When a couple separates, they will have to decide how their property will be divided between them (and how to split up the debts). Deciding who should get what can be quite challenging even during the most amicable of separations, but there are some simple details which can make the process easier to understand.
For family law purposes, property means virtually anything – whether it's an asset or a liability (debt of some kind). Property does not just include real estate (homes, farms, apartments, office blocks, vacant land). It may also include personal items (furniture, kitchenware, white goods); money (cash, bank accounts); debts owed to you or by you (to the bank as mortgages or personal loans, credit cards, loans from, or to, friends or business associates); investments (shares, interest in a business or company, timeshares); and a family business; to name just a few. Interestingly, while people often feel that pets are like children, to a court they are generally treated as property.
Whatever you can think of, it's almost certainly 'property' in the family law sense. And that means ALL of the property – whether it's in your name, your partner's name, joint names, or a company name. Essentially, "What's yours is ours, what's mine is ours and what's ours is ours."
Sometimes, especially in a short relationship, dividing up the property can be pretty easy as there is not much to split between you. It can get quite complicated where a lot of property has been accumulated over the years or where there are complex financial arrangements and structures.
There are three key questions to consider when deciding who is entitled to what property:
- What are the assets and liabilities, and what is their value?
- Who made what contribution to those assets and liabilities (before, during or after the relationship?
- Are there any factors that would support an adjustment of the allocation of property in favour of one person or the other?
Whether easy or complicated, always remember that the arrangements you make with your ex-partner will not be legally binding unless registered in the courts as consent orders or prepared, according to the law, as a Financial Agreement. You can settle your property distribution by mutual agreement or you can go to court to ask for a decision from a judge.
The contents of this blog post are considered accurate as at the date of publication. However the applicable laws may be subject to change, thereby affecting the accuracy of the article. The information contained in this blog post is of a general nature only and is not specific to anyone’s personal circumstances. Please seek legal advice before acting on any of the information contained in this post.