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divorce blog

What You Need to Know Before Filing for Divorce

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It goes without saying that the breakdown of a marriage is difficult for everyone involved, especially when you’re working through the emotional and legal repercussions at the same time. While divorce proceedings are rarely a walk in the park, there are a few important things for you to know before you go ahead with such a big decision.

It’s a process

In Australia, the dissolution of marriage is done in multiple separate steps; the granting of a divorce order, property arrangements and, if there are kids involved, parenting arrangements (although not necessarily in that order). Contrary to what many people expect, the granting of a divorce is usually the most straightforward step, while the other arrangements are lengthier and more tedious due to the nature of what is being discussed and agreed upon. Some simple research from reputable sources either online or in person will help you better prepare for what is to come.

divorce order

Going to court shouldn’t be the goal

We hear it in movies all the time – “I’ll see you in court!” – but when it comes to divorce proceedings, it’s best to try and avoid this situation altogether. What the movies don’t tell you is that walking into the courtroom to fight with your ex-husband or wife is not only emotionally taxing, but time consuming and expensive. That’s why it’s always best to explore other avenues for resolution, such as mediation or arbitration, leaving a court case as a last resort if you can’t seem to come to a fair agreement. This will allow you to discuss your wants and needs with your ex-partner in person, with the hopes of it remaining civil and both of you can leave happy with what is agreed upon.

You will want the advice of professionals

Divorce can be tricky, especially if you’re not on the friendliest of terms with your ex-partner. Luckily, there are a range of professionals who you can go to for valuable advice about how to move through the process in a way that will hopefully provide you with a fair outcome. Finding a good family lawyer whom you feel comfortable speaking openly with is crucial to achieving a positive outcome that you are happy with. You might need to talk to a few different lawyers before you find the person you want representing you, but it will be worth it in the long run. Consulting a financial advisor or accountant, in conjunction with your lawyer, is also a great way to determine what you should be asking for in the settlement. And finally, a therapist or counsellor for you or your kids should be a priority, as it will ensure that you get the emotional support you need during such a difficult time.

prenup blog

What Is a Prenuptial Agreement and Do I Need One?

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Whether you are married or in a de-facto relationship with your partner, putting the appropriate framework in place to easily and fairly divide your assets in the event that you separate is very important. A Financial Agreement (“prenuptial agreement”) helps to do this by representing both of your wishes in a way that is recognised by the court, with the aim being to make the process easier if the need to redistribute your common assets ever arises.

Also known simply as a “prenup”, a common misconception about these contracts is that they are only for couples who are about to get married. While this is certainly one situation in which a prenuptial agreement is signed, the truth is that any two individuals in a relationship can enter into one of these contracts before, during or after the relationship.

financial agreement

So how do you know if a Financial Agreement is right for you and your relationship?

Contrary to what many people think, these agreements aren’t only beneficial to couples in a high income bracket, or for people who earn significantly more than their partner. A “prenup” is a great option for any situation where one or both people involved are bringing significant assets into the relationship, or to protect anticipated future assets, such as a future inheritance. This can include property, businesses in your name and any money that might be in a savings account. It’s also a good way to determine how you will split any common assets you may already have – such as a house or a car – if you happen to end the relationship. As many of us know, deciding who gets what after a break up or a divorce can get very messy very quickly, so it’s wise to agree upon a civil resolution while you are in the midst of love.

However, for some people, it’s not about the assets at all; it’s about the debts. Throughout the prenuptial process, you and your partner can contractually agree on how you will go about paying off important financial obligations such as outstanding loans, university fees or credit card debt. Along with this, you can also get into detail about how this will influence the amount each person contributes to other costs like household fees and bills etc.

While nobody enjoys thinking about the potential for their relationship to not last the distance, a Financial Agreement provides a foundation of open communication and transparency on which two people can build their lives. Not only does it ensure that you both have your respective assets accounted for, but it can help you to avoid a lot of post break up stress if you ever have to go your separate ways.

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One Family Law Myth Exposed

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Do we start at 50/50?

After the breakdown of a de facto relationship or marriage, parties are usually uncomfortable about their financial and property entitlements.

There is a myth that there is a presumption that assets should be divided equally. There is, however, no automatic entitlement in property and financial matters. Each parties’ entitlement depends on their circumstances and the entitlement should be determined and estimated by an experienced family lawyer.

There is no presumption of a percentage entitlement in relation to a property or financial settlement.

The things that are taken into account when determining a property/financial settlement.

In Australia, the Family Court determines how property and financial matters are to, the Family Court determines how property and financial matters are to be settled by reference to the Family Law Act. Family lawyers will tell you what is to be taken into consideration by the Court. Again, there is no formula to be applied as the settlements are based on all of the facts provided and the discretion given to the Court by the Act in deciding each case.

The Court will, however, take into account the following factors:-

  1. Whether it is just and equitable to make an order in the first place.
  2. The value of all assets and liabilities are identified so as to establish the net assets, including assets held individually, in partnership, by companies and by trusts.
  3. The contributions made by each party to the acquisition, maintenance and improvement of the assets, including financial contributions, assets owned at the commencement of the relationship, windfalls such as gifts from parents, inheritances, redundancy packages, etc.
  4. Non-financial contributions made by each party such as where one party looks after domestic matters or children to the detriment of their career.
  5. Indirect financial contributions such as giving up a career to allow the other party to further their own career.
  6. The future needs of the parties such as whether they have responsibility for the care of children, their income earning capacity, their qualifications, age, financial resources, health and superannuation.

Conclusion

Remember that there is no presumption of a 50/50 split as a starting point and that each matter is decided upon the particular circumstances of each case.

The Family Court can make Orders that are just and equitable in relation to division of property.

Separating parties should obtain independent legal advice about their entitlements at the earliest opportunity.

Should you seek assistance with property settlement entitlements following the breakdown of your marriage or relationship, email us [email protected] or call 03 9088 3184 (Melbourne) or 02 9188 2031 (Sydney).

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What is a Prenup?

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Marriages and defacto relationships often fail leaving parties in a quandary as to how to settle their financial affairs. In the event that you are organised and have a Pre-Nuptial/Financial Agreement, then your property and finances will, in all likelihood, be divided in accordance with your wishes in the event that your relationship breaks down.

Pre-Nuptial/Financial Agreements can be made at the start of a relationship, during the course of a relationship or after the relationship has broken down.

Pre-Nuptial/Financial Agreements are regulated by the law and include a provision that each party must be represented by an independent legal advisor who must give those parties certain advice and certify that they have done so. In the event that these technical requirements are not adhered to, then it is quite possible that a Court will overturn the Agreement and it may be of no effect.

Pre-Nuptial/Financial Agreements apply not only to marriages but in relation to defacto relationships as well. You are living in a defacto relationship when you and your partner are living together on a genuine domestic basis but you are not married to each other. A large number of matters are looked at to define defacto relationships, including the length of time that you have been in the relationship, whether finances are intermingled, whether you live together under the one roof and whether you have children together. There are other matters that are considered as well.

In the event that your relationship breaks down and you do not have a Pre-Nuptial/Financial Agreement, then it is essential that you obtain immediate legal advice on your rights and obligations. We can assist you negotiating a settlement, however, it is always wise to give early consideration to entering into a Pre-Nuptial/Financial Agreement so that the future contains some certainty.

Should you have a query, contact one of our lawyers on (03) 9088 3184.