Categories
Articles Case Studies Property and Superannuation

A Curly Case for the Commissioner of Taxation

family law firm
 

A CURLY CASE FOR THE COMMISSIONER OF TAXATION

CAO & TRONG AND ANOR [2018] FAMILY COURT OF AUSTRALIA

There is no escaping the Family Court and the Commissioner …

The wife filed an application for a final property settlement, including an order that:

1. The husband indemnify her ‘against any liability present or contingent including tax … in respect of E Pty Ltd’; and
2. The husband be responsible ‘for all income tax assessed on income received or deemed to have been received by the husband’.

In the period 2005 -2012, the husband incurred a tax liability of $5,519,200 (unpaid).

The Commissioner of Taxation sought leave to intervene in the property settlement proceedings and an order that the court first makes provision for the payment of tax liabilities to the Commissioner prior to any property distribution to the parties.

Before the matter could be determined by the court, the parties effectively withdrew their respective applications for final property settlement orders.

The wife advised the Commissioner that there was therefore now no basis for it to intervene.

The Commissioner was successful in its application for an order that the court does have the jurisdiction and power to determine a claim against a creditor pursuant to section 79 property settlement proceedings – even if the parties have withdrawn their applications.

The case was run by the Commissioner of Taxation as a ‘test case’ and confirmed that even when the parties themselves no longer seek the assistance of the court to achieve a final property settlement, if the Commissioner has already intervened in those proceedings, the court has jurisdiction to make a final order in its favor – and the liabilities owed to it enforced as an order of the Family Court.

In other words – there’s no avoiding the Commissioner – no matter what agreement the parties themselves might ‘agree on, there’s no way around their obligations to it.

I hope that the year is treating you well – even though it is flying by.

We continue to offer a free 15-minute telephone consultation to your clients in need of family law advice – they can call me on 9804 7991 or email [email protected] to book a time.

And remember, we’re always happy to help you out with your own ‘curly cases’.

Stay in touch,

Vanessa and the Team at Mathews Family Law & Mediation Specialists

Categories
Best Interests & Parenting child arrangements Divorce Divorce & Parenting

‘Alienation? Myths, Complexities and Possibilities … ‘

family law

Dear Friends

Last weekend I attended the AFCC Australian Chapter conference in Adelaide.

The conference topic was ‘Alienation? Myths, complexities and possibilities …’.

The caliber of the papers was excellent.

I was particularly interested in the workshop offered by Dr. Philip Stahl, Psychologist, on domestic violence differentiation, personality disorders and unconscious bias.

Also of great interest was the current research on high conflict separations, alienation and children resisting contact with parents.

Early identification and intervention are the keys to avoiding the escalation of ‘mere conflict’ into alienation and the devastating impact on children (regardless of age).

We heard from our local well-known Psychologists Dr. Jenni Neoh and Ms. Lisa Bottomley in particular about their respective intervention programs for complex family matters.

We often work with families facing experiencing particular difficulty with their post-separation parenting – with young and old children. We will be recommending Jenni and Lisa’s very special approaches to these clients in the hope of achieving an early and effective resolution.

The AFCC website provides a wealth of excellent resources, including conference papers http://afccnet.org.au/ . You may like to consider becoming a member.

We continue to offer a free initial telephone consultation to your clients in need of family law advice – they simply need to call us on 1300 635 529 or email [email protected] to book a time for one of our family law specialists to speak with them.

And remember, we’re always happy to help you out with any questions you may have. Stay in touch,

Vanessa and the Team at Mathews Family Law & Mediation Specialists

Categories
Do I have to Attend FDR Mediation

Legal Capacity and Family Law

As the issue of mental health continues to gain more traction within the area of Family Law, at a practical level, and without holding the necessary expert qualifications required to properly identify and diagnose mental health conditions, at what point does a practitioner (legal or otherwise) determine if a client has the capacity to provide appropriate instructions?

Family Law

Justice Power in PY v RJS & Others outlines the general legal test for capacity as follows:

  • Generally, a person is not shown to be incapable of managing his or her own affairs unless it can be shown otherwise. That is, a person is presumed to have legal capacity unless the following characteristics can be observed:
  • That he or she appears incapable of dealing, in a reasonably competent fashion, with the ordinary routine affairs of man and
  • That, by reason of that lack of competence, there is shown to be a real risk that either:
    • He or she may be disadvantaged in the conduct of such affairs or
    • That such monies or property which he or she may possess may be dissipated or lost.
  • It is not sufficient, merely to demonstrate that the person lacks the high level of ability needed to deal with complicated transactions or that the person does not deal with even simple routine transactions in the most efficient manner. That is, the person must understand the purpose of the transactions that they are carrying out in everyday life.

