Property settlement time limits – what happens if you miss the window?
If you have separated, it is important that you get Family Law advice about how to achieve a property settlement as soon as possible.
There are time limits on when spouses/de facto partners can file an application for property settlement in the court. These time limitations ensure that all parties, once separated or divorced, have some certainty that an ex-spouse/ex-partner will not be able to successfully chase them for money at some later point in time, save for in very limited circumstances.
The Family Law Act provides that parties have 12 months from the date of a final divorce order within which to resolve property settlement matters by agreement or file a court application for a property division. For de facto couples, the time limitation is 2 years from the date of separation.
There are occasions however, where parties fail to finalise their property settlement within the allocated time, and have not received their entitlement following the breakdown of the relationship.
If you and your spouse are not agreed on your property division, need the assistance of the court and are beyond the limitation date, you must first seek the leave of the court to proceed. The court has the discretion whether to grant leave or not, and leave will only be granted in a property settlement if you can show that you, or a child, will suffer hardship if the court does not grant leave. Some factors the Court will consider are the length of the delay and reasons for the delay, as well as prejudice to the other party if leave is granted. This can be difficult to establish.
Alternatively, if you and your spouse have reached an agreement about property settlement matters, this could be documented in the form of a Financial Agreement. This document is not required to go through the court and therefore the time limitation will not apply. These documents are usually more complex and therefore more expensive. It is also very risky to assume that your partner will agree to enter into an agreement after the time limit has expired.
It is important to keep track of the date of your divorce (if married) or the date of separation (if de facto) and to note the relevant time limitation that applies. If the time limitation is approaching and you have not finalised your property settlement, you should seek legal advice immediately.
If you require advice about property settlement, your entitlements, or time limitations, please make an appointment with one of our solicitors on (07) 3221 4300 for a fixed fee initial consultation. Alternatively, request an appointment online here.
