Interim orders and interim proceedings in Family Law

Interim orders and interim proceedings in Family Law

Court orders are the legally binding declarations made by judges which fulfil the purpose of resolving a dispute and outlining the obligations which each party must perform. Family Law proceedings are often quite lengthy, with most parties waiting at years for a final hearing, so interim orders ensure that the needs of all the parties are met in a timely manner. These delays make it essential that parties seek legal assistance when applying for interim orders so that the appropriate care and diligence can be taken in preparing and presenting their case.

What are Interim Orders?

Interim orders are temporary orders which are put into place until final orders are made by the Court, which brings the matter to an end. Judges determine interim applications based on the facts and circumstances of each case which is derived from the material filed by each party.

In Family Law matters, interim orders may relate to issues such as parenting or financial matters in separation. In relation to parenting orders, the court must consider the best interests of the child. An interim order may provide families with a sense of stability. In relation to financial orders, an interim order may provide the basis as to which of their properties they are permitted to use or sell while the matter is ongoing. Other common terms pertaining to interim orders in family law include:

  • Allocation of parental responsibility,
  • Living and communication arrangements for children,
  • Instructions to attend upon a family consultant to obtain a family report
  • Instructions for a party to undergo drug or alcohol testing, or
  • The appointment of an independent children’s lawyer (ICL), as necessary.

Interim orders differ from final orders which conclude the proceedings, as well as consent orders which arise out of an agreement between the parties. Final orders are not necessarily irrevocable, as both parties in family law proceedings may have the right to set aside those orders or apply for a change to the orders in the event of a substantial change in circumstances.

Applying for Interim Orders

Each Family Law proceeding commences with the filing of an initiating application. One party must file that initiating application and the other party files a response to that application. This will set out the interim and final orders you are asking the court to make. Generally you will be unable to file for interim orders until you have filed an application for final orders. These applications all need to make it clear to the court what orders you are seeking and the evidence to support them. Any person who is concerned with the care, welfare and development of children can apply for interim parenting orders.

For financial matters in a divorce, either party to the marriage can apply within 12 months of the divorce order taking effect and for financial matters when a de facto relationship breaks down, either party to the relationship may apply within 2 years of the breakdown of the relationship. There are various exceptions in filing out of time, and we strongly advise that you seek legal advice in the event you are faced with this issue.

Case Study: Relocation of Children

Many family law matters that appear in interim hearings involve the relocation of children by one parent before divorce or settlement proceedings are finalised. As reinforced in the recent case of Brant v Brant [2021] FamCA 91, interim orders can be made to undo a parent’s attempt to relocate children before a final hearing and enforce the best interests of the child and shared parental responsibility. In that case, the mother had relocated her two children and enrolled one child in a new school without consultation or consent from the father. The father then sought an interim order for the mother and children to return to the area, offering exclusive occupancy of the matrimonial home and payment of child support to facilitate this arrangement. The Court found that the relocation may have had an adverse impact on the meaningful relationship the children have with their father, and that the relocation should be temporarily reversed until final orders could be made. It is important to note however that where there is an interim hearing regarding children, the overriding consideration of the Family Court is determining what is in the best interests of the children.

Navigating a separation or divorce can be a highly stressful and emotional time for you and your family. At Etheringtons we provide a compassionate and skilled approach to family law matters. If you need further advice or assistance regarding interim orders or other family law matters, please contact one of our experienced solicitors on (02) 9963 9800 or via our contact form.

Why Binding Financial Agreements are not DIY

Why Binding Financial Agreements are not DIY

The courts have reaffirmed the importance of seeking independent legal advice and assistance regarding the execution of Binding Financial Agreements (BFA) or other property arrangements when planning for you and your family. The Family Law Act 1975 (Cth) sets out very strict requirements for a BFA to be valid and enforceable, and it is often the case that informal agreements and one’s executed overseas will not be recognised by Australian courts.

