The 5 Steps of Property Settlement

There are five steps the Court considers when determining a party’s entitlement to an adjustment of property interests as a result of the breakdown of a relationship (either a marriage or a de facto relationship).

They are:

Step 1: To determine whether or not it is just and equitable to adjust the parties’ interests in property held by either party to the relationship.

Step 2: To identify and value all property held by both parties to the relationship, irrespective of where it came from or when it was acquired.

Step 3: To consider the direct and indirect, financial and non-financial contributions made by and on behalf of each of party, including contributions in the role of the homemaker and parent. 

            At this stage, a percentage apportionment reflecting those contributions is usually made (for example 50% / 50% for equal contributions by both parties).

Step 4: To consider, among other things:

a)      the age and state of health of each party;

b)      the income, property and financial resources of each party;

c)      the physical and mental capacity of each party for appropriate gainful employment;

d)      the disparity in the income earning capacities of each party;

e)      any instances of family and/or domestic violence; and

f)       any commitments that are necessary for each party to support themself or any other person (including children or other dependents).

The Court then determines if these factors mean the apportionment in step 3 above should be varied.

Step 5: To consider if the specific order the Court proposes to make to implement the percentage division decided upon is “just and equitable” in all the circumstances of the particular case and make any necessary adjustments.

When we say “Court” these are the guiding principles that the Court has determined previous cases on. Even if your property matter never goes before the Court, we step through the same 5 fundamental stages to determine your entitlements and to advise you on the best course of resolving your property settlement.

If you would like to discuss your property settlement options and entitlements, please contact our team of experienced family lawyers for a consultation.