The cost, complexity and confrontation involved in going to court after the break up of a family unit is something most people would really like to avoid.
The whole process can add another level of trauma and stress on everyone involved, particularly children. The courts, as well, are struggling under the weight of the number of family matters coming before them for resolution.
This is why alternative methods of resolving disputes such as mediation have become more and more popular when it comes to family breakdown, making the process – when done in the proper way – quicker and less fractious.
There are some essential things to take into account before embarking on mediation of a family law dispute, set out in general terms below.
Achieving a successful outcome – whether it’s mediation about parenting arrangements or finances – hinges on how well you’ve prepared before the discussion.
This includes issues ranging from working out who will pick up the kids from school and look after them on the day of mediation, to coming up with a list of your key priorities for discussion on the day and a firm idea of what you will regard as a successful outcome.
Preparing properly will be greatly aided by consulting a legal professional experienced in family mediation. Many lawyers these days are also qualified in conducting mediations and can help clarify and guide the process for you so that the discussion is not considered wasted time.
The key to successful mediation is finding common ground between the parties, not emphasising or heightening areas where you both disagree. This involves a degree of empathy on the part of both parties, requiring you to think about what your ex-partner, for example, will want to achieve from the mediation process.
Both of you need to be well aware of what you can and can’t live with, in terms of resolving the issues at hand. This will require negotiation, compromise and probably some imagination in order to overcome obstacles and areas of difference. Without the appropriate mindset, however, you’re unlikely to reach mediated settlement.
Check your emotions
There are few things in life that can arouse high emotions like matters involving your family. And while it’s natural to feel stress and emotion in any attempt to seek resolution of all the issues surrounding a family breakdown, it’s equally important to control these feelings in the mediation process. Anger and anxiety can impair your thinking and the negotiations needed to achieve a result.
There are many ways to deal with such strong emotions, from writing down your feelings and reactions to try and externalise them, to talking to trusted family members or – on the day or days of mediations – asking to take a break if the discussions are becoming overwhelming.
Most importantly remember to approach mediation with a constructive mindset. Saying things designed to ‘destroy’ or assassinate the character of the other party is a sure path to failure of the process.
Make sure you have support
Whether it’s your trusted legal advocate or someone closer such as a long-time friend that you choose as a support person, consider whether you need an extra hand at a family law mediation. If it’s a friend or family member, it’s important that they be someone who won’t express strong opinions or influence your decisions in the matter at hand. They are there as emotional reinforcement. Be aware this person may not be able to be present in the room during the mediation discussion due to the need for confidentiality.
The combination of an experienced family law mediator and parties who are prepared for mediation after consulting legal professionals with experience in this area can ensure a family break up doesn’t necessarily end up in court. If you have any questions about the issues raised above, contact our family lawyers Gold Coast today.
It’s an unfortunate fact of life that many relationships don’t last. And when a couple splits up, there are difficult questions around how assets that were part of the marriage or de facto relationship are to be divided.
This situation is often made more difficult when there is a property settlement to be decided after a short marriage – one considered to be five years or less – ends. While there is no set formula used by relevant courts to decide property settlements in short marriages or de facto relationships, different factors are taken into account compared with the circumstances surrounding the break-up of longer term couples.
How do property settlements work?
Where there is property to be divided after the dissolution of a relationship, the settlement is a financial order made under family law by a court which is considered “just and equitable” for both parties.
It should be noted that just and equitable does not automatically mean a 50:50 split. The contributions each party has made to the marriage are considered in deciding the property settlement, including both financial and non-financial, such as caring for children or maintaining the family home. The future needs of each party are also considered, with the court deciding the weight to be attributed to all of these factors.
Property settlements after a short marriage
Courts assess the factors outlined above in a different way when the relationship in question was five years or less.
While non-financial domestic contributions are considered roughly equal in value to financial contributions in longer marriages, this is not necessarily the case in short marriages. The financial contributions of both parties to a short marriage are likely to be given greater weight in any decision on a property settlement, particularly if the couple has no children (meaning neither party had the considerable domestic responsibility of childcare). Alternatively, the court may place an equal value on non-financial and financial contributions if the domestic duties were onerous.
If following separation one of the parties remains the primary carer of children from the marriage, the court may also make additional adjustment on his/her entitlements to the share of the settlement, regardless of the short duration of the marriage.
The initial contributions to the marriage by each party will also be more closely examined, including savings, an inheritance or a property. These are given greater weight in settlement of a short marriage because they likely still exerted a substantial effect on the union before it ended.
The result is that one party’s initial contributions to the marriage may be excluded from the property pool to be divided. If one party’s initial contributions are included in the pool of assets, adjustments may be made in favour of the other party.
If the parties kept their financial affairs largely separate during the short marriage, this will also be taken into account when determining the property settlement.
As mentioned above, each property settlement matter resulting from a marriage break-up will depend on the specific facts and circumstances of the relationship, particularly when the marriage is short.
It is advisable to discuss all the details of your matter with a specialist in family law in order to receive accurate and timely advice on property settlement outcomes in the unfortunate event of a relationship ending.
It’s 8:40 AM on the first Monday morning back at work for me after the Christmas New Year break. Whilst I stare at the 2000+ emails requiring my urgent attention, I receive a phone call.
I say to the receptionist ‘can you please take a message and I’ll get back to them later’. She tells me that the caller is in tears and needs to speak with someone urgently.
I take the call. His name is Steve. He told me that he has a young daughter called Amanda and has been married for 10 years. His wife’s name is Tammy. Steve told me that he works away in the mines in Mount Isa on fly in fly out basis. He spends 2 weeks at the mines and then comes back home for a week. He said this was the only job that he could get, and it earns good income for him and his family which is the only reason he took it.
He told me that when arriving back home from his last stint in Mount Isa for the year just prior to Christmas, his wife Tammy, and daughter Amanda, were gone. So was most of the furniture from their house, all Amanda’s and Tammy’s clothes, possessions and beds were gone. Even their king-size matrimonial bed was gone.
He said that he thought he and Tammy had been growing apart and she was becoming more distant from him, however he had no idea at all that this was going to happen.
He told me he spent Christmas on his own in an empty house sleeping on a blow-up bed on the floor. He has been self-medicating with alcohol and he is so depressed that he wants to end his life and for it to be all over. He said the only thing he is living for is to be able to spend time with Amanda again.
I told Steve that ringing me this morning is the best thing that he could have possibly done. I told him that I have been practising family law for over 30 years, that there is a light at the end of the tunnel, and by taking it step-by-step he will get there. I told him that what he’s feeling now is a completely normal reaction but will be nothing but a distant memory in the future.
I arranged an appointment for Steve to come and see me that afternoon. I referred him to a good counsellor to deal with his depression issues and explained to him that in a marriage of that length with a 5-year-old daughter are you not only grow up together, you grow together and become one. You’re like a nice big ripe watermelon until someone pulls out a cane knife and slices you write down the middle. Now one half of you is gone and where it was is very raw. You need time to heal and grow a scab over that cut which takes time.
Steve said to me he does not know where Amanda or his wife would have gone to, or why she left without giving him notice or reason.
Steve was concerned because he was a fly in fly out worker and wanted to know how we can find Amanda and Tammy, what his rights are as a parent post separation with respect to his children. He said, “now that she has done this and has taken Amanda away from me, there is no prospect of reconciliation between us whatsoever”.
He then turned to the family law questions that I knew were coming. I knew they were coming because these are the most common family law questions that I am asked following the separation of two parents with young children, particularly where one parent has taken the children away from the other and/or will not let the children spend time with the other parent.
Question 1: Steve asked, “what rights do I have with respect to my daughter Amanda?”
I told Steve that under the guiding principles of the Family Law Act 1975 (“the Act”), which is the main piece of legislation dealing with family law in Australia, there is a presumption that following separation both parents will continue to have equal shared parental responsibility for any children of the relationship.
I explained to him what equal shared parental responsibility means. It means that both parents have an equal parental right or ability to play a primary role in decision-making for any major issues for the children, such as schooling and medical issues, where the children will live, what the children’s names will be, and overseas travel until the children turn 18.
I told Steve that both he and his Tammy will continue to have joint parental responsibility for his daughter Amanda unless that is altered by the court which in his circumstances is not likely at this time.
Question 2: Steve then said, “if I have equal shared parental responsibility, does that also mean I am entitled to equal time with Amanda?”
The Act says if the parents have equal parental responsibility, the child’s parents are to consider firstly whether an order that the child spend equal time with the parents. Equal parental responsibility and equal time with both parents are very different things.
I explained to Steve that with respect to equal time, that is 50-50 or one week on one week off type arrangements, the court has recognised that such an arrangement can only work in limited circumstances.
- The parents should be living close to each other and to the child’s school;
- there must be no ongoing domestic violence issues between the parents and the child (particularly at changeovers) must not be subject to domestic violence;
- there must be no risks of child abuse, alcohol or illicit substance abuse in the presence of the child,
- there must be no emotional or other physical abuse to the child;
- the parents must be able to communicate with each other regarding the child’s schooling and parenting without arguing after every second sentence;
- it must be otherwise “reasonably practicable” for equal time to work;
- most importantly (and this is a paramount consideration) the proposed equal care arrangement must be in the best interests of the child; and
- (also, a paramount consideration) the child must be protected from physical or psychological harm from being subjected to, or exposed to abuse, neglect or family violence.
My advice to Steve was that in his case, if he continues to be a FIFO worker, equal time will simply not be practicable because of his work commitments. He then said to me ‘I would be prepared to leave that job move close to where Amanda is, if we can find her. Even if it’s in Timbuktu. She means that much to me.”
I said in that case, he will need to establish good communication with Tammy about parenting decisions, he should be close to Amanda’s school and Tammy’s new residence for practical reasons, and most importantly Amanda must not be subjected to or exposed to any domestic violence.
The domestic violence Steve told me about that did take place, particularly when his wife had been drinking had been exposed to Amanda. I told him that this must never happen again. There must also be good communication at changeover and no arguing or pushing each other swearing at each other or any emotional abuse.
It may turn out that his wife continues to drink and become violent, Amanda are may be safer living with Steve. I told him that the court would appoint a family report writer to prepare a family report to make recommendations to the judge as to what is in his daughter’s best interests.
I also told Steve that if Tammy and Amanda have moved out of the area to make it extremely difficult for Steve to spend any time with Amanda, we can ask the court for an order that they be relocated back to this area to maintain the status quo until the court can determine what is in the best interests of Amanda.
Question 3: What is substantial and significant time?
If equal time is not possible, then the court must consider the importance of the child having a meaningful relationship with both of the child’s parents and giving substantial and significant time to the parent with whom the child does not live. The old regime where the father would only get to spend time with his child every second weekend and half the school holidays is not considered to be substantial and significant time.
I explained to Steve that there is also an obligation on both parents to facilitate (make possible) and encourage the children to spend meaningful and significant time with the other parent. I told Steve that if it is at all possible, equal time should be considered.
Additionally, and particularly relevant in Steve’s case, is the fact that because Steve is a fly in fly out worker, a 50-50 equal shared care arrangement would not be possible because of his work commitments. Practicality needs to be considered as well.
I asked Steve if there had been any issues of domestic violence, alcohol abuse or illicit substance abuse by Tammy against him. He told me that Tammy was the heavy drinker, and after a few drinks she would become violent and occasionally would strike out and on one occasion she kicked him in the head. Steve denied that he provoked her to do this. He said she was psychopathic and out-of-control when she had drunk too much. Steve said that he is a mine worker and he drinks heavily himself, however he does not become violent like Tammy does. I asked him why he thought Tammy left, and he said that he suspects she is having an affair because he is hardly ever at home.
I told Steve that while many parents might think that think equal time is the best arrangement post separation, most of the time that does not turn out to be the case.
Equal parenting or week about arrangements can sometimes lead to extra pressure on the children, particularly once you factor in the children’s schooling and extra-curricular commitments, age, and any health issues.
Parents also need to factor in their own lifestyle, financial means and commitments which may impact on their ability to spend meaningful time with the child while in their care.