A BFA when executed correctly, can allow for certainty, trust, and peace of mind in a relationship. If you are wanting to enter into a financial agreement with your partner, or to understand if your current agreement is valid, it is crucial that you take appropriate caution and seek suitable legal advice.

What is a Binding Financial Agreement (BFA)?

A BFA is a legally binding document which sets out what would happen to the couple’s finances and property, should the marriage or de facto relationship break down resulting in separation or divorce. It allows a couple to plan their future rights and responsibilities, before entering a marriage or even after, in the event of a substantial financial change. A BFA is not lodged with a court, but rather acts as a private contract between the parties.

Importantly, a BFA can protect assets including cash, property, superannuation or inheritances and are predominantly used for setting out the financial arrangements of the couple. However, a BFA does not cover child custody arrangements, nor child support payments. A more extensive discussion of which matters can be dealt with in a BFA can be found in our previous blog article about constructing, obtaining and setting aside Prenuptial Agreements.

BFAs can be set aside where:

  • There have been instances of non-disclosure of assets or financial resources.
  • The BFA does not make any provision for children or if there was an adverse change in the welfare of the children so the agreement would cause hardship.
  • The contents of the agreement were not just and equitable.
  • Additionally, as discussed in a previous blog article, the High Court will not enforce any BFAs which have been entered into arising from unconscionable conduct, especially where this conduct is a consequence of a significant power imbalance between the parties.

The Family Law Act 1975 (Cth)

The Family Law Act is the legislation which governs BFAs. It allows parties to enter into these agreements before or during a marriage, or after a divorce. Under this Act, a BFA must be in writing, have been signed by both parties, and make specific reference to the section of the Act it is made under.

Recent case: Akhtar & Gaber (No. 2) [2021] FamCAFC 28

An important recent case demonstrated that marriage agreements which do not comply with the Family Law Act’s requirements for a financial agreement are not binding. In the case of Akhtar & Gaber (No. 2), the Appeal Division of the Family Court of Australia dismissed the appeal which aimed to oust the jurisdiction of the court to make orders relating to property interests and to uphold the terms of the marriage agreement between the parties made in another country (or jurisdiction).

The marriage agreement between Akhtar and Gaber was not a recognised BFA as it did not comply with the strict requirements of the Act. It was therefore not enforceable and did not oust the jurisdiction of the court for determining proprietary interests. This means that, even if the marriage agreement was binding in another country, it does not effectively operate as a BFA in Australia. The division of property between the parties was therefore to be determined in accordance with s 79 of the Family Law Act.

Why obtain our legal assistance regarding your Binding Financial Agreement?

As demonstrated in Akhtar & Gaber (No. 2), it is very important that your BFA meets the requirements set out in the Family Law Act. BFAs which are incorrectly drafted may be deemed invalid or set aside, but engaging an experienced solicitor will assist in this process.

Additionally, for a financial agreement to be binding, before it can be signed by both parties:

  • Each party must have received independent legal advice regarding the effect of the agreement on the rights of that party and the advantages and disadvantages of the agreement, at the time that the advice was provided to the party,
  • Each party must have received a signed statement from a legal practitioner as authority that this advice has been provided, and
  • Each party must have received a copy of the equivalent signed statement of their spouse or intended spouse.

If you need further advice or assistance regarding BFAs or other family law matters, please contact one of our experienced solicitors on (02) 9963 9800 or via our contact page.

Making Your Will Count – Healthy Will Checklist

Making Your Will Count – Healthy Will Checklist

Making a Will is important for everyone over the age of 18, to make ensure their wishes are followed and their assets are distributed as they would want after they die.

If you don’t have a Will your assets will be divided according to how the law dictates in the rules of intestacy, that is, when you have not made a Will.  If you die intestate it is very likely that your estate will not be distributed as you would have desired.

A Will is also the place where you can indicate to your family and friends your wishes on other important matters, such as who you want to be the guardians of your children.

Making a Will shows a level of care in not wanting to give loved ones any more stress to deal with than they will already face when you pass away.  In many ways it is one of the most selfless and considerate things you can do.