The “Client Capacity Sub-Committee” of the New South Wales Law Society has developed guidelines to assist practitioners concerned about the competency of their clients to give proper instructions. By way of summary, practitioners should be wary of the following:

  • Are you as the practitioner able to obtain proper instructions from your client after you have provided a brief summary/explanation of likely issues to them?
  • If your client has a diagnosable illness, is it likely to be a temporary or permanent impairment? If it is temporary or medication based, think about different ways in which you might obtain instructions (i.e. taking frequent breaks in conference, drawing diagrams).
  • If the issues needing clarification are minor and short-term, can a friend or relative assist the client with providing instructions that are in the client’s best interests?
  • Will the client consent to a formal assessment of capacity by a specialist professional?
  • Should you as the practitioner cease to act? If at any time the practitioner has become the substitute decision-maker, he or she should make immediate arrangements to have a substitute instruction giver appointed.

Subject to any specialist evaluation of the client’s legal capacity, or should it be the case the matter is already in Court, it may be appropriate to appoint a “Case Guardian”. This process involves filing an Application with the Court pursuant to rule 6.08 of the Family Law Rules 2004 together with an Affidavit in support containing the relevant evidence (i.e. short report from the client’s treating specialist regarding the client’s mental health and likely duration of any diagnosable condition).

Categories
Best Interests & Parenting Best Interests & Parenting child arrangements Family Violence Family Violence Parenting Plans

Family Violence and Children at Risk

Every day in my practice as a specialist family lawyer, family dispute resolution practitioner and mediator, I hear stories of family violence and children at risk.

Whilst family violence is a tragedy in and of itself, more tragic is the suffering caused to the children who are exposed, in one way or another – by hearing, seeing, feeling – to incidents of domestic violence and/or the aftermath of family violence.

The following article in ‘The Age’ reports the findings of a new study by the Australian Institute Family Studies which confirms what we already know – that children who are exposed to family violence are at higher risk of suffering sexual, emotional and physical abuse.

The issue is ‘What can be done to prevent children from being exposed to family violence, thereby reducing the risk of future abuse for these very same children?’

The Australian Institute of Family Studies report, which will be released on Wednesday, also shows that children exposed to domestic violence from an early age are more likely to experience difficulties at school and have lifelong problems with social and cognitive development.

The report, Children’s exposure to domestic and family violence, draws on local and international research to examine the effects on children raised in abusive households.

It found young people who grew up around domestic violence were at higher risk of other forms of abuse, and that exposure to family violence was the leading cause of homelessness in young people.

“It affects their development in such a global fashion,” AIFS director Anne Hollonds said. “The problems are extensive and they go right across physical and mental wellbeing, cognitive development, which obviously affects academic achievement and employment.”

The study found child abuse often co-existed with domestic violence and that victims of persistent maltreatment in childhood suffered similar effects to trauma, which can lead to aggression, self-hatred and a lack of awareness of danger.

Ms Hollonds said the experience of children exposed to violence at home was not well understood and that a fragmented response meant the most vulnerable children were falling through the cracks.

“What we have is a fragmented patchwork of some services in some areas often operating in quite a siloed way,” she said.

“For example, domestic violence support for women might not always be focusing on the needs of the children. Similarly, adult services for mental health or drug and alcohol issues might not have a focus on the needs of dependent children.

“Unfortunately in some families the problems are multiple, it’s not just violence towards the other parent but there is also various kinds of abuse that the children directly experience. This multi-victimization of children requires our urgent attention.”

The Australian Human Rights Commission released a report on Monday that found up to five children in every classroom had experienced or witnessed family violence.

The National Children’s Commissioner, Megan Mitchell, said children were the “invisible victims” of the domestic violence scourge and that growing up in an abusive household could have a devastating lifelong impact on a person’s mental and physical health.

She said children exposed to family violence might also feel they needed to defend the parent, or be the one to call police or an ambulance.

Crime statistics show Victoria Police were called to 65,400 family incidents in 2013-14 and that children were present in more than one-third of cases.

According to the Australian Bureau of Statistics, more than half of victims abused by their partner had dependent children in their care at the time, with that figure rising to 61 per cent in cases of abuse at the hands of former partners.

Ms Hollonds said a multidisciplinary approach to domestic violence across health, child protection and family services sectors was needed to help the most disadvantaged families, who are often dealing with complex problems but face the most barriers accessing help.

