Mediation & Property Settlements

Posted on the October 17th, 2013 under Friends by Laurence Pharoah

Mediation can save you thousands of Dollars.

Mediation can save you thousands of Dollars.

 

Nowadays more than 50% of marriages end in divorce.  In most marriages a property settlement will need to occur to divide assets between ex-partners.  For a lot of people this process is extremely confusing.  The purpose of this article is to explain how a court judge will decide the division of assets in a property pool and help you to prepare for legal or mediation process.

What The Court Sees

Judges apply a 4-step process when deciding on a percentage split for assets in a marriage.  After valuing the property pool, the court looks at each partner’s contribution towards the marriage.   Ultimately, the court will value financial contributions (e.g., salary) as much as non-financial contributions (e.g., looking after children).  For example, a medical specialist earning over $1M/ year’s contribution will be the same as their spouse looking after the children, assuming it is a long marriage.  A short marriage is a relationship that is shorter than 5 years.  Any marriage that lasts over 5 years in duration is considered by the court to be a long marriage.

It is also important to understand when you form a defacto relationship.  A defacto relationship is formed after living with your partner for 2 years.  And the length of a relationship in the case of divorce occurs from the moment you choose to move in together not the start date of the marriage.

The court also takes into consideration future needs.  For example, if you have decided to quit your job to look after your child, you will be compensated at the time of separation because your future earning potential will be lowered as a result of this decision.  The court will also take into account the age of the child.  For example, if you have sole custody of the children and they are at a young age, expect this to be taken into consideration in the final settlement amount that you will receive.

Financial Agreements

Another issue is financial agreements that can be entered into prior to or during a relationship.  These agreements are known as Binding Financial Agreement or Pre Nuptial Agreement if entered into prior to marriage.  If you decide to do one – make sure to do it properly.  If you don’t – then they are not worth the paper that they are written on.  Expect to pay between $6,000-$7,000 for a lawyer to draft the agreement.  Make sure that both parties obtain legal advice otherwise the agreement won’t stand up in court.

From a psychological point of view – ultimately, divorce is going to be painful.  There is no getting around that point.  Yes – you can minimise the damage and protect yourself (somewhat) but it is still going to hurt (both financially and emotionally).  This may put a lot of people off ever entering a marriage.  Thinking about the negatives if it doesn’t work out.

But what’s the alternative?  Choosing not to enter a serious relationship because of what may go wrong.  This is living a life based on fear.  You can apply this rationale to any big decision that you make in life.  From going on a holiday, to

buying a car or purchasing a house.  Would you not do any of these things purely based on the fear of what may go wrong?

It is very important in life not to make decisions based on fear.  It really is a shame that some people never overcome this fear and enter a fulfilling and long lasting relationship.  Oftentimes their life is not the same as a result.  Now you have the facts and hopefully you can make an informed decision about your relationship as a result.

For all of your Mediation needs in Brisbane visit Mediation Brisbane or Mediators Brisbane or Click here.

WhyMediation

Here Is A Family Mediation In Process.

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