Family Law Library

Search our articles to learn your rights

Mathews Family Law have created many detailed articles answering the most common questions people have in relation to their rights and Australian Family Law.


Popular Articles

You’ve Tried Everything – Time for Family Court?

You’ve Tried Everything – Is it Time for Family Court?

While many married or de facto couples terminating their relationship try to work things out amicably, it can be tough.  Here’s this person you thought you’d spend the rest of your life with, and now you don’t even want to sit next to them at the same table.  But it’s almost always best to avoid court, at least in the beginning.  We recommend trying a number of alternatives, before going to Family Court:

Work it out on your own

Sit down and talk to each other.  This can save both of you time and money.   And being able to work things out at such a difficult time in your relationship bodes well for the future, demonstrating that despite the breakdown, you can work together for what’s best for everyone.

Family Dispute Resolution 

Many couples start with family dispute resolution.   Trained practitioners in the field of family disputes, with additional training in law, social work and psychology work with a separating couple to help them through the process.   This is generally used when children are involved.

Mediation 

Mediation is led by a trained, objective person whose role is to help each of you define the issues at hand, manage the discussion and come up with solutions.  The mediator is interested in resolving the problem in the best way possible for everyone involved.  The mediator does not judge or make a final decision but will help you come to your own resolution.

Collaborative Divorce 

Collaborative divorce is similar to mediation but each side also has a lawyer and often a social worker or counsellor and a financial advisor are involved.  Together all sides work together to help both of you come up with a solution that works for everyone.  Among the incentives to make this approach work: if negotiations fail, neither sides’ lawyer can represent them in court.

When is it time to throw in the towel and go to Family Court?

Sometimes though, Family Court may really be the right way to go.  Here are some factors to consider when making the choice whether to continue (or start) alternative approaches or go to Family Court.

Imbalance of Power

If your partner is abusive or domineering or makes more money or controls the finances in the family, this may put you in a much weaker position if you are trying to work it out by yourselves.  While some neutral third parties like a mediator have experience handling these types of people, you still might find yourself stuck and unable to move forward.

Your Partner has an Aggressive Lawyer

Even the most well-meaning of people can fall under the spell of a tough lawyer.   If they are working towards “getting even” rather than being fair, it’s probably time to go to Family Court and let a judge decide.

Your Partner does not Communicate

Each side has to be willing to talk about the issues at hand, express their needs and wants and listen to the other side.  You can’t really work out a problem with someone who refuses to show up to meetings or won’t express what they want  or won’t agree to anything,  If this describes your partner – repeatedly – it may be necessary to find a good lawyer and turn to the Family Court.

Vanessa Mathews and Kuppy Nambiar are accredited specialists Melbourne family lawyers Melbourne divorce lawyers who have the expertise and experience to provide you with the separation and divorce legal advice you are looking for.

Contact Mathews Family Law, Accredited Family Law Specialist, Level 2, 599 Malvern Road, Toorak, Victoria, phone 9804 7991, enquiries@mflaw.com.au

Mathews Family Law: http://www.mathewsfamilylaw.com.au

Family Court of Australia: http://www.familycourt.gov.au

Federal Circuit Court of Australia: http://federalcircuitcourt.gov.au

Using Credit Cards after Separation and Divorce

Using Credit Cards after Separation and Divorce

 There are a number of practical steps to take regarding your credit cards after you separate.

  1. Write down the date you actually separated. Even better, send an email to your spouse or partner stating clearly that “on May 1, 2014, we officially separated”. This date may become important later on when and if debts need to be divided.   If your spouse incurred the debt after the date of separation, the court may hold him responsible for it when dividing up property.
  2. If possible, get rid of joint credit cards. If you are the primary card holder – great!  You can lower the credit limit, which prevents your spouse from going crazy with the card and running up more debt.  The best option is to cancel the card all together, if the company allows it.  If your name is on the account, no matter who runs up the debt, you are also responsible.
  3. Make sure to print out all of your balances from your credit card account, including all purchases and payments. Even if you are held accountable, when the time comes to draw up a property settlement, you may be able to have these listed as your spouse’s debt and deducted from his share of the assets.
  4. Discuss with your lawyer signing a legal separation agreement. Written correctly, this may limit your liability for your spouses’ debts, including credit card debts.

 

Inheritances and Divorce Property Settlement?

Inheritance – What Happens to Them In Divorce Property Settlement’s

An article written for accountants and financial advisors by Vanessa Mathews of Mathews Family Law.

