DEALING WITH DIVORCE

The art of settlement is all about compromise. If you can do that and walk away with a deal that you can live with, you will save yourself probably tens of thousands of dollars in legal costs and a year of your time that you’ll never get back.

Once you’ve reached agreement, consider entering into what are known as consent orders, a parenting plan, or even a binding financial agreement.

A breakdown of a marriage is a very emotive time and can generate bitterness. You will save yourself a lot of grief, money and time if you are prepared to compromise.

If one party will not engage in the pre-application procedures and genuine efforts to resolve a matter, that doesn’t mean that you can’t apply for court orders. You would file your application, and you would file a document to indicate that you have unsuccessfully made a reasonable attempt to conciliate and mediate the dispute.

Your application will be served on the other party, and if they still refuse to cooperate the court will hear the application in the absence of that party. Orders will be made without the other party taking the opportunity to submit their own circumstances and point of view to the court, so putting your head in the sand is not a solution.

Typically in a property matter, a lawyer will obtain all the information about assets of the marriage and the financial history. The lawyer would then write to the other party setting out the brief history that has been received from the client and the orders that the client is seeking to obtain. The other party is required to respond within 14 days. If no contact is made by the other party within that time, usually a follow-up letter would be sent. If nothing is heard from the other party after a month, instructions would be sought from the client about commencing court proceedings. Many people ignore those initial letters from a solicitor, but very few people ignore a court application. Once a party is served with a court application, they have obligations under the ongoing pre-application procedures to make disclosure.

Sometimes parties hide assets from their partner or do not disclose all of them. If hidden assets are revealed later on the party can be charged with contempt of court, which can result in fines, jail time, or a good behaviour bond. It is very important to properly engage and to comply with the pre-application procedures and make a full disclosure of your assets.

It’s fairly easy to investigate property, because it’s all on the public record. The best way to search for other financial assets is usually by way of a subpoena. There have been situations where somebody has moved on, re-partnered, and purchased a property with their new partner, but in their disclosure documents they swore that they had virtually nothing. A lawyer may subpoena the bank records to see the loan application, which will set out all the assets for the loan. This is often a very fertile area to harvest information about what assets parties might really have and if they might be hiding something.

The rules of the court require a number of things, as follows:

• Bank statements for the previous twelve months
• The last three year’s tax returns
• Real estate agent market appraisals for any property
• The value of any cars and motorbikes (can be downloaded from the internet at redbook.com)
• Details of shares and investments
• Interests in any business that either of the parties might be operating
• Recent superannuation statements
• Any documentation related to the value of all property, whether in joint names or individually
• All property in an individual’s name will be regarded as matrimonial property. There is a requirement to disclose all property, irrespective of whose name it is in

All assets that are owned by either party, no matter whose name those assets might be in, and include inheritances and money that one party might have received by way of compensation, for example, worker’s compensation.

These can be financial or non-financial contributions, and can be direct and indirect contributions. If a party is a homemaker and a parent, their contribution is just as important in the eyes of the law as direct financial contributions. A couple will meet and marry, and they start their lives together with nothing. They will jointly acquire assets during the course of the marriage. When they decide to have a family, usually one party gives up their employment, stays at home to look after the children, and takes care of the household. The other spouse may go out to continue to earn money, and that money may pay for mortgage repayments and also for household expenses.

The contribution of the party as a homemaker and a parent is just as important as the contribution of the spouse in a direct financial sense, that is, the contribution of both parties will be considered equal. If the couple has come together, started off with nothing, and acquired assets together, everything is regarded as a 50-50 joint contribution. There may be adjustments around future maintenance needs. For example, the rule of thumb is that the care of a child under 18 years of age adds another 5 per cent to that party’s entitlement to matrimonial property.

If a party (the carer) has three children after separation, 5 per cent per child gives them 65 per cent of the net asset pool, and the spouse 35 per cent. The carer my also have given up their career and be disadvantaged in the labour market because they have the ongoing care of the children, so they may be entitled to another 5 per cent.

