Mediation is a cost effective way for Married or De Facto Parties who are separating may do a Property Settlement of their assets and liabilities any time after separation.
For Married couples this must be completed within 12 months of a divorce and for de facto couples this must be completed within 2 years of separation, unless in each situation, the parties have applied to the Court for leave to extend this time frame.
The parties’ property settlement is formalised by way of Consent Orders lodged with the Family Law Court, or by way of a Binding Financial Agreement.
The Agenda
Case law shows that there is a preferred approach by the Court to the determination of an application brought pursuant to the provisions of s79 of the Family Law Act regarding Property Settlements.
The Mediation process will follow the same 4 process steps as that followed by the Court in determining Property matters. The steps are as follows:
- Identify/ value the assets, liabilities, and financial resources.
- Assess the contributions made by each party before and during the relationship and post the separation.
- Consider the future needs of each party.
- Divide the property/assets in a way that is “just and equitable”.
The agenda of a property mediation is therefore typically:
- What are the assets and liabilities and what are their values?
- How and who made these contributions, including financial and non-financial contributions.
- How can we address future needs?
- How can we manage any special issues? For example, loans, gifts, inheritance.
- How will we divide our assets and liabilities?
To help you prepare for your property mediation, please download a free copy of Nicole’s Property Negotiation Handbook.
Based on the agenda, the process of discussing each asset and liability may take the following approach:
| Assets (in whose name) | Party A’s value | Party B’s value | Agreed value |
| 1. | |||
| 2. | |||
| Gross total assets | |||
| Liabilities (in whose name) | |||
| 1. | |||
| 2. | |||
| Total liabilities | |||
| Net estate |
Just and equitable
The court must not make any order unless it is satisfied that, in all the circumstances, it is just and equitable to do so (FLA s 79(2)). This requirement refers to both the assessment of the contributions of the parties and the s 79(4)(d)–(g) factors (of which the s 75(2) factors are the most important).
Full and frank disclosure
Circumstances in which the Court may set aside Consent Orders (FLA 79A) or Binding Financial Agreements (FLA 90K) are as follows:
- There has not been a Full and frank disclosure of Assets / Liabilities at the time of the Property Settlement (non-disclosure/fraud)
- The Agreement regarding the Property Settlement is impracticable
- There has been a material change of circumstances relating to the care of a child. (accident or such that effects the child’s future needs)
Legal advice
There are many outside factors that may impact on your particular circumstances. It is recommended that you receive advice from a family lawyer and/or your accountant, tax advisor and / or financial advisor prior to commencing a property settlement mediation.