Week about arrangements, of their nature, may place too much of a burden on the child’s psychological state and ability to be apart from one parent more than the other. This is particularly the case for younger children who may still be dependent on their primary carer. Amanda falls just within this category, and I told Steve that if Amanda is safe living with her mother and she is not exposed to or neglected by excessive alcohol use and associated violence, then she will most likely remain living with mum. However, if Amanda is not safe in that environment, it may be turned out to be in Amanda’s best interests for her to live with Steve. I told Steve depending on how things go, in a year or so they made look at trying and equal shared care arrangement if the circumstances allow.
Both parents must also have the ability and capacity to properly care for the child and meet the child’s before equal time is simply assumed.
Question 4: how do I find Amanda and Tammy?
I told Steve that in these circumstances, where Tammy has left with the child she must perceive some conflict, threat or an emotional need to be away from him. Tammy will be likely even if we find her, to resist or restrict Amanda spending time with him.
Steve said he still has an email address for Tammy, although he doesn’t know if she still uses it. I said the best thing we should do immediately is to write to her in a civil and polite manner and ask her why she has left, where she has gone to, and what proposals she has for Steve to spend time with Tammy.
If there is no response to that letter (which will give a very short timeframe for a response), then we will have to issue legal proceedings for a location order and a recovery order (to force Tammy to relocate back to the area to maintain the status quo) and some interim parenting orders. We will also ask for the court to appoint a family consultant to prepare a report once Tammy and Amanda have been found.
Question 5: if we find Amanda and Tammy before issuing Court proceedings, what should we do next?
I told Steve that if we happen to find Tammy and Amanda’s whereabouts from communicating to her through her email or by other means, the first sensible step is to try to organise a mediation with Tammy. Mediation (referred to in the Act as “family dispute resolution conference”) this can be done through either government mediation services or private mediators. A mediation is required before court proceedings are issued, unless there are circumstances of extreme urgency or there is a risk of harm to the child being exposed to family violence or child abuse.
The benefit of mediation is that it provides both parties with the ability to discuss their concerns about parenting matters with an independent mediator, which may provide them with a better perspective on what is in the best interests of Amanda.
Amanda will not be included in the mediation, and I told Steve that when he starts communicating with Tammy it is very important for him and Tammy to not put Amanda in the middle of any parenting discussions where arrangements for Amanda are being discussed. This will put uncalled for emotional pressure on Amanda.
Question 6: Steve then asked me “what if mediation fails and I still cannot see Amanda?
I told Steve that if he fails to reach an agreement at mediation, the mediator will give him what’s called a section 60 I certificate authorising him to commence legal proceedings. I did say that in the circumstances of his case where Tammy took Amanda away without any notice or informed consent, and due to the domestic violence and alcohol issues, he probably falls within an exception to having to file a section 60 I certificate to get court proceedings underway. However, if there is a possibility that mediation might have worked, I always recommend trying that first.
Question 7: What are the benefits of issuing Court proceedings? Will I get Orders in place quickly?
Issuing Court proceedings in the family law courts can be an expensive and drawn out process, both financially and emotionally. Generally, at the 1st return date, which in urgent circumstances may be as quick as in one week, but in normal circumstances is probably 2 to 3 months away we can ask for some interim parenting orders and for a family report to be prepared. The matter is then generally adjourned for 6 to 8 months to enable the family report to be prepared. The family report writer will make recommendations to the judges to what is in Amanda’s best interests. 9 times out of 10 the judge will make orders along those lines. However, if he or Tammy disputes the recommendations the matter will be set down for trial which could be another 6 to 12 months away, or longer if the proceedings are in the family Court of Australia.
I have written another article which is on our website called “What if mediation fails”. In that article I explained the court process in more detail. I suggested that Steve read that article and all the other articles of our website dealing with the family courts and parenting matters, so he can get a good grasp of how everything works.
Question 8: How can I safely communicate with Amanda’s mother about Amanda?
Steve asked me what will be the best to communicate with Tammy about Amanda in circumstances where there will most likely be hostility. Phone calls can readily get out of control, and text messages can be misinterpreted.
I suggested to Steve that he and Tammy communicate by email only in what is known as the FYO RR method as follows:
I said to Steve “, so you wish to inform Tammy that Amanda now knows how to do backstroke, that her homework for the week has been finished, or that she has found a good friend next door to your house. But you also need ask Amanda if she knows what happened at school on Thursday because when you picked Amanda up from school she had a scratch on her face. You also want to know what her test results were. You also wish to enquire about the roommate she has, and if Amanda is safe around him.”
I said “using the FYO RR method you will communicate this by email in short bullet points under 2 headings, the 1st being FYO (for your information) and the second heading will be RR (response required). You will give her a week to respond. If Tammy is caught up with something and cannot respond within that week, Tammy will email you during that week to tell you that she needs an extension of time and will give you a time by which she can reasonably respond. If that time is reasonable you will allow it.
So, your email will look as follows:
- Amanda has learnt how to do backstroke and did it well today. She is excited about that;
- Amanda’s homework for the week has been completed;
- Amanda has made friends with the girl next door. She is one year older than Amanda and her name is Vicky. They enjoy spending time together.
- do you know what happened at school on Thursday because when I picked Amanda up she had a scratch on her face. It’s not too deep but it looks like a nail scratch.
- Can you please let me know the results of Amanda’s blood tests? I would appreciate it if you could send me a copy and let me know what the doctor said.
- Amanda has informed me that you now have another person living in your house. Can you please tell me a bit about him to help satisfy me that Amanda, being only a young girl, is safe around him?
You have one week to reply to the RR questions, which means that the deadline is 5 PM on Monday, 12 September 2019.”
Steve said he thought that was a great idea, and he would try down the track.
What was the result?
I took down all of Steve’s details and then prepared a letter to Tammy setting out a brief history of the relationship, the circumstances that Steve now finds himself in, and his proposals with respect to be able to spend time with Amanda. I won’t tell you what happened from here. I won’t tell you if we found Tammy and Amanda through that letter or if Steve had to go through the lengthy process of court proceedings. I also won’t tell you why Tammy left with Amanda, but I will tell you that she returned to rent a house near his. I also won’t tell you if she was forced to return by order of the court or if she did it voluntarily. No
I will however tell you that Steve now has a fantastic relationship with Amanda, and they get to spend a lot of fun time together. Steve takes Amanda to her swimming lessons, they go Kayaking together he assists her with her homework during the time that he has with her.
Steve and Tammy communicate very effectively about Amanda using the FYO RR method and Amanda is doing very well at school as a result.
Please contact our family law team at OMB Solicitors if you find yourself in circumstances like any of the above so that we can assist you to find yourself enjoying a happy relationship and spending meaningful time with your child, like Steve and Amanda now enjoy.
Please note that the names and circumstances in this article are completely fictitious, and every individual’s circumstances will differ. However, I have over my career found myself acting for people in very similar circumstances to Steve and in all cases a good outcome was achieved in the end for the child and her father.
The Effect of Marriage on your Will
Marriage is a time of joy and commitment. However, by saying the words “I do”, you are also inadvertently saying the words “I do hereby revoke my Will“. For those who are preparing vows to be together until “death do us part”, you do need to think about what happen when death does, in fact, part you.
In Queensland, section 14 of the Succession Act 1981 (Qld) provides that Marriage automatically revokes a Will, unless the Will was expressly made in contemplation of the marriage.
If a Will is made in contemplation of marriage, the contemplation must clearly state the testator (Will maker) expected to marry the particular person and intended that the Will should not be revoked.
The effect of Divorce (or separation from a Civil Partnership / de facto relationship) on your Will
In Queensland section 15, 15A & 15B of the Succession Act 1981 (Qld) sets out the effect that divorce (or separation from a Civil Partnership / de facto relationship) has on a Will.
Unless a contrary intention is shown in the Will, a testator’s divorce (or separation from a Civil Partnership / de facto relationship) revokes the following:-
- Any beneficial interest the testator’s former spouse/civil partner/de facto partner had under the Will;
- Any appointment the former spouse/civil partner/de facto partner has as an executor, trustee, advisory trustee or guardian under the Will; and
- Any grant, made by the will, of a power of appointment exercisable by or in favour of the Will maker’s former spouse/civil partner/de facto partner.
The Will of the testator then takes effect as if the former spouse/civil partner/de facto partner had died before the testator.
However, in Queensland, a testator’s divorce (or separation from a Civil Partnership / de facto relationship) does not revoke—
- the appointment of the testator’s former spouse/civil partner/de facto partner as trustee of property left by the Will on trust for beneficiaries that include the former spouse’s/civil partner’s/de facto partner’s children; or
- the grant of a power of appointment exercisable by the testator’s former spouse/civil partner/de facto partner only in favour of children of whom both the testator and the former spouse/civil partner/de facto partner are parents.
Marriage and divorce/separation can have unknown and unintended consequences on your Will. The next document that you should sign after your Marriage Certificate, should be a new Will.
Similarly, if your marriage/relationship doesn’t turn out to be “happily ever after”, you need to give consideration to updating your Will.
Firstly, give yourself a pat on the back! It is great that you have reached agreement, as you will save the considerable legal costs involved in arguing over who gets what and ending up in court.
Once an agreement has been reached between you as to how you wish to divide your assets and liabilities in a family law settlement, you have the option of entering into a financial agreement or consent orders to formalise and finalise your agreement.
You will need to have either consent orders made or a financial agreement in place, to legally resolve the dispute once and for all (so that it can be used in resisting a court application in the future with respect to the same issues).
Consent orders or a financial agreement will also be required to obtain the stamp duty exemption for the transfer of any interest in property pursuant to your agreement.
Consent orders are often preferred over financial agreements, where a potential future breach of the terms of the agreement by one party is sensed as a serious likelihood by the other party. It is easier and less expensive to enforce compliance with consent orders than it is with financial agreements.
It is also often less expensive to both parties to formalise their agreement with consent orders, and consent orders are harder to set aside than a financial agreement.
I will explain both options to you further below:
We will draft any agreement reached in the form of consent orders, and file those orders in the Family Court with an Application for consent orders. It will be necessary for both parties to sign. Your spouse will not need a lawyer (if he or she chooses not to) for this process.
If the consent orders contain a superannuation split, flag or otherwise impose an obligation on the trustee of a superannuation plan, we must first serve written notice of the terms of the order on the Trustee of the superannuation plan in which the interest is held.
After the application for consent orders is filed, a Registrar of the Family Court will consider the application. If the Registrar is satisfied that the orders should be made, the Registrar will sign the proposed orders and sealed copies will be sent to us. Your court appearance for this process is not required, as the Registrar will decide the application in chambers in the absence of the parties.
If the Registrar is not satisfied that it is just and equitable for the orders to be made on the information before the court, a notice will be sent to us with a brief explanation as to what further information or evidence is required.
It may be necessary for the application to be ultimately heard in court, however this generally only occurs in rare cases where the orders appear to be grossly unfair to one party.
In a best-case scenario, the Registrar will make the consent orders, and sealed copies will be returned to us within 1-3 months of filing.
It may be preferable or necessary to prepare a financial agreement in certain circumstances instead of consent orders. These circumstances include:
- where the parties cannot wait for consent orders to be made (a financial agreement is binding as soon as it is signed by both parties);
- if the property settlement is unfair to one party, or
- assets or businesses are to be continued be jointly owned by the parties.
If a financial agreement is preferred, then we will draw up the required agreement. Once the terms are approved by you, we will send it to your spouse (or their lawyer) to review and settle the terms by negotiation.
A financial agreement aims to oust (remove) the jurisdiction and power of the family law courts in relation to all financial matters to which the financial agreement applies. The financial agreement is not filed in the court.
The financial agreement can deal with all or some of your property, and spousal maintenance and superannuation.
To be binding the financial agreement:
- Must be in writing;
- Must specify which section of the Act it is made in accordance with;
- Must be signed by both of you;
- There must be a Statement of Independent Legal Advice for each of you from a qualified legal practitioner setting out the matters referred to in the Family Law Act (“the Act”), and confirming that the advice was given to you each before you signed the financial agreement;
- The Statements of Independent Legal Advice must be exchanged;
- One party will retain the original financial agreement and the other will be given a copy;
- There should have been full and frank disclosure of all financial matters between both of you (however this is not strictly necessary under the Act); and
- All of the technical requirements set out in the Act must be complied with.
