The Importance of Making a Will after Separation

Your Will should reflect any significant changes in your relationship status, whether you are getting married, having children, or breaking up.

If you made a Will whilst you were single but have now married, this automatically cancels your Will rendering it invalid.

Divorce affects your Will differently in each state. In Victoria, pursuant to the Wills Act 1997, upon divorce, any provision in your Will that relates to your former spouse becomes invalid. On the other hand, unlike divorce, separation does not automatically cancels the provisions in your Will relating to your former spouse/partner. This means that, if you separate, your former partner may still get a share of your estate (or your whole estate if you leave no children at the date of death) unless you make a new Will.

However, if you divorce but continue to maintain an amicable relationship with your former spouse for the sake of your children, and you intend to leave your former spouse as the executor of your estate after your death, your former spouse may encounter complications proving your intentions when you are no longer around.

Rather than leaving these issues to the Supreme Court to unravel, it would save one the hassle and legal fees to simply make a new Will to ensure your intentions are clear. If you think about this carefully, taking the time to draw up a Will or revisit your old Will each time a significant event occurs is worth taking the time for, particularly if you have children or family members or friends you wish to provide for when you are no longer around.

At Nevett Ford Lawyers, we always advise clients who are starting or have finalised property proceedings, and or applied for divorce to make a Will (or a new Will) and properly arrange their estate affairs. We cannot emphasise the importance of this enough!

So, the next time you update your relationship status on Facebook and/or on other social media, think about this article and remind yourself to also update your Will! If you have done the former but not the latter, call us now on 03 9614 7111 or email Melbourne@nevettford.com.au.

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Would you sign a prenup if your fiance threatened to cancel the wedding?

Binding Financial Agreements (BFA’s) or prenups as they are commonly known are meant to be voluntary, and each party must enter into the agreement of their own free will, and not because they have been pressured into it by the other party.  The High Court will consider the issue of “duress” in the matter of Kennedy & Thorne [2016] FamCAFC 189 where Ms Thorne claims she was forced to sign the binding financial agreement — because her husband-to-be, “Mr Kennedy”, said he would cancel the wedding if she refused.  Her legal team argues that this meant she was “under duress”, and that the agreement should therefore be declared void by the court.

Mr Kennedy was a divorced, 67-year-old property developer worth between $18 million and $24 million, while Ms Thorne was half his age with no assets.   They met on a dating site and he organised to fly to her home country in the Middle East to meet in person, promising to marry her if they hit it off.  After a four-year marriage, she is contesting a BFA she signed on the eve of the wedding, which left her with just $50,000 of his fortune and she is now seeking a bigger slice of his wealth.

The High Court will examine the question of whether threatening to “cancel the caterers” amounted to “unlawful duress”.  Mr Kennedy has passed away while the trial was part heard and the case will be carried on by the husband’s estate.  The estate, it seems will counter that Ms Thorne willingly signed the agreement after obtaining independent legal advice, and was not concerned at the time about the amount of money she would be left with if the marriage ended. 

The High Court is due to hear the appeal on 8 August and will need to clarify issues around duress, undue influence and unconscionable conduct.

If your married, intending to marry, in a de-facto relationship, have assets or have been gifted an inheritance then it could be time to think about a BFA.  However please ensure that if you are considering if you want to have a BFA, don’t leave it until the day or two before the wedding, and don’t threaten to call the whole thing off if your beloved doesn’t sign. 

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Be careful what you pay for – creating a pattern of dependence

People will often consult a family lawyer after a separation and be struggling as a result of now having to pay for two separate households, having become used to having to support one household for many years. Parties’ expenditure may have expanded during a relationship given the savings they were making in only running one household, meaning that post-separation the weekly budget becomes very strained.

It is important then to carefully consider what you do and don’t pay for post-separation, as this will likely become the position you have to keep up until there is a final settlement. If you start paying for the mortgage as well as for your rent in new premises, then you will have to convince a Court carefully and with proper detail of a very significant change in your financial circumstances. You will need to explain why you no longer have capacity to pay this amount in order to avoid having to continue with this arrangement for what is effectively “spousal maintenance” whilst proceedings continue. The recent case of Hogan & Orwell (http://www.austlii.edu.au/au/cases/cth/FamCA/2016/505.html) reviewed the party’s finances from the perspective of a spousal maintenance application and the Husband in that situation was required to continue with mortgage payments. The Husband had increased his credit card liability by about $35,000 but had produced no explanation for why this had increased by such a large amount.

