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Property Orders
The courts approach to the division of property
In all family law property matters, a “four step” approach is applied, which includes the following:
Step 1: Identify and value the assets and liabilities
Property eligible for consideration in settlement proceedings includes all of the property of both parties. This includes property held in joint and separate names, and property under the control, or for the benefit of, of one or both parties. This also includes the parties’ liabilities.
All the assets and liabilities together are often referred to as “the property pool” or the “total asset pool”. Everything in the pool is assigned a dollar value (with liabilities a negative value). The net value of the property pool is calculated by adding and subtracting the values of assets and liabilities.
Step 2: Assessing the parties contributions
After the assets and liabilities in the property pool have been identified and valued, each party’s contributions to the relationship, both financial and non-financial are assessed. A preliminary division of the property pool is then made, on either an asset-by-asset or a percentage basis.
It is important to note that the relevant period is the time between the commencement of cohabitation and the hearing date.
The factors the court is required to take into account to determine the contribution of the parties are set out at section 79(4) of the Family Law Act 1975 (Cth) and for parties who are married, and section 90SM(4) Family Law Act 1975 (Cth) for de facto relationships.
The major sets of considerations include the following:
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Financial contributions to the acquisition, conservation or improvement of property;
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Non-financial contributions to the acquisition of, conservation or improvement of property; and
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Contributions as homemaker and parent to the welfare of the family.
Additional contributions considerations include child support, the effect of the proposed orders on earning capacity, and future needs and resources of the parties.
Step 3: Future Factors
After the court has determined the financial and non-financial contributions of the parties, the court must then review future factors, to determine whether further adjustments should be made.
The factors listed at sections 75(2) of the Family Law Act 1975 (Cth) for married parties and section 90SF(3) for de facto relationships deal with the expected future needs and resources of the parties, which include:
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The parties’ age and health;
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Their income, property, financial resources and capacity for future gainful employment;
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The care of a child of the marriage or de facto relationship;
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The parties’ commitments to supporting themselves, or anyone they have a duty or responsibility to support;
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Pension or superannuation entitlements;
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A standard of living that is reasonable in the circumstances;
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The duration of the relationship and its effect on earning capacity;
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Financial circumstances relating to a party’s cohabitation with another person;
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Child support payable for a child of the marriage or de facto relationship;
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Any other circumstances that the court considers it just to take into account;
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The terms of any binding financial agreement; and
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Other relationships of the parties.
Section 4: Just and Equitable
Section 79(2) and section 90SM(3) of the Family Law Act 1975 (Cth) states that the court shall not make an order unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
Before a proceeding starts
In compliance with pre-action procedures, there is a requirement that each prospective party to the proceeding take genuine steps to resolve the dispute before proceedings are instituted, unless an exemption applies.
A Genuine Steps Certificate must be filed with any Initiating Application (Family Law) or Response to Initiating Application seeking financial orders.
Limitation period
Unless the Court grants leave or both parties consent, financial proceedings (other than applications seeking declarations of existing property interests, or seeking to vary, set aside or revive existing property settlement or maintenance orders) may only be commenced:
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within 12 months of a divorce order taking effect or decree of nullity in relation to a marriage, or
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within two years of the breakdown of a de facto relationship: see section 44 of the Family Law Act.
In the event that property proceedings are filed out of time, leave must be sought by the applicant in the application as an interlocutory order, together with an affidavit stating the facts relied on in support of the application for leave.
Making an application and documents to file
A financial proceeding is commenced by filing an Initiating Application (Family Law), unless the proceeding involves an application for consent orders only (which requires an Application for Consent Orders).
The following documents must be filed with an Initiating Application (Family Law) in financial proceedings:
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a Genuine Steps Certificate, confirming the applicant’s compliance with the pre-action procedures listed in Schedule 1 of the Family Law Rules;
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a Financial Statement;
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a Financial Questionnaire;
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a copy of any family violence order affecting the party in accordance with rule 2.10 of the Family Law Rules;
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an Undertaking as to Disclosure in accordance with rule 6.02 of the Family Law Rules;
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if the applicant is aware that the Financial Statement will not fully discharge the duty to make full and frank disclosure, an affidavit providing further particulars: see rule 6.06(6) of the Family Law Rules;
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if the application seeks interlocutory orders, an affidavit stating the facts relied on in support of the interlocutory orders sought;
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if the application seeks a search order, an affidavit which includes the required evidence as set out in rule 5.19(3) of the Family Law Rules; and
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if the application seeks a freezing order, an affidavit which includes the required evidence as set out in rule 5.23(3) of the Family Law Rules.