A financial agreement is a complex and technical document and takes a lot of time to prepare. There are schedules with all assets and liabilities. A comprehensive letter of advice to you is also required.
Your spouse will need a solicitor to advise him or her on the financial agreement and sign a certificate of advice, otherwise it will not be binding.
If either of the parties breach a term of the financial agreement, the other party can apply to a family law court to enforce the financial agreement. If the financial agreement is held to be valid and enforceable, the court can enforce the terms of the financial agreement as though those terms were orders of the court.
The Advantages and Disadvantages of a Financial Agreement Compared with Court Orders
The advantages to you of making a financial agreement may be summarised as follows:
- Entering into a financial agreement brings certainty to the outcome of the division of your property. This also applies to consent orders.
- Entering into a financial agreement also brings certainty to the payment of spousal maintenance, and unlike consent orders made by the court, the spousal maintenance clauses in the financial agreement (if binding) can be used to resist an application being made to the court for spousal maintenance by either party in the future.
- The terms of a financial agreement are generally not construed by the court to see if they are “fair” or “just and equitable”, unless they are grossly unfair to one party and that party was unduly influenced or coerced (forced) into signing the financial agreement by the other party directly or through some unconscionable (unreasonable or unacceptable) conduct, or duress.
- Because the agreement is not filed in the court unless one party wants to enforce it or set it aside, the court does not have the opportunity to see if the financial agreement effects a “once and for all” division of assets. A financial agreement therefore gives you more flexibility than a court order, as the court requires a final division of the party’s assets and looks to sever all financial ties between the parties.
- You will avoid the costs of protracted court litigation over a property settlement following separation, which in some instances can cost up to $120,000 (or more).
The disadvantages of making a financial agreement or consent orders include:
- You are contracting out of your right to have a court determine a just and equitable division of your assets and assess your entitlement to property and/or spousal maintenance following separation;
- The terms of the financial agreement might not be within the range of your likely entitlement, depending on the date of separation, your future needs at the time, the size of the asset pool at that time, and the contributions (both financial and non-financial) that you have made. At least with consent orders you have the security of a court registrar reviewing the terms and being satisfied that they are within your likely range of entitlements.
- Financial agreements are able to be set aside by a court if they are not drafted and executed in compliance with the Act, and for a number of other reasons including non-disclosure of a substantial asset, fraud, undue influence, unconscionable conduct, duress, mistake and where it is no longer possible or it is impracticable to carry out the terms of the financial agreement.
For any further advice and assistance with your family law property settlement matter, or which is the best way to proceed when you have reached an agreement, please contact our Gold Coast lawyers team at OMB Solicitors.
Divorces can be an emotionally tough time for both partners, as well as affected third parties such as children, parents, in-laws and even friends. Unfortunately, divorces can also be a lengthy and tiring process.
Eligibility for divorce
Before a spouse can apply for a divorce, there are specific eligibility requirements that must be met. Either spouse must have been born in Australia or be an Australian citizen by grant or descent. They must otherwise be lawfully present in Australia and intend to continue live in Australia and have been in Australia for a period of at least 12 months.
The marriage between the spouses must be ‘broken down irretrievably’ and the applying spouse must consider that there is no reasonable likelihood of reconciliation and resumption. The spouses must also have been separated for at least 12 months and one day.
If the spouses have been married for less than two years, evidence of a counselling certificate, or evidence saying why this could not be provided, must also be filed.
If the spouses have, at any time, lived with one another during the 12-month period, extra evidence will need to be given to prove that there has been a change in the marriage.
Initiating an application
Once these requirements are met, an Application for Divorce form must be completed, either joint or sole. The application will be joint if both spouses involved in the divorce wish to mutually make the application. If the application is sole, one spouse is making the application and the other spouse is the respondent. The application must then be sworn or affirmed in the presence of a lawyer, a Justice of the Peace, or another who is authorised to witness your signature on the document.
It is advisable that the laws governing the State or Territory in which the application is being made are reviewed, to determine that the witness of the document is authorised to do so. If the applicant is overseas at the time he or she wishes to have the document witnessed, the document can be witnessed by Notary Public, an Australian Diplomatic Officer or Australian Consular Officer, or an employee of the Australian Trade Commission.
Filing and serving documents
Once the application has been completed, the past procedure was to the mail the application to the Family Law Registry along with two photocopies of the document and also a photocopy of your marriage certificate (though this does not need to be sworn, affirmed or certified). Once the Family Law Registry received the application, the court would then file it, and forward sealed copies of the application with a file number, along with a time and date of the scheduled hearing.
However, as our firm is registered with the Family Court portal, we are able to file the application online, and we will obtain a hearing date at the time of fling. We then print sealed copies of the divorce application to serve (with an information brochure from the court) on the other spouse.
The application must be served to the other spouse either by mail or by a third party within a time period of 28 days before the scheduled hearing date, if the spouse lives in Australia, or 42 days if the spouse lives overseas. If the other spouse’s residential address is unknown, an order to either dispense with service or enable substituted service can be applied for by the applicant spouse.
With a joint application, there is no need for service as both parties are applying together for the divorce.
Costs to file for divorce
The average cost of the filing fee for a divorce application in the Federal Circuit Court is usually $900. If financial hardship is an issue, the spouse applying can also apply for a reduction in the filing fee. In this case, the spouse must provide to the Court specific documents such as Centrelink income statements, health care cards, earlier government grants such as Legal Aid, payments for Austudy, or evidence that the applying spouse is a prison inmate or held in legal detention (if that is the case). This evidence would need to be provided by both spouses in a joint application, or solely by the spouse initiating the application if a sole applicant.
Children and previous names
If there are children of the marriage, the applying spouse must provide to the court the current particulars of the children and care arrangements. Children of the marriage include step, fostered, adopted or biological children, and the details for all such children must be included. This information would include whether the child or children were born before or after the separation, and/or whether the non-biological children were a part of the family before the separation. The particulars and arrangements of the children would include anything from where they primarily live; their contact with each parent or reasons explaining why contact is limited or no contact with a parent; which school they attend; any current arrangements involved, as well as their health.
The financial positions of each parent also must be provided to the court, and if applicable, details of non-provision of financial support by a parent. Additionally, if a spouse in the divorce has a different name to both the married or maiden name, an affidavit will need to be filed with the court, explaining the difference.
Granting of a divorce
Following the granting of a divorce, the divorce will take one month and one day to finalise unless the court makes a special order to shorten this time frame.
As described, a divorce is a long and tiring process, and legal assistance is advisable throughout the process.
Independent legal advice will assist a spouse to understand their rights and responsibilities, how the law both works and applies to their individual cases.
Please contact the Gold Coast Lawyers at OMB Solicitors for assistance and advise for divorce and any other family law issues that are causing you concern. There are often strict time limits involved to do certain acts and file certain documents, and failure to obtain legal advice is not an excuse readily accepted by the Court for missing these time limits.
One of the first things to become clear when you are going through separation and divorce is that there is a lot of confusing legal jargon. There are technical terms about the property, financial and even parenting matters that inevitably surface as your relationship officially ends. For example, you may have heard of a ‘Conciliation Conference’ but can be forgiven for not knowing exactly what that means.
Also known as a ‘Property Settlement Conference’, this is simply a meeting where you and your former spouse or partner have a chance to reach consensus about the distribution of your property before going to court.
Unfortunately, you cannot schedule this meeting yourselves. Instead, the Court will schedule it for you, though this will only happen if you have not resolved your differences during or following a preliminary meeting with a Registrar of the Family Court in what is called a ‘Case Assessment Conference’.
Preparing for the Property Settlement Conference
If you cannot resolve your disagreement during the Case Assessment Conference, the registrar will let you know what you must do prior to the Property Settlement/Conciliation Conference.
After the Case Assessment Conference, you will usually have 28 days to exchange relevant information following the Registrar’s instructions. Along with new material relevant to your case, this may also include documents that were not shared prior to the Case Assessment Conference. Here is what you will need:
- Paperwork about any financial matters referenced in your respective financial statements;
- proof of joint and individual financial contributions made when cohabitation began;
- documentation of any inheritances, gifts or compensation payments received during cohabitation;
- documentation about the purchase or sale of property in the year before or since the separation, and any increase or reduction of liabilities since separation;
- detailed documents about superannuation.
Depending on the specific nature of your dispute, you may also need to complete a financial questionnaire and balance sheet as directed.
Within this context, it is crucial that you share all the facts and documents about any aspect of your application. Failure to do so can have grave consequences, including delays, added costs or even an order mandating that you pay any costs incurred by your former partner or spouse. At its discretion, the Court may also issue a greater order for a property settlement favouring the other person.
Understanding the process
Even with the proper legal, financial, and emotional support, preparing for a Property Settlement Conference can be stressful. But knowing what to expect at the meeting can help lessen your anxiety.
One of the first questions you may have is how long the meeting will take. The answer is based on the unique circumstances of your case, but you should be prepared to spend one to two hours in conference.
The meeting format depends upon the Registrar’s preferences. He or she will usually begin by speaking with each of your lawyers to confirm the specific nature of the disagreement. Based on this information and material submitted prior to the meeting, the Registrar will frame the ensuing conversation with your lawyers in a manner designed to achieve consensus. However, you should not be surprised if the Registrar also asks to speak with each of you directly.
You should be aware that in most cases, both you and your ex-partner or spouse must both attend this conference. If either you are worried about this for any reason, you should let your lawyer know so he or she can relay your concerns to the Registrar, who will make arrangements to address this issue.
You should also be aware that anything said during a Property Settlement Conference or Conciliation Conference is usually confidential. This means that you cannot refer to these conversations in any ensuing Court hearings if the matter is not resolved.
The three parts of the Property Settlement Conference
A Property Settlement or Conciliation Conference is usually a three-step process. These steps are the introduction, the settlement discussions, and the conclusion. Below is a simple description of each stage:
- Introduction: The Registrar will explain the general format for the meeting and lead a brief discussion about any points of contention. He or she will also give guidance for ensuing negotiations based on the specific circumstances of your case.
- Settlement discussions: This is when the Registrar will facilitate the actual conversation about how to resolve your disagreement(s).
- Conclusion: At the end of the meeting, the Registrar summarises everything that has happened and reviews any agreements. If all the issues have been successfully addressed, your lawyer will put the agreement(s) in writing so that the Court can issue consent orders accordingly.
What if we still do not agree?
In a perfect world, everything will settle at the Property Settlement or Conciliation Conference. If not, the only alternative is court intervention. In this case, you will have to attend a pre-hearing conference, which is usually held within six to 12 months, and a pre-trial conference.
You should be aware that you and your former partner or spouse (and your lawyers) can keep trying to reach a settlement until the final hearing. If you still have not been able to resolve the issues by that time, the Court will evaluate all relevant material and testimony. After it does so, it will issue an immediate ruling or announcement that it will issue its decision later.
If you and your partner and spouse are going through separation or divorce and cannot agree on property, financial or parenting matters, it is essential to get the proper legal advice. Contact our Gold Coast Lawyers today.
Bob and Betty have both had terrible experiences in property settlement matters with their prior spouses. They are now in their 50’s and have been ‘going out’ for about 8 years. They have both sworn that they will never get involved in a de facto relationship or marriage again!
Bob and Betty do not live together. They have their own separate houses over an hour’s travel apart, and Betty still has 2 adult children from her earlier relationship still living with her.
They see each other 3 weekends a month. On 2 of those weekends Bob stays at Betty’s house for the weekend (2 nights) and on another weekend Betty similarly comes to stay with Bob. The reaming weekend they each stay at their respective homes and do not see each other. They ring each other once or twice during the week.
Bob and Betty do not have any joint accounts, nor do they share finances. They have their own assets and liabilities and do now own anything jointly. They have separate credit cards and neither of them is authorised to use the others card.
When they go out to dinner together, Bob, being the gentleman that he is, usually pays. They regularly go on overseas holidays together and pay their own way, though Bob again will pay for meals and drinks.