Your client has the good fortune to receive a ‘windfall’, such as an inheritance or a lotto Your client and their partner separate.

Will the windfall be included in the property settlement asset pool?

Your client will likely answer ‘No Way’!

From the court’s perspective, windfalls are not a special category of contributions and they must be:

  1. Included in the asset pool.
  2. Considered in the same manner as, and holistically with, all of the other contributions made during the relationship– financial, non-financial, homemaker and parenting.

The timing of the windfall will however be relevant as to how the windfall is ‘shared’:

  • A windfall received early in the relationship is likely to be treated equally.
  • A windfall received shortly before separation is less likely to be treated equally.
  • A windfall received after separation is even less likely to be treated equally.

The short answer is that the windfall is unlikely to be retained in full by your client.

I’ll leave it you to break the bad news to them.

Next Steps Before a Divorce Property Settlement

You and/or your client may benefit from discussing the circumstances of the inheritance or other windfall and divorce property settlement before taking any action such as distributing or disposing of the asset in a manner that may adversely impact against your client.

Vanessa Mathews and Kuppy Nambiar are family law specialists with the expertise and experience to advise you about your family law property settlement issues.

Please call Mathews Family Law on 03 9804 7991 or email enquiries@mflaw.com.au to speak with Vanessa Mathews or Kuppy Nambiar.

Resources

Mathews Family Law – Dividing the Property: http://mathewsfamilylaw.com.au/divorce/divorce-videos/dividing-the-property-in-victoria/

Family Court of Australia: http://www.familycourt.gov.au/wps/wcm/connect/fcoaweb/home

Federal Circuit Court of Australia: http://www.federalcircuitcourt.gov.au/wps/wcm/connect/fccweb/home

Bitcoins and Divorce Property Settlements

I recently had my first encounter with ‘Bitcoins’, a new and modern form of currency which, like savings, are included in the matrimonial asset pool.

‘Bitcoin’ is a form of digital currency.

‘Bitcoin’ can be used for payment of goods and services.

In this particular case, the value of the ‘bitcoins’ had significantly increased and was considered by the parties to have been an excellent investment. Much of the ‘bitcoin’ market is speculative, and the value of ‘bitcoins’ is therefore very much subject to fluctuation.

The ‘bitcoin’ investment was valued according to the current market value and included in the assets of the marriage to be divided between the parties.

Whether its ‘bitcoin’, an e-commerce business or an ‘app’ in the development phase, the team at Mathews Family Law, Australia Divorce, is able to provide you with expert legal advice about your property settlement entitlements.

‘Special Contributions’ and Divorce

Your client who is going through a matrimonial/de facto property settlement may say to you that their particular contribution to the accumulation of the asset pool was ‘special’, by which they mean that:

  • They made a greater contribution than their partner;
  • They should receive a greater share of the asset pool.

In this article we review the current law on ‘special contributions’ and how you might respond to your client’s claim.

The second step of the ‘4 Step Process’ for determining how the assets of the marriage ought to be divided between the parties includes consideration of the contributions of the parties.

Contributions may be:

  • Financial, to the acquisition, conservation or improvement to property
  • Non-financial, to the acquisition, conservation or improvement to property
  • Welfare and homemaking, to the relationship and the children of the relationship.

A party may claim that they made a ‘special’ direct financial contribution which warrants them receiving a greater share of the asset pool.

Examples of ‘special contributions’ include contributions made by:

  • An inheritance
  • A ‘good’ business person
  • An entrepreneur
  • A successful artist
  • A specialist surgeon.

The existence of a ‘Doctrine of Special Contribution’ was recently reviewed, and rejected, in the decision in Kane v Kane by the Full Court of the Family Court [2013].

The parties had been married for 30 years. The issue in dispute was the weight to be given to their respective contributions to their self-managed superannuation fund. The husband sought a greater share of the fund based on his ‘special contributions’, being ‘the application of his acumen to investment decisions which caused the fund to prosper’ (from $540,000 in 2008 to $1,850,000 in 2012). The husband, with the wife’s consent, purchased shares using matrimonial savings. The shares were registered separately in the name of the husband or the wife, with different rates of growth in their respective portfolios. The husband asserted that this separation evidenced the parties’ shared intention to benefit individually, and not collectively, from their respective portfolios only. The wife asserted that the husband had merely invested their savings and they should benefit equally in the overall growth. The husband took principal responsibility for the investments and the wife was content with this (not unusual) arrangement although in evidence she conceded that she was unenthusiastic about the husband’s wish to invest in a particular share purchase. The husband asserted that he carefully researched each investment before deciding to purchase and that the success of the investment was due to his judgment and not mere chance or a random lottery win.

