Property settlements can be formalised by way of Court Orders or Binding Financial Agreements. Financial Arrangments are sometimes referred to as Binding Financial Agreements.
Formalising property settlements
It is very important to formalise your property settlement to prevent a future, further claim being made against you by your former spouse and formalising your property settlement will often allow for stamp duty exemptions on the transfer of property and capital gains tax tollover relief.
Consent Orders are scrutinized by the court and bear the court seal. You do not need to “go to court” however to obtain a Consent Order. Parties who do not otherwise have their matter before the court, can reach an agreement and file such agreement at the court by way of Application for Consent Orders. Such Applications are filed in the Family Court of Australia and a Registrar considers the Application and makes the Order in chambers. If there is a problem with the Application then the court will issue a requisition, which will need to be attended to before an Order will be made. One important thing to note about a Consent Order is that although the parties have “consented” to it, the Court has exercised it’s discretion and made the Order. Therefore it’s very difficult for a party to later try to set the Order aside because “it was not fair”. Therefore in practical effect an Order is more “binding” than a “Binding Financial Agreement”.
Going to court
It is sometimes necessary for parties to commence court proceedings to obtain a just and equitable property settlement outcome. Even then, during the course of the proceedings, parties can (and mostly do) enter into a Consent Order, which finalises their property settlement. Of about 100 people who commence court proceedings for property settlement, only about 5 such matters proceed to final hearing or trial. Usually matters settle along the way at a Conciliation Conference or a court ordered Mediation. The structure contained in the court processes can be helpful when negotiating a property settlement with a difficult ex-partner.
Financial Agreements (often referred to as Binding Financial Agreements) are an alternative way of recording and formalising a property settlement. In finalising your property settlement in such manner, the final decision is not left up to the Registrar of the Court or another judicial officer, but rather it is left up to the parties themselves, with the assistance of their lawyers. It is mandatory for parties to obtain their own independent legal advice when entering into a Binding Financial Agreement and their legal representatives must sign a statement to the effect that the parties have been provided such advice, for the Financial Agreement to be binding. Financial Agreements can be entered into prior to a marriage or defacto relationship, during a marriage or defacto relationship or following separation. Whatever type of Financial Agreement is being entered into, there are a number of technical requirements which must be fulfilled. A party should not enter into a Financial Agreement without the advice of an experienced family lawyer.
Finalising property settlements
It is very important to formalise your property settlement by way of court Orders (including Consent Orders) or a Binding Financial Agreement. Such Orders and Agreements prevent future claims and often allow for stamp duty exemptions on the transfer of property.
We can help
There are different ways to go about negotiating a property settlement, including the traditional way whereby solicitors correspond with one another, or by attendances at round table conferences and Mediations. As well there is a “collaborative approach” which can be taken to settlements. Springwood Lawyers is able to assist you in terms of helping you find the best way to approach your property settlement.