Regularly review your Will

Preparing a Will is not a once-off event. It is sensible to review your Will regularly, and we suggest that this be done a minimum of every three to five years.

Changes in your life may create problems for others in interpreting your wishes in any Will you have already made and may undo all the good work you have done to protect those close to you by making one. It can make your Will ineffective or even invalid.

It could be that a Will made many years ago is still appropriate, just as it may be that a recently made Will is now out of date.

Ideally you should review your Will every five years or more frequently if necessary. It is likely that your needs and circumstances will change many times in the course of your life and with those changes it is prudent to consider your Will.

Healthy Will checklist

There are a number of life events that can impact on your Will and which mean you need to revisit and update it.

Here is a checklist of life changes which can impact on the validity of your Will and which you need to consider in examining the legal health of your existing Will.

  • Have you married? Or separated from your partner?
  • Have you had any children?
  • Is the person you named as executor, to carry out the wishes in your Will, still alive and well enough to do the job?
  • Have the circumstances of any beneficiaries changed to make you reconsider your wishes, or have any of them died?
  • Have you nominated any specific gifts that are no longer valid or don’t exist, for example, have you sold a property that you had left to someone in the Will?
  • Have you acquired any new assets that you would want to make specific plans for in your Will?

Superannuation

At the same time as you check the health of your Will, you need to check your super and life insurance, which is often now a part of your super policy.

Many people assume their superannuation will be divided up in accordance with the wishes in their Will, but that is not necessarily the case. You need to look at your super policy to check how you have nominated that your super should be allocated, and that it is still allocated in the way you want. Sometimes, a nominated beneficiary direction will lapse after three years.

At the same time, check the division of any life insurance you have in your policy, and update it if necessary.

Conclusion

The important thing is to consider your circumstances at every major personal milestone in your life.

Any Will you have made is likely to become out of date and no longer accurately represent your wishes in some way following changes in your life, possibly within a few years of drawing it up. It will depend on circumstances that are unique to you.

If you would like to discuss a new Will or changes in your circumstances and a review of your current Will please call us on (02) 9963 9800 or via our contact form.
 

Unpacking the Family Court Structural Reforms

Unpacking the Family Court Structural Reforms

The government has introduced the Federal Circuit and Family Court of Australia Bill 2019 in order to structurally reform the Federal Circuit Court and Family Court of Australia, both of which currently have responsibility for family law matters. This merger has been proposed to help reduce delays and increasing backlogs in the family law courts leading to greater efficiency in the way family law matters are dealt with in Australia. This hotly debated reform passed the lower house late last year (December 2020) despite much opposition. In this blog, we review the proposed court merger and other changes under this bill.

The Court Merger

The Federal Circuit and Family Court of Australia Bill 2019 aims to bring the Federal Circuit Court of Australia and the Family Court of Australia together into an overarching, unified administrative structure to be known as the Federal Circuit and Family Court of Australia (FCFC). These structural reforms facilitated by the Bill purport to create a framework in the Federal Circuit and Family Court of Australia for common leadership, common management and a comprehensive and consistent internal case management approach.

There is a clear emphasis on efficiency, evident under section 5 of the Bill which states that the object of this legislative instrument is:

(a)  to ensure that justice is delivered by federal courts effectively and efficiently; and

(b)  to provide for just outcomes, in particular, in family law or child support proceedings; and

(c)  to provide a framework to facilitate cooperation between the Federal Circuit and Family Court of Australia (Division 1) and the Federal Circuit and Family Court of Australia (Division 2) with the aim of ensuring:

(i)  common rules of court and forms; and

(ii)  common practices and procedures; and

(iii)  common approaches to case management.

In a Media Release from the office of the Attorney-General, Christian Porter has said that ‘bringing the courts together under one amalgamated structure creates a single point of entry for families who will no longer be bounced around between different courts – an issue that occurs too often in the current system and can lead to lengthy delays for families because matters have to begin again.’ However, it is worth noting that some legal experts, while acknowledging the difficulties presented by a duplicate court system, worry that the merger will be an abolition of the specialist Family Court of Australia.