They start off with a 50-50 contribution-based assessment, and then the future needs of one party may increase it to a 70-30 split between both of them. For example, the carer who has the ongoing care of children under 18 years of age will need additional property to accommodate those children.

Again, it is not uncommon for one party to give up a career path in order to support their spouse in their career path. Those disadvantages of the employment market and ongoing care of children are maintenance factors that also need to be taken into account and may add to the share of the property that the carer may obtain.

This is where the court examines the assets and the contributions the parties have made to the acquisition and preservation of assets, and looks to future maintenance factors. If there is only a very small pool of assets for example, the court may decide that it is just and equitable that the carer who has three children to look after gets the lot, and the spouse doesn’t get anything because they have a job and can earn an income and re-establish their life. A just and equitable approach is the wildcard and is a reason to avoid going to court. It is difficult to anticipate what a judge will decide is a just and equitable outcome.

When solicitors take instructions from clients, they gather all the details of their financial history. These details are considered and eventually form the basis of an advice as to what the solicitor thinks.

The step-parent may feel a moral obligation to care for those children, but they don’t have a legal obligation. The fact that the step-parent is making an additional contribution to care for and support the children will be taken into account by the court.

Depending on the circumstances, and even before the property application, it is possible for a party to make an application for spousal maintenance to ensure that they have the necessary income to support the household. If one party is in a position to do so, orders can be made for that party to pay a lump sum on an interim basis, even to cover the other party’s legal costs.

Alterations and additions to a property that will increase the value of that property, such as building retaining walls, maintaining the property, building alterations and new rooms, can be taken into account and may add to the entitlement of the party who has done the work.

A couple bought a house. One of the parties contributed 90 per cent to the property, and then within two years they have separated.

The court would proceed through the following four-step process:

The first step is to identify the assets.

The second step is to look at the contributions each party has made, either to the acquisition or the preservation of assets.

If one party had 90 per cent of what was required to purchase the property, then that 90 per cent contribution will be in their pool, and the other 10 per cent perhaps to the other party.

If they separated within a very short period of time then the party who made that 90 per cent contribution will get most of that back. However, the benefit of that contribution will dissipate over time. For a lengthy marriage of, say, 20 or 30 years, the contribution may only be worth a few percentage points at the end of a 30-year relationship, compared with recouping it all if they were to separate after only, say, two years.

Over time, the benefit of a gift will dissipate. However, a loan has to be repaid in full upon separation, whether it’s after two years, 10 years, or 15 years.

After a lengthy relationship breaks down, people may often try and argue that the money that was received from a parent was a loan, and not a gift. Unless the amount has been properly documented as a loan, it’s more likely to be regarded as a gift.

If a parent is considering advancing money to a child and the child’s spouse, and they expect to have the full amount paid back to them should the relationship break down, the money should be properly documented as a loan and not just given to the child. Otherwise, it might become part of the pool of matrimonial assets.

This list is not exhaustive, but can include things such as:

• The length of the marriage
• The age of the parties
• Health issues - if one party is in bad health and unable to work, then they might be entitled to a greater share
• The earning capacity of the parties and disparity of incomes and financial resources, which can include future inheritances
• Personal injury compensation - is not regarded as property for the purposes of being divided by the court, but a court can certainly take it into account. If a party had a major accident and has been awarded several hundred thousand dollars in compensation, that is a financial resource that they have the benefit of. The court might award more of the percentage of present-day assets to the other party
• The ongoing care of children
• A reasonable standard of living - if parties are used to a particular standard of living, or the children are attending private schools, the court will also take that into account.

The very first thing that parties should bear in mind is that the court will regard the best interests of the child as the paramount consideration in determining issues around where the child might live and who the child might spend time with.

Generally, people use legal terms such as custody, access or contact, and guardianship.

Those terms are no longer used in family law, and are referred to instead as who a child might live with instead of custody, and who a child might spend time with instead of access or contact. There are also other terms, such as who a child might communicate with and issues around parental responsibility, which is the old concept of guardianship.

The best interests of the child are paramount. The court will make orders that will enable meaningful involvement of the birth parents in a child’s life. The Act also seeks to protect children from physiological or psychological abuse, helps them to achieve their full potential, and encourages parents to meet their responsibilities of care, welfare, and development of the child.