They have a sexual relationship but have no children together.
They are known as a couple to close friends and family, and when they are out together in public on weekends or on holidays they would be seen as a couple. However, on all other occasions during the week and on one weekend a month, they will be seen living their own separate lives, paying their own bills, buying their own groceries, doing their own washing, and cleaning, and maintaining their own homes, gardens, and lawns.
On the weekends that they are at either party’s property, they both make contributions to their food, groceries, and cleaning. Bob will ‘wipper snip’ while Betty is on the ride on mower, and so on. They both shared in the repainting the inside of Betty’s house.
Have Bob and Betty fallen into the trap. Are they in a de facto relationship, even though they do not live together?
What constitutes a de facto relationship?
Every person’s circumstances will be different to that of Bob and Betty, and each case will be decided by scrutinising all aspects of each relationship.
The Family Law Act 1975 (“the Act”) is a Commonwealth Act, so the same de facto laws apply throughout Australia. The Act deals with what factors a court must consider when deciding if a de facto relationship exists or not.
If (god forbid) Bob and Betty broke up, and Betty ‘turned nasty’ and wanted to file proceedings in the court for a property settlement alleging a de facto relationship, she would have to satisfy the Court that all the following circumstances exit:
- That she was in a genuine de facto relationship with Bob, which has broken down irretrievably; (can Betty prove this?)
- That the relationship meets one of the following four gateway criteria:
- That the period for the de facto relationship is at least 2 years (Betty could show this);
- That there is a child of the de facto relationship (not applicable in Betty’s case);
- That the relationship is or was registered under a prescribed law of a State or Territory (again not applicable in Betty’s case); or
- When assessing property or custodial claims in cases of a breakdown of a relationship, it is recognised that significant contributions were being made by one party and the failure to issue an order would result in a serious injustice (it would appear that neither Bob nor Betty made a significant financial or non-financial contribution that deserves an adjustment to solve any injustice).
- That Bob and Betty have a geographical connection to a participating jurisdiction (both Bob and Betty are Australian citizens and live in Queensland, so this is satisfied);
- That their relationship broke down after 1 March 2009 (Bob and Betty only recently separated, so this requirement is satisfied).
Having satisfied all the other gateway requirements, whether Betty is successful will depend upon her proving that they were in a genuine de facto relationship.
What makes a genuine defacto relationship?
In deciding whether Bob and Betty were in a genuine de facto relationship for the first gateway criteria, the court will have regard to the following matters.
Section 4AA of the Act defines a de facto relationship. The Act requires that Bob and Betty must have had a relationship as a couple living together on a genuine domestic basis for a defacto relationship to exist.
The Act then gives a list of factors to consider in deciding if Bob and Betty had a relationship as a couple living together on a genuine domestic basis.
Those factors are:
- the duration of the relationship (8 years – this is good for Betty);
- the nature and extent of common residence; (the parties lived separately and only spent holidays and 6 nights a month together – this is not good for Betty’s prospects);
- whether a sexual relationship exists or existed (it did – again this good for Betty);
- the degree of financial dependence or interdependence, and any arrangements for financial support, between the parties; (Bob and Betty were financially independent of each other – this is not good for Betty);
- the ownership, use and acquisition of their property (Bob and Betty did not buy any assets together, and they owned their own homes and vehicles. Again, this is not looking good for Betty);
- the degree of mutual commitment to a shared life (this appeared to be in existence, however Bob says they were just taking one day at a time and if the relationship did not last, then so be it. Bob says Betty was of the same view, but non-surprisingly in her affidavit she claims that this commitment to a shared life existed. The Judge may need to decide based on credit, who is telling the truth in a “he said she said” argument, and objectively it is difficult to figure out from the facts, which are (like every case) so unique. Given that Betty has the onus of proving the facts I will give her a fail on being able to prove this joint commitment);
- whether the relationship is or was registered under a prescribed law of a State or Territory as a prescribed kind of relationship (this relationship was not so registered, and this issue is really for same sex relationships before amendments were made to the Marriage Act to allow same sex couples to marry – this is not relevant to Bob and Betty who were very much male and female);
- the care and support of children; (there are no children together, another blow for Betty) and;
- the reputation and public aspects of the relationship (I will give this one to Betty because all their family and close friends knew them as a couple, and when in public together they acted as couple).
No one factor is more important than any other. However, the more factors from this list that Betty can prove will aid her in convincing the Court that there was a de facto relationship. Likewise, the more factors that Bob can disprove will help show that there was not a defacto relationship in existence.
Betty is looking good on 3 of the above factors (duration of relationship, a sexual relationship and public perceptions), however Bob is looking much better on 5 of the factors (no common residence, financially independent of each other, property ownership use and acquisition, no mutual commitment to a shared life, and no children together).
There is not a certain number of factors from the list that must exist (or not exist) for a defacto relationship to be proven (or disproved for the absence of a defacto relationship).
There is also no minimum number of nights that the parties must spend together in a common residence, nor is there a need for the parties to have actually lived together at all before a defacto relationship will be found to have existed.
The Family Law Act also recognises that a person who is married, may also possibly be in a defacto relationship with another person at the time. A person can also be in several de facto relationships at the same time if the test is satisfied for each of those relationships.
Does Betty succeed?
If I were acting for either Betty or Bob, I would be able to argue very strongly in either of their cases of the existence or non-existence of a defacto relationship. Who will win will depend on how the evidence falls at the hearing, matters of credit and what factors the Judge considers to be most important in deciding the matter one way of the other. Judges have very wide discretion in deciding these matters, one Judge might say there was a defacto relationship, while another Judge (or the Court of Appeal) may decide that there was not.
If I were a betting man, my money in this case would be on Bob, but I would not put too much money on the bet. This is close to a 50/50 chance. It could go either way.
If I were advising Betty or her prospects of success, I would be telling her that she has a compelling case, but I would be testing her to see if she accepts whether it is worth the risk. If Bob opposes the existence of a defacto relationship (which he will) Betty will have to pay significant legal costs that will be involved if the matter goes ahead all the way to a final hearing. She will need to weigh that up with the amount that she is looking for, and her prospects of success. The normal rule in family law cases is that each party pay their own legal fees.
If I were acting for Bob, again I would be telling him that he also has a compelling case. I would recommend that he strongly oppose Betty’s application on the basis that there was no defacto relationship and gather as much evidence as he can to support this conclusion.
Generally, matters like this will settle at mediation, with both parties accepting that going to Court will be expensive, taxing on their time and their emotions, and involves a serious risk that they each might fail.
Time limit to start proceedings for financial orders
If (despite her legal advice on costs and chances of success) Betty still wishes to try to obtain financial orders, and settlement of the matter at a mediation fails (neither Bob nor Betty will shift from their positions), then Betty must apply to the court within two (2) years of the breakdown of the defacto relationship. After that time, she would need the leave (permission) of the Court to apply, and the Court does not readily give that leave.
Sometimes you simply must tell the truth, the whole truth and nothing but the truth. A lie by omission – something you do not mention when you should – is still a lie. Australian law dictates that people seeking resolution of certain issues related to separation or divorce must make certain information available to each other, and to the court. This is called the duty of disclosure.
When it applies
As stipulated in Family Law Rules 2004 (“the Rules”), the duty of disclosure applies to you when you are seeking resolution of financial matters in a separation or divorce. This means you must make certain information available to your former spouse or partner in property settlement, spousal maintenance, and similar cases.
You and your former spouse or partner must also exchange certain information when seeking resolution of parenting matters. This may include but is not limited to: living arrangements, visitation, and child support.
The timing and extent of disclosures
Legally, you must make “full and frank disclosure” of all information that has direct bearing on any point of contention in your case. In other words, you must give any pertinent material that you actually have, or that you have access to or authority over. And you must do so before the case goes to court.
It is best to be aware that both parties have this duty, and that it is ongoing. This means you must report any relevant changes – such as a job change or loss of employment – to the other person, and they must make similar information available to you. Your respective obligations to exchange pertinent information will not end until you reach an agreement, or the court issues a final order.
Finally, it is important to note that there are no legal stipulations about the way in which this material should be given, so it does not matter if you share electronic or paper records. The information you must give will also vary based on case type and your situation.
Your duty of disclosure in financial cases
In these cases, both of you must give comprehensive information about your respective financial circumstances. This usually means you must supply any or all the following:
- Documents reflecting your regular earnings;
- bank statements reflecting deposits and withdrawals from checking accounts, savings accounts and so on;
- tax documents;
- superannuation statements;
- material documenting the valuation and appraisals of assets;
- material about financial resources other than income, along with supporting documentation;
- information about interests in any company and/or trust, along with supporting documentation;
- information about any assets disposed of prior to and since separation.
Please bear in mind that this is not an exhaustive list, and you may need to give different and/or more material given that each case is unique.
Your duty of disclosure in parenting cases
In disputes over parenting matters, both of you must give information the court needs to make decisions about the care and living arrangements for a child. Specifically, you must supply any material relevant to the child’s welfare. As in financial cases, however, the type of information will depend on your unique circumstances.
The following is generally subject to disclosure in parenting cases:
- The child’s (or children’s) school reports;
- relevant assessments about the child/children and/or parents issued by doctors, psychiatrists, psychologists, social workers and so on;
- information about the amount of time the parent spends at work;
- information about the supervision of the child/children when they are not with you;
- information about any issues that affect each parent’s ability to care for the child, such as substance abuse, mental illness, or chronic medical conditions;
- official documents about any family violence, including intervention orders, police reports or relevant statutory body reports.
Penalties for noncompliance and dishonesty
Rule 13.01 of Family Law Rules allows the court to disregard any material that has not been fully and properly disclosed in finance cases. If you do not fulfill your duty of disclosure, the Court may also be reprimand you for contempt of court.
At its discretion, the court may also issue a costs order against you for failure to meet this obligation fully and truthfully. If it does, you will have to pay not only your own legal costs but also those incurred by your former spouse or partner. In the most drastic cases, you may be fined or incarcerated.
If either one of you finds out that the other failed to fulfill the duty of disclosure prior to the issuance of family law final orders, the aggrieved person can ask the court to change the order or set it aside. The court may also vacate or amend a final family law order if either of you have not fulfilled your duty of disclosure before it is issued.
As we have noted, each case is different. If you are going through separation and divorce, and you have questions about the type of information you have to disclose, contact our Gold Coast Lawyers today.
Clarifying Binding Death Nominations in Superannuation
Re Narumon Pty Ltd  QSC 185
A recent decision in the Queensland Supreme Court, Narumon, emphasizes the importance of a valid Binding Death Benefit Nomination (BDBN) within superannuation funds and clarified whether an attorney has the ability to renew BDBN’s.
Summary: In Narumon, the deceased (Mr. Giles) was the sole member of the John Giles Superannuation Fund. Mr. Giles appointed his wife (Mrs. Giles) and his sister (Mrs. Keenan) as his attorneys under an enduring power of attorney (EPOA) for financial and personal/health matters. His attorneys were to begin making financial decisions on his behalf when Mr. Giles had been determined incapable of making his own decisions. In November of 2013, that very situation occurred and Mr. Giles was declared completely incapable of making his own financial, health, and lifestyle decisions. From then on, his wife and sister were authorised to act as attorneys on his behalf.
Mr. Giles made several BDBNs before he lost capacity. The most recently created BDBN was on the 5th of June 2013, which directed his attorneys to distribute his superannuation death benefits, a portion of which were obviously left to his wife and sister, who just so happened to also be acting as his attorneys. Additionally, 5% of Mr. Giles’ death benefits were to be paid to a non-dependent and non-legal representative. The 2013 BDBN stated that three years after the date it was signed, it would cease to have effect and must be signed within three years of the member’s death.
Issue: 5% benefit to non-dependant and non-legal representative
In order to ensure that the 2013 BDBN and its extension were valid, Mrs. Giles and Mrs. Keenan decided to change the 5% nomination to a non-dependant and distribute it between the dependant’s already nominated. The court, however, confirmed that the original 2013 BDBN was valid, despite the 5% nomination to a non-dependant. The reallocation was found to be a conflict of interest and, since there was no explicit language in the BDBN allowing such a conflict, the new BDBN would not be valid.