When an affidavit is required
Applications for interim orders must be filed with an affidavit from the applicant in accordance with the formal requirements. Further, unless permission is granted by a judge, an affidavit in support of an application for interim orders must not exceed 10 pages in length, or contain more than five annexures.
If material in an affidavit exceeds these limits, the judge has discretion to not read the affidavit into evidence or ask the party to select only 10 pages to rely on, and costs consequences may follow. An affidavit is not required to be filed with an Initiating Application (Family Law) seeking final orders only.
Urgent applications
If an application is urgent, the applicant must seek an order that the proceedings be given an urgent listing. An urgent application must be accompanied by:
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an affidavit stating the facts relied on in support of the urgent application; and
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a cover letter as to urgency, outlining the nature of the application and the basis upon which an urgent listing is required. The cover letter should refer to specific paragraphs of the affidavit relied upon in support of the urgent application.
If no application for final orders has been made, the urgent application should be included in the interlocutory orders sought in the Initiating Application (Family Law). If an application for final orders has already been made, an urgent application should be made by filing an Application in a Proceeding.
Notifying the other party/parties
The applicant must serve the following documents on all other parties in accordance with Part 2.6 or Part 2.7 (as appropriate) of the Family Law Rules:
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Initiating Application (Family Law);
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any affidavit;
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Financial Statement;
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Financial Questionnaire;
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Genuine Steps Certificate; and
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the Marriage, Families and Separation brochure.
What the court will do next
Upon filing the Initiating Application (Family Law) and supporting documents, the Court will fix a date as soon as practicable for the first Court event.
Any application made by a party for an urgent listing will be determined by a Judicial Registrar on the papers.
If an Initiating Application (Family Law) or Response to Initiating Application is filed without a Genuine Steps Certificate, or before pre-action procedures have been complied with, and no exemption is applicable, the Court may stay the application until such time as the parties comply with the pre-action procedures: see rule 4.04 of the Family Law Rules.
Responding to an application
A respondent must file a Response to Initiating Application if consenting to or opposing any of the orders sought by the applicant, or if seeking any other orders in accordance with Part 2.4 of the Family Law Rules.
However, if a respondent does not wish to contest any of the orders sought by the applicant and will submit to any order the court may make, a Submitting Notice should be filed in accordance with rule 2.22 of the Family Law Rules.
The following documents must be filed with a Response to Initiating Application:
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a Genuine Steps Certificate, confirming the respondent’s compliance with the pre-action procedures listed in Schedule 1 of the Family Law Rules;
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a Financial Statement (unless the respondent is objecting to jurisdiction: see rule 2.19 of the Family Law Rules);
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a Financial Questionnaire;
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an Undertaking as to Disclosure in accordance with rule 6.02 of the Family Law Rules;
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if the respondent opposes any of the interlocutory orders sought by the applicant or seeks interlocutory orders in their Response to Initiating Application, an affidavit;
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if the Response to Initiating Application seeks a search order, an affidavit which includes the required evidence as set out in rule 5.19(3) of the Family Law Rules; and
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if the Response to Initiating Application seeks a freezing order, an affidavit which includes the required evidence as set out in rule 5.23(3) of the Family Law Rules.
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A Response to Initiating Application must be filed and served within 28 days of service of the application to which it relates.
Responding to an application
Where a respondent seeks orders relating to parenting proceedings or another type of proceedings for the first time in the Response to Initiating Application and the applicant seeks to oppose those orders or seek different orders, the applicant must file a Reply with respect to those orders.
Superannuation
Where a party applies for a flagging or splitting order which is expressed to bind the trustee of an eligible superannuation plan, or applies to set aside such an order under Part VIIIB, the party must serve a copy of the application or response on the trustee of the eligible superannuation plan pursuant to rule 1.12(5) of the Family Law Rules.
Where such a flagging or splitting order binding a superannuation trustee is sought and the proceeding has been listed for final hearing, the applicant must notify the trustee of the eligible superannuation plan in writing of the terms of the order sought at the final hearing no less than 28 days prior to the final hearing pursuant to rule 1.12(6) of the Family Law Rules.