This cost can become overwhelming for people, and if decisions are not made very carefully, you can be locked in to paying for two properties for a considerable period of time, particularly if litigation takes a long time to sort out. This is one of the many factors your sensible family lawyer should advise you about in considering how to run your case. Call us for more information or send us an email if you would like to discuss your situation in a confidential free initial assessment.

http://nffamilylawyers.blogspot.com/2017/05/be-careful-what-you-pay-for-creating.html

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Husband’s Business Suddenly Gains Value Post Settlement – What’s a Wife to do?

$93 million dollars! The Age today made headlines with this splashy article about an-going legal battle that was brought before the Family Court of Australia. The parties have been given the pseudonyms of Mr and Ms Wills, and you can read their case here http://www.austlii.edu.au/au/cases/cth/FamCA/2017/183.html

In this case, the parties were married for 35 years before they split. On 27 April 2015, their property dispute was finalised where the wife received a division of assets worth $15 million. The Wife has then filed an application for this agreement to be disregarded, claiming that the Husband had failed to disclose relevant information relating to an interest in a business which later resulted in him receiving $93 million.

As it appears to have turned out, on 1 May 2015 the Husband was said to have “determined to take the initial steps to the making of an Initial Public Offering (IPO)” for the business. Their property dispute was finalised on 27 April 2015.

Having not seen the full details of the case, it is hard to say exactly who said what, knew what and when, and so we cannot comment definitely on what will happen. But there may be some value in looking at cases where the property ‘pool’ consisted mainly of lottery winnings (bought by the husband), as in the case of Elford v Elford [2016] Fam CAFC.

In Elford the Appeal Judge upheld the trial judge’s decision that the winnings were not a joint endeavour but rather recognised that the husband made the sole contribution to the winnings – therefore dismissing the wife’s appeal to a greater share in the property pool.

The question then is whether the wife receives any entitlement to the $93 million.

Only an experienced lawyer such as one from our family law team would be able to navigate you through complex scenarios such as the above – we are contactable on 03 9614 7111 or otherwise out of office hours on melbourne@nevettford.com.au

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Risks in delaying property settlements

Risks in delaying property settlements

Parents, children and or family members who have endured or witnessed a relationship breakdown can certainly attest to the challenges and intimidation separated parties face as a result. Not only are they emotionally challenging, they involve life-changing and confronting decisions, particularly adjusting to the severance of any financial ties and or resolving care arrangements for the children.

It is not uncommon to come across clients who have separated and left finalising their property settlement for many years. Empathetically and understandably so, property negotiation with a former partner is probably the last detail on the minds of separated parties, given the need to also address emotional issues resulting from separation – however it is imperative that you know the considerable risks associated when discussions surrounding a family law property settlement are left for a significant period.

It is important to be aware of the time limits under the Family Law Act 1975 in brining proceedings for property settlement or spousal maintenance before the Court, which is designed to promote property settlements within a practical time frame.

• For married couples, you have 12 months from the date of divorce;

• For de facto couples, you have two years from the date of separation.

For married couples, we do not recommend applying for divorce until property settlement has been finalised or proceedings commenced seeking property orders. For de facto couples, we commonly run in to the issue of being out of time and we see parties expending legal costs to argue the exact date of separation – therefore reiterating the importance of finalising your property settlement at the first available opportunity following separation.

These time frames exist under the Act to provide certainty to both parties and is beneficial in cases where one party is deliberately skirting the negotiation process (usually the party required to pay maintenance or the party who has smaller future needs) and delaying a property settlement.

In the event you wish to pursue a property or maintenance claim outside the designated time frame, you can only do so with the Court’s permission, that is, leave must be sought from the Court to begin proceedings. The Court must be satisfied that hardship will be caused to you or a child if leave was not granted. In maintenance proceedings, you must demonstrate that at the time the ordinary time limit expired, you were unable to support yourself without an income tested pension, allowance of benefit.