Other Changes

The legislation also requires that judges hearing family law matters in either Division will need to satisfy additional appointment criteria to guarantee they are suitable to dealing with family law matters, including family violence. This is due to the fact that many matters that come before the family court tend to have elements of family violence, therefore family law judges will also need to have a strong understanding of family violence and its implications for the safety of women and children.

In a further Media Release from the office of the Attorney-General, it was noted that the Government has provided $4 million in funding to the federal courts to review court rules and assist with implementing the reforms as well as a $3.7 million boost to court resources.

Get Legal Advice

Navigating the family law system can be a confusing and emotionally exhausting task. Our dedicated family law solicitors are ready and willing to assist you with your parenting or family law concerns. If you would like further information, please do not hesitate to contact one of our experienced solicitors on 9963 9800 or via our contact form. For more articles on family and other areas of law, see our blog here.

Understanding Family Law Financial Settlement Documents

Understanding Family Law Financial Settlement Documents

When ex-partners come to an understanding in terms of settling financial matters upon separation, there are two key ways to finalise this agreement in a legally binding way. These are ‘consent orders’ and a ‘financial agreement’. Not many people are aware that it is important to finalise family law financial matters in a legally binding way, as informal agreements can easily collapse and a court application can come at any time and many years following the breakdown of the relationship. In this blog, we review the two most common ways of finalising family law financial agreements and considerations you should take into account when deciding which avenue is most appropriate for you.

Consent orders

A consent order is a written agreement that is approved by a court. It can cover many family law matters, such as parenting arrangements for children as well as financial arrangements such as property and maintenance. Consent orders are lodged with the Family Court and officially stamped as a court order. The Court must be satisfied that the consent orders are just and equitable and/or in the best interests of the child/children (if applicable) before they make a consent order.

In order to obtain the stamped court order, two documents are required to be filed. These are the Application for Consent Orders and the proposed orders. The Application will contain important details of the parties, such as assets, liabilities, income and super. The proposed orders should set out the orders that the parties have agreed on and are asking the Court to make.

Financial agreements

A financial agreement is not lodged with a court and is rather a private contract agreed on between the parties. In order to ensure the agreement is legally binding and enforceable, both parties are required to receive independent legal advice from different legal professionals about the consequences of signing the agreement.

Considerations when deciding which agreement is best for you

When deciding which avenue is more appropriate for your circumstances, there are a variety of considerations to take into account. Some of these include:

  • Consent orders can cover matters pertaining to spousal maintenance, however a financial agreement may be a safer option to guard against any applications to prolong or increase maintenance. It is important to keep in mind that you are not confined to either option to settle your financial arrangements and a hybrid model could allow you to finalise your property settlement while a financial agreement could settle your spousal maintenance.
  • A financial agreement is not subject to judicial scrutiny and is a private agreement. However, for a court to approve consent orders, it must agree that the orders are just and equitable. For financial agreements, any deal can be struck no matter how unfair it may be perceived.
  • Often consent orders can take a long period of time to be approved, however financial agreements come into effect essentially upon the signing of the agreement by each party.
  • If you are seeking property orders, you should read and consider sections 75 factors outlined in the Family Law Act 1975. To learn more about section 75 factors, see our blog here. Some of these factors include:
    • How the length of the marriage affected the earning capacity of the party seeking maintenance
    • The age of any children of the marriage/relationship
    • The age and state of health of each of the parties
    • The income, property, finances and ability to earn an income of each party

Get Legal Advice

An experienced family law professional will be able to assist you with determining which family law settlement document is most appropriate for you and your circumstances. If you would like further information, please do not hesitate to contact one of our experienced solicitors on 9963 9800 or via our contact form. For more articles on family and other areas of law, see our blog here.

Inheritances and Family Law

Inheritances and Family Law

Families and money can sometimes be a volatile combination. This can be complicated especially in circumstances where a divorce or separation occurs and a new Will isn’t drafted to reflect the change of circumstances. In this blog, we review what it means to have an inheritance included in the asset pool of a separating couple.

