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Month: July 2021

Financial orders—Am I treated differently if I am married as opposed to being in a de facto relationship?

The making of financial orders, which include property settlements, spousal maintenance matters, and superannuation splits, is governed by the Family Law Act in Australia. 

If you were to ask, Am I treated differently under the Family Law Act if I am in a de facto relationship as opposed to being married?, the simple answer would be No. In some cases, however, different conditions could apply.

Since 2009, parties of a de facto relationship have been able to apply to the Family Court or Federal Circuit court to have financial matters determined in the same way as a married couple.

It is important to remember that an application for de facto financial orders should be made within two years of the breakdown of your relationship. In the case of a marriage, an application should be made within 12 months of divorce. After this time, you will need permission from the Court to apply.

It should be noted that de facto relationships in Western Australia are governed by the Family Court Act, as opposed to the Family Law Act; whilst the provisions are similar, please ensure you seek advice about which act applies to your circumstances if you have been, or are currently living in Western Australia.

What constitutes a de facto relationship?

A de facto relationship is one in which a couple lives together on a genuine domestic basis.

The first point to note is that you do not need to be living together for two years before you are considered to be living in a de facto relationship. 

However, the Family Law Act does not generally apply to de facto relationships unless the couple has been living together for at least two years OR there is at least one child of the relationship. 

The significance of this is that the Family Law Court has the power to make financial orders, and this includes property settlements, spousal maintenance matters and superannuation splits.

While there is no clearly defined meaning for de facto relationships, the following factors will be considered when assessing whether two people are in a de facto relationship:

  • Are they living together?
  • How long have they been living together?
  • Do they have a sexual relationship?
  • Do they share joint bank accounts?
  • Do they jointly own property?
  • Do they share weekly living costs like electricity or telephone bills?
  • Do their family and friends recognise them as a couple?
  • Do they have any children together?

A person can only ask a court to make an order about financial matters if the following requirements are fulfilled:

  • The two parties have been in a de facto relationship that has now ended.
  • The de facto relationship lasted at least two years.

OR

  • If the de facto relationship was shorter than two years then:

– The person who wants an order has made a substantial contribution.

– To not make an order would result in serious injustice to the person applying for an order.

OR

  • There is a child of the de facto relationship.

OR

  •  The de facto relationship is registered under a prescribed law of a State or Territory.

If you would like to know your rights as a party in a de facto relationship, please do not hesitate to contact us for advice and guidance.

Tackling the division of property due to a divorce or separation

The thought of divorce or separation is not without its battles, but deciding who gets what can be additionally complex and stressful.

Issues like co-parenting may be easier to discuss, and a simple mathematical formula would have eased the process of splitting assets, but since this is not a possibility right now, the need for lawyers and messy litigation is real.

Dividing assets in a divorce

The overarching principle in dividing assets under the Family Law Act is that the division of assets must be ‘just and equitable’. That sounds fair enough, but what does it mean?

Section 79(4) and 90SM of the Act sets out in broad terms the matters to be taken into account, in deciding a just and equitable splitting of financial assets. This means that each relationship is considered unique and there is no clear way of how that determination might be made. 

Therefore you should not assume that your assets will be split equally, although this should be considered a starting point, particularly in long-term marriages/relationships.

This is because there is a lot to consider when it comes to dividing assets, including starting assets, current and past incomes, health, and age. As a direct result of all this, your case will always be dealt with on an individual basis.

How are assets defined?

As part of the divorce process, you will have to define, declare and value all your current assets. All parties involved must provide a full and frank disclosure of all assets. The final asset pool includes all assets, liabilities, and superannuation interests from both parties.

The process of dividing assets in a divorce

Once the asset pool is compiled and all parties agree that everything has been declared, the contribution that each party, financial and non-financial, is measured.

Non Financial contribution includes parental contributions (if applicable), contributions as a homemaker, parent or home renovator. It can also involve any indirect contributions, such as those made by a family member of either party.

Once this is done, future financial circumstances are taken into account. Here, a range of factors is considered, including the age and health of each party, which party will take primary care of any children (if applicable), earning capacities, and any impact the relationship had on them (such as a career break for child care) and the length of the relationship.

Once all of these factors have been considered, a percentage or range would be assessed.

A court will then decide whether this percentage or division is ‘just and equitable’ under the Family Law Act.

When assessing each of these factors, the length of the relationship will be significant in assessing contributions; the shorter the relationship, the higher the focus will be on financial contributions and vice versa.

