New Year New Me?
Help! I’ve made the decision but I don’t want a fight. So where do I go from here and how does it actually work?
New Year New Me? It sounds so easy but if that means you have decided to separate it is only the first of many decisions. You have probably heard the horror stories, read the news about movie stars and billionaires dragging it through the courts and spending a fortune to make their ex suffer and everyone you talk to will give you free advice about their friend of a friend who’s lawyer told them………
But whether it has been a long time coming or you have simply had enough, the decision has been made. So where do you go and what do you do now?
Everyone who comes to BrightSide is a little unsure of the process at first so we like to lay it out simply and clearly so you know where you stand and the options you have.
Because you do have options and you can make decisions that will make the whole thing a lot less awful.
So, in an effort to make it all a little clearer we have included a simple breakdown to help you understand how the process works, some of the choices you can make, what those choices might mean for you emotionally and economically and what you can and can’t do when dividing stuff between yourself and your ex.
Property and Parenting
This is a guide for dividing your property and doesn’t really work for parenting. In our experience the best outcomes come from sorting out your property first and then sorting out parenting. And we definitely advise against trying to divide your property and work out parenting at the same time because it can get very complicated and often ends badly.
So how do I do it.
Firstly there are four paths you can follow when dividing your property.
- An informal agreement between yourselves;
- a binding financial agreement;
- consent orders;
- and litigation (going to court)
What can I put in and what can’t I put in.
And for all four of these paths there are certain things that can be included in a financial or property agreement.
- property. e.g. the family home, investment property’s, or a farm
- personal property. e.g. car’s, boats, jewellery
- spousal or partner maintenance
But it is important to know that in a financial or property agreement like this, parenting matters are not included and are in fact covered in a whole separate agreement.
An informal agreement.
This really is a DIY Divorce. You need no lawyers, no courts, and no paperwork
If you get on pretty well with your ex and feel that isn’t going to change in the future you can simply come to an agreement you can both live with. The major advantages of this are no legal fees, no delay – and if you can pull it off, no arguing.
But beware, there are some disadvantages as well.
An agreement like this is not legally binding so if one of you changes your mind there isn’t much the other can do about it. And you both still have the right to go to court if you want to even after you have agreed on how to the split your assets.
Also there are time limits for applications to the court so if it does go wrong in the future and you do end up needing to involve lawyers you may need to apply to the court for special permission.
You may also find you have to pay taxes and/or stamp duty when it comes time to sell or transfer your assets.
A Binding Financial Agreement.
Also known as a BFA.
A BFA is a legally binding agreement that you both sign and are bound to honour. It is negotiated between you outside of court but is still legally enforceable.
A BFA will generally include a clause that prohibits either of you going to court over property or financial disputes once you have signed the agreement and also has the general effect of preventing the court from intervening should a dispute arise in the future.
A BFA can be entered into at any time before during or after a marriage or de facto relationship and in fact is better known as a pre-nup if entered into before the marriage.
There are some disadvantages to a BFA however.
A BFA is a complex legal document that must include specific things to be enforceable. So it is not the sort of thing you can knock up between yourself and the ex over the kitchen table.
You will both also need separate legal advice to ensure you are not signing something that is unfair.
Because of all that a BFA is not a cheap option and will cost around $10,000 to $12,000 to draft. More expensive than consent orders but still a fraction of going to court and fighting it out.
It is also very important to know that a BFA can still be overturned by the courts. If one of you was pressured to sign, if the agreement is ‘unconscionable’ (very unfair) or fraud by one or both of you was involved (e.g. you had a secret bank account) the courts can set aside your BFA and then you are back at square one.
Consent Orders are a court order made with the consent of both of you and are considered the best solution for the future of Family Law.
Although consent orders are an agreement between you and your ex, to be legally binding the court needs to approve them. To make this happen your consent orders need to be submitted to the court for approval, but once the court has approved them they are final and you both have to abide by them.
