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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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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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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What is urgency for parenting cases?

Parents in the heat of family law situations will often want to know if the Court can help them with their dispute urgently. To a parent in the middle of a dispute situation – they may not have seen their child for months, or they may want to change their current arrangements – their situation may appear genuinely urgent. However, this is not the test that the Court applies in determining whether a matter should be listed urgently in front of a Judge or Registrar.

In the matter of Fowler & Glover (http://www.austlii.edu.au/au/cases/cth/FCCA/2016/2595.html), the Court considered what test is, and should be, applied to determining whether something should be heard urgently when it is delivered to the Court Registry to file.

In that case, the Father had not seen the child concerned since separation, with there being a delay of some more than six years between separation and the Father seeking Orders. The Father was trying to get orders made in time for his planned visit to the area where the child lived. The visit was scheduled for only a month after the Court documents were being filed. The Court empathised with the situation, but emphasised that the reality of the Court’s resources were that the Court was already overlisted (above capacity) with other matters. Nevertheless, the Court clarified that it continued to overlist urgent matters, which were described as typically involving ‘allegations of serious and immediate risk of harm to children.’

This reflects our experience. The Court will largely only overlist / list urgently parenting situations where there is the immediate risk of harm to a child. An immediate risk will usually be a threat to the safety of a child well above and beyond any harm that is suffered as a result of a delay in that child’s relationship with a parent.

A good family lawyer will be able to advise you on how to identify what are, and are not, good reasons to list urgently, and be able to make a compelling case to the Court for why urgency is justified. Our lawyers will advise you on this and other practical measures to take in relation to your situation, and are available to speak to you on 03 9614 7111 (tel:0396147111) or Melbourne@nevettford.com.au

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Superannuation – Cap and Trade

The federal government in its May 2016 Budget indicated that it intended to make changes to the superannuation system that would limit the amount of contributions people would be able to make above and beyond their compulsory employer contribution, which may affect those engaging in a family law property settlement.

 

The proposed change highlights the difficulty that separated parties may have in re-earning superannuation post-separation.

This is particularly the case where one party decides not to take any superannuation so that they can retain another item, for example the family home. 

 

It is important to note however that the family law system has taken some pre-emptive action in this regard a number of years ago.

Cases that go to Court and are decided by a Judge will now often have superannuation earnt during a relationship split between parties.

This has the effect of ensuring that both parties are put in a position where they can save for retirement, even if it means some short term difficulty with property.

 

With that said, it is still entirely possible for parties to organise and come to an agreement between themselves to arrange their assets how they like.

The government’s proposed changes to how superannuation work should be fully considered by your family lawyer and incorporated into your family law settlement.

You can call our experienced lawyers to discuss your situation and whether you might be affected by the changes on 03 9614 7111.

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The Internet, titillation, and the Family Court of Australia

Does a predilection for masturbation mean that someone should not spend overnight time with their children?

Judge Ryan of the Family Court of Australia at Sydney delivered a judgment in a case that concerned this issue in January 2016. The full text of the judgment is available here(http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/cth/FamCAFC/2016/3.html ).

The case was an appeal from the initial decision in the Federal Circuit Court.

In brief, it is a question that turns very much on the facts – in this situation, there was it appeared no evidence that the children would be exposed to the material that the father accessed, and that if they were to do so, every indication was that the father would act promptly to correct the issue. Additionally, there was no evidence that the children were aware of the father’s habits, and there was no evidence that they had ever interrupted the father during masturbation.

No material appeared to be permanently stored on the father’s television, phone or tablet.

It also seemed that although there was reference to pornography by lawyers acting for the parties, the material concerned may have been at least in part more properly described as television shows containing sex scenes, which would have passed censoring of some sort, rather than wholly pornography.

The father would it appears watch a show on the TV or tablet, and sometimes masturbate in the bathroom afterwards. The mother in the situation was highly critical of the father’s other parenting skills as well, which may have contributed to a perception that her concerns were out of line with wider community expectations.

The Court made a careful consideration of the facts, and the children were permitted to spend time with their father for one overnight per fortnight on an alternate weekend, and for three nights per week during school holidays.

Media reports on the case have missed some of these subtleties and may inadvertently misdirect a party as to what is acceptable conduct and how to conduct yourself during Court proceedings. Broad sweeping statements about what type of behaviour is or is not permitted can lead people astray.

