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What are the rights of each partner in a separation?

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CM Law's Ultimate 50 List - Separated Couples FAQ #3:
What are the rights of each partner in a separation?

Introduction

When a relationship ends, whether it is a marriage or a de facto partnership, both partners have rights and entitlements under Australian law. In New South Wales (NSW), these rights are determined by the Family Law Act 1975 (Cth) and other relevant state legislation, including the Property (Relationships) Act 1984 (NSW). Understanding these rights is crucial to navigating the separation process, especially when it comes to property division, financial support, and the care of children.

1. Rights to Property and Assets

1.1. Entitlement to a Fair Share of Property

In NSW, both partners have the right to a fair and equitable share of the property and assets accumulated during the relationship. The Family Court of Australia or the Federal Circuit and Family Court of Australia determine property settlement matters based on a four-step process:

  1. Identifying and Valuing Property and Debts: All assets (e.g., homes, cars, bank accounts, businesses) and liabilities (e.g., mortgages, loans) are identified and valued.

  2. Assessing Contributions: The court considers both financial contributions (e.g., income, investments) and non-financial contributions (e.g., homemaking, raising children).

  3. Considering Future Needs: Factors such as age, health, earning capacity, and the care of children are assessed.

  4. Achieving a Just and Equitable Outcome: The court makes a determination that is fair and reasonable for both parties.

1.2. Right to Remain in the Family Home

One partner may have the right to remain in the family home temporarily, especially if they are the primary caregiver of children. This right can be negotiated between the parties or ordered by the court, taking into account the best interests of the children and each partner’s financial situation.

2. Rights to Financial Support

2.1. Spousal Maintenance

Partners have the right to seek spousal maintenance if they cannot support themselves adequately post-separation. The court considers the needs of the applicant and the capacity of the other party to pay. Spousal maintenance may be temporary or ongoing, depending on the circumstances.

2.2. Child Support

Both parents have the right to receive or pay child support to meet the child's needs. Child support is determined based on an administrative assessment by Services Australia, which considers each parent's income, the number of children, and their living arrangements.

3. Rights Related to Children

3.1. Parental Responsibility

Each partner has the right to share parental responsibility for their children unless a court orders otherwise. This right includes making long-term decisions about the child’s education, health care, and religious upbringing.

3.2. Right to Time with Children

Parents have the right to spend time with their children, and the children have the right to a meaningful relationship with both parents. The Family Court determines arrangements based on what is in the best interests of the child, considering factors like the child's safety, wellbeing, and relationship with each parent.

4. Rights to Safety

4.1. Protection from Family Violence

Both partners have the right to safety from family violence. Victims of family violence can apply for an Apprehended Domestic Violence Order (ADVO) through the Local Court to protect themselves from the other partner. The order can impose various conditions, such as prohibiting contact or requiring the partner to vacate the family home.

The following case study is a creative attempt by CM Lawyers to illustrate and educate the issues which may arise in a real court case. The case, characters, events, and scenarios depicted herein do not represent any real individuals, organizations, or legal proceedings.

Case Study: Complex Separation Case in NSW – Smith v. Jones [2021] NSWSC 384

Introduction

In the case of Smith v. Jones [2021] NSWSC 384, the end of a 15-year marriage led to a highly contentious and emotionally charged separation. The couple had two children and significant assets, including multiple properties, a successful business, and substantial savings. The legal battle over these assets was prolonged and costly, demonstrating the complexities involved in asserting rights during separation.

Background and Overview

The Smiths were a well-established couple with a combined asset pool of $6 million, including a $3 million family home, a $2 million business, and $1 million in various investments and savings. When their marriage broke down, they could not agree on property division, child custody, or spousal maintenance, resulting in an 18-month legal battle.

Behaviour of the Participants

The separation quickly became contentious, with both parties accusing each other of misconduct and misrepresentation. Ms. Smith, fearing financial insecurity and the loss of her family home, felt desperate and overwhelmed. She alleged that Mr. Jones had hidden assets and manipulated business accounts to reduce her share of the property settlement.

On the other side, Mr. Jones, believing he had been wronged and seeking to retain control over the family business, refused to compromise. He argued that he had contributed more to the acquisition and growth of their assets and was unwilling to relinquish his perceived share. The conflict escalated into a series of heated legal confrontations, with both parties feeling increasingly desperate and distraught.

Legal Process and Court Involvement

Multiple mediation sessions were attempted but failed due to the deep mistrust and animosity between the parties. The matter proceeded to the NSW Supreme Court, where both parties presented extensive evidence regarding their contributions to the marriage, the business's value, and allegations of hidden assets.

The court found that Mr. Jones had failed to disclose certain financial information, including offshore accounts and undeclared business income. The judge ordered a forensic examination of the business accounts and found significant discrepancies, strengthening Ms. Smith's position in the settlement.

Financial Consequences

The legal battle's financial consequences were severe. The total legal costs for both parties exceeded $500,000, significantly reducing the estate's available assets for distribution. The court ordered the sale of several properties, including the family home, to cover legal fees and ensure a fair division of assets. The once-thriving business was also substantially affected by the legal scrutiny and valuation process, reducing its market value by 20%.

Statistics

  • Property Settlement Disputes: 50% of contested property settlements in NSW involve high-value assets, such as businesses and investment properties.

  • Legal Costs: The average legal cost for contested property settlements in NSW ranges from $50,000 to $300,000.

  • Spousal Maintenance: About 25% of separations involve claims for spousal maintenance, with the average claim lasting 2-3 years.

  • Child Support Arrangements: 60% of separating couples in NSW negotiate child support through Services Australia.

  • Domestic Violence Orders: Over 30,000 Apprehended Domestic Violence Orders (ADVOs) are issued annually in NSW.

  • Court Resolution Timeframe: On average, contested separations resolved in court take 18-24 months.

  • Non-Disclosure of Assets: Approximately 20% of property disputes involve allegations of hidden or undisclosed assets.

  • Superannuation Division: 40% of property settlements involve disputes over superannuation entitlements.

  • Children's Care Arrangements: 70% of cases involving children result in shared parental responsibility orders.

  • Percentage of Mediation Success: Mediation resolves 60% of family law disputes without the need for court intervention.

Essential Resources

Government Resources

Non-Profit Organisations