After a separation, the individual parties from a marriage or defacto relationship are entitled to seek a division of assets from the relationship. This includes all assets held jointly or individually whether they were acquired prior, during or after the relationship. Pre-marital assets will be considered a contribution from the person who bought it into the relationship. It does not matter which partner paid for the asset or from where they obtained the funds.
The process of dividing assets is undergone in court, with laws dictating the division on a “just and equitable basis”. The court determines whether there should be a change to the ownership of assets at all, in regards to the circumstances of the relationship. Particularly in the case of short marriages, second marriages or if there are overwhelming contributions by one party with minimal or no contributions by the other, the court will determine that there should be an alteration of property interests, however, this is not guaranteed. The court may also consider it appropriate that the assets remain with the person who has ownership or possession at the date of the hearing.
The court will often look at assets as a whole in what is deemed an asset pool. Determining the asset pool is achieved by taking the value of the assets held jointly or individually and deducting the value of liabilities of the parties. Usually all liabilities are included but in some cases, certain liability can be excluded if the court considers it appropriate in a particular case. The net value, the assets minus liabilities, is what makes up the asset pool for division.
Once the asset pool is established, the contributions of both parties are considered. These are not just monetary contributions, but acts such as who the primary caregiver was, who was the primary financial provider, did one party renovate the property, who did the greater share of the cooking, cleaning, gardening etc? After accessing these factors, the court will also look at things such as future earning capacity, health, age and any future caring responsibilities of the parties.
The court then looks at the effect the proposed orders would have on both parties. Considering the length of the relationship and previous factors outlined, the court will then determine whether the proposed orders are fair, having taken into account all of the circumstances of the relationship. Here is where matters such as destruction of property or continual gambling are considered.