Another significant risk associated in delaying a property settlement is that values of assets, liabilities and or superannuation, as well as the parties’ financial circumstances may change between the date of separation and when negotiations begin and or the matter is brought before the Court –the law looks at and considers the asset pool at the time of any trial, not at the date of separation. This means that any lottery wins or inheritances accumulated may be included as part of the asset pool for division. Similarly, delaying a property settlement whilst meanwhile disposing of any matrimonial assets prior to a settlement can be treated by the Court as that the person has already received part of their property settlement entitlement, thereby reducing their entitlement in the final settlement.

When property settlements are left for a significant period, this also increases the risk that one party may die before proceedings are initiated. Any property owned as joint tenants such as the matrimonial home will be transferred automatically to the surviving tenant (usually the ex-spouse), regardless of what the deceased’s Will states and regardless of whether the parties have separated.

It is for these complexities and risks involved in determining the parties’ entitlements after a long period of separation that we advise you to speak to one of our experienced family lawyers post-separation. Or, if you are in a position where the ordinary time limit has lapsed, we can tailor our advice to you accordingly taking into account your circumstances.

On the same note, if you have managed to reach an agreement with your former partner about a property settlement, we encourage you to document it in a legally binding and recognised manner, either through Consent Orders or a Binding Financial Agreement. The risks you face otherwise is that your partner later decides to change the agreement, which was never formalised in the first place. Putting the terms of settlement in a legally enforceable way would save considerable amount of time and costs in the future if the “informal” agreement was challenged.

Please do not hesitate to contact us on 03 9614 7111 or email us out of hours on melbourne@nevettford.com.au.

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The Nuts and Bolts of a Property Claim in a De Facto Relationship under the Family Law Act

De Facto Relationship:

A De Facto relationship arises when two people, who are in a relationship, are not married or related by family, and having regard to all the circumstances of the relationship, are a couple who live together on genuine domestic basis. Circumstances of the relationship that the Court will consider in determining whether a De Facto relationship exists or not include the duration of the relationship, living arrangements, whether there was a sexual relationship, financial arrangements, property owned jointly or individually, any registration of the relationship under State or Territory law, any children and public representation of the relationship.

Grounds for Property Claims in a De Facto Relationship:

If a De Facto relationship breaks down, the Family Law Act provides that a Court can make orders in relation to property of the relationship only if: -

• The relationship has lasted for a minimum of 2 years; or
• If there is a child of the relationship; or
• A party has made a substantial contribution; or
• The relationship was registered under a State/Territory law.

As a result, the De Facto relationship that last for less than 2 years, a property claim can only be made if there is a child of the relationship, the relationship is registered or if the concerned party has made a substantial contribution.

Substantial Contribution:

Substantial contributions are contributions which are not ‘illusory’ and are ‘considerable or large’ having real worth or value. Contributions that would be considered by the Court as being substantial contributions include, but are not limited to, the following: -

• Financial contributions made for acquisition, conservation or improvement of any property of parties
•  Non-financial contributions made for the acquisition, conservation or improvement of any property of parties
• Contributions made to the welfare of the relationship and/or children of the relationship including homemaker contributions.

When determining whether a contribution is a substantial contribution, the Court may also take into account other considerations, such as: -

• Effect of any proposed order on earning capacity of any party
• Matters such as age, health, income, care or control of child, any commitments, standard of living, extent of contributions to financial resources of the relationship
• Any financial agreement/arrangement between the parties
• Child support

There is a further requirement for claims based on substantial contributions. If a party makes a substantial contribution and in the absence of an order that party would suffer a serious injustice, only then can a claim for property be made by that party. The Court requires this injustice to be more than slight and a mere injustice will not suffice.

If you have been in a de facto relationship that has unfortunately broken down and you would like to discuss further what your entitlements are, please do not hesitate to contact one of our approachable family lawyers. The number to dial is 03 9614 7111, or email us out of hours on melbourne@nevettford.com.au. 

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Partner Visa (Australia) – Married or De Facto

You could be granted a Subclass 820/801 or Subclass 309/100 Partner visa if:

• Your partner is an Australian citizen, permanent resident or an eligible New Zealand citizen.

• You are married or can show that you have lived together with your partner in a ‘de facto’ relationship for 12 months.

The 12-month cohabitation can be waived if the couple registers their relationship in the state they live in. Relationship registration is only available for people living in certain Australian states.

