Property settlement is usually necessary when there is relationship or marriage breakdown. This is to ensure each party’s contributions and future needs are considered.
Property settlement involves a detailed assessment of each party’s financial position, and whether their financial position needs adjusting.
Before making any adjustments, consideration is given to the length of the relationship and the size of the parties’ combined financial positions.
Then an assessment is undertaken as to who brought to, or did what during the relationship in terms of contributions. These contributions are not just financial, but also non-financial, such as contributions as homemaker and parent.
Each of the parties future needs is also compared when working out what is a just and equitable property settlement.
If an agreement regarding property settlement can be reached between the parties, it is usual and highly recommended that it be formed in a legally binding manner. This will ensure that there are no further claims between the parties (save for exceptional circumstances).
There are two ways to make a legally binding property settlement.
One of these ways is by a Consent Order. This involves lodging certain documents with the Court for approval of the terms of the agreement.
The other way is by a Binding Financial Agreement. This involves a lawyer for each of the parties signing a certificate stating that their client has received independent legal advice about the agreement.