“We have a late reaction policy culture and find it difficult to co-ordinate across portfolios,” she said. “The key is acting earlier because often we don’t find out about the problems people are having until they’ve escalated to a very serious stage, and by then children will have been affected.”

Read more:

The Age:  www.theage.com.au/national/kids-exposed-to-domestic-violence-more-likely-to-suffer-sexual-physical-abuse-20151208-gli3au.html#ixzz3tmyef5Ib

The Australian Institute of Family Studies:  aifs.gov.au/publications/evaluation-2012-family-violence-amendments

Lifeline for counselling and support: www.1800respect.org.au/

If you would believe you would benefit from legal advice about family violence and/or other relationship issues, please contact Vanessa Mathews, Accredited Family Law Specialist Australian family lawyers, Mathews Family Law & Mediation Specialists, Level 2, 599 Malvern Road, Toorak, Victoria, phone 1300 635 529, email [email protected]

Vanessa is an expert specialist Melbourne Divorce Lawyer with many years of experience in advising clients about family violence and family law issues, from parental rights and child support, to family disputes and family law property matters.

Vanessa’s clients have kindly been willing to express their satisfaction with her work by writing, and consenting to have published, their testimonials on Mathews Family Law & Mediation Specialists, Melbourne Divorce Lawyers, website:  mathewsfamilylaw.com.au/stories/

Further testimonials as to Vanessa’s work may be found at Google Reviews:  click here

Categories
Best Interests & Parenting Best Interests & Parenting child arrangements Children De Facto Relationships divorce Divorce Divorce & Parenting Parenting Plans

Re-partnering After Separation, Divorce

Second marriages, partnerships, step-families present challenges, new opportunities after legal separation, divorce

Re-partnering After Separation, Divorce

Relationships Australia has prepared this informative summary about the challenges and complications of re-partnering after Legal separation, or divorce.

In second partnerships, couples are often more aware of the difficulties in establishing a successful relationship and are more committed to making the marriage work.

Both second marriages and step-families have to overcome some difficult hurdles. These hurdles can present significant challenges to the couple in their relationship as partners and as parents.

Unfortunately, many second marriages and step-families, despite their commitment to making things work, fail to get over these hurdles.

This page outlines some of the challenges and complications of re-partnering and step-families.

The decision to re-marry or re-partner

Before you re-marry or re-partner, you should consider the following questions:

  • When?
  • Why?
  • To Whom?

Listen to any doubts. If necessary, wait a little longer

When?

The simple answer is after you have fully come to terms with the end of your previous relationship. This is particularly important if you did not want the first marriage to end, and had to deal with the pain of leaving or being left by your previous partner.  It takes longer than many people expect to get over the end of a long-term relationship, even if you were unhappy and felt that the end was inevitable.

Some studies suggest many people take at least two years to adjust to the end of a long-term relationship. There are many exceptions to this. Some people take longer, others adjust more rapidly. Ask yourself:

  • Do I find myself thinking about my ex-partner and do these thoughts still arouse strong feelings such as anger and resentment?
  • Have I adjusted to living alone again?
  • Have I regained a sense of self-confidence?
  • Can I look back on that relationship and recognise some of the things that contributed to its breakdown?

In other words, am I emotionally free to re-partner? Can I put all my emotional energy into this new relationship without allowing my feelings about my previous relationship to get in the way?

Just as you cannot re-marry until you are legally free to do so, being emotionally free to re-marry is also important.

Why?

Unfortunately, this question is often overlooked. Are you thinking of re-marrying or re-partnering because you want to be with someone whom you love or do you want to re-marry or re-partner for the sake of being in a relationship or to provide a two-parent home for your children? Being alone is not easy after being married or in a long-term relationship, especially if you have children living with you. However, moving too rapidly into a new relationship can create a new set of problems.

To whom?

Past experiences influence our choice of partners. This is especially true of a second marriage. Be realistic about what worked and what didn’t work in your first marriage when making a decision about a new partner. Learn from that experience to clarify what sort of partner you want.

Being in love is not enough to make a relationship work especially once the initial excitement has worn off.

