The Power of Mediation in Property Division Post-Separation

Family Dispute Resolution practitioner/Family Law Mediation

Experiencing a relationship separation can be an incredibly challenging and emotional time. Not only are you grappling with the personal impact, but you also find yourself needing to navigate the complex process of asset and property division – a task that can feel overwhelming. However, through the support of mediation, you can streamline this process and find clarity amidst the complexity.

Understanding Property Division

Property and assets may be divided between you and your partner through various methods:

  • Private agreements (not legally binding)
  • Using solicitors to negotiate a settlement on your behalf, then having the documents formalised by the court (6 -12 + months)
    • Going to court and having a Judge issue a Court Order (2 – 3 + years)
    • Reaching an agreement with a Family Dispute Resolution Practitioner (FDRP), also known as a Family Law Mediator. Then, have your agreement formalised. (3-4 months)
    • Using solicitor-assisted Family Law Dispute Resolution (mediation where you both have your lawyers present and a Family Law Mediator)
    • Collaborative Law. (a meeting where lawyers, accountants, and mental health professionals all work with you and your former partner to negotiate a settlement).

    (This is not a comprehensive list; these are some of the primary options)

    Navigating Financial Separation

    The division of finances, both assets and liabilities, is often a complex and nuanced process. It is strongly advised that you seek professional advice to fully understand your position. A Family Dispute Resolutions Mediator can provide invaluable guidance in this regard.

    It's important to note that mediating before taking a Financial Settlement through the Federal Circuit and Family Court of Australia is now mandatory.  You may also require legal advice. An FDR Mediator can offer impartial support and information to help you make the best decisions for you and your family.

    It's a common misconception that a formal agreement is unnecessary if the separation is amicable. However, under Australian Family Law, a couple remains financially connected until they have a formalised agreement. An FDR mediator can clarify all your options.

    If you go through the court, it is a Judge's job to make a decision about the division of your property, finances, and debt. This is neither simple nor straightforward, and discretion plays a large part. To comply with the requirements of the Family Law Act, you must provide complete and frank disclosure of all assets, liabilities, and entitlements.

    Family Dispute Resolution practitioner/Family Law Mediation /Separation

    Separation and your FDRP

    Your Family Dispute Resolutions Practitioner cannot give legal advice. However, they can help guide you through the Family Law process. An FDRP ensures that any agreement reached complies with the Family Law Act. Asking the right questions and listening to your story will help you find the right solutions for your situation. If you have children, they will always keep the best interests of children at the forefront of negotiations.

    The Courts are always an option if FDR Mediation fails. However, it can take more than two years to get to a final hearing. Your first appearance at court is with a Registrar of the Court. They will check that all the Pre-Action procedures have been met. This includes attempting mediation and making a genuine effort in mediation.  

    There can be financial consequences for those individuals who do not make a genuine effort. It is also conceivable that you will not get a first trial date for 18 months or more once you have started Court proceedings. The Federal Circuit and Family Court of Australia expect couples undergoing separation to make every effort to resolve their issues without appearing before a Judge. 

    When should we divide our property & finances?

    You do not have to be divorced or separated before you divide your property. However, it helps if you have gone through the worst of the emotional upheaval of separation. As well as make some arrangements for your children. There are time restrictions for applying to court, which differ depending on your relationship.

    For divorced couples, you must apply to the court for a property settlement within 12 months of your divorce. Unless there are special circumstances. For de facto couples, applications regarding maintenance and property must be lodged within two years of the relationship ending. 

    De facto includes: 

    • Couples who have lived together in a domestic relationship for two years or more 
    • Have a child born of the relationship
    • One of the parties has made such a substantial contribution that if the court did not make an order, it would be unjust 
    • A registered relationship

    The Four Guiding Principles of Property Settlement

    1. What are the assets and liabilities?

    The general assumption is any assets and/or liability acquired during the relationship are joint property. This includes wages, super, property, equity, personal belongings, and businesses.

    2. How are contributions determined?

    As a rule, financial and non-financial contributions are weighted equally. A party cannot be disadvantaged because they stayed home with children or did not earn the same as the other party.

    3. What are future needs and the issues that impact them?

    This looks at whether and how someone within the relationship will be more greatly disadvantaged by the breakdown of the relationship. This includes earning capacity, age, health, and who cares for the children.

    4. Is the agreement just and equitable?

    Any agreement reached must satisfy the Family Court's requirements for justness and equitability. If your agreement is deemed not to be just and equitable, the court may not formalise it.

    Most people have never had experience with the Law or Family Law when they find themselves looking for ways to finalise their separation and divorce. Researching your options, educating yourself about the many ways to resolve your Family Law disputes and understanding your rights under the Act is important. 

    This is where an experienced private Family Dispute Resolution practitioner can be invaluable. The Federal Circuit and Family Court of Australia website is a good place to start 

    Empowering Your Separation: Conclusion on Simplifying Property Division

    In conclusion, amidst the complexities of relationship breakdowns, navigating property division can seem daunting. However, with the guidance of professionals and the option of mediation, there's a clear path forward. By understanding your options, seeking expert advice, and embracing the mediation process, you can simplify the journey towards a fair and equitable resolution.

    Remember, you're not alone on this path, and there are resources and support available to help you navigate this challenging time with clarity and confidence. A Family Dispute Resolution practitioner (Family Law Mediator) will also provide support, guidance, and information to help direct you to the best solutions for your family.

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    Dianne Loveday

    About the author

    Dianne is the principal mediator at Bayside Mediation, with 15 years of experience. As a Nationally Accredited Family Dispute Resolution Practitioner and Mediator, she specializes in minimizing distress during family breakdowns. Dianne prioritizes children's well-being and ensures fair agreements for all parties involved.

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