One thing is for certain, there is no saying how a court may ultimately split assets. 

If you require guidance on the best way to deal with splitting assets, speak to us at Conscious Separation; we will help you approach the division of assets in the best way possible.

Navigating the subsequent steps of a separation or divorce

Having survived the initial impact of a separation or divorce, it is important to look at unraveling some of the more tricky aspects of financial obligations and splitting of assets. The longer parties have been together and the more entangled their assets have become, the harder it is to come to a mutual agreement.

That said, there are several different ways to approach splitting of financial resources, including: 

  • Sitting down and working together to determine how to split assets
  • Engaging lawyers to ensure a just and equitable split
  • Using a mediation service to help both parties come to an agreement 

Out of these options, working together to come to a resolution is the most cost-effective and timely choice. Sadly, this is not always possible as both parties may still be emotionally charged or have different perspectives on what is fair and what they deem to be an equitable share of the assets.

It is also important to understand your rights when it comes to asset splitting. Engaging a lawyer in the proceedings is the most effective way to do this.

Finding a lawyer, however, is not always a breeze. Some lawyers may promise a high percentage of the assets to get you to sign up. The pursuit of getting the promised number might lead to a financially and emotionally draining legal battle that can stretch for years. So, you need to be aware of these strategies to avoid unnecessarily stressful legal battles.

This brings us to the third option: hiring a mediator. They view the separation and the preceding and subsequent proceedings from a holistic angle. It means they consider the entirety of your relationship, not just the painful end, preventing immature decision-making due to feelings of heartache, fear, resentment, and revenge. 

Engaging a mediator can help you understand your rights, reach a mutually agreeable financial settlement, and navigate the emotional turmoil of the situation.

If you and your partner can work with a mediator, it can save you a great deal of time, money, and energy while giving you the best opportunity to move on with peace of mind.

Conscious uncoupling is transforming how we approach divorce and separation

You may have heard the term conscious uncoupling, made famous by Gwyneth Paltrow when she announced her separation from her then-partner, Chris Martin, in 2014.

Gwyneth revealed how challenging it was for her after the announcement when, in her own words, “the public’s surprise gave way quickly to ire and derision. A strange combination of mockery and anger that I had never seen”.

The phrase conscious uncoupling was actually popularised by therapist Katherine Woodward Thomas, who wrote a book of the same name in 2015, but had been using the expression since her own separation with her partner.

The book provides a five-step process to find healing and break patterns to help you move forward after a divorce and separation with a sense of empowerment, ownership, and hope.

With the evolution of relationships, the concept of marriage and the expression ‘till death do us part’ no longer has the same meaning it used to. It is now more likely that a couple will separate than they will stay together. 

Fewer couples are getting married, and as our life expectancy continues to grow, the number of relationships that stand the test of time diminishes.

Yet, at the same time, the pain and devastation of a broken relationship still remain. With this pain come the seemingly inevitable emotions of anger and resentment.  

It has been said that hurt people tend to hurt people.

So how can you move through a divorce and separation and ensure that your hurt and pain don’t end up becoming the catalyst for further pain and hurt?

The answer to that is to embrace what Gwyneth described as a conscious uncoupling.  

What does this mean?  

In simple terms, it means doing the best you can to not be overwhelmed by your emotions. Instead, taking ownership and responsibility for your role in the relationship and your decision to part ways. Both the good and bad bits, which allows your spite to give way to empathy, understanding, and appreciation for what you have shared as a couple.  

This becomes the foundation upon which you can deal with the practicalities of your divorce and separation, and the difficult issues of working through changes in living arrangements, child custody, and the splitting of assets with a sense of generosity, respect, and integrity.

If you can bring a healthy dose of this to your separation and divorce, you have the possibility to part ways gracefully, which in turn supports your healing, helps maintain healthy relationships—this is particularly important where kids are involved—and move forward with a sense of empowerment and hope.

There is something practical and useful in being as conscious as you can be in even the most difficult circumstances. It is not easy to do, especially without the support of friends and professionals to remind you of the bigger picture and the benefits of avoiding a lengthy, emotional, and financially draining experience.

Here at Conscious Separation, our goal is to provide you with emotional and legal support and a safe environment to feel heard and understood. We help you reach the outcomes that support everybody as they move forward in the most empathetic way possible.

We often talk about how great it would be to exit a relationship with the same sense of love, care, and respect that existed when you first entered into the relationship.

If you would like to see if this is possible for you, but you recognise you may need support to stay on track, please feel free to contact us here at Conscious Separation.

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