Relationship registration in Queensland, Victoria, Australian Capital Territory or New South Wales:

The registration process is different in each state and not all states allow couples to register. If you can register your relationship, you can lodge a Subclass 820 partner visa application without having lived together for the 12 months prior to lodging the visa. You must however be living together when your 820 partner visa is lodged.

For example, to register your relationship in New South Wales, you’ll need to prove that neither of you are married and that one of you has lived in NSW for a short period of time. Registering your relationship in NSW is crucial if you have not lived together for 12 months prior to lodging the application.

To register your relationship in Queensland, you’ll need to prove that neither of you are married and that at least one of you has lived in Queensland for a minimum of 6 months. You must register your relationship in Queensland to be able to lodge the Subclass 820 visa, if you have not lived together for the most recent 12 month period.

To register your relationship in Victoria, you’ll need to prove that neither of you are married and that at least one of you has lived in Victoria for a short period. Victorian relationship registration is essential if you have not lived together for the past 12 months.

To register your relationship in the Australian Capital Territory (ACT), you’ll need to show that neither of you are married and that one of you is ‘usually’ resident in the ACT. An ACT relationship registration allows you to apply for a Subclass 820 partner visa if you have not lived together for 12 months.

We can provide detailed information on relationship registration requirements.

Showing evidence of your genuine and ongoing relationship

In relation to a Subclass 820/801 Partner visa application you must be living together when the visa is lodged. You need to show evidence of your shared life, such as financial commitment to one another, shared living and social recognition of your relationship. We help you put together your evidence to demonstrate your commitment to each other.

A permanent residency partner visa straight away

If you have been living your partner for at least 3 years prior to your application – or you have a child together and have lived together for the previous 2 years, you can apply for the Subclass 801 visa straight away (i.e. without having to hold the Subclass 820 (temporary residence) Partner visa first.  It is ultimately at the discretion of the Department as to whether they will grant the permanent residence visa straight away but if you meet either/both of these policy criteria then you have a good chance.

If this does not apply to you, the Subclass 820 visa application must be submitted first before you can apply for permanent residency. Once 24 months has passed since your first visa application, you can then apply for the Subclass 801 permanent residency visa, by showing that you are still a legitimate couple.

Onshore Partner visas and work rights

If you hold an eligible visa and you lodge your Partner visa, you transition on to ‘Bridging Visa A’ or a BVA when the first eligible visa expires. You have full work rights on your BVA, during the partner visa processing time and you can also obtain a temporary Medicare card for medical services.

It should also be noted that if you lodge a partner application whilst holding a 457 visa, you cannot stop working for the sponsor until your Subclass 820 visa is granted.

If you hold a Working Holiday 417 visa and lodge a partner visa, we can help you apply for a work rights wavier, allowing you to remain working longer that the allowed six months, for one employer.

It currently takes the Department approximately 12 - 15 months to process the Partner visa application.

Please contact us if you would like further information, advice and assistance, including an initial consultation. 

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Binding Financial Agreements (BFA)

Parties can enter into a BFA before marriage (s 90B), during the marriage (s 90c), after a divorce (s 90D), before entering into a de facto relationship (s 90UB), during a de facto relationship (S 90UC) or after the breakdown of a de facto relationship (s 90 UD). Both heterosexual and same-sex (LGBT) couples can enter into a BFA.

A Binding Financial Agreement (or BFA) is a written document signed by both parties to a relationship which contains provisions about the division of property in the event of a separation. It must comply with either Part VIIIA or Part VIIIAB of the Family Law Act 1975 and parties to the Agreement must obtain independent legal advice about the Agreement.

A Binding Financial Agreement is often referred to as Prenuptial Agreement (prenup or prenups), Cohabitation Agreement, Postnuptial Agreement (postnup or postnups), Property Settlement Agreement or Divorce Settlement Agreement.

Binding Financial Agreements entered into prior to or during a Marriage or De Facto Relationship

Advantages

1. It allows parties to protect assets and financial resources which existed prior to the relationship from a claim for division after separation.

2. It allows parties to protect an inheritance or gift they received prior to the relationship, during the relationship or after separation.

3. In some circumstances, it allows parties to remove their respective responsibilities towards the other to provide spousal maintenance.

4. It provides a degree of certainty to the parties as to how their assets, financial resources and liabilities will be treated in the event they separate and remove any anxieties they may have about entering into a relationship in the first place.

5. It allows parties to be clear about the responsibility of debts such as credit card debts, home loan, personal loans, business loans, etc.