The biggest advantage of consent orders is cost, they are the cheapest way to have a legally enforceable agreement. The disadvantage is the court has the final say so they must follow a certain pattern and they must be ‘just and equitable’ meaning there are limits on how you can split your property and finances.
So don’t think simply agreeing to a 50/50 split will necessarily do the trick. The court will take into account many things when issuing court orders such as future needs, which of you has a better job, which of you may earn more as time goes by, which of you is older or which of you may be better off in 5 years time. And on top of all that there is also a need for consent orders to be ‘just and equitable’ to make sure neither of you will be living in your car because of what you agree to.
Consent orders also need to be prepared following a specific format and including specific things and are presented to the court for approval. Once the court has received your application and the court agrees with what you propose the consent orders are made by a registrar (a registrar is like a judge) without you needing to appear in court and are enforceable in exactly the same way as if you had attended court and a Judge had made the orders.
So although you can do DIY consent orders it is a complex process and some legal and/or financial advice is probably wise.
If you don’t want to learn the intricacies of Consent Order law or don’t feel you can talk to your ex without it getting ugly, you can get a lawyer to draft your consent orders. Having a lawyer do your consent orders for you follows exactly the same process except you can keep it at arm’s length. Your lawyer will negotiate with your ex – or with their lawyer if they have one – and will write the consent orders making sure everything is done properly so the court will approve them.
If you can negotiate constructively with your ex (through your lawyer of course) consent orders will cost between $4,000 and $6,000 depending on how complex your finances are. Consent orders are our bread and butter at BrightSide because we believe they are the best option both economically and emotionally fro the vast majority of people.
If you would like more information on DIY consent orders we have a good E-book with lots of info that you can download here.
Or you can download the Attorney General’s Property and Financial Agreements and Consent Orders – What You Need To Know PDF here. This is a comprehensive 50 page guide which steps you through exactly how to DIY Consent Orders.
And finally, litigation.
Or going to court.
Going to court is the longest and most expensive option and is an absolute last resort for people who simply cannot agree or where there is profound domestic violence. Some estimates suggest only about 5% of couples need to actually go to court.
In Western Australia we have a slightly different system to the rest of Australia and going to court means going to the Family Court of Western Australia.
The advantage of going to court is it is final. Also a Judge will make the final decisions, so if you really can’t agree the Judge will decide for you and you both need to comply with those decisions.
The disadvantage of going to court is cost and time. Fighting for your divorce in court will cost between $100,000 and the sky is the limit. Some couples have spent millions. On average fighting it out in court will also take at least 2 years and in some cases up to 5. And you lose all control of the decision’s. Although your lawyer will present your case, the Judge has the final say and they will not take in to account tax liabilities, damage to business ownership structures, or the best timing for the sale of assets.
It is also important to remember we have no fault divorce in Australia so the court will not take in to account any bad behaviour during your marriage and dole out ‘punishment’ in the form of money. It is also important to factor in the emotional toll on everyone involved. Going to court places an emotional burden on you as well as negatively impacting parental relationship’s and broader family and friend relationships. Litigation is also time consuming and means you will need to take time off work or caring for children to attend multiple court hearings.
There definitely are a couple of ways to DIY your divorce if that is your choice but there are also very good ways to get it done for you without it taking years or costing a fortune.
- If you can agree and you can communicate a simple agreement can work well or you can DIY consent orders and keep the cost very low.
- In the middle there are lawyer drafted consent orders or a BFA both of which are within the financial reach of most couples
- And at the top end – for those who really need it – there is litigation
For help with your separation or parenting issues call BrightSide
Susan Hewitt is the Principal at Bright Side Family Law, a non-litigious family law and mediation practice. Susan has worked as a lawyer and journalist for almost 30 years. She is an accredited collaborative lawyer and family-law mediator who is committed to helping families through their relationship breakdown in an honest, cooperative and respectful manner.
If you are facing a family law matter call or email Bright Side https://brightsidefamilylaw.com.au/contact-us/