There are many advantages of reaching agreement about the division of your property including saving legal costs and minimising stress, as well as giving yourself the freedom to move on with your life.
A lot of people think that a relationship breakdown inevitably means you will wind up in the Family Law Courts, costing you a lot of money and stress in order to obtain a separation of assets.
The reality is that achieving a settlement outside of the court system is not only a quicker and usually less expensive way to resolve things, but it will save you and your former partner from the stress and uncertainty of an outcome that you don’t have control over.
Given the time and effort involved in building up your assets during the relationship, surely making the effort, even when it is difficult, to invest in reaching an agreement makes sense.
It is important that any agreement you reach about the division of your property is properly documented to ensure that it is legally binding and final.
If you don’t do this, you haven’t achieved a legally recognised settlement and have left the door open for a property settlement down the track.
Documenting a property settlement can be done by either a Consent Order or a Binding Financial Agreement.
A Consent Order is a Court Order that has the same effect as a Judge making a decision after a trial of your matter.
The difference is that you and your former partner have come up with the terms of the Order.
While it is a Court Order, you do not have to appear in Court to obtain it.
The Order is issued by the Family Court after the Court is satisfied that the settlement you have come up with is ‘just and equitable’ or fair having regard to the circumstances of your relationship.
The other way to formalise a property settlement is with a Binding Financial Agreement.
This type of agreement can be made at any stage of a relationship, such as before you start living together (commonly called a ‘pre-nup”), during the relationship and after separation or divorce.
It is basically a contract between you and your former partner that sets out the terms of the agreement you have reached to divide your assets.
There are strict rules to following when entering into the Agreement and each party must obtain their own separate legal advice about the proposed agreement.
It is important to know that ‘handshake agreements’ between you and your former partner or a piece of paper setting out the terms of your property settlement will not be recognised as a property settlement.
It can be a nasty shock to receive a property settlement application when you have moved on with your life and thought that the ‘around the kitchen table’ agreement with your ex was final.
Paula Phelan is a Family Lawyer with Specialist Accreditation in this area from the Queensland Law Society.
She has been a lawyer for 27 years and is the director of Phelan Family Law, a Rockhampton legal firm specialising in Family Law only.
