FAQ - Frequently Asked Questions

How Is Property Divided in a Divorce

Justice Family Lawyers Sydney

There is no formula that the court uses to divide property after a separation or divorce. Each case is examined independently from other cases. This means that it is quite difficult to predict the outcome of a property settlement, even by looking at similar previous cases.

It is useful to note that a divorce order simply ends a marriage between two people. The division of property happens either when the two former spouses come to an agreement together (by themselves or through mediation) and then perhaps legally formalise this agreement, or when one or both of them apply to the court for financial orders.

The court makes financial orders to divide property and assets, as well as to order spousal maintenance. There are time limits within which couples can apply to the court for a property settlement. This limit is up until two years after the date of separation for de facto couples and up until one year after the finalisation of the divorce for married couples.

Apart from this, married and de facto financial orders are treated exactly the same. The value of the assets and liabilities is first calculated, and the property to be divided is placed in a divisible pool of assets. This pool is divided according to the contributions each party made to the relationship and their future needs. The court works with the aim of achieving a result that is just and equitable for both people.

The court looks at many factors, such as each party’s current and future needs, age and health, income earning capacity and the care of children. Parties’ contributions to the relationship are categorised as financial, such as earning an income, and non-financial, such as caring for children and maintaining the household. The court adjusts the percentage of the asset pool each party will receive depending on their contributions and needs.

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