The following organizations offer separation, and divorce counselling:

Family Relationships Centre:  http://www.familyrelationships.gov.au/searchpages/searchpage.aspx?KEYWORD=frc%20not%20pop&RESOURCETYPES=Service

Relationships Australia: http://www.relationships.org.au/what-we-do/services/counselling

CatholicCare: http://www.ccam.org.au/

Family Mediation Centrehttps://www.fmc.org.au/marriage-counselling.php?gclid=Cj0KEQiAqK-zBRC2zaXc8MOiwfIBEiQAXPHrXsvDPeRotm4nM6DHg4zIk5QIa_fiidlbpIzCf9gbUlYaAoXl8P8HAQ

Categories
Best Interests & Parenting Best Interests & Parenting child arrangements Divorce Divorce & Parenting Parenting Plans

Separation and Divorce at Christmas

The following informative article about coping  with separation and divorce at Christmas was published by Relationships Australia www.relationships.org.au

Resources

For some people, Christmas can be the most stressful time of the year. People can feel increased financial pressure from the costs of buying gifts, entertaining and holidays, and there can be increased strain from spending time with family members. For those people with complex family situations, such as separated families, Christmas time can present even greater challenges. Stress, anxiety and depression are common feelings over the holiday period.

There are some practical things you can do to prevent stress at Christmas

  • If someone close to you has recently died or you are unable to be with your family and friends, acknowledge your feelings. It’s normal to feel sadness and grief and you can’t force yourself to be happy just because it’s the holiday season.
  • If you feel lonely or isolated, seek out community, religious or other social events. They can offer support and companionship. Volunteering your time to help others also is a good way to lift your spirits and broaden your friendships.
  • Sometimes expectations around family gatherings may make you uncomfortable or stressed. As families change and grow, traditions and rituals often change as well. Choose a few to hold on to, and be open to creating new ones.
  • Try to accept family members and friends as they are. Set aside grievances until a more appropriate time for discussion and be understanding if others get upset when something goes awry. People under stress often ‘self-medicate’ with alcohol, cigarettes and other drugs. Try to remember that drugs can’t solve problems or alleviate stress in the long term.
  • Stick to a budget. Before you go gift and food shopping, decide how much money you can afford to spend and then stick to your budget. If you have a large circle of extended family or friends to buy gifts for you might be able to suggest a change in the way your family and friends give presents. For example:
    • Buy presents only for the children.
    • Have a Kris Kringle, where everyone draws a name out of a hat and buys a present only for that person.
    • Set a limit on the cost of presents for each person
  • Plan ahead. Set aside specific days for shopping, baking, visiting friends and other activities. If you plan your menus and activities you may avoid the stress associated with last-minute or forgotten tasks.
  • Learn to say no. Saying yes when you should say no can leave you feeling resentful and overwhelmed. Most friends and colleagues will understand if you can’t participate in every project or activity. If it’s not possible to say no when your boss asks you to work overtime, try to remove something else from your agenda to make up for the lost time.
  • Don’t abandon healthy habits. Overindulgence can add to your stress and guilt. Try these suggestions:
    • Have a healthy snack before holiday parties so that you don’t go overboard on sweets, cheese or drinks.
    • Get plenty of sleep and regular exercise.
  • Take time out for yourself. Spending just 15 minutes alone, without distractions, may refresh you enough to handle everything you need to do. Find something that reduces stress by clearing your mind, slowing your breathing and restoring inner calm. Some options may include:
    • Taking a walk at night and stargazing.
    • Listening to soothing music.
    • Getting a massage.
    • Reading a book.

Where to get help with separation and divorce at Christmas

If you need professional medical help, talk to your doctor or your local community health center

If you would like to talk to someone immediately, you can contact:

You can also access counselling and support services in your state and territory through the Relationships Australia website www.relationships.org.au or by calling 1300 364 277

If you feel anxious or depressed, information and resources are available at www.beyondblue.org.au

If you are a young person, or the parent or career of a young person with mental health problems, support is available at www.headspace.org.au

If you are caring for someone you may find useful information and resources at www.carersaustralia.com.au

If you, or someone you know is experiencing family violence you can contact 1800 RESPECT 24 hours a day 1800 737 732 or www.1800respect.org.au

If you need help with budgeting, you can find a financial counsellor in your local area by accessing

http://www.financialcounsellingaustralia.org.au/Corporate/Find-a-Counsellor

You can also talk to a phone financial counsellor from anywhere in Australia by ringing 1800 007 007 (minimum opening hours are 9.30 am – 4.30 pm Monday to Friday).

