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Property Division – Document your Property Settlement or Risk Future Claims

12/07/2021

Watson & Watson Lawyers has successfully settled a property division case on behalf of the husband.  At the time he sought advice the husband’s position did not appear to be strong.  The Wife’s case appeared to be strong and if the wife had been successful the husband would have received very little on the division of property.

The difficulty for the husband was that he and the wife had separated before he sought legal advice from Watson & Watson Lawyers.  The husband and his wife agreed on the division of moneys (and divided the assets) and went their separate ways – or so the husband believed. 

Divorce – Time Limitations

The husband and wife separated but did not divorce. The Family Law Act 1975 imposes time limitations for the commencement of property/financial proceedings.  Any application for Orders in relation to property division and spousal maintenance must be commenced within 12 months of the date upon which a Divorce Order was made (becomes absolute).  The limitation period does not commence at the time of separation and does not commence when the husband and wife divide their assets.

The husband believed that there would not be any application for the division of property. This was not correct

The Background Facts 

The husband and wife were married for over 10 years and there were 2 children of the marriage.  At the time of separation, the parties were both owners of the family home which was in joint names.  They agreed to sell their home and agreed on how the sale proceeds would be distributed between them.  They each agreed that they would retain their own superannuation and be responsible for payment of any debt in their individual names

The husband believed that at the time of separation he had achieved a property settlement and that no claim could be made against him. 

The husband some time later received a letter from lawyers acting for the wife indicating that she now wanted much more than she agreed and had already received. 

The husband sought advice from Watson & Watson Lawyers who advised him that the wife was within the time to commence proceedings and that the distribution of moneys between them which took place at separation, was not effective in preventing the wife from pursuing her claim in the Family Court or Federal Circuit Court.  The agreement reached was only verbal and had not been documented.  The verbal agreement was not binding.  The verbal agreement reached between the husband and wife should have been documented by way of Consent Orders approved by the Family Court of Australia or Federal Circuit Court or by way of a Binding Financial Agreement.  This was the advice provided by Watson & Watson Lawyers to the husband.

Wife Makes New Claims – Seeks Orders that Loans be Repaid

In addition to seeking Orders that the husband pay her significant amounts of money and share his superannuation, the wife also asserted that during the marriage her parents through a family trust had made loans to her which needed to be repaid.  The husband was not aware of these loans having been made during the marriage and took issue with the claim for repayment of moneys to the wife’s parents said to be loan moneys.

Resolving the Case Wife’s apparently strong case falls apart

Watson & Watson Lawyers sought particulars of the loans made to the wife by her parents through a family trust from the wife’s lawyers.

The response did not appear to be credible.  Watson & Watson Lawyer issued a subpoena to the Family Trust, the accountants and to a number of Banks.

An analysis of the financial information by Watson & Watson Lawyers showed that payments made by the Family Trust to the wife did not support the assertion that the moneys were advanced by way of a loan. The wife could not prove that there were loans that had to be repaid.  What appeared initially to be a strong case failed once the evidence obtained by Watson & Watson was examined and tested.  The husband’s case was improved very significantly and his capacity to reach a settlement more favourable to him was increased.

Conciliation Conference and documented final settlement

The matter was listed for Conciliation Conference before a Registrar of the Family Court of Australia.  The Husband had prepared his case for a Conciliation Conference and Watson & Watson Lawyers represented the husband at the Conciliation Conference.  Documents were provided in the Conference which indicated that the wife’s claim that there were loans that need to be repaid could not be substantiated.  The failure of the wife’s case allowed for settlement of the matter at the conclusion of the Conciliation Conference.  The Balance Sheet did not include any of the substantial loan repayments that the wife had asserted was required to be paid.  Accordingly the matter proceeded on the basis that the alleged loans were not required to be repaid and the available assets could be divided between the husband and the wife.  The matter was settled on the basis of a division of the assets.

Watson & Watson prepared Consent Orders which were approved by the Court.  Also Watson & Watson prepared a Binding Financial Agreement, the effect of which was to prevent any future claims being made against the husband by the wife for additional financial support.  Our assistance in the matter enabled the husband to achieve a successful outcome.

At Watson & Watson Lawyers our highly experienced Solicitors can assist you in relation to financial/property settlement matters and related family law matters.  While verbal agreement may be amicably reached with your husband/wife or partner in relation to financial/property settlement, it is not legally binding and our recommendation is that you seek appropriate advice to ensure that you are protected.  Please contact Richard Watson Senior Family Law Solicitor or Shereen Da Gloria his Personal Assistant to discuss your matter and seek timely advice.

This is only a preliminary view and is not to be taken as legal advice without first contacting Watson & Watson Solicitors on 9221 6011.

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