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Four Step Process

Family Law, Divorce Lawyer, Property Settlement, Child Custody, Defacto Law

STEP 1

In the first step of a family law property division, the Court identifies the net asset pool.  That is, the Court identifies and values all the property of the marriage, less the debts of the marriage.  All property, assets and debts are included in this marital asset pool which is available for distribution.  It does not matter whose name the asset or debt is in or how the asset or debt was acquired as part of the family law property settlement. 

STEP 2

After the Court has identified the net marital asset pool, the Court then assesses the contributions made by each of the parties pursuant to Section 79(4) of the Family Law Act.  Contributions may be any of the following:-

1. Direct financial contributions

This includes direct financial contributions to the acquisition of assets, and includes assets either party had at the commencement of the relationship; inheritances or gifts; compensation or other employment lump sum payments etc. 

2. Indirect financial contributions

An example of an indirect financial contribution is where one party’s income is used to buy the groceries each week to enable the other party’s wages to be applied directly towards the mortgage or to the acquisition of assets. 

3. Non-financial contributions

Non-financial contributions include contributions as a homemaker and parent or caregiver to the children.  The Court cannot place a dollar figure on such contributions, however it is fair to say that the Court sees the role of a homemaker and parent as being significant. 

STEP 3

Under the third step in family law property division, the Family Court considers whether, having taken contributions by the parties pursuant to Section 79(4) into consideration, an adjustment is needed to be made to take into account Section 75(2) of the Family Law Act.  Section 75(2) of the Family Law Act lists various factors which are to be taken into account when determining the division of the property of the marriage.  A copy of Section 75(2) is enclosed. The list of factors include the following:-

• The age and state of health of each of the parties;
• The income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment;
• Whether either party has the care of a child of the marriage who is under 18 years of age;
• The commitments of each of the parties necessary to enable them to support themselves, or a child or another person they have a duty to maintain;
• The responsibilities of either party to support any other person;
• Any entitlement of either party to Social Security benefits or entitlements under a superannuation fund;
• The extent to which one party has contributed to the income, earning capacity, property and financial resources of the other;
• The duration of the marriage and the extent to which it has affected the earning capacity of either party;
• Any child support payable by one party to the other and whether it is, in fact, being received;
• Any other fact or circumstance. 

STEP 4

The fourth step involves the Court determining how the property will actually be distributed and whether the distribution is just and equitable in all the circumstances.

Doolan Wagner & Callaghan are expert at providing family law advice on this four (4) step process and assisting parties achieve a family law property settlement.