Relationship breakdowns & Property Settlements
It’s no dark secret that marriage / relationship breakdowns are commonplace in our community.
Here are some interesting Australian statistics: (based on 2019 figures):-
– The average marriage lasts for 12.2 years.
– Marriages between 5 and 9 years have the highest rate of breakdown.
– The average age for a man to divorce is 45.6 years.
– The average age for woman to divorce is 42.8 years.
– 33% of first marriages end in divorce.
– 60% of second marriages end in divorce.
So why all the depressing statistics?
Unfortunately marriage /relationship breakdowns are a fact of life.
When it happens, one of the issues for the parties to work out is how to divide the assets and debts of the relationship between each other or in other words, who gets what?
Lawyers refer to this as a “property settlement”.
Due to the high costs and length of time involved in Family Court proceedings, the majority of property settlements are done by way of either Consent Orders or Financial Agreements.
As the names suggest, these processes can only be used in circumstance where the parties have been able to reach an agreement on the division of their property and debts.
In short, the end result is a written document signed by each party and the respective lawyers, which sets out the details of how the assets and debts of the marriage or relationship were divided.
Consent Orders are more formal than Financial Agreements in that Consent Orders are filed in Court and once approved, they become Orders of the Court.
Why is this important?
For protection and peace of mind.
Consent Orders, being Orders of the Court, are enforceable by the Family Court. If one party does not comply with the Consent Orders, the other party can rely on the Court to enforce the Orders.
In the case of Financial Agreements, provided the Agreement has been prepared and signed in accordance with the strict rules that apply, both parties then have the security of being able to rely on the Financial Agreement to protect themselves from any potential future claim or “second bite of the cherry” from the other party.
Financial Agreements can also be enforced by the Family Court although due to their less formal nature, may not be as easy to enforce as Consent Orders.
Be aware that the time and costs involved in preparing these types of documents after you separate is a small fraction of the time and costs associated with a potential Family Court battle when you least expect one.