Making Your Financial Settlement Legal
A ‘Property settlement’ or ‘Financial settlement’ refers to the division of yours and your former partner’s shared property. This can include (but sometimes isn’t limited to) the division of assets, liabilities, and superannuation, and can be worked out in several ways.
Direct negotiation (‘kitchen-table negotiation’ or through email) – you and your former partner can determine between the both of you who should get what, without the involvement of third parties.
Mediation – this is when you aren’t sure how to go about dividing your property and financials, and this may even be a source of conflict between you and your former partner. An independent expert third-party assists by providing the framework for a balanced and constructive discussion on dividing your shared property.
Lawyers are engaged – this is when a breakdown in communication with your former partner (possibly resulting in outright conflict over the terms of a settlement) may necessitate the involvement of settlement lawyers to determine the entitlements of each party.
Court – though not always the case, an escalation in conflict over the terms of a settlement may mean taking the disagreement to the Family Court for a definitive decision.
Once you have reached a financial or property settlement, there are 3 ways to make your settlement legally binding
A Binding Financial Agreement – this can be prepared by a family lawyer, and can be used where a couple is seeking to divide their finances in a way that is outside what a Family Court would consider appropriate in the circumstances of that case.
Binding Financial Agreements are a helpful tool in many settlements, however you and your former partner must both have received independent legal advice on the terms of the agreement for it to be binding.
Once a couple agrees the terms of their settlement, a Consent Order is drafted and delivered to the Family Court for the court to consider ‘sealing’ or making the order. For Consent Orders to be endorsed, the court must be satisfied that a property settlement is ‘just and equitable’
A Court Order, this is made by a judge at the end of a court hearing or trial. If you are seeking the court to make an order you will have limited control over the terms of that order. This is a very expensive and a very lengthy process, with only a small percentage of couples finding their way to the end of the court process.
There are considerable advantages in making your financial settlement binding:
Stamp Duty and Capital Gains Tax relief from the transfer of real estate
Protection from future claims
Financial independence from the other party
Legally binding and enforceable
And Peace of Mind
Simple Separation is a complete Mediation and Legal information service that assist couples to legally finalise their separation from start to finish online. All legal services are provided by our preferred panel of the best independent Family Lawyers, Estate Planning Lawyers and Conveyancers who share the same philosophy - to separate simply, fairly and respectfully.