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In the vast majority of cases, disputes between married or de facto couples about the division of their property when their relationship breaks down are settled by negotiation. In fact, only a tiny fraction (about 4%) of cases that are filed with the Family Courts go on to a final hearing in front of a judge. In addition, many matters are settled without issuing any court documents.    

Property settlements (that is, where the division of the family home, a business, motor vehicles and anything else of value are agreed on) can come about in several ways. The parties can attend a private mediation to try to reach an agreement, sometimes an independent lawyer, such as a barrister, is engaged to conduct the mediation, or there can be negotiations through their respective solicitors. If court proceedings are issued by one of the parties, that will lead to a Conciliation Conference, led by a court registrar, who is a lawyer working for the court.

Each of these options is designed to try to get the parties to reach an agreement about a property settlement. To be successful, each party needs to make a full and frank disclosure of their financial situation and the value of significant assets, such as the house, should be agreed on, or a valuation obtained.

If an agreement is reached between the parties, one of the lawyers will draw up either Consent Orders, to be made by the court, or a Binding Financial Agreement (BFA), which does not go before the court, but has the same force and effect as a court order.

At any time up to when the court makes property orders, or a BFA is signed, one or both of the parties can change their mind and withdraw from the settlement. However, there can be consequences if that is done following a court-ordered conciliation conference. Of course, changing you mind (quite often after having thought about the settlement overnight, or discussed it with family or friends), after agreement has been reached will usually upset the other party and make a further settlement more difficult, as well as more expensive to achieve.

If you are at court and negotiations have been going on all day to try to reach a property settlement with your former partner (and the judges are usually happy for those negotiations to take place, rather than run the case in court for 2 or 3 days, at great expense for both sides), a time will come towards the end of the day when your barrister or solicitor will try to save you the expense of another day in court, and to advise you to sign a settlement agreement that is in your best interests, but is usually a compromise between what you and your ex want.

The judge can then formalise the settlement with court orders. Lawyers are often told by their clients the next day that they were “forced” to sign the settlement agreement. But that’s not the case. Read the document carefully and make sure that you understand and agree with it. If you don’t, then don’t sign. For, once the judge makes the orders, or both parties sign a BFA, that’s that. Only in rare circumstances can the orders or the BFA be set aside – if there is fraud, non-disclosure of assets or other limited reasons.

So, negotiate your settlement with the help of your lawyer, act in good faith, but don’t commit yourself to a final settlement unless you are prepared to live with it.

This is intended as general information only. For more information on negotiating property settlement book an appointment with us today or contact our Family Law team at Tonkin Legal Group on (03) 9435 9044.