It is for these types of reasons that detailed, specific and expert advice tailored to your particular circumstances is important to reach a happy ending.

Contact our Liz Hall and Richard Hamilton on 03 9614 7111 or Melbourne@nevettford.com.au to talk through your situation.

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Know Your Deadlines – Property Division pursuant to the Family Law Act 1975

It is important to know that there are time limits on making applications under the family law for a property division. If you are unaware or not advised of these, there can be serious repercussions leaving you significantly worse off.

For defacto relationships, an application cannot be made under the Family Law Act 1975 more than 2 years after separation. For married couples, the time limit is 12 months after your divorce is made final. For this reason, many family lawyers will not encourage people to actually obtain their divorce until their property settlement is finalised or very near to being finalised.

 

While the deadline is clear cut for divorcing couples, the time limit on defacto relationship can cause more difficulties, particularly if there is a disagreement about precisely when your separation occurred. Parties will of course be more likely to recall a separation date in a way that is advantageous to them.

 

In the event that the deadline passes in either case, the Court may grant leave to a party to apply even if they are out of time, but you will need to explain to the Court the reason for the delay. The Court may grant leave to you to proceed out of time if it is satisfied that:

• Hardship would be caused to a party to the relevant relationship or a child if leave were not granted; or
• If applying for an order for spousal maintenance, that at the end of the limitation period, the circumstances of the person applying were that the person applying would not have been able to support themselves without an income tested pension, allowance or benefit.

The definition of hardship is a vigorously contested one. The Court will take a variety of factors into account when considering these issues, particularly what exactly is meant by ‘hardship’ but it is important to seek legal advice and act quickly if you are approaching or have just passed one of these deadlines.

Call us on 03 9614 711 or email Melbourne@nevettford.com.au.

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The Small Business Family Law Dilemma

Clients with small businesses often find themselves gobsmacked at the approach that the family law courts may take in relation to their business. A valuer will regularly be appointed at significant expense and that valuer will place an astronomical value on a business that the client has no ability to sell, leaving them with a fixed asset of paper-worth but little by way of realisable value.

 

The situation that may result is a difficult one for many small business owners to face – that they will be left with just their personal-services business whilst their former spouse will keep the whole of a house and a significant proportion of their superannuation to boot.

 

Clients on the other side of this equation will often not appreciate the precariousness of a valuation that may come falling apart, or indeed how a business owner might readily lower their business incomes dramatically to avoid a genuine valuation of the business occurring. Recent developments in the law regarding how ‘add-backs’ are considered mean that this becomes a particular risk for parties to family law disputes.

 

Not even considered in this situation yet is the impact such a valuation, or the forensic accounting exercise undertaken to get to a valuation, may have on the business partner(s) of a person undergoing a family law property division.

 

Judicious and early advice is the best answer to help you deal with the complex web of outcomes in such a situation, whether you operate the business or are the former spouse of such a person.

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Parenting post-separation – don’t become a victim to statistics

The Australian Institute of Family Studies (AIFS) recently released research which showed that only 6% of children under 17 spent equal time with both mother and father. Yet regularly family lawyers will be regularly instructed to seek an equal shared care arrangement, or what many clients refer to as ‘shared custody’. Why doesn’t this frequent desire of separated parents often materialise in reality?

There are a variety of factors that the Family Law Act (Cth) 1975 requires be considered in making Orders concerning parenting arrangements, and a good family lawyer will advise their client of these factors early on in their consultation, including the paramount consideration of the best interests of the children. It is frequently not seen to be any easy experience for children, already dealing with the difficulty of mum and dad living in separate houses, to have to live out of a suitcase on a week-on week-off arrangement. Our lawyers are experts at identifying what issues preclude an equal shared arrangement early on, so that you can ensure that your situation is appropriately managed and directed so that you improve you can get the result you are seeking. 

One more issue to come out of AIFS’ research however should be kept in mind – half of children of relationships that have broken down do not spend any overnight time at their non-resident parents’ home. By even taking the step of seeking and maintaining regular time with your children, you will be significantly shifting the odds in your favour. Call our office today to seek advice on how best to progress your situation.

