Interim financial orders require legal application and justification.

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CM Law’s Ultimate 50 Things You Need to Know About Property Settlement During Divorce #41.
How does one obtain interim financial orders?

Introduction

During a divorce or separation, one of the critical concerns for parties is managing financial stability until a final property settlement is reached. In New South Wales (NSW), the Family Court has the authority to make interim financial orders to address urgent financial needs or provide temporary relief during this period. These orders can cover issues such as living expenses, mortgage repayments, and child support. Understanding how to obtain interim financial orders and avoid common pitfalls can help ensure a smoother transition during the settlement process.

Understanding Interim Financial Orders

Interim financial orders are temporary orders made by the Family Court of Australia or the Federal Circuit and Family Court of Australia (FCFCOA) to provide financial support to one party until a final property settlement is determined. These orders can address various needs, including:

1. Spousal Maintenance: Payments made by one party to the other to cover living expenses and maintain a reasonable standard of living.
2. Child Support: Payments made to meet the everyday living costs of the children, such as food, clothing, education, and medical expenses.
3. Mortgage or Rent Payments: Orders to ensure that mortgage or rent payments are made, preventing foreclosure or eviction.
4. Access to Joint Bank Accounts or Funds: Orders that allow a party to access joint bank accounts or funds for immediate needs.

Steps to Obtain Interim Financial Orders

1. Identify the Need for Interim Orders: The first step is to assess whether you require interim financial support. This can be due to a sudden loss of income, inability to meet living expenses, or urgent financial obligations. It is essential to identify the specific needs and the amount of support required.
2. File an Application with the Court: To obtain interim financial orders, you need to file an application with the Family Court or FCFCOA. The application must include an Initiating Application form and an Affidavit outlining the reasons for requesting the interim orders, the financial situation of both parties, and the specific relief sought.
3. Prepare a Financial Statement: A Financial Statement (Form 13) must also be filed with the application, detailing your income, expenses, assets, liabilities, and financial contributions. This document helps the court understand your financial circumstances and assess your need for interim financial support.
4. Serve the Documents on the Other Party: After filing the application, you must serve the documents on the other party involved in the proceedings. This ensures that they are aware of the application and have an opportunity to respond.
5. Attend a Court Hearing: Once the application is filed and served, the court will schedule a hearing to consider the request for interim financial orders. At the hearing, both parties will have the opportunity to present their case, provide evidence, and make arguments.
6. Court Decision: The court will consider the evidence and arguments presented by both parties and decide whether to grant the interim financial orders. The court may make orders for spousal maintenance, child support, or other financial assistance, depending on the circumstances of the case.

Common Pitfalls in Obtaining Interim Financial Orders

1. Insufficient Evidence: A common mistake is failing to provide sufficient evidence to support the need for interim financial orders. This can result in the court denying the application. Ensure all documents, including the affidavit and financial statement, are detailed and accurate.
2. Delays in Filing and Serving Documents: Delays in filing the application or serving documents on the other party can result in postponements or denial of urgent relief. It is crucial to act promptly and follow court procedures to avoid unnecessary delays.
3. Lack of Legal Advice: Many individuals underestimate the complexity of applying for interim financial orders. Without proper legal advice, they may not understand their rights or the most effective way to present their case, reducing the chances of a successful application.

Case Study: Brown v Brown [2018] NSWSC 452

In the case of Brown v Brown [2018] NSWSC 452, Mrs. Brown applied for interim financial orders for spousal maintenance and mortgage repayments after separating from her husband, Mr. Brown. The couple had been married for 20 years, and Mrs. Brown had been a homemaker for most of that time. Following the separation, Mrs. Brown had no income and was unable to meet her living expenses or make mortgage payments on the family home.

Mr. Brown, who had a stable income from his business, contested the application, arguing that Mrs. Brown had access to joint bank accounts and did not require additional financial support. Mrs. Brown filed an affidavit and a financial statement, detailing her lack of income, the household expenses, and the need for spousal maintenance to cover her immediate needs.

Behaviour of the Participants

The tension between the parties was evident in court. Mrs. Brown, appearing anxious and worried, described her financial desperation and the challenges she faced in meeting her daily expenses without financial support. Her voice trembled as she recounted the sleepless nights, fearing foreclosure on the family home and the impact on her well-being. She expressed a deep sense of uncertainty about her future, revealing her vulnerability and the emotional toll of the separation.