There is an assumption that each parent is entitled to shared responsibility. Terms such as guardianship, custody and contact are no longer used. Parental responsibility is a similar concept to what people previously understood as guardianship - the right to have input into the major decisions of a child’s life, such as education, religious training and consents to medical procedures.

In principle, both parties are entitled to shared parental responsibility and, unless there are allegations of abuse, that will most likely be granted by the court.

The issue of shared care, however, is quite a different issue. Shared care basically means that the child lives equally with both parents. Because around 90% of cases settle, it is preferable for the parents to come to their own agreement about shared care.

For those matters that go to court because the parents cannot agree, a court is very unlikely to order shared care in those circumstances.

It used to be that the court would not regard the interests or the wishes of a child until they were 12 years of age, but this is now no longer the case.

The court will consider the interests of a child of any age; however, obviously the younger or the more immature the child is, the less weight a court will attach to those wishes being expressed by the child. The court will order that the family attends a family consultant, who is usually a trained psychologist. That family consultant will prepare a report for the court, which will set out the wishes of the child as they’ve been expressed. The report will also contain some comments on the parenting skills of both the parties. That is often a very important component of the report, as it will have an impact on the court’s ultimate decision.

In circumstances where there are allegations of child abuse, in addition to the child’s wishes being expressed via the family consultant’s report, the court can also order that the child be separately represented by a solicitor. In those circumstances, the children’s representative is obligated to produce to the court all information relevant to the interests of that child. Our court system is an adversarial system in which parties sometimes decide what evidence they will use, and what evidence they won’t use.

Generally, parties won’t use anything that is to their disadvantage. Having an independent children’s representative means that those situations will be avoided. If there is information that parents may not want the court to know about, the children’s representative will ensure that the court does know. The family consultant will also refer to it in their report.

There’s a difference between a child going to see a child psychologist for genuine therapeutic reasons, and a parent who sends a child to a child psychologist for the sole purpose of obtaining a report that is going to try to give them some advantage in the children’s court proceedings. There is a court rule that prohibits that from being done, and it may amount to contempt of court for a parent to tender such a report.

If there is an allegation of sexual abuse, report it to the police as soon as possible. The police will then consult with DoCS, which will make an investigation into the allegation. They may or may not decide to take any further action, depending on what evidence is available for them to corroborate and prove that allegation. If a party becomes aware of a sexual assault on a child and they don’t report it, and then a year or two later when they’re in court they suddenly raise these allegations, it could appear that the allegation was raised to give them some advantage in those court proceedings, rather than being a genuine concern. If you have a genuine concern about your child, you should be taking the appropriate steps to alert the authorities as soon as possible.

These are referred to as relocation cases. If a parent is seeking to move a child out of the state or to some other region away from where the child has grown up, a range of things need to be examined. The court will assess the effect that a move will have on the child because of severance from the parent with whom the child is spending time, other extended family relationships, and contact arrangements. For example, seeing one parent every fortnight and half the school holidays may be reduced to just half the school holidays, which may have an adverse impact on the child. One particular case a few years ago involved a mother who was living in Queensland and who wanted to relocate with her new partner to Melbourne. The child had been raised in Queensland and the father was in Queensland, but all the mother’s support and her extended family were all in Victoria. On balance, the court considered that it was better for the mother to have support around her so she could properly care for the child, rather than refuse her permission to relocate the child to Victoria.

Relocation can be a very complex issue, and some situations are not straightforward.

What Happens if a Parent Fails to Return a Child?

The law is very clear - the court will issue a warrant for the child to be taken into custody and returned to the parent with whom the child was living. The police can also issue a warrant for the arrest of the parent who has removed the child. It is unlawful to collect and then fail to return a child. Some criminal charges can be laid against a parent for kidnapping their own child.

Wills

If you are separating from somebody and you have already made a Will which leaves your entire estate to them, you might consider changing your Will to leave your estate to your children.

