CASE STUDY: Property Settlement Consent Orders Needed Urgently

Man signing contract

When separating and dividing assets, reaching agreement with your ex-partner is almost always best. If you can reach agreement on the division of your marital property, you can avoid going down the litigation route which is usually costly, time-consuming and stressful. 

But when reaching an agreement with your ex, it’s important to make sure it isn’t an informal agreement, such as a ‘handshake’ or a verbal one. That’s because informal agreements carry a lot of risk down the track. 

There can be later misunderstandings or misinterpretations. The agreement isn’t legally binding or enforceable. And the waiving of stamp duty is only available on the transfer of property if there is a court order—which may mean you absolutely need a formal agreement in your case.

So if you’ve agreed with your ex-spouse on how to divide property, turning your agreement into Consent Orders filed in the court means you will be neatly finalising your financial matters in a legally binding manner. This goes a long way towards avoiding and resolving any future disagreements.

What are Consent Orders?

Consent Orders are filed with the court to indicate that you and your ex-partner have come to an agreement outside and now want that agreement made official. Consent Orders can be made in property or parenting matters, or in matters involving both. They can be made at the beginning, during, or at the end of a court matter and you might enter into Consent Orders to modify or cease Family Court orders already in place.

When you file your Application for Consent Orders (the court form) together with a Minute of Consent Orders (a court document where you set out the orders you want to be made), if the Court finds your proposals will lead to a just and equitable division of property, it will approve them.

After Consent Orders are signed, dated and stamped by the Court, they are then binding. Parties can’t make any further claims on property in the future (except in exceptional circumstances), so it’s a good idea to get a family lawyer’s advice before signing off on Consent Orders.

What is a “just and equitable” property settlement?

For a court to approve Consent Orders, it must be satisfied that the outcome would be “just and equitable” for both parties according to section 79 of the Family Law Act 1975.

In considering if proposed orders will achieve a just and equitable result, the court uses a classic four-step process. This means looking at a range of factors:

  1. Ascertaining the value of assets, liabilities and resources of parties. This might mean any combination of bricks and mortar property and mortgages, investments, shares, loans, credit cards, motor vehicles, leases, superannuation, cash, furniture, jewellery and household effects–anything that can be seen as an asset or a liability.
  2. Consider contributions parties made through the relationship. These can be financial, non-financial, homemaking and parenting.
  3. Consider parties’ current and future needs and long-term impacts of the proposed outcome. Here the court will look at factors such as if there are children, or if there is different earning capacity between the spouses, and why.
  4. Then arrive at a determination of whether the proposed orders achieve an outcome that is just and equitable.

This four-step process ensures a fair outcome and one that is tailored to an individual situation.

Our client’s story

Our clients had reached agreement on the terms of their separation and wished to have Consent Orders drawn up. The problem was that the matter needed to be finalised in a very short timeframe to avoid losing approval to take on the mortgage secured over the former matrimonial home.

The issues

Could this property settlement be achieved and finalised within the prescribed narrow window of time before the finance approval lapsed? The courts typically need up to a month or more to process Applications for Consent Orders.

For our client to succeed with their finance application that would facilitate their proposed settlement, there was little more than a week to complete the drafting and filing process.

What we did

With just a week of wriggle room before a court filing had to be completed, our lawyer Tom Galton worked his magic to provide advice to the client, prepare the required settlement documentation (an Application for Consent Orders and corresponding Minute of Consent Orders), arrange for both parties to sign and file the documentation with the court and made submissions for the Application to be dealt with urgently. (There was no need for the other party to obtain independent legal advice.)

The outcome

The court approved the Application in time. The parties were then able to arrange for the former matrimonial home and the mortgage to be transferred to our client – importantly, just before the relevant approval period expired.

This matter highlights the need to be mindful of likely court timeframes for dealing with applications. If, similarly to our clients, you are considering entering into Consent Orders with your ex, it’s useful to know the likely turnaround for Applications for Consent Orders. But you’ll also need to factor in additional time for obtaining legal advice and taking the time to consider ramifications of potential decisions.

Should you also be dealing with buying or selling real estate, that will have its own deadlines and timeframes. The stress of having competing deadlines and timeframes is ideally avoided!

The consequences of decisions on property are usually long-term. So you’ll need to make informed decisions with the best information and advice as to how various scenarios might impact your future financial situation.

Due to their complexity, property settlements can be difficult and they’re made trickier if the process is urgent. It is vital to seek the advice of an experienced family lawyer to guide you through the process towards a fair and realistic outcome. Please contact our expert Central Coast lawyers today to make an appointment.

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