Enduring separation can be one of the most challenging experiences in life, both emotionally and financially.
Understanding what you are entitled to during this period is crucial for ensuring a fair and equitable outcome. Whether you are parting ways from a marriage or a de facto relationship, being well-informed about your rights and the legal processes involved can provide much-needed clarity and peace of mind.
At O’Sullivan Legal, we specialise in guiding individuals through the complex landscape of separation matters in Sydney with compassion and expertise.
In this comprehensive guide, we will explore what you are entitled to in a separation, covering everything from property settlement to child custody and spousal maintenance.
Understanding Property Settlements
Property settlement is the process of dividing assets and liabilities between partners when they separate. This process applies to both married couples and de facto relationships. It involves a thorough assessment of all property, financial resources, and debts accrued during the relationship.
Pursuant to the provisions of the Family Law Act 1975, property settlement must be applied for married couples within 12 months from the date the divorce becomes final. De facto couples, on the other hand, have up to two years from the end of their relationship to make a property settlement claim.
The court adopts a structured four-step approach to determine a fair and equitable property settlement. This process ensures that all relevant factors are considered, and the final settlement is just for both parties.
Discover more about our property settlement services.
This four-step approach includes:
- Identifying and valuing assets and liabilities
- Considering financial & non-financial contributions
- Assessing future needs of both parties
- Ensuring a just and equitable settlement
Identifying and Valuing Property Interests
The first step in the property settlement process is to identify and value all the assets and liabilities of both parties.
This includes a comprehensive list of all property, whether owned individually or jointly, and all debts such as:
- Real estate
- Superannuation
- Investments
- Vehicles
- Bank Accounts
- Personal Property
- Businesses
- Mortgages
- Loans
- Debts
Assessing Financial & Non-Financial Contributions
The court considers both financial and non-financial contributions made by each party during the relationship. Financial contributions are relatively straightforward and include income, property, inheritances, gifts or investment returns. Non-financial contributions are equally important and can significantly impact the property settlement such as home making, child rearing, and property maintenance.
Considering Future Needs
When determining a fair property settlement, the court evaluates the future needs of both parties. This assessment ensures that the settlement supports both individuals’ long-term well-being and financial stability.
The key factors considered include:
- Age
- Health
- Income and Earning Capacity
- Care of Children
- Financial Resources
- Standard of Living
- Responsibilities
Based on the assessment of these factors, the court may make adjustments to the property settlement. These adjustments are designed to address any disparities in future needs and ensure a just and equitable distribution of assets.
For instance:
- A party with primary custody of the children might receive a larger share of the property pool to provide a stable home environment.
- If one party has significantly lower earning potential due to age or health issues, they might receive additional support or a larger share of the assets.
Ensuring a Fair Settlement
The goal for the court to achieve a settlement that considers both parties’ future needs and provides financial stability moving forward. This holistic approach ensures that the settlement is not only fair at the time of separation but also sustainable in the long term.
The court ensures the practicality of the proposed settlement, assessing whether it is feasible and sustainable for both parties. This includes:
- Division of Assets: Ensuring that the distribution of assets and liabilities is fair and manageable.
- Financial Support: Providing adequate financial support to the party with lower earning capacity or greater future needs.
- Living Arrangements: Facilitating stable living arrangements, particularly when children are involved.
Spousal Maintenance
Spousal maintenance is financial support provided by one partner to the other after separation. It is designed to help the lower-income spouse maintain a reasonable standard of living. This support can be crucial for individuals who may have sacrificed their careers or earning potential to contribute to the household or support their partner’s career.
Learn more about spousal maintenance.
Factors Influencing Spousal Maintenance
The court considers several factors when determining whether spousal maintenance is necessary and, if so, how much should be awarded.
These factors include:
- Financial Needs and Resources
- Earning Capacity
- Standard of Living
- Contributions
- Duration of the Relationship
- Responsibilities
Types of Spousal Maintenance
Spousal maintenance can be awarded in different forms, including:
- Periodic Payments: Regular payments made at set intervals (e.g., weekly, monthly).
- Lump Sum Payment: A one-time payment instead of ongoing periodic payments.
- Combination: A mix of periodic payments and a lump sum.
Superannuation and Property Settlement
Superannuation, or retirement savings, is considered part of the property pool and can be divided between parties during a separation.
Unlike other assets, superannuation is not immediately accessible as cash but is still a valuable resource that must be accounted for in the settlement.
- Splitting the Superannuation: This involves transferring a portion of one party’s superannuation to the other party’s superannuation account. This split does not provide immediate cash but ensures that both parties have retirement savings.
- Offsetting Superannuation: Instead of splitting superannuation, one party might retain their superannuation in exchange for other assets of equivalent value. For example, one party might keep the family home while the other retains their superannuation.
Find out more about dividing superannuation.
Child Custody and Support
Making decisions regarding child custody is one of the most emotionally charged aspects of a separation. The primary consideration in custody decisions is the best interests of the child. The court aims to ensure that children maintain a meaningful relationship with both parents, provided it is safe and in their best interest.
Under Australian law, both parents are encouraged to share parental responsibility. This means that both parents should be involved in making major decisions about the child’s welfare, education, and health. Equal shared parental responsibility does not necessarily mean equal time with each parent, but rather joint decision-making.
Both parents are responsible for financially supporting their children, regardless of custody arrangements. Child support payments are calculated based on a formula that considers both parents’ incomes, the amount of time the child spends with each parent, and the number of children.
Learn more about child’s best interest principle.
Advocating for Your Full Entitlements
Going through separation can be a daunting and complex process but understanding your entitlements and the legal framework can help you take charge of the narrative.
At O’Sullivan Legal, we are committed to helping you through every step of this journey with compassion and expertise.
Our goal is to ensure that you achieve a fair and equitable outcome that supports your future wellbeing and that of your family. We’re here to provide the personalised support and advocacy you need to move forward with confidence.
If you have any questions or need assistance with your separation, please don’t hesitate to get in touch.
We are here to help you secure the best possible outcome during this important time in your life.