Post-separation Contributions

When you divorce or separate, dividing your assets and becoming financially independent can take some time and a lot of negotiation. If your separation is not amicable and you have to ask the Court to divide your assets and liabilities, the Judge will consider money spent and assets gained after your separation date. On the morning of your final hearing, the Judge and Barristers will go through a balance sheet and determine what values are agreed. Often items that you put on the balance sheet will be discarded by the Judge like cars, furniture and post separation debt. Formal valuations will likely be required for big ticket items.

If the Judge is convinced that you have deliberately depleted the asset pool after your separation date to make a gain from your ex spouse or partner at a hearing, the percentage division will reflect that and you will not be looked at favourably.

Normal financial activities like paying mortgages and credit cards and making reasonable and necessary purchases are expected by the Court.

If you have agreed to sell an asset like an investment property and divide the proceeds ahead of a final settlement, you must be extremely careful. Often it’s best to leave the proceeds in one of the law firm’s trust accounts. More recently, the Court does not, as a rule, add money or assets back into the final figure. If one party spends all of their early split on ordinary expenses and the other party invests, the invested portion and any capital gain will be put back on the balance sheet as a joint asset. Certus can advise you fully on these types of difficult scenarios. At the end of the day, however, the Judge must divide your assets in a just and equitable manner by following the relevant sections of the Family Law Act.

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