The Five Steps of a Property Settlement
In this video, Page Provan Family & Fertility Lawyers Managing Director, Bruce Provan discusses how property settlements are resolved and in particular the five-step process that the courts use to determine each property settlement matter.
Transcript
My name is Bruce Provan, I’m the Managing Director of Page Provan, Family and Fertility Lawyers. I want to talk to you today about property settlements and how they’re resolved, and in particular, the five step process that the courts use to determine each property settlement matter.
Now, of course, many matters don’t go to court, many matters are resolved through negotiations out of court. But in advising you, lawyers will advise you and apply the five step process to determine what your entitlement is. So the five steps are, first to determine whether it’s just and equitable for an order to be made at all.
There are some cases where a court is likely to find that each party should just keep what they’ve got, and that there is no need, or it’s not just and equitable for an order to be made. If it is just and equitable for an order to be made, the second step is to work out what is the pool of property that’s available for distribution between the parties.
In most cases, that’s fairly straightforward. But in some cases, it becomes very complex, especially where you’ve got company, trust, or tax issues and often in those cases, we need the help of other advisors such as accountants.
The next step is to look at contributions. Contributions include not only the financial contributions, but also the non-financial contribution, such as the contributions as homemaker and parent. Now when weighing up the contributions, certain factors may mean that one party is entitled to more than fifty percent. For example, if either side has brought in more to the relationship at the beginning, or that might be a gift or a significant inheritance during the relationship.
The next step is to look at the future needs factors, and that includes things like who’s got the majority of the care of the children, the relative earning capacities of the parties, the age and state of health of each of the parties, whether either party has commenced cooperation with another person, whether either party is entitled to any government entitlement, and once we’ve gone through that stage, the final step is to look at the percentage distribution and say, is that a just and equitable outcome?
In doing that, the court will usually allocate a certain percentage to each party. So for example, the court might say that the wife might get X percent and the husband is to get Y percent.
At Page Provan, from the outset we will advise you what your entitlement is and what the range of entitlement that you are likely to receive might be, and use that as a basis for trying to negotiate a property settlement with the other party or their lawyer.
