FAQ's About Your Property Law Settlement - How long can I Wait? Do I really Need Court Orders?

Do I need to finalise my property settlement with orders? And how long do I have?  

This is a common question we are asked when approached for advice about separation and property settlements.

The Family Law Act sets out timeframes for dealing with property matters. You have 12 months from the date of grant of divorce to finalise your property settlement or two years from the date of separation if you are defacto. Often separating couples come to an arrangement about their finances and in the short term may not see a benefit in the costs of having financial orders drawn up and see it as unnecessary. I mean what could go wrong?

However, there is considerable benefit and peace of mind to be had in finalising financial matters between you and your former partner when you separate. The role of the court in making property orders is to, as far as practicable, finally determine the financial relationship between you to avoid further court proceedings. These orders can be entered into by consent, but they must be made in a way that ends the financial relationship between you. When you are seeking final property orders the arrangement needs to sever the financial ties between you. If there are maintenance orders these are separate.

Whist the timing provisions are 12 months after divorce or two years after separation the court has broad discretion to exercise in allowing out of time applications.

What if I dont get orders - How long after can I or my partner bring an application to the court?

If you do want to bring an application for a property settlement ‘out of time’ you will need to first get the permission of the court or leave to proceed with the application. However, recently there have been a number of cases where leave has been granted over 10 years out of time.

In Lambertson & Lambertson [2021] this was a case appealed to the full court of the Family Court. The parties were married for 17 years and in the year following the divorce the parties commenced court proceedings, engaged solicitors and it was agreed that the wife would receive 60% of the property pool and the husband 40%. The property was dispersed but final orders were never made. The wife repeatedly did not turn up to court and didn’t provide the documents required to be filed. The wife only attended court again after there was a warrant issued for her arrest. The proceedings were ultimately abandoned, and no final orders could be made.

11 years later, 2021, the wife brought an application seeking 52% of the husband’s superannuation based on the balance at 2008 plus the interest on the base amount at that date. The husband asserts that the agreement was that the wife would have 60% of the property pool and leave his superannuation untouched. The husband further put to the court that he is highly prejudiced because his solicitors are only obliged to keep records for 7 years and there is no evidence of the agreement. The husband appealed the grant of leave given to the wife, but the matter has been returned to the Federal Circuit Court to be redetermined and to examine more closely the reasons for the delay.

No matter the outcome the stress and costs of reopened proceedings 11 years later is a high price to pay.

Can my property orders be set aside?

We call this setting them aside and they can be set aside if it is found that they were made based on fraudulent or falsified information or if there was not a full disclosure of the financial position.

Basing any orders on a full and frank financial disclosure is essential and where one party doesn’t make this disclosure it leaves them open to be challenged.

If there has been duress or threats this may be a reason to set aside an order of if a child or other may suffer undue hardship if the orders were allowed to stand.

In February 2021 the Court said that hardship was a reason for allowing leave for a property matter to proceed 10 yours out of time in the case of Vince No.2. The parties were married for 10 years, after divorcing in 2009 the two children largely lived with their mother. During the marriage the father suffered psychiatric illness and the wife claimed there was violence toward her. They had little at the start of the marriage and lived in rental accommodation and had debts at the end of the marriage They had similar and modest amounts of superannuation. The parenting proceedings ran between 2007 and 2016 and by the end of these the fathers’ financial position was beginning to change.

After the parties separated between 2011 and 2018 the husband received some $710, 000 due to a workplace injury and reimbursement of income which he would have earned during the relationship and the husband paid $128, 000 back to his parents who had advanced him the money while he was waiting for the insurance claim and the wife asked this to be added back to the marital financial pool.

This judge clarified in this case that hardship is not simply a loss of entitlement. The payment was deferred income from the time of the relationship and compensation for an injury that took place during the relationship. The court granted the wife’s application for leave and ordered a division of the non-superannuation asset pool 67.5% to the husband and 32.5% to the wife. The wife also received $60, 000 from the husband’s superannuation.

If you are ending your relationship and want certainly about your financial property settlement, we strongly recommend you enter final property orders. As you can see in the cases mentioned here the door can be left open for years to come.

Speak to us at Voice Lawyers for advice and representation in your Family Law matter.

Make an appointment. Talk to us (02) 92611954 or email us voice@voicelawyers.com