Covid-19 and the effect on your property settlement: to hold or to go?

Separated parties across the country are pondering the question of how to proceed with their property settlement. Should I hold or should I go? In the current environment there are a number of considerations to be taken into account.

1. What does my asset pool look like now?

The impact of the COVID-19 global pandemic on the share market, businesses and property values is a matter that has been widely publicized and discussed. What the ultimate impact of the pandemic will be is something no-one knows. However, there are some practical matters to be considered.

Is a business valuation out of date? Generally, businesses are valued on a market value basis. Is there now a market for the sale of that business? What about the market within which the business operates?

What is my house worth now? As with business valuations, valuations of real estate may also be impacted by the effects of the pandemic. Parties who had envisaged their settlement would result in the sale of property may also want to reconsider the practical impact of the current restrictions with auctions being suspended and home opens being replaced by private or virtual inspections.

Super split superseded? Many married couples propose a splitting of one party’s superannuation as part of an overall property settlement. Super split can be dollar figures (known as a base amount) or a percentage. Superannuation, like the share market, is an area which has been impacted by the pandemic. As a result, offers containing superannuation splits, the sale of shares or the transfer of shares may need to be reviewed and reconsidered.

These are all issues which need to be considered within the context of your case and should be discussed with your lawyer.

2. Where is the pause button?

The Family Court has always had the power to grant an adjournment, effectively pausing proceedings, on an application by either party.

An applicant seeking a stay of their proceedings must satisfy the Court that firstly, there is likely to be a significant change in the financial circumstances of the parties to the marriage (either one of both of them) and having regard to likely time for that change an adjournment is reasonable. Secondly, the Court must be satisfied that an order made after the change has occurred is more likely to do justice and equity between the parties than an immediate order.

Whether the impact of the COVID-19 pandemic will be sufficient to satisfy the Court’s requirements will largely depend on the circumstances of each individual case.

3. Delay, delay, delay

Delay is probably one of the terms that first come to mind when talking about Family Court proceedings. Unfortunately, delay is an inevitable side-effect of an under resourced system facing what seems like never ending demand. That being said, the sooner you get in the queue, the sooner your time will come. And just because you’ve taken the step to commence proceedings, doesn’t mean you have to litigate; you can agree with the other party and resolve matters at any point along the way. In spite of the current climate, life does go on, albeit a little differently at least for the time being.

4. Mediate now more than ever

Whilst the extent of delays in the Family Court is unclear, now more than ever parties should be trying to achieve a mediated outcome. Platforms like Zoom and Microsoft Teams are becoming widely used to facilitate people engaging in virtual mediations. One of the obvious benefits of a mediated outcome is a degree of control. You and your former partner can agree and control the outcome rather than having it imposed on you by a third party, who has never met you or your family. Timing is also important. People are able to organise and attend mediation much quicker than getting to trial and without the cost. With the economic strain of this pandemic, now feels like a good time to avoid the fees of going to trial, if you can.

5. A better focus

With more time on our hands than usual, people are taking time to re-evaluate their lives. In doing so, the question those involved in litigation might be asking themselves is – is it worth fighting over? Sometimes the answer is a resounding yes and on other occasions, it’s not so clear. Resolving your issues lifts and weight off your shoulders and brings with it an emotional freedom. In times like these, reducing the issues to worry about rather than adding to them seems to be the way forward.   With that in mind, considering making or taking that offer or organising that mediation!

What is clear in all of this is that no matter the make up of your asset pool or the stage of your separation, now more than ever people need advice from specialist family lawyers. As no two relationships are the same, the advice needs to be tailored to your specific set of circumstances as well as the outcome you are trying to achieve.

If you want some advice from one of our team, we’re offering clients web-conferences, telephone appointments and in the right circumstances (and with social distancing employed) face to face meetings. Call or email us now, 9322 8000 or contactus@carrco.com.au.

 

Categories: News & Alerts, Perth Family Lawyers Information, and Property Settlement.