Can my Partner Claim Property After Divorce?

Your partner may be able to claim property after the finalisation of a divorce either through a Court Order or through a Binding Financial Agreement (‘BFA’). You may have heard of a BFA being referred to as a prenuptial agreement (or a pre-nup). Whether your former spouse will be able to claim property after a divorce through a court order will depend on the Court’s assessment of your individual circumstances. 

What does the term ‘property’ mean? 

Property refers to the assets that you or your partner owns. This can include things like the family home, other real estate assets, cash in bank accounts, vehicles, investments, or superannuation entitlements. It can even include personal items such as jewellery and tools. Additionally, property may also include the value of any stake in a business you may own. The property owned by either you and your partner, either jointly or individually, is commonly referred to as the asset pool. 

A property settlement is the process of dividing the matrimonial asset pool between the parties to a marriage, or the parties to a de facto relationship when they separate. 

Binding Financial Agreements

If you already have signed a BFA, then the assets will be divided according to the terms of that agreement. 

However, in the following circumstances, a Court may order for the BFA to be set aside:

1. Misrepresentation or fraud; 
2. Fraud against third parties; 
3. Uncertainty and incompleteness; 
4. Impracticality; 
5. Unconscionable conduct, duress, indue influence; and / or 
6. Change of circumstances for the children. 

What If I Don’t Have a BFA? 

If you do not have a BFA, you may seek the Family Court to make an order for financial/property matters to be settled through the Court. Once the order has been made, it is difficult to claim more money or assets years after your divorce or separation. The only exception is when it can be proved that your partner did not disclose their true financial position, or where there are allegations of fraud or duress. In these circumstances, a Court might grant leave (permission) to make a further application. 

What If I Don’t Have a BFA or a Court Order?

If a BFA has not been signed and a Court order has not been given, it must be shown to the Court why you should be granted leave (permission) to make an application years after the divorce or separation has been finalised. 

It is required that a party must satisfy the Court that there is a real possibility of success in making a property settlement claim and to demonstrate that real hardship will be caused if the permission is not granted. 

The Court will then consider the following in exercise their discretion: 

1. The length of delay and reasons for the delay; 
2. The prejudice that could be caused to the other party; 
3. The merits of your case; and 
4. The degree of hardship caused if leave was not granted. 

How is Property Split? 

How your property is going to be divided will depend on how the Family Law Court sees the evidence. It is important that you seek legal advice on this matter. If the property settlement is determined by the Family Court, after all the evidence is heard, the judicial officer will decide whether it is appropriate to make an order for property based on the facts of the case. If the Court decides to make an order, it will decide what is just and equitable (or fair) in your circumstances. 

When looking to decide what will be fair, the court will consider the following:

• Your assets and debts, and what they are worth when added together (net worth) 
• Direct financial contributions by each party to the relationship, such as wages. 
• Indirect financial contributions by each party, such as gifts or inheritances. 
• Non-financial contributions to the relationships, such as caring for children. 
• Any future requirements, such as age, health, financial resources, caring responsibilities, and capacity to earn. 

I Thought Property was Split 50:50?

There is a 4-step process for working out what percentage of the property each party to the relationship gets. The process is as follows: 

1. Working out the matrimonial asset pool
2. Assessing and allowing for the contributions to the asset pool
3. Looking at and allowing for the future financial needs of each partner
4. Evaluating the fairness of a proposed property settlement. 

It may result that the matrimonial asset pool will be split 50:50, however there is no hard and fast rule stating that assets must be divided in this way. 

How Do Debts Affect the Division of Assets? 

Your debts are also part of the asset pool. These are considered, whether they are in your joint name, or in separate names. On top of dividing any assets such as property, it will also need to be determined who pays off what debts. 

How do I stop my partner from spending our money, or selling the assets? 

If you are worried that your partner may expend assets before the property settlement is finalised, you may seek a Court order to stop them from using their bank accounts or selling off any property. 

Time Limits 

It is important to reach a conclusion to the property settlement process as soon as possible after separation. If you do go to Court or want to apply to the Court for consent orders, time limits do apply. Although you do not have to wait until you are divorced, if you get a divorced and have not worked out property arrangements yet, you must apply to the Court for property orders within 12 months of your divorce becoming final. 

Looking for a family lawyer? We can help. Contact us if you need assistance with a property settlement, or any other aspect of family law.