Issue: May an attorney make a BDBN?
The court held that, yes, an attorney has the power to make a BDBN on a member’s behalf. His Honour looked closely at the language of the deed. The deed did not prohibit such an act. In fact, another section expressly stated that an attorney would enjoy all of the rights that a member would have. Since there was no restriction under the Superannuation Industry (Supervision) Act of 1993 preventing an attorney from making a nomination, there was nothing to prevent Mr. Giles’ attorneys from making a nomination on his behalf.
Issue: Validity of the 2013 Binding Death Benefit Notice
The issue in question was whether or not Mrs. Giles and Mrs. Keenan would be allowed to renew the 2013 BDBN or make a new one, despite also being recipients. The Court considered whether or not there was a conflict created by the dual interests of Mr. Giles’ attorneys. In the end, the judge ruled that there was no conflict created.
The judge reasoned that because they were merely confirming existing estate planning intentions, there was no conflict. However, it is unclear whether making one from scratch would also be allowed or if that would be considered a conflict. Therefore, it is clear that the individual circumstances for each case will need to be considered in determining whether or not a BDBN renewal is likely to be valid.
“This is the first time it’s been considered as far as I’m aware of, that an attorney subject to the trustees of the super fund is able to renew a binding death benefit nomination for the person for whom they are the attorney,” said Scott Hay-Bartlem of Cooper Grace Ward Lawyers after the judgement.
In this podcast, OMB Solicitors, Family Lawyer, Gary Mallett answers the commonly asked question, as to whether costs can be recovered in family law matters.
What is the General Rule About Costs in Family Law Matters
S.117 of the Family Law Act 1975 provides that each party to proceedings under this Act shall bear his or her own costs, subject to a few exceptions. In other words, the general rule in Family Law is that each party will have to pay for the costs of their own legal representation and should not expect to be able to recover any part of those costs from the other party.
Subsection 2 then goes on provide that if the court believes there are circumstances that justify doing so, the Court may make such order as to costs as the Court considers just.
What Matters do the Court Consider in deciding if it is “just” to depart from the general rule?
The Family Law Act provides that in considering what order if any should be made with respect to costs, departing from the general rule, the Court shall have regard to:
- The Financial Circumstances of each of the parties to the proceedings;
- Whether any party to the proceedings receives assistance by way of legal aid and if so, the terms of the grant of that assistance;
- The conduct of the parties to the proceedings in relation to pleadings discovery and inspection and directions to answer questions, admissions of fact, production of documents and similar matters;
- Whether the proceedings were necessitated by the failure of the party to the proceedings to comply with previous orders of the Court;
- Whether any party to the proceeding has been wholly unsuccessful in the proceedings;
- Where either party to the proceeding has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and
- Such other matters as the Court considers relevant.
So, if I make an Offer to Settle and I beat that Offer at the Hearing, will I receive a Costs Order?
The purpose of the Court enquiring as to whether any offers to settle have been made in considering cost orders, is to ensure that offers to settle are considered seriously by both parties, to minimize the cost of litigation and reduce the workload of the over loaded Family Law Courts.
The Court also tries to eliminate any injustice that may occur if a financially stronger party is placed in a position where they can drag out the proceedings, mounting up costs and wearing out the other party.
The Court will consider the actual terms of the offer and possible outcomes of a settlement resulting from acceptance of that offer. A comparison will then be made to determine if acceptance of the offer would have resulted in a greater share of the assets to a party than what was ordered by the Court to that party at final hearing. If the comparison shows that the party would have been better off accepting the offer, then the court may make a costs order against the party who declined the offer.
As an example, in one case I was recently involved in, the Husband made an offer to the Wife before legal proceedings were even commenced that she have 65% of the property pool. The Wife rejected that offer. The matter went to trial and the Wife was awarded 62% of the property pool. The Husband had beaten his offer at the trial. Acceptance of the offer by the Wife would have given the Wife a greater share of the matrimonial pool then she was given at a final hearing, some two and a half years later.
The Wife would also have saved herself the significant legal costs, time, and the trauma of years of Court litigation, where all both parties’ dirty laundry is aired, and the property pool gets eaten away by legal costs, experts’ costs, barristers’ fees, mediator’s costs and other expenses.
The Husband applied to the Court for a costs order to recover his legal party and party costs on the applicable Court scale from the Wife, from the time the offer was made until the time of the final hearing.
As the Husband found out, the granting of a costs order to him because he had beaten his offer was not a guaranteed certainty. The Judge also looked at all the other matters required to be considered in deciding a costs order, to satisfy the Judge that it was just for her to use her discretion and part from the general rule.
The Judge noted the offer that was made and agreed that the husband had beaten it. However, the Judge went on to consider the parties conduct during the case. She noted that the Husband failed to comply on numerous occasions with his obligations to disclose documents, which resulted in lengthy delays and a waste of the Courts time and resources. The Judge further took serious note of the fact that the Husband had even breached The Judge’s own Court Orders for the Husband to disclose documents. Judges do not take lightly to their Court Orders not being complied with.
The Judge considered that the Husband’s conduct outweighed the effect of the Husband beating the initial offer that he had made.
The cost order was refused, and each party was ordered to pay their own costs.
If I am awarded a Costs Order, Can I recover all my Legal Costs?
If a standard costs order on what’s known as a party and party basis is made in your favour, you will not recover all your legal costs. You will only recover the costs for certain items of legal work on a scale prescribed by either the Family Court Rules or the Federal Circuit Court Rules.
Depending on how much your Lawyer has charged you, and what hourly rate you have been paying, often parties end up recovering less than 50% of their total legal fees on a party and party costs assessment.
However, if the Court goes one step further and considers that the justice of the case warrants an order that that the costs to be paid to the winning party by the losing party should paid on an “indemnity basis”, then all reasonably incurred costs by the winning party will be paid by losing party.
In determining whether the justice of the case demands indemnity costs, the court will consider the following:
- if a party, properly advised, should have known that they had no chance of success in their proceedings, then indemnity costs might be appropriate.
- If a party has knowingly made false allegations of fraud or irrelevant allegations of fraud during the proceedings, then an indemnity costs order should be considered. So be very careful when making allegations that the other party has been fraudulent (e.g. defrauded the government, forged a signature etc.) If these allegations are irrelevant to the case or are found to be untrue or have no substance, then you may find yourself looking down the barrel of an indemnity costs order.
- And finally if a party has conducted themselves in such a way that they wasted the time of the court and the other parties, or made allegations which should never have been made, or prolonged a case by groundless contentions or imprudently refused to offer to compromise or, consistently failed to comply with the Orders of the Court, indemnity costs order might be appropriate.
So, If the general rule is that each party pay their own costs, why do Solicitor’s letters always threaten to seek costs on an indemnity basis?
Occasionally it may be appropriate for lawyers to threaten to apply the Court for cost orders against the other party on the indemnity basis if their client’s demands are not met or orders are not complied with, but only where the justice of the case suggests that such a costs order might be made.
However, on most occasions when lawyers threaten the other party with cost orders, those threats are in reality ’empty threats’ and are generally made as a strategy to unsettle and intimidate the other party.
If in the context of family law proceedings, if you receive a letter from another Lawyer making certain requests or demands and then threatening to seek a costs order against you, you should immediately obtain our Gold Coast Lawyers legal advice. Often, the costs threat will be a bluff, however, it might not be, and we can advise you when it should be taken seriously, and how to respond.
For Australians going through divorce and separation, there are plenty of advantages of living in the ‘Information Age’. Now it is easier than ever before to access the court forms and other material you may need.
This makes it possible to do more on your own, so you may save money on legal costs. There are also plenty of disadvantages, however, the most significant of which is the amount of misinformation readily available in the digital world. If you’re getting divorced or separated, following the wrong legal advice – be it from the Internet or even friends, family and workmates – can be costly, especially when you’re trying to figure out who gets what in a settlement. Here’s what you should know.
The first and most important thing to understand is that every case is different. Essentially this means that regardless of what you may have heard, read online or seen on television and films, everything is not always ‘split down the middle’. It also means there is no real basis for the belief that women always benefit from the property settlement, or that you must go to Court in order to get one. It is true that courts must approve related orders, but they actually intervene in only a small percentage of cases.
Having said that, there is a proven method that is used to ensure that couples going through separation and divorce arrive at fair settlements. It consists of four steps, which we will discuss in detail.
To begin with, you should prepare a comprehensive list of assets and liabilities that will be shared with the other person. By law, each of you must fully disclose all of your assets and liabilities. This means you should be sure to include everything, irrespective of whether the asset or liability is in one person’s name, both of your names, or held by one of you and a third party. Although it is technically considered a different type of property, don’t forget to include your individual or joint superannuation interests on a separate list at this point.
The second step is a little bit trickier because it involves the identification and valuation or assessment of each person’s contributions to the marriage. Contrary to popular belief, this evaluation is not strictly limited to each of your financial contributions. Non-financial contributions, such as home improvements or those you made as a stay-at-home mum are assessed as well. Furthermore, ‘indirect’ contributions to the household – or those made by your relatives – are also considered. Each contribution is then assigned a percentage on a scale specifically created for this purpose.
At the next stage, another set of factors is assessed. These include but are not limited to each person’s health, each person’s ability to make a living, how many kids you have, how old they are, who will have primary custody and the extent to which your ex-spouse will be involved in their lives. Another key factor that will be considered at this stage is whether or not any of your children require special care. If warranted at this point, the determination made in the previous step may be changed.
Finally, in the fourth step, the court takes one more objective look at the division of property to see if the outcome reached through this process is fair and reasonable to everyone involved. This final determination is based on all circumstances of the case. Although the court can make additional changes at this time, it will seldom do so.
The bottom line is that the decision to end a relationship is seldom easy. The prospect of separation and divorce can be intimidating and overwhelming, even when a wealth of information is so readily available. The best way to safeguard your interests and secure a fair outcome for everyone involved is to work with an experienced family lawyer. If you are considering separation and have questions or concerns about the process for reaching a settlement, contact our Gold Coast Lawyers today.
Even in a best-case scenario – one in which you and your partner have decided to end the marriage on amicable terms – questions may arise about your legal rights and obligations. For example, you may both have questions and concerns about spousal maintenance. Specifically, you may be wondering if either of you is eligible and if so, how to apply, the deadlines for doing so, whether there are different types of spousal maintenance and so forth. Here are some of the things you need to know.
To begin with, spousal maintenance (known as alimony in America), is simply a legal term for the financial support one former spouse provides for the other following separation or divorce.
Ideally, you and your former spouse are still on good terms and you can agree on all of the issues related to spousal maintenance (such as the amount and a schedule for payment). When this is the case, you can simply put the terms into a legally binding Financial Agreement or Consent Orders that must be filed with and approved by the court.
If, on the other hand, you can’t agree on anything, much less the terms for spousal maintenance, you can apply for Spousal Maintenance through the Federal Circuit Court or Family Court.
Application is irrespective of whether you were in a traditional marriage or a de facto relationship (including a same-sex de facto relationship) but there are different standards of proof you must meet for eligibility.
To be eligible for spousal maintenance if you were in a de facto relationship, you must demonstrate that:
- you were in the relationship for at least two years, or
- you and your former de facto partner have a child together, or
- one of you made substantial monetary contributions to the other’s property, or
- one of you officially registered the relationship (at Registry of Births, Deaths and Marriages, or an interstate/overseas equivalent).
On the other hand, to qualify for spousal maintenance if you were in a traditional marriage, you must prove that:
- you cannot support yourself financially;
- your former spouse has adequate means to do so.
More often than not, the court will award spousal maintenance if you can show that your former spouse earns significantly more than you do and/or that you lack the potential to earn sufficient income based on factors including but not limited to your education and past work experience. For instance, the court may approve your application if you are a ‘stay at home’ parent and cannot secure outside employment. Your application for spousal maintenance may also be approved if you have had a prolonged absence from the workforce and now lack the skills or are too old to secure employment, or if an illness precludes you from working.