The trial judge held that ‘the evidence in the present proceedings permits a rational conclusion that the acquisition of those shares was no fluke. The husband’s diligent research of that corporation and his decision to invest the parties’ funds in it was an inspired investment decision, manifesting considerable expertise. His decision is all the more remarkable given that he knew he was making that investment decision without the support of the wife. I am satisfied that, without the husband’s skill in selecting and pursuing the investment in Company 1 shares, the parties’ superannuation interests within R Investments would currently be worth substantially less. It follows that the husband’s contributions to those superannuation interests were substantially greater than those of the wife. I reject the wife’s submission that her contributions were equal to those of the husband. The real difficulty is evaluating the parties’ contributions in mathematical terms’.

The trial judge split the fund two-thirds to the husband, one-third to the wife.

On appeal by the wife to the Full Court of the Family Court, it was held that the trial judges’ disproportionate division of the Fund could not be justified.

On the claim of ‘special contribution’ by the husband, His Honour Deputy Chief Justice Faulkes stated:

  • The Family Law Act does not refer to ‘special’ or ‘extraordinary’ contributions
  • `Special skills … will not always produce significant financial results. An academic may be brilliant and possess exceptional or special skills which require much work and effort to apply, but which may nevertheless not reflect in the … property of the parties’
  • `A range of highly specialised practical skills may not produce an economic return equivalent to the return produced by the entrepreneurial skills or a newspaper magnate’
  • It is difficult to correlate effort or skill (even if special) with result. Frequently, the financial result of a contribution (whether by physical or intellectual labour or imagination foresight and perspicacity) will be influenced by external factors beyond the control of the party contributing’.

Family lawyers now have the benefit of a very clear message from the Full Court of the Family Court:

  • There is no such thing as a ‘Doctrine of Special Contribution’
  • The totality of the contributions to the asset pool must be considered
  • An asset pool ought not be divided merely on the basis of a ‘special contribution’ having been made by one of the parties
  • No one contribution to an asset pool should be given greater weight than other contribution.

The rejection of the existence of a ‘Doctrine of Special Contribution’ will be most keenly felt by parties with a high value asset pool which they believe is the result of their ‘special contribution’ over and above the other parties’ contributions.

Spousal Maintenance

…read more

Mediation and Family Dispute Resolution

…read more

Australia Divorce Overview

…read more

Property Division – The Basics

Whether you were party to a valid marriage or a de facto relationship, you are entitled to property division. While the courts maintain broad discretion with regard to property division, they strictly adhere to the following four-step process to determine who gets what.

  1. Identify/value the property – includes all assets and liabilities
  2. Consider contributions of the parties – includes financial and non-financial contributions
  3. Consider relevant factors – including but not limited to age, health, income, an standard of living of the parties
  4. Ensure order is just and equitable – the order must be fair

Generally, the courts will look to split the net asset pool of the parties equally, unless while applying steps one through four it is apparent that an unequal split of the assets would be just and equitable.

The goal of property division is to both to allow parties to finalise their economic relationship, and also to recognise contributions to property. However, while the goal is to allow the parties to reach economic independence, a valid property order may in fact be varied under certain circumstances.

Property Division – The Details

Property Division – The Details

The Family Law Act provides for property division for both formerly married couples, as well as de facto couples. There are two main goals when it comes to property division. First, this should be a step towards finalising the economic relationship between the parties. This “clean break” principal is supported by the requirement that courts make orders that will end the financial relationship of the parties as far as practicable. Second, this process recognises contributions to property, both financial and non-financial.

An action for property division must be brought timely. For instance, if you were formerly married you must bring any property proceedings within 12 months of when your divorce order became absolute. Alternatively, if you were in a de facto relationship, you must seek property division prior to two years after the end of the relationship

Broad Discretion

The court maintains broad discretion when it comes to making property orders. For instance, should the parties disagree as to the ownership of property, the court has the discretion to make a declaration regarding the property in question.

Even the language in the Family Law Act speaks to this notion that the court has an abundance of discretion; the exact language expresses that the court may make “such order as it considers appropriate.” This broad discretion is subject to seven restrictions/considerations the court must contemplate. These considerations listed below are enumerated in the Family Law Act.

