Elizabeth Adams, Senior Family Law Solicitor explains how the attitude of “taking him to the cleaners” just might bring you a lot of stress and hurt your hip pocket.
Separating from a spouse can be very messy. Someone you once loved can become your worst enemy, particularly when the separation is not a mutual decision.
When first meeting with a newly separated client, I often hear the words “I’m going to take him to the cleaners” or “I want to take her for everything, so she ends up with nothing.” Whilst these are often merely words of anger and pain, coming from someone who is normally very sensible, some separated spouses are actually of the view that they will be able to seek retribution for the wrongdoing of the other party in a property settlement. This is generally not the case.
There is a method to a property settlement that is not based on blame for the breakdown of the relationship. So as to determine how assets should be divided, the following factors are considered:
- What does the property pool consist of? This entails calculating all of the assets owned by the parties (including through company and trust structures), calculating the liabilities of the parties as well as financial resources, such as superannuation and imminent compensation payments.
- What contributions have the parties made? This includes the assets each party had at the start of the relationship, contributions made by each party to preservation and increase of the pool during the marriage and contributions after separation. The types of contributions that are considered include financial contributions by a higher income earner, care of children, care of the home, inheritances received and cash gifts received.
- What matters may affect a party in the future? Factors such as income disparities, greater primary care of children, cost of stay-at-home parents returning to the work force, health factors and age of the parties are common factors that are considered.
By giving careful consideration to the above, a family law solicitor can work out what distribution each party is likely to receive.
In some situations, the parties may already have in their own names the property that they could expect to receive as a result of a property settlement. In this scenario, it may be appropriate that no property division take place, rather the parties keep what they already own. Such a settlement should still be formalised so that neither party can “rock the boat” by seeking a property settlement further down the track.
As each family is different to the next, there is no hard and fast rule as to what each party will receive from a property settlement. Just because someone is emotionally hurting after a separation, often for entirely justifiable reasons, it doesn’t mean they will retain the lion’s share of the property pool. Sound objective advice from an experienced family lawyer will maximise your chances of reaching an amicable settlement without the stress (and extra cost) of heading off to Court.