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Deane & Deane 2014 FamCA 869

A couple had been married for several years and had two daughter aged 7 and 3 years at the time of the hearing.  During one year the father’s own mother died and the father did not enjoy the Christmas period as he felt that his grief had not been adequately recognised, that there was no sexual intimacy with his wife, and that he would not be missed if he left the family.  The wife subsequently made allegations about three types of incident over the holiday period: that the father had thrown one daughter against a wall, that the husband had raped the wife, and that there was sexual abuse of the children.  Criminal charges did not proceed due to lack of evidence.  The parents separated soon after, with the father maintaining contact with his children.

Allegations by both children about sexualised behaviour by the father continued.  Allegations included that the father was naked in the bedroom of one daughter, and that the father performed an unusual exercise involving movement of his groin.

The judge found that too many concerning factors had been raised.  The judge ruled that the father’s access with his children should be supervised, but that evidence from the father’s own family had been too partisan for the judge to be confident that their supervision would be objective.  The judge ruled that the risk to the children was an unacceptable risk and that indefinite or ongoing supervision was required.

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How do you proceed with a divorce if you do not know where your spouse is?

You can still proceed with your Divorce application but you need to obtain an Order from the Court for “substituted service or dispensation of service”.

An Order for substituted service permits you to serve the Divorce documents on a third person who the Court is satisfied will bring the divorce documents to the attention of your spouse. 

An Order for dispensation of service gives your permission not to serve the Court documents on your spouse if the Court is satisfied that you have taken all reasonable steps to locate your spouse. 

An affidavit is required by you setting out the steps you have taken to locate your spouse.

For further assistance in preparing the affidavit, please contact the Family Law Team at Nevett Ford Lawyers on 03 9614 7111.

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Can Domestic Violence Increase My Family Law Property Settlement?

The short answer is yes.

In circumstances where the contributions of a party are made more “onerous” by the violence of the other party, the Courts may give more weight to that circumstance.

For example, if one party is subjected to verbal or physical abuse which causes difficulties for that party in carrying out their “role in the relationship”, this may be taken into account.  As well as being relevant to the party’s present health and their likely future employability, that party may get an extra portion of the property.

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If I separate, is there a time limit to make a claim for a property settlement?

Yes, the deadline for issuing a property (or maintenance) application is 12 months for married parties after a Divorce Order has taken effect (except by leave of the Court or the agreement of the other party).  A party to a de facto relationships may apply for a property (and maintenance Order) only if the Application is made within 2 years after the end of the relationship.  If you are outside these timelines, we recommend you obtain legal advice.

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If I separate is there a time limit to make a claim for a property settlement?

Yes, the deadline for issuing a property (or maintenance) application is 12 months for married parties after a Divorce Order has taken effect (except by leave of the Court or the agreement of the other party).  A party to a de facto relationship may apply for a property (and maintenance Order) only if the Application is made within 2 years after the end of the relationship.  If you are outside these timelines, we recommend you obtain legal advice.

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My partner and I are separating and I want to take the kids overseas, what do I need to do?

• To obtain a child’s passport, written consent is required from each person who has parental responsibility for the child (usually both parents).
  
• If you are not able to obtain the other party’s written consent you need to apply to the Court seeking permission to travel internationally (this is so, even if you have a Court Order for sole parental responsibility) as the Passport Office has specific requirements.
  
• If you wish to prevent the other party taking a child overseas (if they have the child’s passport) you will need to make an Application to Court seeking an Order preventing the child leaving Australia.  This is called an “Airport Watch Order”.
  
• Once you have an Airport Watch Order in place, if you agree in the future for the child to travel overseas you need to apply to the Court before you propose to travel and have the Airport Watch Order removed.
  
• Any Court Applications regarding overseas travel need to be supported by Affidavit material setting out various details of the proposed trip, the purpose of the trip and other relevant matters.
  
• If you wish to prevent a child being removed from Australia (if they do not yet have a passport) you can make an Application to Court preventing a passport being issued and preventing the child from leaving Australia.
  
• If you fear that the other party may attempt to apply for an Australian passport without proper legal consent you can lodged a “Child Alert Request” at any Australian Passport Office.  You will then be notified of any passport application for the child.
  
• Special caution needs to be exercised where the children are eligible or where they already have a foreign passport.  A Child Alert does not prevent a child leaving Australia on a valid Australian or foreign passport.  It is recommended that you contact the embassy of the relevant country if you think a passport may be issued by another country.
  
• You should seek legal advice if you have a query about travelling internationally with children or considering relocating overseas with children. 

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