Assets gained after separation

Assets after separation ARE included in property settlements. Understandably most people assume that any assets you gain after separating from your ex partner are automatically excluded from any asset division processes, but this isn’t necessarily the case. So, what does the law say?

THE SHORT ANSWER

• Assets obtained after separation can influence property settlements.
• Post-separation assets are not automatically excluded from property pool consideration.
• Debts incurred after separation are also relevant in property settlement negotiations.
• This principle applies regardless of whether you settle amicably or through a court trial.
• The property pool considered isn’t frozen at the separation date but determined at the settlement agreement or trial date.
• Your ex-partner doesn’t automatically get half of assets acquired post-separation.
• Timely property settlements can help mitigate asset value fluctuations.

THE LONG ANSWER

Inclusion of Post-Separation Assets

Imagine purchasing a new car, investing in property with a new partner, growing your superannuation, or receiving an inheritance after a separation. It’s natural to think these assets have no impact on your property settlement negotiations. However, that assumption is not entirely accurate.

Clients are often surprised to learn that assets and liabilities acquired after separation are not automatically excluded from the property pool. Despite their post-separation origin, these assets must still be considered in property settlement negotiations. This also applies to any debts incurred by either party after separation.

Legal requirement in Family Law

The inclusion and consideration of all assets and liabilities, including post-separation ones, is a fundamental requirement in Family Law. This requirement applies whether you reach a property settlement with your ex-partner amicably or through a court decision following a trial.

The dynamic property pool

The property pool under consideration isn’t static at the date of separation. Instead, it is determined at the time you and your ex-partner formalize an agreement through mutual consent (e.g., via a consent order from Family Law Courts or a Binding Financial Agreement) or at the date of a trial if no agreement is reached.

Percentage of division

Your ex-partner doesn’t automatically receive an equal share of assets or liabilities acquired after separation. The presence of these post-separation assets or liabilities will affect the overall value of the property pool and make legal arguments regarding each party’s entitlements more complex.

The timing of Property Settlements

In most cases, it’s advisable to complete a property settlement as soon as possible after separating from your partner. Doing so helps reduce the risk of significant fluctuations in the value of the asset pool. There are also time limits on when you must start property settlement proceedings depending on whether you have left a defacto relationship or a marriage.

If you have any questions or concerns about family law property settlements and how they apply to your specific circumstances, please reach out to our office to arrange an initial consultation with one of our experienced family lawyers.

We can also support you through all other areas of separation and family law including parenting and domestic violence matters and alternative dispute resolution and mediation.