Be aware, however, that spousal maintenance is not automatic just because you don’t make any money of your own, or you don’t make very much. In other words, if you are capable of working and simply choose not to do so, the court is likely to deny your application.
You should also be aware that there are different deadlines for applying for spousal maintenance. With certain exceptions, if you were in a traditional marriage, you must apply for spousal maintenance within a year (12 months) after the divorce order is granted. Conversely, if you were in a de facto relationship, you must make this application within two years (24 months) after the relationship officially ends.
Another thing to keep in mind is, for the most part, spousal maintenance is not a long-term benefit. Usually, it is only in effect until you (the applicant) gain or regain your financial footing by getting a job or receiving training necessary to find work.
Furthermore, if you were in a conventional marriage, your right to receive spousal maintenance from your ex- husband or wife usually ends when you marry someone else. However, your right to financial support received after the break up of your de facto relationship won’t necessarily end when you start a new one. This is because the court will consider the financial dynamics between yourself and your new de facto partner when determining whether you can support yourself.
The way in which spousal maintenance payments are made will also depend on your unique circumstances. In some cases you may prefer one large (‘lump sum’) payment, and in others, you may prefer regular payments once a month, twice a month, weekly or even annually. If need be you can also apply for spousal maintenance on a limited basis. This may be your best option if you know you only need enough financial support to tide you over until your property settlement is finalised.
It should also be noted that spousal maintenance is not limited to monetary payments. Transferring ownership of a motor vehicle, investment property or other assets is also considered as legal payment of spousal maintenance.
Finally, we must also point out that, contrary to popular belief, child support and spousal maintenance are two separate benefits. While spousal maintenance provides financial support for you, child support payments should be used only to meet the children’s needs. This means courts can – and do – issue orders for the payment of both.
Divorce and separation are emotionally trying for anyone. Addressing complex legal matters on your own during times of stress can complicate things even more. For more information about the legal aspects of divorce, separation and related issues, including but not limited to spousal maintenance, contact the Family Law team at OMB Solicitors today.
Who gets what will depend on the facts
Australian statistics show that one third of relationships end in separation or divorce. The growing breakdown of relationships caused by divorce or separation has allowed for the distortion and generalisation of what is perceived to be ‘Who Owns What’ in a property settlement. The reason for the misinformation is due to there being no specific rules that indicate which party will retain what in the event of a breakdown in relationship. Each case is fact specific and will be determinable on those facts, each case differing from the one before and after it.
Property Settlement – the Law
Property settlement after separation is governed by the Family Law Act 1975 (Cth) (‘the Act”) and is applicable to married couples’ and De Facto (same sex and heterosexual) relationships. A property settlement may be applied for any time after the breakdown in relationship occurs and need not wait until divorced.
Get started quickly
Because a property settlement order will deal with assets and liabilities that exist at the time the order is made, it is strongly recommended that negotiations for a property settlement begin as soon as is practicable after separation. If you delay, and in some cases, parties have delayed for ten or more years, then the Court will deal with what property exits then, and not when you separated. One of the parties may have accumulated substantial additional assets since separation, and the other party may have run up substantial debts. The property settlement then (in 10 years) would look completely different to a property settlement reached within a reasonable time of separation.
Where a couple gets divorced they must commence property settlement proceedings (i.e. Bring a Court Application) within twelve months of the divorce. Whereas for a married and De Facto couple the application must be bought forth within two years of the breakdown in relationship. Where proceedings are not bought within these limits, a loss of rights may occur due to being outside the time frame. The law takes into consideration the below factors and does not considered the way in which the relationship deteriorated.
This the way a Court will tell you “Who Gets What”
Judges have a wide discretion to make orders for property settlement. In some circumstances, a court will not make any order at all dividing the property, if it appears to the judge that it is just and equitable that each party should keep the property they have without making any adjustment.
However, if the judge decides that an order is necessary to adjust property interests, then orders to divide the property on a just and equitable basis will be different in almost every case, as the circumstances of each particular case that comes before the court are all unique and different.
In applying the legislation over the years, the courts have defined a framework within which it must work to achieve what is a fair and equitable division. This framework involves an approach with four or five steps.
The Steps involved in working out “who Gets What”
The steps to working out a property settlement now may be summarized as:
- What are the legal and equitable interests of the parties in their property;
- Should these interests be altered;
- What are the contributions of each party and what weight should be given to the contributions;
- What is the future of each party and should there be any adjustment for that;
- How is the proposed division to be implemented?
Step 1- What are the legal and equitable interests of the parties in their property
The Court determines what the legal and equitable interests of the parties are in their property.
This will be all assets, liabilities and financial resources in joint names, and in each party’s separate names. Until an order is made, for family law purposes both parties have an interest in each asset in the property regardless of who owns it. The Court will take into account all of the property and financial resources in existence at the time that the order is made. Both parties have an obligation to make full and frank disclosure of all assets and liabilities that exist to each other and to the Court.
The Court then attributes values to each of the parties’ interests. Generally, the court will value the items as at the date that an order is made.
Step 2- Should the parties interests be altered
Once all the property is identified and valued, the Judge will take a step back and look at the length of the relationship, who brought what into the relationship, who owns what now, is there jointly owned property and/or bank accounts or did the parties keep their property separate, and was that their intention or agreement.
If the Judge is of the view that no adjustment in property interests is warranted, then no property settlement order will be made, and each party will keep what they currently own.
However, if relationship circumstances are such that an order is necessary to adjust property interests (and in most cases it will be), the Court proceeds to the next step.
Step 3 – What are the contributions of each party and what weight should be given to the contributions;
The Court determines the contributions that the parties have made to the acquisition, conservation and improvement of the property. The contributions can be direct and indirect, financial and non-financial as well as relating to a homemaker/parent role and otherwise to the welfare of the family unit. The Court will take into account the contributions made:
- at the commencement of the relationship,
- during the relationship, and
- since separation.
Some of the general principles that apply to the assessment of contributions are:
- There is no presumption that contributions are equal or that they were made in “partnership”;
- An evaluation must be made of the actual respective contributions of each party;
- Although in many cases the direct financial contributions of one party will equal the indirect contribution of the other as homemaker and parent, that is not necessarily so in every case;
- Care must be taken to recognise and distinguish a windfall gain;
- Whilst decisions in previous cases where special factors were found to exist may provide some guidance to Judges, they are not prescriptive, except to the extent that they purport to lay down general principles;
- It is ultimately the exercise of the Judge’s own discretion on the particular facts of the case that will regulate the outcome; and
- In the exercise of their discretion, the Trial Judge must be satisfied that the actual orders are just and equitable.
In a short relationship (up to seven years) the Court is more likely to adopt an asset by asset or “piecemeal” approach to the assessment. Relationships beyond that time will be regarded as a mid to long term relationship.
In mid to longer range relationships the Court is more likely to adopt a global assessment of contributions. When taking into account the contributions of the parties the Court will have regard to any period of separation prior to commencement of the relationship.
The assessment of contributions will not be equal in circumstance where:
- One party has made a greater initial contribution than the other; or
- One party has received a significant inheritance (particularly late in the relationship);
- One party has received a significant gift (particularly late in the relationship);
Step 4 – Future Needs
The Court then assesses the future needs of each party, having regard to the various factors set out in the Act. These factors involve looking at and assessing the difference between each of the party’s:
- current income;
- income earning capacity,
- property and resources,
- superannuation entitlements,
- deficits in health,
- closeness to retirement; and
- the need for one party to care for children of the relationship.
Step 5 – How is the proposed division to be implemented
The Court will then give consideration on how the proposed division of property is to be implemented. For example, an order may be structured where the wife gets to the retain the former matrimonial home as the primary care provider for the children, and the husband keeps his superannuation and business assets.
In Property Settlement Court proceedings, the Judge will decide “who gets what”. That judge has very wide discretion and may make a completely different order to the Judge in the next courtroom. You may like the order that is made, or you may detest it.
Before or during your relationship, enter into a binding financial agreement under the Act so that you (and not a Judge) can determine “Who Gets What” should you separate.
If you do separate without a Financial Agreement in place, it is important that you consult a family law solicitor to ascertain what your entitlements are likely to be, and then attempt to reach agreement as to “who gets what”, either personally, through your solicitors or at a mediation. If an agreement can be reached, your agreement can be finalised by consent orders of the Family Court or a Financial Agreement.
Contact our Gold Coast Lawyers
If you require assistance or advice with respect to:
- Your likely entitlements upon separation;
- Negotiation of a property settlement
- Preparation of a Financial Agreement,
- Organising a mediation,
- Commencing court proceedings or the preparation of consent orders.
In family law matters, you may have heard of the term, “family report,” but what is it and in what circumstances do they apply. In this podcast, Gary Mallett, our family lawyer at OMB Solicitors discusses the topic.
Dan: What is a family report?
Gary: A Family Report provides the Judge with an independent assessment of relevant issues in parenting disputes before the Court and assists the Judge to make decisions that are in a child’s best interests.
The primary focus in family law parenting proceedings is the child’s best interest.
Family reports will usually contain recommendations for the child’s future care, welfare and development and generally include suggested parenting arrangements as to whom the child should live with, and how and in what manner the child should spend time with the other parent.
These recommendations are made after the Family Consultant has interviewed all the parties concerned with the dispute over the child’s care, and others who are significantly involved or concerned with the child, including the children themselves, siblings, and often grandparents and the new partners of the parents.
The report may also provide important insights into the views of the children, relationship dynamics and family attachments of the children involved in the dispute. The report will identify areas of concern such as domestic violence, drug and alcohol abuse, child abuse and neglect. The Report will then make recommendations that endeavour to protect the child form these risk factors.
Dan: When will a family report be ordered?
Gary: A family report will often be ordered if the Judge believes it will help the Judge with the process of determining what is in a particular child’s best interests.
The Judge may order a family report on its own initiative, or after a party to the proceedings makes an application.
Dan: Who writes the family report?
The family report will be written by a family consultant, who will be either a psychologist or a qualified social worker. Family consultants are recognised by the Family Court as expert witnesses in children’s matters, and therefore only psychologists or social workers with the appropriate skills and extensive experience working with children and families are appointed.
Dan: What does a family report contain?
Gary: The Judge may ask the family consultant to create a report focusing on whatever matters the Judge directs.
When a Family Report is ordered by the Judge, the Judge is able to set out in detail the particular issues that need to be covered by the Family Report. There might be an older child and both parties are telling the Judge that the child wants to live with them. The Judge might then order that the report consider the child’s views.
However, in doing so it must be made clear to the child that the child does not have to express a view if they don’t want to, and the questioning of the child is not an interrogation.
A family report may include information on a wide range of issues, including:
- A child’s wishes and views;
- The nature of the child’s relationship with each parent and other significant adults;
- The likely effect that any change in circumstances may have on the child;
- The practical difficulty of the child spending time with either parent;
- Any risks to the child (as identified previously, family violence or abuse etc); and
- an overall history of the family and the personal histories of the parties and other significant people.
The report will also assess the parenting capacity of each party, considering:
- The capacity of each parent, and other significant adults, to provide for the child’s needs (including their intellectual and emotional needs);
- The attitude each parent demonstrates towards the child and the varied responsibilities of parenthood; and
- The willingness and ability of each parent to encourage and facilitate a continuing relationship between the other parent and the child.
Dan: How are family reports prepared?
Gary: A family report is compiled from information from a variety of sources, including interviews with the parties, affidavits and other reports filed in the case, and documents that have been produced to the Court under subpoena (e.g. criminal histories, medical reports, school reports etc).
After the report has been ordered, the family consultant will arrange appointments for interviews. The family consultant conducts individual interviews with all parties that the Consultant believes should be interviewed, which is generally all the parties and children involved in the case, including others with a strong connection to the child.
The child will be interviewed separately from the adults, thereby assisting the family consultant to ascertain the child’s views away from the potential influence of the child’s parents. The Family Consultant will also make observations of the interactions between the child and their parents and other significant people.
Interviews are usually conducted at the family consultant’s premises, and in most circumstances, they will take a full day.