If you are having ongoing conflict or disagreements with your children, siblings, parents or extended family, you can seek the professional assistance of a counsellor or mediator, for example see:

There are many volunteering opportunities in Australia and the websites below can give you some ideas about the various ways you can broaden your social networks and contribute to your community:

http://govolunteer.com.au/

http://www.volunteeringaustralia.org/

If you live near others who are likely to feel isolated, lonely or vulnerable around Christmas, check in with them, and perhaps include them in your own festivities. For information and ideas about what other people do for their neighbors see the Neighbor day website, Australia’s annual celebration of community:

http://www.neighbourday.org/

Sources: http://www.mayoclinic.org/healthy-living/stress-management/in-depth/stress/art-20047544;

Categories
Mediation When To Get Advice

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 is an accredited family law specialist, and the Melbourne family lawyers at Mathews Family Law have the expertise and experience to provide you with the separation and divorce legal advice you are looking for. Speak with one of our specialist solicitors today about your family law property matter or family law parenting matter.

Contact Mathews Family Law & Mediation Specialists, Accredited Family Law Specialist, Level 2, 599 Malvern Road, Toorak, Victoria, phone 1300 635 529, [email protected]

Mathews Family Law: https://mathewsfamilylaw.com.au

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

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

Categories
Complex Divorce Divorce Separation

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 cardholder – 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 altogether 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. One of our divorce law lawyers can provide you with specialist advice.
Categories
child arrangements Parenting Proceedings

Special Medical Procedures, Gillick Competence and the Family Court

Where a ‘special medical procedure’ for a child is proposed, parental consent to the procedure will be insufficient and order of the Family Court will be required.

A special medical procedure is one that is invasive, irreversible, requires major surgery and where the consequences of the procedure give rise to a significant risk of making a wrong decision and a wrong decision carries with it grave consequences.

Special Medical Procedures, Gillick Competence and the Family Court

Examples of special medical procedures include:

  • Gender identity dysphoria (GID).
  • Surgical gender reassignment.
  • Heart surgery.

In June 2015 the Family Court was asked to determine whether a 16-year-old child, known as ‘Dale’, who was transitioning from female to male, was competent to consent to stage 2  of GID treatment (also known as ‘testosterone hormone treatment’).

Dale had already commenced stage 1 treatment (puberty suppression hormone treatment), for which a court order is not required.

As it was likely that stage 2 treatment would result in physical changes that would be difficult to reverse, stage 2 treatment is considered a ‘special medical procedure’ for which a court order is required.

Dale’s parents and his treating medical practitioners believed that Dale was, and should be, able to make his own decision about stage 2 treatment, without a court order being required.

His parents therefore sought a declaration that he be found to be ‘Gillick competent’ and therefore able to make his own decisions in relation to treatment.

In the English case of Gillick, it was held that … parental right yields to the child’s right to make his/her own decisions when he/she reaches a sufficient understanding and intelligence to be capable of making up his/her own mind …’

Gillick has been approved and applied by the Family Court of Australia since 1992 (Marion’s Case).

If a child is found to be Gillick competent:

  • The child may consent to the special medical procedure.
  • The consent of the child’s parents is not required.
  • A court order is not required.

So how does the court determine if a child is Gillick competent?

The court must have regarding the child’s best interests as the paramount consideration.

The child’s ‘best interests will be determined by a consideration of:

  • The age and maturity of the child
  • The views/wishes of the child
  • The urgency of the application

The court will consider the evidence as to the child’s best interests from:

  • The child’s parents.
  • Expert witnesses such as medical specialists, mental health professionals, counselors, etc.

Having regard to all of the evidence, and making a positive finding as to Dale’s ‘ … intellectual capacity and sophistication to understand the information relevant to making the decision and to appreciate the potential consequences, some of which may be irreversible … his views are clear and have not changed … ’, the court determined that Dale was Gillick competent and therefore competent to consent to the stage 2 treatment.

The special medical procedures jurisdiction of the Family Court is intended to protect against wrong decisions by parents that may result in irreversible wrong outcomes for children. The court has demonstrated a willingness to apply the provisions of the Family Law Act to these particularly difficult family circumstances with sensitivity, empathy and compassion.

Vanessa Mathews, accredited family law specialist at Mathews Family Law & Mediation Specialists, can assist with your questions about special medical procedures.

Categories
4 Step Property Settlement Process Property Settlements

Inheritances and Divorce Property Settlement?

family law property settlement

Inheritance – What Happens to Them In Divorce Property Settlement

An article was written for accountants and financial advisors by Vanessa Mathews of Mathews Family Law & Mediation Specialists.

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 to 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 your client.

Vanessa Mathews is a family law specialist solicitor with the expertise and experience to advise you about your family law property settlement issues.

Please call Mathews Family Law & Mediation Specialists on 03 9804 7991 or email [email protected] to speak with Vanessa Mathews regarding any family law property matters.

Resources

Mathews Family Law – Dividing the Property: https://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