Why is inheritance an asset?

When a separating couple needs to divide their assets, they must first work out the pool of net assets available for distribution. The pool includes all the assets and liabilities in each person’s name and in the parties’ joint names, as well as each person’s share of an asset owned jointly with another person.

If one person received an inheritance before or during the relationship, that inheritance would normally form part of the pool of assets available for distribution.

Does that mean my partner gets half my inheritance?

No, not necessarily. Just because an asset is included in the pool of assets available for distribution does not mean that the asset or the whole pool will be divided 50/50. Each matter is considered on a case-by-case basis.

Importantly, once the parties have identified what is in the pool of net assets, they must then consider what contributions they each made, and their respective future needs, in order to determine their respective entitlements and percentage split of the net assets they will each receive.

What are contributions?

When working out which party made what contribution, the Family Court considers the parties’ financial contributions – i.e., who earned what, the lump sums expended during the relationship, who bought what and who paid for what – and also non-financial contributions – such as being a homemaker and parent, physically renovating a home or landscaping a garden, managing the parties’ financial affairs, etc.

After a long relationship where there haven’t been any significant inheritances or other financial windfalls, a court usually finds that financial and non-financial contributions during the relationship are roughly equal, unless special circumstances apply.

An inheritance received by one party before the commencement of the relationship would be treated as an initial financial contribution by that person – i.e., money or assets that person brought into the relationship. Similarly, an inheritance received by one partner during the relationship is usually considered to be a financial contribution by that person.

In these circumstances, depending on factors such as the size of the inheritance, when it was received, what it was used for and the parties’ other contributions, this would generally mean that the person who received the inheritance would be treated as having made greater contributions during the relationship.

What about an inheritance received after separation?

This situation is less clear cut. A court usually considers an inheritance by one party as a sole contribution by that person. Generally, this will usually mean that the other party did not contribute to the post-separation inheritance and it should not be included in the pool of assets to be divided. However, each matter is dealt with on a case-by-case basis and while this may be a potential result, it is always dependent on the facts of the case and the circumstances of the lead up to the inheritance.

For example, if the post-separation inheritance had been received from the husband’s mother and the wife had a close relationship with her mother-in-law and had cared for her during an illness, a court might find that both parties had contributed to the receipt of the inheritance and therefore both parties will be entitled to a share of the inheritance.

Future needs

After working out financial and non-financial contributions, the future needs of the parties are assessed  before determining a split of the net assets and whether any adjustments should be made in favour of the party in need. Future needs include things like income, earning capacity, financial resources, ongoing care of children, age, health, etc.

An inheritance, even one received after separation, may be taken into account in this final step. The reason for this is the recipient of the inheritance would have greater financial resources and may be receiving income from an inherited investment which may well mean that person’s future financial circumstances may significantly outweigh the other person.  In such a case, a court may rebalance the division of the net asset pool in favour of the other partner by way of an adjustment which is derived from section 75(2) of the Family Law Act (Cth).

Summary

An inheritance received before or during a relationship will almost always be treated as an asset available for distribution between separating parties, whereas an inheritance received after separation will usually be found not to fall into the main pool of assets but may be treated in a separate pool. However, that does not necessarily mean that the other person is entitled to half the inheritance.

The receipt of a large inheritance will almost always have a significant impact towards the determination of contribution of the parties. In addition, an inheritance, including one received after separation, could have an impact on the determination of future needs of the parties and whether any adjustments ought to be made.

Finally, once the parties have been assessed as to the net assets, what contributions were made, whether there are future needs, a court is then required to determine whether the proposed split of net assets is just and equitable.

Contact us

The Family Law team at Etheringtons Solicitors are skilled at handling all matters relating to inheritances and are able to assist with complex cases in the event of a relationship breakdown. If you need assistance with any area of Family Law, do not hesitate to contact us on 9963 9800 or via our contact form here.