  1. the direct and indirect financial contributions of the parties
  2. the non-financial contributions of the parties
  3. contributions to the welfare of the family, including contributions as homemaker or parent
  4. the effect of any order on the parties’ income earning capacity
  5. the list of considerations in s 75(2) and 90SF(3) of the Family Law Act
  6. any other order made under the Family Law Act affecting a party or child of the marriage or de facto relationship
  7. any child support payable, or likely to be paid in the future

Finally, the last bit of guidance that the Family Law Act offers to the court, is that the court shall not make an order unless the circumstances indicate that it is both just and equitable to make the order.

Because the Family Law Act fails to provide strict guidelines with regard to property division, and the courts are given such broad discretion, the courts have adopted a four-step process to apply to property orders. First, the court must identify and value the property, then consider contributions of the parties, then consider the factors listed above, and finally consider whether the order is just and equitable.

Step One: Identify and Value Property

The court must identify and value a rather encompassing pool of property, which includes real property, assets, liabilities, financial resources, property presently possessed and property expected, as well as property disposed of. The court must also identify and value business interests, licenses, permits and professional qualifications, inheritances, insurance policies, among many other types of property. As you can see, the type of property is pretty much anything – the list is rather extensive.

Both the nature of the property as well as the value must be determined as of the date of the decision, rather than the date of separation or divorce. When determining the value of the property, the court will begin by considering the fair market value of the property. Fair market value generally refers to the amount that a willing (not anxious) purchaser who is adequately informed would pay a willing (not anxious) seller of the property. In some instances where there is a dispute as to the value of property, and the court cannot make a determination of the value, the court may order the property be sold.

Once the property has been identified and value, a simple formula is used to determine the net asset pool of the parties. The total assets minus the total liabilities will result in the net asset pool used by the court.

Step Two: Contributions

The court will consider financial contributions, non-financial contributions, contributions to the care and welfare of the family, and contributions in the capacity of homemaker or parent. Financial contributions are any monetary contribution related to acquisition, conservation, and improvement of the property and refers to contributions made before the marriage, during the marriage, and after separation. On the other hand, an example of a non-financial contribution would be where one party performs maintenance or renovations of any family asset.

Often, especially when considering long relationships, the court will make a determination that the parties contributed equally. However, each situation is unique, and may not call for a determination of equal contribution. The court can make necessary adjustments to account for your unique circumstances.

One situation that is given special attention with regard to contribution is violence. If violence during the marriage or relationship had an adverse impact on a party’s contributions to the marriage, the judge will consider this when assessing the respective contributions of the parties.

Step Three: Additional Factors

This step helps the courts in addressing the future needs of the parties. The court will consider all relevant factors, including but not limited to:

  • the age and state of health of each party,
  • the income, property and financial resources of each party and their physical and mental capacity for achieving gainful employment,
  • responsibility for a child of the marriage who is less than18 years old,
  • commitments necessary for a party to support themselves or to support any other person that the party has a duty towards,
  • eligibility for a pension, allowance or benefit,
  • the standard of living which is reasonable in the circumstances,
  • whether the relationship has affected the earning capacity of a party and to what extent,
  • if either party is living with someone else, the financial circumstances arising from cohabitating with another person,
  • the terms of any Orders made in relation to the property of the parties and the terms of any binding financial agreement.

Step Four: “Just and Equitable” 

The last step in the property division scheme requires to court to ensure that the proposed order is both just and equitable. This step is intended to allow the court to take a step back from the proceedings, and a whole, determine if the order is appropriate. The order should only be finalised if it is fair for each party. What is fair for one couple may not be fair for another couple, and thus determining fairness is wholly dependent on the circumstances of each individual case.

Variations of Property Orders

Despite the objective of ending the economic ties between the parties, property orders may in fact be varied after they have been issued. Variations are only permissible under certain circumstances. The Family Law Act only allows for reconsideration of a property order where both parties have consented, or where one party makes an application and the court is satisfied that at least one of the following is applicable:

  • there has been a miscarriage of justice by reason of fraud, duress, suppression of evidence, etc.
  • circumstances have arisen since the order was made that has rendered it impracticable for all or part of the order to be carried out
  • a person has defaulted in carrying out an obligation imposed by the order, and as a result it is just and equitable to vary or set aside the order
  • circumstances have arisen since the order relating to a child or the marriage or relationship, and hardship will occur if the order is not set aside or varied
  • a proceeds of crime order concerning property of the marriage or relationship, or such an order has been made against a party to the marriage or relationship.

Should you be in a situation where you anticipate property division, the best thing for you and your former partner to do is to work through steps one through four before bringing property proceedings. This will often help you avoid having to go through litigation to arrange for your property division.