How Long After Separating Should You Start Property Settlement?
When parties separate, they can initiate negotiations to resolve their property issues immediately. There is no requirement to wait for a period of time or for a divorce order to be made before discussions and negotiations can start.
An application to the court for property orders must be made within the following time limits:
- For married couples, an application must be filed within 12 months of the date the divorce order takes effect;
- For de-facto couples, an application must be filed within two years of separation.
If an application is not filed within these time limits, a party may be barred from seeking property division order from the Family Court, unless the court grants permission to file an application outside of time.
The Family Court may grant permission to start proceedings outside of the time limits in limited circumstances. It will consider:
- Whether hardship would be caused to any party or a child of the parties if leave is not granted;
- If the application involves spousal maintenance, the party’s circumstances at the end of the time limit.
Generally, losing a right to claim property settlement will not be sufficient to overcome the hurdle of hardship. It is necessary to show serious hardship to a party or a child of the couple for a permission of such nature to be granted.
As property divisions are complex, it is essential to consult an experienced family lawyer.
Dealing with property straight after separation
The period immediately after separation is a very stressful time. One of the biggest causes of stress can be not knowing how to deal with finances in the short term. Sometimes, people continue living in the same house even though they are separated. In other families, one partner may move out and live elsewhere, which means they have to find a way to pay rent, and cover new expenses.
There are no set rules or laws setting out who covers regular payments after a separation, before a final property settlement has been organised. There are usually many things to consider, including rent or mortgage payments, insurances, school fees, credit cards, personal loans and day-to-day bills. It is not the case that the court would expect each partner to pay half of all expenses, as in most families it is not common that each partner earns an equal amount or is able to contribute equally.
If a family already has an existing arrangement that they can afford to continue, it is usually best to keep things as they are for a short period of time. That way, everybody knows the usual arrangement, bills continue to be paid and the changes that are going on in the life of the family are minimised.
Problems can arise where the family can no longer afford to continue the existing arrangement, because of the increased costs of living separately. Where possible, the couple should have a discussion about who will pay which bills or regular payments, and whether there are any regular payments that can be reduced, put on hold or cancelled. You should always seek financial advice, but some of the options that can be considered are:
- Cancelling or reducing regular donations to charity, even if for a short period;
- Having discussions with banks or lenders about putting mortgage or other loan repayments on hold for a short period, or other options that may be available;
- Cancelling, reducing or putting on hold subscription services, such as Netflix, gym memberships, magazine subscriptions and similar;
- Negotiating with flexible service providers to alter payment arrangements.
It is important that both parties carefully monitor bank accounts and incoming bills so that both can be satisfied that all obligations are being met. Most service providers can send statements and accounts to two different address, if they are notified that joint account holders have separated.
For advice or representation in any legal matter, please contact Armstrong Legal.