Something that is really exciting to see, as a family lawyer, are separated couples sorting out their own sh*t.
They’ve worked out how they will each spend time with the kids.
They’ve sorted out all their property and financial stuff.
They’re still not on the best of terms. They’ve just separated. But they got their act together as two responsible and accountable adults, did the wise thing, and sorted out the issues. Themselves. Bonus points if they updated their Estate Plans too.
But. And there is always a ‘but’, isn’t there? I do like big ‘buts’ and I cannot lie.
Without a court order (or financial agreement) in place, the finality of your property and financial settlement remains at risk.
How does that work?
If you were married to your former partner, you have up to twelve months from the date of your divorce to file an application for property orders in the Family Court and Federal Court of Australia (‘FCFCoA’). You can’t divorce until you have been separated for one year, so it is about two years, in total. Theoretically, if you never actually divorce, you can still make that application at any time.
If you have left a de facto relationship, you have two years from the date of separation to make the application.
If the two of you reached an agreement, did all the things, and didn’t get court orders made, then either of you are open to make a court application any time up to the end of those two time limits.
For example: You separate all your things, sell your house and split the money. Six months later, you win the lotto. So your ex-partner applies to the court to seek a division of the property pool. This includes any property owned by either of you at the time of the application!!! Your lotto win is in jeopardy! Argh!
Better and more likely example: As above, but it could be a workers compensation payout, or an inheritance that wasn’t expected. Either way, if you haven’t formally finalised your settlement, it remains open to being part of the property pool.
Worse still, and not at all uncommon – incurring debt. I’ve seen people wrack up huge credit card debt after separation, sometimes necessary, sometimes frivolous, either way factored into the property pool until a settlement is formalised and requiring good evidence to rebut it. Whilst ‘wastage’ can be argued, it can be challenging to clearly evidence and is likely to prolong and complicate settlements if raised.
So what should you do?
I will tell every single client that I see that, regardless of how amicable things may appear, they need consent orders.
Whilst you may not need it practically, such as to avoid stamp duty on a transfer of property, it is effectively insurance to see you through that timeframe, allowing you to safely move on, immediately, with your life and financial situation.
It protects what you have.
It protects you from new debt incurred by the other person.
It protects your superannuation.
It really is like insurance.
Where to next?
How much do you spend on insurances for your family each year? In total?
And how often do you use them?
I know that, for me, I spend a few thousand dollars per year between house, car and health insurance, despite hoping that I never have to use them.
Consent orders should be looked at the same way. An investment that you hope you never need to use, it’s just sound, legal protection.
And update your Will.
Contact JP Family Law & Mediation on 0466 090 434 or book online to get started.