verbal agreement is reached, the couple still need to comply with their legal obligation to provide their ex with full and frank financial disclosure of their assets, liabilities, financial resources and earnings. This obligation cannot be circumvented.
This disclosure obligation requires documents such as (but not limited to) payslips, bank statements, superannuation statements, tax returns and assessments, financial records of any trust, partnership or company that a party has an interest in, and share statements, over various periods of time, to be provided to the other party.
It can be quite onerous and time consuming to collate the required disclosure documents, but it is a crucial part of a family law property matter. The family law system places so much importance on the obligation for full and frank disclosure because it allows the parties to be informed as to their joint and personal financial positions before a settlement is agreed. This provides a degree of equity in cases where one party was largely excluded from financial decisions during the relationship. Disclosure also assists a solicitor in being able to provide their client with advice about the proposed property settlement and its effects.
If there is a delay in providing financial disclosure, then this will lead to delays in any verbal agreement being formalised. It is therefore important that both parties be willing and cooperative in meeting their financial disclosure obligations.
Once disclosure has been satisfied, a Binding Financial Agreement (which is similar to a contract) can be executed, or mutually agreed Consent Orders can be filed with the Court for approval. Both options will reflect the agreement between the parties as to how they want their assets, liabilities and resources to be divided and will be legally binding and enforceable.
If you have separated from your partner, we recommend that you begin the process of gathering your financial documents as soon as possible. We can assist by providing clients with a comprehensive list of all documents required and advising over what period the documents are required to cover. If the financial disclosure process occurs smoothly and quickly, this will allow our family law team to progress your matter more expeditiously.
For more information on disclosure in a family law matter, or for advice after a separation, contact our experienced family lawyer, Kara Cook, at CDQ on 02 8556 0130.
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