Information provided to a family consultant is not confidential, and all relevant information will be included in the family report which will be filed in the Court and read by the Judge.
Dan: How should I prepare for the interviews?
Gary: Spruce yourself up for the interview, and wear something decent, as if you were going to Court, Church or a nice restaurant. The Family Consultant will take notice of and report on your appearance and demeanour.
Generally, you will be able to bring a friend for reassurance and emotional support, but you should think twice about bringing a friend who may argue with or intimidate the other party. Parties sitting in the waiting room are often being observed directly or indirectly by the Family Consultant, and observations of interactions, arguments or intimidation may end up in the Family Report.
Before the Interview it is important to read through your Affidavit material and any other Affidavit material that has been filed in your proceedings and make a note of any concerns that you have in the material. You can take notes into the Family Report Interviews if it assists your memory, however what you say in the interviews must be your real thoughts and feelings.
Try to relax during the Family Report Interview. You may feel that your life and your actions are under the spotlight, however the role of the Family Consultant is to help the Court make decisions in the child’s best interests, so focus on what arrangements you want for your child or children; and why you believe that those arrangements are best for your child or children.
Having said that, because the Judge will be focused on what is in the child’s best interests, proposals that simply suit you or the other parent, and suggestions of what you or the other parent believe you are entitled to, take a back seat if they are not in the child’s best interests.
You need to remember that because the Interviews are not private or confidential, anything that you show to the Family Consultant (for example photos or videos) and anything you discuss with the Family Consultant may end up in the Family Report and shown to the other party.
Under no circumstances should you coach children about what to say before a Family Report Interview or at any stage in Family Report Interviews.
If the Family Consultant considers that the children have been coached, that will be noted in the Family Report. When the Judge reads about the Family Consultant’s concern of coaching, whatever the children have said (even if it is really what they feel) may be doubted by the Judge and will certainly be contested by the other parent.
Do not, under any circumstances coach, put down or denigrate the other parent or party. You can express your concerns about the other parent’s parenting abilities or use of drugs etc, without denigrating them. Always remember to remain child focused and show that you are willing to foster the child’s meaningful relationship with the other parent, with the appropriate safeguards against risk factors in place if necessary.
Dan: Who pays for the family report?
Gary: The typical costs of a family report are between $3,000 to $4,000.
Family Reports are usually paid for by the parties to the proceedings equally. However, when one party has no money and the other party has a much higher income, the parent with the higher income may be ordered to pay. Where both parties have no money and only a small income, the Court may agree to fund the cost of the Family Report.
Never assume that the Court will fund a Family Report. The Court does not have the money to continuously pay for such Reports.
There are benefits of privately funding the costs of a Family Report. In such circumstances the parties can select and agree on the Family Consultant, and the Report is normally made available much quicker.
Dan: Who sees the family report?
Gary: The Court will release copies of the family report to each party involved in the case (or their lawyers), and to the Independent Children’s Lawyer. Only those persons may read and retain a copy of the report. Even if other people were interviewed for the report, they cannot see the Report without the Court’s permission.
Section 121 of the Family Law Act 1975 makes it an offence to publish or distribute to the public, any part of a family law proceeding that identifies one or more of the parties, witnesses or other persons. This would include showing the family report to other people.
The Family Report may contain recommendations to the Judge about parental responsibility, who the child should live with and how and when the child should spend time with the other parent. The Report may recommend that one or both of the parties attend counselling, a PPP Parenting Course, a Parenting Orders Program or other such courses.
The recommendations will reflect what the family consultant believes is in the child’s best interests, in particular, their care, welfare and development needs.
Family reports are often highly relevant pieces of evidence and very valuable to the Judge in making parenting orders. However, they are only one piece of evidence the court may consider, and the family consultant’s recommendations should not replace the court’s role in the family law process.
Judges can accept or reject the family consultant’s recommendations. The Judge will be aware that Family consultants do not usually have the opportunity to view all the available evidence, and their recommendations may be based on incorrect facts or assumptions.
If one of the parties wishes to contest or object to any of the facts, assumptions or recommendations, then they must call the Family Consultant as a witness for cross-examination at the trial.
Dan: Where do people go for further information?
Gary: There is more information and fact sheets on Family Reports and the role of Family Consultants on the Family Court’s website. There are also further useful family law articles and podcasts on our website about parenting matters and other Family Court proceedings.
Please do not hesitate to contact our Gold Coast Lawyers for a consultation should you still have any further questions on the Family Report process, or if you require any assistance with parenting issues or proceedings that are currently before the Court..
In family law property settlement proceedings all assets and liabilities of each party, (whether they are owned jointly or separately) are combined to form what is commonly known as the “matrimonial property pool.” This pool of assets and liabilities is then subject to scrutinization and possible division by the Court upon separation.
A business interest, owned either separately or jointly, and whether in a partnership, sole trader, company or trust structure, can be treated by the court as “property” as defined in the Family Law Act 1975 (Clth) (“the Act”) and will fall into this asset pool. Each spouse’s business interests will need to be valued (if a value is not agreed to).
In the case of a small business operated as sole trader or a partnership between the spouses, it is generally the assets of that business that largely determine its value. If the business has little by way of assets, and generates income though one or both spouse’s efforts, skills or trade (e.g. a plumbing business), its value may be very little (nominal). Other businesses may have a corporate and/or trust structure, extensive assets and goodwill, and each spouse’s interest in that business will need to be valued. This may involve a valuation of the entire business enterprise, with the value of the share owned by the spouse (or spouses) then calculated.
If one spouse wishes to retain their interest in any business, they should be aware that the value of that interest will be attributed to that spouse’s portion of the overall split and will give them a financial resource to offset future needs.
Each spouse has an ongoing obligation to give full and frank financial disclosure of all documents relevant to the valuing of any business interest. This includes business records, financial statements, bank records, BAS and tax documentation
Different Types of Business Structures
A sole trader (like a tradesperson or professional consultant) is a “personal exertion” style of business, with few employees, if any.
Generally, the Court would order (and it is common sense) that the spouse who runs this business will retain the business, as he or she has the necessary skills and training to continue with the business.
A value needs to be attributed to the business, because it is an asset that the sole trader is keeping. Because a sole trading business generally just relies on the personal reputation and skills of a sole trader, a modest value is normally applied to such a business interest.
However, if there are multiple employees and the business has goodwill such that it may be sold as a going concern, then the value of business will be determined by the usual valuation processes by a business valuer, and full disclosure of the books and records of the business will need to be made.
It is also possible that in addition to being an asset retained by that spouse, the court may take the business into account as a future financial resource of the spouse retaining the business.
Partnership businesses may be constituted by both spouses in partnership with each other, or partnerships with a third party or parties.
Spouses in Partnership
When spouses are in partnership, they are normally running a “personal exertion” style of business. If one spouse wishes to retain the business, a value will be determined for the business, like valuing a sole trader business.
However, if the business has employees and goodwill and has been operating for several years, it will need to be formally valued by a business valuer.
For one partner to buy the other out of the business, the partnership will be dissolved and (often in exchange for paying to the other spouse half the value of the business), the continuing spouse will be operating the business as a sole trader.
Partnership with Others
Where the partnership involves third parties, the other business partners will be impacted by separation. The partner who has separated will be going through a tough time and may lose focus on the business. Third parties are also very uncomfortable with the obligation on the spouse partner to make full and frank disclosure of the business, its assets and its dealings.
There will usually be a written partnership agreement, which will generally say what is to occur if one partner was to leave the partnership, if one partner wants to sell his or her interest to the other partners, and what is required to bring the partnership to an end. Separation of a partner may trigger a buy/sell arrangement between the partners. These clauses will generally have been drafted to preserve the business and maintain its value.
If you are not separated and you are in a partnership with your spouse or third parties, I strongly recommend that you contact us with instructions to prepare a partnership agreement (if you do not already have a professionally prepared agreement), so there is certainly as to what will happen to the business if one or more of the parties go through a separation.
Company Owned Businesses
Where a company owns and operates a business, and that company is a “family company”, with the spouses being the only shareholders and office holders, then the Court will generally deal with the business as a type of partnership between the spouses. The business will need to be valued, and it will either be sold, or the party with the requisite skills to keep the business running may buy out the other party, and a share transfer between the spouses will be effected.
However, if the company has third party shareholders as well, it will again be necessary to determine the value of the shares in the company, by valuing the business and any other assets of the company. The value of each parties share in the company will then be determined by the Court, considering the company’s share structure to see if there is an equal or an unequal shareholding, and what rights and benefits attach to different classes of shares.
During the valuation process, director’s loan accounts will need to be considered, and whether the loan is in credit or debit. Repayment arrangements for these director’s loans will generally be made or suggested in the valuation process.
If one party has a majority of the shares in the company, that may affect the way the company is operated and valued.
If the separating spouse shareholder has a minority shareholding with a third party, then the value of the minority shareholding may be given a lesser value as the minority shareholder is unable to make determinations about the operations and the future of the company.
If the separating spouse shareholder has a majority shareholding with a third party, then that spouse will be able to exert a majority influence and control the operations of the business.
Any shareholders agreement entered between the shareholders will also be carefully securitized. Shareholding Agreements may include method to determine value and trigger events (such as separation from a spouse), leading to the implementation of a buy/sell arrangement.
Again, if you are reading this and you are not separated and have shares in a company with your spouse and/or third parties, I strongly recommend that you contact us with instructions to prepare a Shareholders Agreement, to give certainly as to what will happen to the company and business in the event of one or more of the parties going through a separation.
The company constitution may also be relevant.
Discretionary Trusts and Unit Trusts
“Who is in control” is the most important aspect of a Trust Structure.
In a discretionary trust, which includes what is commonly known as a family trust, the Court will consider the trust deeds, the identity of the appointor of the trust, and the history of use of the trust. The Appointer has the power to replace the Trustee, so the Appointer is the “Controller” of the Trust. If the Appointer is a spouse, then it is likely that the Court will treat the Trust as “matrimonial property” rather than a financial resource.
Family Discretionary Trusts are usually set up to hold a family’s assets or to conduct a family business. The Trustee of the Trust will own the assets and operate the business on trust for the beneficiaries.
The beneficiaries of discretionary trusts are usually immediate and extended family members, other family companies and charities. In a discretionary trust, beneficiaries have no interest in the trust property unless the trustee exercises its discretion to distribute to them.
The trust deed will need to be examined to determine how the Trust can be varied to remove a beneficiary spouse who will no longer be involved in the business due to separation. Generally, one spouse will take over the business, which will require a Deed of Amendment to be prepared and executed to remove the spouse as beneficiary, and possibly also to provide for a share transfer by that spouse of any shares owned in the Trustee (if the Trustee is a company).
If the trust is a unit trust, it may be treated with the same principles that apply to a company. The units in the Trust will be valued, and the trust deed examined to see if units can be transferred between unitholders. The trust deed (and any unitholders deed) must be examined carefully as to the duties, powers and obligations on the Unit Holders. The financial records of the business must also be considered.
So, what will happen to your business on separation?
Where both spouses have worked in the business and then go through a separation, this will have obvious and significant repercussions and likely impacts on business continuity and profitability. It may also affect the staff.
In most situations, one of the separating spouses will seek to retain the business free of the other spouse. If that agreement is reached, then orders will be drafted to make that happen according to the type of business structure. The transfer of interest in the business from one souse to another may also be accompanied by payment to the exiting spouse of a “settlement sum” which will often be the value of the exiting spouses share in the business. Otherwise the business will be an asset that one spouse is keeping, so its value will need to be considered in determining a just and equitable division of all assets between the parties.
Whilst it is quite uncommon for a business to continue to be operated by two spouses who have separated, it sometime does happen, generally for an agreed number of years, after which the spouses will meet to decide its future or sale and the division of sale proceeds. Whilst a Court would not make that order (the Court makes a “once and for all” property settlement so that all financial ties are broken), the spouses could agree to implement such an agreement in a Financial Agreement made under the Act.
If neither party wished to retain the business then the business (or their shares in the business) will need to be sold, and the sale proceeds divided in a just and equitable manner. Appropriate orders will be prepared by your solicitor for the sale or transfer of shares, according to the type of structure that operates the business.
