Property settlement is an important part of the necessary process following breakup. Married couples must reach settlement within 1 year of divorce, while de facto couples have until 2 years from separation.
Settlement can be accomplished in several ways: a Binding Financial Agreement, Consent Orders, or orders determined then issued by the Family Court. Noted elsewhere in these articles is the 4-step process that the Family Court will follow if the process is left to them.
No matter what option is used to determine a settlement, it is firstly necessary to fully establish the asset pool that is being apportioned.
It is a requirement under the law for both parties to provide a complete inventory of all assets, from superannuation, property, finances, cars and jewellery, through to cash.
It doesn’t matter whether assets were purchased prior to or during the relationship, or whether the asset is in joint names or in an individual name.
However, for whatever reason, perhaps out of ignorance of those requirements, or perhaps through a desire to hide assets so that the ‘ex’ doesn’t get their hands on them, a party may choose to not declare some items.
As with many areas, a good first step is to communicate directly with the other party. Depending upon the circumstances, a verbal communication may work, although if there is any doubt it is far better to have requests and responses in writing. Individual circumstances will dictate.
If a personal request to gain full disclosure fails, the next option would be to seek the advice of a lawyer, particularly one well versed in family law matters. A more formal request from a law firm may achieve a better outcome.
Law firms who offer specialised family law advice are also able to arrange or conduct professional mediation. A specialist mediator will facilitate an impartial meeting between parties to try and tease out a solution wherein both parties fully disclose their assets.
It is important to realise that the Duty of Disclosure is not just a desirable nicety – it is a legal requirement that is defined in the Federal Circuit and Family Court of Australia Rules 2021. Likewise, the
Family Court also demands that parties investigate all avenues available for resolution prior to heading to court.
Hopefully, a Binding Financial Agreement (BFA) or Consent Orders will be the achieved outcome, although it is important to realise that even with these solutions each party is formally stating that they have made full and complete disclosure.
When all else fails
Should circumstances eventually require that the parties proceed to the Family Court, the court will demand that both have met with their Duty of Disclosure in revealing all assets. Failure to do so is a breach of a court direction, and may lead to penalties, or at worst a charge of Contempt of Court.
By its very nature, a financial settlement is intended to be a once and for all solution.
If it is established that a party has failed to fully disclose, it is quite possible that any settlement resolution will be set aside and matters revisited. Costs may well be awarded against the perpetrator.
The Duty of Disclosure is a legal requirement that begins at the outset of the settlement process and failure to comply can have serious consequences.
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