6. In conjunction with a will, it allows parties to plan their estate and ensure that their children, especially any children from previous relationships, are not disadvantaged in the division of the estate.

7. It allows parties to determine their property settlement without the intervention of the Courts and costly legal disputes.

Examples of when a Binding Financial Agreement may be useful

1. When one party has significantly more assets and financial resources than the other, a BFA (whether entered into before or during the relationship) allows that party to keep those assets and financial resources safe from the other in the event that they separate.

2. When both parties have significant assets and financial resources and they both wish to quarantine those assets and financial resources from the other in the event that they separate.

3. When one or both parties have children from previous relationships and wish to protect all or part of their assets and financial resources for their children.

Binding Financial Agreements entered into after separation

Advantages

1. It allows parties to keep the terms of their settlement agreement away from the eyes of the Courts, the Australian Taxation Office (ATO) and other persons and organizations.

2. It allows the parties more flexibility in how they wish to determine their financial matters.

3. In some circumstances, it allows parties to remove their respective responsibilities towards the other to provide spousal maintenance.

Examples of when a Binding Financial Agreement may be useful

1. When parties have complex property, business or trust arrangements which they wish to keep as private as possible.

2. When the settlement terms are more in favour of one party and as a result may not be approved by a Court.

3. When the parties need a quick resolution to their financial affairs and wish to avoid an agreement which requires the review and approval of a Court (consent orders).

We have a competent and approachable team of family lawyers who is able to assist you in determining the right kind of Binding Financial Agreement for your circumstances. We recommend you contact us on 03 9614 7111, or email us out of hours on melbourne@nevettford.com.au.

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Preventing unlawful removal of children from Australia

Do you have concerns that your child may be removed from Australia against your permission? Have you agreed to your child traveling overseas with the other parent but there is a genuine fear that they may not return your child to Australia?

We understand that this would be a stressful situation for any parent.

If so, it may be important that you act immediately to prevent this. You will need to obtain a Family Law Watch List from the Family Law Courts preventing or limiting your child from travelling outside Australia. A Family Law Watch List is also otherwise known as an Airport Watch List. If the situation is urgent, the Courts may make an Order on an ex parte basis.

The Family Law Watch List directs the Australian Federal Police to put your child’s name on the Watch List which in effect, operates at all international departure points including sea ports until discharged by the Courts. It is crucial to note though that the Family Law Watch List does not restrict interstate travel. The Australian Federal Police will not place your child’s name on the Family Watch List without a Court Order, unless in very limited circumstances.

If a child does not have a valid passport, Australia requires the other parent’s signature on the Passport Application form. If this is the case, and you suspect the other parent may fraudulently make an Application, you may, at first instance, consider whether a Child Alert Request will suffice. A Child Alert Request is a warning to the Department of Foreign Affairs and Trade not to issue an Australian Passport for a child without first making further enquiries (https://www.passports.gov.au/passportsexplained/childpassports/Pages/childalerts.aspx).

If the other parent has an international passport, you can make enquiries with embassies/consulates about the possibility of the other parent obtaining an international passport for your child. If there continues to be a real risk your child could travel on an international passport, you can make an application for your child’s name to be placed on the Family Law Watch List.

When facing with an application for a Family Law Watch List, or an application for the child to travel overseas, the Courts uphold its primary consideration being the child’s best interests – Will a travel abroad be in the child’s best interest? What is the time period and reason for the intended travel? Is there a real risk that the child will not be returned to Australia? Is the intended/likely travel destination a Hague Convention country? To find out whether a country is a Hague Convention country, go to https://www.ag.gov.au/FamiliesAndMarriage/Families/InternationalFamilyLaw/Pages/HagueConventionontheCivilAspectsofInternationalChildAbduction.aspx.

On the other hand, if you are a parent considering removing a child from Australia without the other parent’s consent, or relocating overseas, you should think twice as your actions may constitute an offence punishable with imprisonment up to three years. If you wish to relocate with your child, you should consult the other parent seeking an agreement in writing, or seek Court Orders allowing your child to travel or relocate.

If you have a pressing fear that your child may be removed from Australia unlawfully, or you simply wish to know more about international travel arrangements, you can contact our attentive Family Law team on 03 9614 7111 or Melbourne@nevettford.com.au.

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