As the spouse who retains the business will also have a continuing financial resource at their disposal, the court will take this into account when considering the “future needs” of the spouses before adjusting property between them.
- Property settlement negotiations and mediations;
- Commencing property settlement proceedings in Court;
- Drafting the necessary orders to deal with your business as you have agreed;
- Prepare a Shareholders Agreement (for a company or unit trust); or
- Any other legal advice on separation.
There’s no doubt about it. Ending a relationship is never easy. But in Australia, ending a marriage is relatively simple – at least in the eyes of the law. This is because, unlike the divorce process in the United States, divorce in Australia doesn’t address some of the most emotionally volatile issues such as child custody, child support, spousal maintenance and the division of marital assets in detail. In fact, the only issues addressed when you apply for divorce here are whether you are legally eligible to do so and whether or not you’ve followed all of the applicable rules.
To be eligible to file for divorce in Australia, the only requirement in most cases is that you and your spouse have separated for one year. The only exception to this rule is if you are filing for divorce less than two years after you got married (inclusive of the time when you were separated). In such cases, you must see a court-approved counsellor with your spouse and file a signed counselling certificate with the court upon completion. If you and your spouse are unable to fulfil this requirement for any reason, you must ask the court’s permission to get divorced.
If you were married abroad, you may still apply for divorce here if you or your spouse:
- Regard Australia as your home and intend to live indefinitely in Australia and are an Australian citizen or resident, or
- Are an Australia citizen by birth or descent
- Are an Australia citizen by grant of Australian citizenship
- Ordinarily live in Australia and have done so for 12 months immediately prior to filing for divorce
If you meet one of these criteria, you can go ahead and prepare your application for divorce. If you aren’t comfortable filling it out yourself, you can also do so with help from a lawyer. If you choose to consult a lawyer, be sure to bring the following to your appointment:
- Marriage certificate
- Information about any children under the age of 18
- Any current or pervious orders associated with family law
Once you’ve completed the application you and/or your spouse must sign it so it can be filed with the appropriate court (along with any other applicable documents), and a hearing can be scheduled. If only one of you does so, it is considered an individual application, and if you both do so, it is considered a joint application. This is an important distinction, because it determines who must do what from now on.
For example, if you filed an individual application, you must serve a copy of the copy on your spouse. You must also file two documents related to the service with the court. The first of these is called an Affidavit of Service, and the second is the Acknowledgement of Service (when required).
Furthermore, if you file an individual application and you and your spouse have children age 17 or younger, you must attend the hearing. However, you need not do so in person, as long as you seek permission to participate by telephone. If need be, you can also attend at the relevant court registry. In this case, you must still serve the application on your spouse and file the paperwork specified in the previous paragraph.
Finally, even if you file an individual application, your spouse has the right to file a response seeking changes to the application if he or she disputes any of the details, or if he or she simply opposes the application. Another thing to keep in mind is that even if your spouse pursues this option, he or she is not required to attend the hearing.
At the hearing, you will be asked about the application, and if you have minor children, the judge will also ask questions to ensure that they will have a chance to spend time with you and your spouse. If all of these questions are answered to his or her satisfaction an order will be granted accordingly.
On the other hand, if you file a joint application, the ensuing process is much easier. This is because neither one of you will be required to attend the hearing, whether you have any minor children or not. This also eliminates the need to serve the application on your spouse or file related documents with the court.
In either case, the divorce order will take effect, or become “final,” one month and one day after the hearing. At this point, the court will send a copy to each of you, and you’ll no longer be legally married.
Conversely, failing to take any of these steps can result in denial of your application. If this happens, the court will usually give you time to correct any deficiencies prior to another hearing. If you need help correcting a mistake that resulted in the denial of your initial application or to lessen the chances that your divorce application will be rejected due to a technicality, contact our Gold Coast Lawyers today.
We know that family law disputes are often tumultuous with so many people, quite apart from the 2 spouses and children that are caught in the crossfire. One such group, is grandparents and they often ask, what about our rights in relation to the grandchildren? In this podcast, Gold Coast Lawyers at OMB Solicitors’ Gary Mallett answers the question.
Dan: Gary, do Grandparents have rights?
Gary: The short answer is YES, and equally the grandchildren have rights under the Family Law Act to communicate and spend time on a regular basis with any person concerned with their care, welfare or development, including grandparents and other relatives.
The law, therefore, recognises the rights of the children to continue to have a relationship with their grandparents after separation of their parents.
As a result, grandparents are given the specific ability to apply for a parenting order for their grandchildren under 65C of the Family Law Act.
The best interests of each child will be the most important consideration in any case about care arrangements for grandchildren. It is the needs of each child and their right to spend time with both parents and other significant adults such as grandparents that are considered.
All care arrangements for the grandchildren must also be practical and must keep them safe from family violence and child abuse.
A grandparent does not therefore automatically have the right to spend time with their grandchildren or have their grandchildren live with them, particularly if it is not in the best interests of the children for that to happen.
As a grandparent, you may find yourself concerned about the welfare of your grandchildren.
You may be concerned that your grandchildren are being exposed to domestic violence, or that they are being abused, in their household.
Alternatively, your grandchildren’s parents may have separated, and the parent with whom the children are living may be refusing to allow your grandchildren to spend time with you.
In a further scenario, you might find yourself caring for a grandchild, either on a short term or long term basis because neither of the parents of that child is able to do so, because for example:
1. One or both of child’s parents have drug, alcohol or mental health problems;
2. Both of the child’s parents are deceased;
3. The parents are in jail;
4. The parents are working or studying away from home; or
5. The child has been removed from the care of their parents by Department of Child Safety officers, and placed with you.
Dan: Why would a grandparent need a parenting order in a situation where they already have the care of a grandchild?
Gary: If you have a grandchild or grandchildren in your fulltime care, you may still need to have parenting orders made for you to have parental responsibility for your grandchild or grandchildren, and for an order that they live with you for the following reasons:
• to provide evidence of care for Centrelink purposes:
• to enroll a child at school or in kindy;
• to enable you to apply to the court for a recovery order if a child is taken from your care;
• to consent to medical treatment for a child.
• to apply for a passport for a child.
Dan: What can Grandparents do in situations where care arrangements for their grandchildren are in dispute?
Gary: The first step, if your grandchildren’s parents are still alive, is to attempt to reach an agreement with the parents about the grandchildren spending time with you, or for you to have parental responsibility for grandchildren and for the grandchildren live with you, whatever the case may be.
This agreement can be reached by engaging solicitors to act for you to attempt to negotiate an agreement with the children’s parents, or by attending a family dispute resolution conference with both parents through a mediation organised by your solicitors, or through a government or community funded centre such as a Family Relationships Centre, Relationships Australia or Centacare.
If the parents are already involved in contested litigation in a family court over the children, it may be necessary for you to apply to the court to become a party to those court proceedings.
If you have been able to reach an agreement with the parents of your grandchildren about your involvement in the children’s care arrangements, then that agreement can be formalised by incorporating it into a written parenting plan for the children.
However, a parenting plan is not enforceable by the Court.
A parenting plan, does not give a grandparent any enforceable right to be able to spend time with their grandchildren, or to have parental responsibility for them.
I always recommend that grandparents go one step further and consult a solicitor to draw up the parenting plan as consent orders, and file an application in the Family Court for consent orders to formalise the agreement in the parenting plan.
Consent orders can be enforced by the Court, and a grandparent will need these orders if there is any concern about one or both of the parents sticking to the agreement that you have reached with them about your grandchildren.
If you cannot reach an agreement with the parents of your grandchildren, or both parents are deceased, then you will need to apply to the court for a Parenting order for your grandchildren. You will need a solicitor for this application to give yourself the best prospects of success.
A parenting order can cover:
• Who is to have parental responsibility for the grandchildren;
• With whom the grandchildren children are to live;
• who the grandchildren spend time and communicate with and how often;
• What orders need to be made to safeguard the grandchildren from exposure to family violence and child abuse;
• schooling or childcare for the grandchildren;
• medical issues;
• religious or cultural practices;
• financial support for the children; and
• how those with parental responsibility will communicate with each other.
Family law is a unique and specialised field of law, and legal advice and assistance is always recommended.
In particlar, legal advice should be immediately sought in the following circumstances:
• If you or your grandchildren are at risk of harm;
• There is an existing parenting dispute over the grandchildren that is in Court, and you need to apply to become a party to the proceedings;
• You have a parenting plan that you wish to made into consent orders;
• You have been presented with Consent Orders and have been asked to sign them;
• You need to apply to the Court for a parenting order because you cannot reach agreement
with the parents of the grandchildren, or because those parents are deceased;
• Before you appear in court;
• If you have an existing court order and you want to make changes to the arrangements for your grandchildren;
• if you disagree about what’s in the best interests of the grandchildren;
• if you believe that you have been bullied, tricked, intimidated, coerced, threatened or forced into signing consent orders; or
• if you have a grandchild in your care and you wish to seek child support. Child support can be another complex part of family law, and it is important to get legal advice about child support issues before you apply.
When alternative dispute resolution processes do not resolve the property or parenting issues in dispute with your ex-partner (taking into account that these processes require the co-operation of your ex-partner) you will need the assistance of the Family Court or Federal Circuit Court process to resolve your matter.
Are there time limits?
Unless you bring proceedings in the Family Court of Federal Circuit Court for a property settlement or spouse maintenance within 1 year from the date of your divorce being finalised, you lose the right to bring such proceedings without leave of the Court (which is not readily given).
What Happens During the Court Process
The process in both the Family Court and the Federal Circuit Court of Australia follow the basic procedures below, with some minor variations, namely:
- An Initiating Application and an Affidavit by you in Support of the Application and a Financial Statement if a property matter, or a Notice of Risk if a parenting matter, is filed in the Court and served on the other party. A Court filing fee is payable;
- The other party must file and serve a Response, Affidavit and Financial Statement (or Notice of Risk) within fourteen (14) days of the first Court return date;
- The matter comes before the Court for the first time for a case assessment conference (Family Court) or for a “first return date” (Federal Circuit Court) and interim hearing if necessary (both Courts);
- The Court will make any orders by consent on the first return date, and will normally order that the parties attend a conciliation conference or a private mediation (for property matters) or that a Family Report be prepared and/or an Independent Children’s Lawyer (“ICL”) be appointed for the children (parenting matters);
- If the matter does not resolve at the conciliation conference or private mediation (property matters) or in line with the recommendations of the Family Report Writer and/or ICL (children’s matters), the matter is returned to Court for trial directions;
- The matter is prepared for a hearing, and a barrister is appointed to prepare for attend the hearing.
- The matter is heard by a Judge for a final decision.
- The Judge will hand down his or her decision, and this decision can only be appealed on certain grounds within twenty eight (28) days.
If there are any urgent matters which need to be determined by the Court prior to a final hearing, either party can bring an interim or urgent application in which case the matter will be dealt with depending on the urgency of the matter.
On the return date of an interim or urgent application, the Court will make a determination of the matter on an urgent basis and the matter is determined on the affidavit material filed and the submissions of both parties. Normally oral evidence is not given at such a hearing. Affidavits must not be more than ten (10) pages in length, and the number of exhibits which can be attached is limited.
During the Court proceedings, it is important to remember that:
- Your personal appearance is required on all Court dates, including mentions and callovers, unless excused by the Judge beforehand;
- You will need our assistance to prepared affidavit material (which may need to be settled by counsel) and this can be time consuming and costly;
- Barristers will be required to be engaged for all defended interim hearings and for the final hearing of the matter. Whilst solicitors will generally appear on mentions, callovers, and where consent orders are being made, solicitors are not generally experts in Court advocacy and will engage counsel to provide the best possible representation of you and presentation of your case at defended and final hearings, particularly where cross-examination is required.
- Every Court appearance carries with it an opportunity to resolve the matter or particular issues in dispute by consent with the other party, and therefore the most should be made of these opportunities.
- Judges in the family court arena have a very wide discretion when it comes to making property adjustment orders, and this wide discretion gives limited rights to appeal a seemingly unfavourable decision towards a party.