Divorce does not revoke a Will. However, it nullifies a gift to your divorced partner. If you have a Will that states, “I leave all of my estate to my spouse, but if my spouse dies before me, then to my children”, a divorce has the same affect as if the spouse has died. Therefore, the gift to the spouse is nullified, and the estate will pass directly to the children. In addition, if you intend to re-partner again, marriage does revoke a Will entirely. If you have separated from your spouse, made a new Will that gifts your estate to your children, re-partnered, and then decide to marry again, the new marriage will revoke the Will that you made. Instead of your estate going to your children, your new spouse will then have certain succession rights in relation to your estate. It is advisable to seek advice from a solicitor to make a proper Will, and not try to do it yourself. There are issues around challenging Wills that relate to blended families in particular. If a person dies without having made a new Will, they are said to have died intestate. The new spouse will be entitled to a greater share of the estate, and the children from the first marriage may inherit less than what was originally intended.

Remember - the future definitely belongs to the prepared!

As family law expert Geoff Brazel says, “The law is full of mystery. People are often very afraid of going to see a lawyer to seek out advice. There are lots of bush lawyers around and my advice to anyone would be to get proper advice about your own particular situation rather than relying on general advice from friends or relatives”.

The law is very clear - the court will issue a warrant for the child to be taken into custody and returned to the parent with whom the child was living. The police can also issue a warrant for the arrest of the parent who has removed the child. It is unlawful to collect and then fail to return a child. Some criminal charges can be laid against a parent for kidnapping their own child.

Wills

If you are separating from somebody and you have already made a Will which leaves your entire estate to them, you might consider changing your Will to leave your estate to your children.

Divorce does not revoke a Will. However, it nullifies a gift to your divorced partner. If you have a Will that states, “I leave all of my estate to my spouse, but if my spouse dies before me, then to my children”, a divorce has the same affect as if the spouse has died. Therefore, the gift to the spouse is nullified, and the estate will pass directly to the children. In addition, if you intend to re-partner again, marriage does revoke a Will entirely. If you have separated from your spouse, made a new Will that gifts your estate to your children, re-partnered, and then decide to marry again, the new marriage will revoke the Will that you made. Instead of your estate going to your children, your new spouse will then have certain succession rights in relation to your estate. It is advisable to seek advice from a solicitor to make a proper Will, and not try to do it yourself. There are issues around challenging Wills that relate to blended families in particular. If a person dies without having made a new Will, they are said to have died intestate. The new spouse will be entitled to a greater share of the estate, and the children from the first marriage may inherit less than what was originally intended.

Remember - the future definitely belongs to the prepared!

As family law expert Geoff Brazel says, “The law is full of mystery. People are often very afraid of going to see a lawyer to seek out advice. There are lots of bush lawyers around and my advice to anyone would be to get proper advice about your own particular situation rather than relying on general advice from friends or relatives”.

If you are separating from somebody and you have already made a Will which leaves your entire estate to them, you might consider changing your Will to leave your estate to your children.

Divorce does not revoke a Will. However, it nullifies a gift to your divorced partner. If you have a Will that states, “I leave all of my estate to my spouse, but if my spouse dies before me, then to my children”, a divorce has the same affect as if the spouse has died. Therefore, the gift to the spouse is nullified, and the estate will pass directly to the children. In addition, if you intend to re-partner again, marriage does revoke a Will entirely. If you have separated from your spouse, made a new Will that gifts your estate to your children, re-partnered, and then decide to marry again, the new marriage will revoke the Will that you made. Instead of your estate going to your children, your new spouse will then have certain succession rights in relation to your estate. It is advisable to seek advice from a solicitor to make a proper Will, and not try to do it yourself. There are issues around challenging Wills that relate to blended families in particular. If a person dies without having made a new Will, they are said to have died intestate. The new spouse will be entitled to a greater share of the estate, and the children from the first marriage may inherit less than what was originally intended.

Remember - the future definitely belongs to the prepared!

As family law expert Geoff Brazel says, “The law is full of mystery. People are often very afraid of going to see a lawyer to seek out advice. There are lots of bush lawyers around and my advice to anyone would be to get proper advice about your own particular situation rather than relying on general advice from friends or relatives”.