Valuations

One of the first steps in any property settlement is identifying all the values of the property pool, including all assets, liabilities and superannuation. In many cases, parties can agree on values through their own research or by consulting industry professionals. For example, motor vehicles are often valued using widely accepted guides such as RedBook.

Where agreement cannot be reached, it may be necessary to obtain a formal valuation from an independent expert. The best practice is for the expert to be appointed jointly, which prevents the parties from each obtaining valuation, which may differ, and then disputing which valuation to rely upon.

Typically, the most common assets that require valuation are real estate, vehicles, and business interests, although anything that does not have a set value (such as a bank account) may be subject to valuation.

Real Estate

Real estate is often the most significant asset in a property settlement.

Parties commonly begin by obtaining multiple appraisals from real estate agents to see if an agreement can be reached. These appraisals are estimates based on recent comparable sales and are usually provided at no cost.

If agreement is not possible, a qualified property valuer can prepare a formal valuation report. This report is based on the valuer’s expertise, training, and detailed market analysis.

In litigated matters, the court will generally require independent expert evidence to determine the value.

Typical cost: $600 to $1,500 per property

Businesses

Business interests can be complex and often require specialist valuation, often completed by forensic accountants.

As a first step, parties may rely on advice from their own accountant to propose an agreed value. However, if there is a dispute, an independent expert will be appointed to assess the value of the interests of the parties in the business/entity.

Valuations of businesses may include an assessment of the net assets of the business, calculating future maintainable earnings, and applying market-based valuation approaches.

Since these valuations are an extensive exercise, it is important to consider whether the cost of a valuation is proportionate to the value of the business before proceedings, as in many cases, it is significantly more cost effective to agree on a value between the parties, rather than engage a formal valuer.

Typical cost: $10,000 to $30,000 per business

Motor vehicles

In most cases, the value of a motor vehicle can be agreed using online valuation tools such as RedBook.

However, specialist valuation may be required when a vehicle is rare, unique, vintage, or under restoration. In those circumstances, and expert is usually required to provide an opinion on the value of the vehicle, and should be jointly instructed to provide a written report.

Household items

Household contents are generally valued at “garage sale” value and considered as a single overall figure, rather than itemised individually.

However, items may be separated from the general ‘household contents’ and considered individually especially if they are antiques, heirlooms or collectables, and may require expert valuation, if the parties cannot agree on a value.

Superannuation

Superannuation is often a significant asset in family law matters.

For most accumulation funds, the value is simply the balance shown on the member’s statement.

However, more complex interests may require specialist valuation, including:

• defined benefit funds 
• self-managed superannuation funds (SMSFs) 

Defined benefit funds usually require a formal valuation by a specialist. This process often involves the fund completing a Superannuation Information Form.

SMSFs may hold various underlying assets (such as property or trusts), which may need to be valued individually before determining the overall fund value.

Other assets

There is a huge variety of assets that a couple might own. This can include interests in unit trusts, cryptocurrencies, racehorses or gold or silver bullion. Without agreement, all assets need to be valued to finalise a family law claim, and there are specialist valuers for almost every circumstance.

Accurate valuation of all assets is essential to achieving a fair and equitable property settlement. Without reliable evidence of value, disputes can be prolonged and outcomes uncertain. Obtaining appropriate valuations early can save time, reduce costs, and help resolve matters more efficiently. For help, please contact Armstrong Legal.