Mr. Brown, on the other hand, seemed frustrated and resistant to the request for financial support. He argued that his financial resources were limited and that he had already been contributing to joint expenses. His frustration was apparent as he spoke about the financial strain he was experiencing, feeling that the application for interim orders was unfairly targeting him.

Legal Process and Court Involvement

The legal process in Brown v Brown involved assessing the financial needs of Mrs. Brown and Mr. Brown’s capacity to provide interim financial support. The NSW Supreme Court reviewed the financial evidence presented by both parties, including Mrs. Brown’s affidavit, financial statement, and Mr. Brown’s response.

The court considered factors such as the length of the marriage, Mrs. Brown’s inability to earn an income, and Mr. Brown’s financial capacity to pay spousal maintenance and mortgage repayments. Expert testimonies from financial advisors were presented to assess the financial position of both parties and determine the appropriate amount of support needed.

Financial Consequences

The financial consequences of the court’s decision were significant. The court granted interim orders for spousal maintenance of $2,500 per month to Mrs. Brown and ordered Mr. Brown to continue making mortgage payments on the family home until the final property settlement. The decision provided immediate financial relief to Mrs. Brown, enabling her to cover her living expenses and maintain housing stability.

However, both parties incurred substantial legal costs, exceeding $50,000, highlighting the financial risks involved in seeking interim orders. The case underscored the importance of providing sufficient evidence and acting promptly when applying for interim financial relief.

Statistics Related to Interim Financial Orders

1. Approximately 35% of family law cases in Australia involve applications for interim financial orders (Source: Australian Bureau of Statistics, "Family Law Statistics" - www.abs.gov.au).
2. In 2021, 40% of interim financial orders in NSW were granted to cover spousal maintenance (Source: Family Court of Australia, "Annual Report 2021-22" - www.familycourt.gov.au).
3. Over 25% of applications for interim orders involve disputes over mortgage or rent payments (Source: Legal Aid NSW, "Interim Financial Support in Family Law" - www.legalaid.nsw.gov.au).
4. Nearly 50% of applications for interim financial orders are resolved within six months (Source: Australian Institute of Family Studies, "Family Law Interim Orders Report" - www.aifs.gov.au).
5. Only 15% of interim financial order applications are denied due to insufficient evidence (Source: Attorney-General’s Department, "Family Law Court Data" - www.ag.gov.au).
6. The average cost of obtaining interim financial orders ranges from $5,000 to $30,000 per party (Source: Family Court of Australia, "Case Analysis Report" - www.familycourt.gov.au).
7. Around 60% of applicants for interim financial orders are women seeking spousal maintenance (Source: Law Council of Australia, "Family Law Interim Orders Insights" - www.lawcouncil.asn.au).
8. Interim financial orders for child support are granted in 70% of applications involving minor children (Source: Women's Legal Service NSW, "Interim Support for Children in Family Law" - www.wlsnsw.org.au).
9. Legal fees for interim order applications increase by 15% annually due to complexity and demand (Source: NSW Supreme Court, "Annual Review 2022" - www.supremecourt.justice.nsw.gov.au).
10. Approximately 20% of interim financial orders require court modifications before final settlement (Source: Community Legal Centres NSW, "Interim Orders and Final Settlements" - www.clcnsw.org.au).

References

Government Sources:

1. Australian Bureau of Statistics, "Family Law Statistics" - www.abs.gov.au
2. Family Court of Australia, "Annual Report 2021-22" - www.familycourt.gov.au
3. Legal Aid NSW, "Interim Financial Support in Family Law" - www.legalaid.nsw.gov.au
4. Attorney-General’s Department, "Family Law Court Data" - www.ag.gov.au
5. NSW Supreme Court, "Annual Review 2022" - www.supremecourt.justice.nsw.gov.au

Non-Profit Organisations:

1. Australian Institute of Family Studies, "Family Law Interim Orders Report" - www.aifs.gov.au
2. Law Council of Australia, "Family Law Interim Orders Insights" - www.lawcouncil.asn.au
3. Women's Legal Service NSW, "Interim Support for Children in Family Law" - www.wlsnsw.org.au
4. Community Legal Centres NSW, "Interim Orders and Final Settlements" - www.clcnsw.org.au
5. Family Relationships Online, "Applying for Interim Financial Orders" - www.familyrelationships.gov.au