Property Settlements and Items of Sentimental Value

During Family Law proceedings, the Federal Circuit and Family Court (FCFCA) has wide discretion to make orders ensuring a ‘just and equitable’ outcome depending on the particular circumstances of the case. This means that the court can consider factors that are more subjective or personal to each individual case. The courts have emphasised the difficulty of assessing sentimental value, but they will make these assessments when necessary to finalise a property settlement. This article outlines the types of property that the court would deem to be of ‘special’ or sentimental value and examines the probable way that the court would deal with these items.

Property Settlements

When a married or de facto couple separates, they must divide the assets from the relationship. If the parties are unable to make an arrangement privately, then they can apply to the FCFCA for a property settlement assessment. This process starts with the collection of a list of the assets, each of which is assigned a value. This is the first step of a 5-step process, which includes assessing the contributions (financial and non-financial, direct or indirect) made by each party to the marriage. The court also ponders the future needs of each individual, and whether in the circumstances the propose division of property is just and equitable.

What Does the Court Consider a Special Item?

The courts will assess property of any value, but it does encourage parties to come to an agreement between themselves, particularly for items of smaller or sentimental value. The court deals with a range of specialty items in property settlements, from items of sentimental value, such as inherited pieces, to property that is essential to one’s occupation, such as tools of the trade. Under the Family Law Act 1975 special heirlooms and sentimental items are treated like any other asset in a property settlement. All property must be assigned a value, either by a qualified valuer or through spousal agreement.

There is no presumption that specific pieces of property will be allocated to one partner over the other. Rather, it depends on the particular circumstances of the case, including how the items came into the couple’s possession (that is, who purchased or received them). The court will make an assessment as close to a just and equitable outcome as possible, usually based on a pragmatic judgement.

What Is the Best Approach to items of sentimental value?

It is always best to try and tackle a property settlement as unemotionally as possible. When a couple separates, the parties should each list the items that are special to them, and then consult on the list and try and reach an agreement on the division of assets. This should be completed as soon as possible, as items can be displaced, sold or broken in the interim. There are some instances where a pragmatic solution can be reached, for example, sentimental photos can be duplicated and given to both parties. With many pieces of property of sentimental value, only one party has an emotional attachment to the item, and this can make it easier to divide the items.

In practice, negotiation about items that have sentimental value to both parties, such as family pets, are the most difficult to resolve successfully. If the parties are having trouble coming to an agreement, they can attend mediation with a qualified mediator.

Should Parties Leave items of sentimental value Up to the Court in a property settlement?

The court prefers parties to make an agreement on the division of items of sentimental value privately, as the cost of litigating is usually greater than the value of the items themselves. If the parties definitely cannot reach a decision between themselves, they can ask the court to adjudicate the matter.

The judgment of the court often depends on the item itself. For example, if one partner needs certain tools of their trade to earn an income, then the court is likely to assign them to that party. With heirlooms, the court considers the particular circumstances of the case, including which partner inherited and when, and the monetary value of the inheritance.

Then there are items that have both monetary and sentimental value. In a 2012 case in the Family Court, a family farm inherited by the husband was awarded to the wife in a property settlement. The court found that each party’s contribution to the marriage had been roughly equal, but that the wife’s plan to generate future income through running a bed and breakfast on the property was persuasive. After nearly two decades of being out of the workforce, the court assessed this business opportunity as her best chance to earn an income. The husband was able to rely on his relatively well-paid managerial role for future income. The case was complicated further in that there were items of significant sentimental value on the land. The husband’s parents ashes were interred on the property in a memorial garden in two large urns with commemorative headstones, next to a bronze bust of the man’s father. After the court ruled that the wife should keep the farm, the husband was given two weeks to relocate his parents’ remains.

As much as it is a natural impulse to pre-emptively collect your own personal items after the dissolution of a relationship, it is best to have an honest discussion with your former partner and try to reach an agreement over the property, particularly those items of sentimental value. If you have any questions about dividing special and sentimental items in a divorce settlement, please telephone Armstrong Legal on 1300 038 223 or email us to make an appointment.