My Ex Partner Took the Kids and Now They Want the Home as Well. Why Can’t I Get 50/50?
CONTRIBUTIONS: Which partner did more?
We often meet clients who have worked all their lives to maintain the family whether as the homemaker or as the salary earner.
Each partner has made a significant contribution to the emotional and financial well-being of the family.
Each partner has a right to believe that the Court should acknowledge that contribution. However, the final settlement that ends their financial relationship may seem unfair and hard to understand.
Separation is a highly emotional time and can bring out bitter exchanges and memories. The Family Law Act as well as the Family Courts have tried to work out a pathway that will take the emotions out and recognise the various contributions made by all parties.
HOW DOES THE FAMILY COURT WORK OUT CONTRIBUTIONS?
By way of background, the Court has traditionally used a 4-step process as a guide to determine Property Settlements.
i. Valuing the assets and liabilities;
ii. Assessing the Parties’ Contributions to the Assets;
iii. Future Needs and Other Considerations; and
iv. Just and Equitable Outcome.
Valuations
Property is quite broadly defined and encompasses the legal and equitable interests of the parties. You will have to provide evidence of whether assets and superannuation were acquired before or during the marriage or de facto relationship. Further information is required about your obligations such as for private school fees and extracurricular activities and any other liabilities you may have.
We then work out the property pool so that each party’s assets and liabilities are taken into account and a realistic valuation can be given to what property is at your disposal and what can be divided between you both.
Contributions: Financial and Non-Financial
Each couple is different: you may both have worked throughout the relationship or one of you may have stayed home to care for the children.
The Courts generally consider the homemaker/parent contribution to be equivalent to that of the party in full-time employment. By allowing one party to concentrate on employment opportunities, the homemaker/parent will be considered to have contributed to the overall income, assets and superannuation of both of you.
Non-financial contributions may be if one of you made improvements to the family home or an investment unit by painting it or upgrading the kitchen as this contribution would significantly improve the overall well-being and assets of the parties.
The Court will also consider any gifts from grandparents or other relatives as a contribution of the partner whose relatives have given them money, land or given them the springboard to establish a business.
“Future needs” and other considerations
After assessing the parties’ contributions, the Court considers whether there should be an adjustment to this assessment by taking into account factors outlined in the Family Law Act 1975 (Cth) often called the “future needs”.
If one party has given up career opportunities or whose skills are out of date after bringing up children, the Court will take that into account and consider whether retraining would assist in finding employment. The Court may make a percentage adjustment out of the property pool in favour of the partner who has to retrain to give him or her time and capacity to return to work.
Considerations about the age and maturity of the children which would have an impact on the capacity of the homemaker to retrain or return to work full-time would also be taken into account.
Just and equitable requirement
The Court then determines whether the alteration of property rights is just and equitable. This is just a legal way of saying that the settlement is fair to all parties in all the circumstances.
Once the Court works out the dollar amount each party is to receive which reflects the contributions and needs of the parties, the Court then has to work out how the property division will work. This means the dollars have to be matched against the property and assets that were initially valued. If you cannot maintain the home or do not have enough case to buy out the other party, you may have to sell the family home.
Alternatively if the wife, for example, wants to keep the family home to house the children until they grow up, that may mean she has a greater percentage of the property division which would not be considered “just and equitable”. She would then have to make a cash payment to the former husband to make up the difference. If she cannot raise the funds then the home may have to be sold and the proceeds of sale divided between the parties to each buy a new home.
It may not seem fair if you have to sell the family home but in the long run the Court has to see that the well-fare of the children is maintained and that each party has the opportunity to move on and the capacity and means to establish a new life.
By dividing the property in the way the Court determines, it gives the separating couple the best chance in the circumstances with the financial assets and liabilities at the end of the relationship to allow them to re-establish themselves.
The age of the parties may also have an impact as a young couple may not need superannuation as much as cash as they have opportunities to establish a career. An older party may need superannuation as he or she is approaching retirement and will not be in the workforce long enough to make up for lost earnings.
THE WAY AHEAD
Each case is different and is decided on the circumstances when you separate. Most of you have never been to Court and this can be very confusing and intimidating.
We try to settle as much as possible without going to Court. If Court is the only option, we prepare your case to minimise the conflict and get your life back on track.
Please do not hesitate to call us and we can discuss your particular case and advise the best way forward.
*Articles on our blog are for your information and do not constitute official legal advice