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Getting Advice About Your Separation (WA)

If you are going through a separation, it is important to get legal advice on the financial implications of this as early as possible. It is common for one party to a marriage to seek family law advice  and to have commenced making plans for the future before the separation has even occurred, while the other party does not even appreciate that a separation is looming. This can mean being unprepared for the legal processes following separation and also for the financial position that the separation may put them in. Even when a separation is amicable and no major issues are anticipated, it is a good idea to obtain thorough legal advice and be well aware of your position.

Misconceptions about settlements

Post-separation contributions

A common assumption made by clients looking to finalise financial arrangements with a former partner is that the settlement will be based on the asset pool at the time of separation. Settlements are in fact calculated based on the assets and liabilities of the marriage at the date of the property settlement. 

As there can sometimes be a long period between the separation and the property settlement, assets can be sold or disposed of and new assets can be purchased or inherited. Values of properties can change. Loans can be paid out or new loans obtained.

Delays in finalising a settlement can be caused by circumstances outside your control, but  if you seek legal advice as soon as  you become aware that a separation is on the cards  you can be well prepared and keep delays to a minimum. A lawyer will be able to advise you on how contributions made by each party both prior to and following the separation are likely to effect your future property settlement.

It is important to understand that the post-separation contributions which are taken into account at the settlement are not considered in isolation and can be of both a financial and non-financial kind. An increase in the value of property held by one party can be offset by the role of the other party acting as primary carer of the children of the marriage.

Superannuation splits

Parties will often reach for a superannuation statement issued about the time they separated or seek a valuation from their super fund based the balance of their super on the separation date.

This is rarely helpful as any super split ordered may include contributions from post separation income, as well as capital growth on superannuation which was acquired when the parties were still together.

Limitation period

De facto couples have a period of two years from the date of separation to file an application for financial orders in the Family Court of Federal Circuit Court. If this limitation period is missed, the court may grant an extension of time to file an application. However, in Western Australia this is done at the discretion of the court and only if the court considers that a refusal to grant an extension of time would result in an undue hardship. No one should rely on being granted an extension of time to file an application.

Case studies

Ng v Ng

A husband insists on remaining in the matrimonial home with a promise he will continue to pay the mortgage and make a lump sum payment to the wife in the property settlement. The wife agrees in a spirit of optimism, moves out with the children and pays rent for their new accommodation.

The husband fails to get a loan to pay out the wife. The former matrimonial home has to be sold. The property is hard to sell because the husband has failed to properly maintain it and make it presentable to prospective buyers. The property declines in value and sells at a loss.

Had the wife sought legal advice before leaving the home, she would have been advised to  remain in the home, as this was where the children had always lived. She may have been able to obtain a court order for the sole use and occupation of the home. The husband may have been required to continue paying, or at least contributing to, the mortgage. The wife could have maintained the home and ensured it was well-presented when potential buyers came to see it. All in all, she would have been in a much stronger position to protect her financial interests.

Jones v Jones

A husband and wife prepare a joint application for divorce, sharing the cost of the filing fee, and overcome the need to attend a court hearing. The parties have not finalised a property settlement but have an amicable relationship. Twelve months after the divorce order takes effect, the limitation period for filing an application for a property settlement expires. The parties’ relationship has deteriorated and they require the court to make financial orders. However, the court declines to extend time for them to file an application.

Conclusion

The above examples illustrate the importance of legal advice in guiding you through a separation, ensuring that you think ahead and do not miss any crucial deadlines. If you require legal advice or representation in a Family Law matter or in any other legal matter, please contact Go To Court Lawyers. 

By Bruce Heathershaw, Senior Associate

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