A property dispute can be a very stressful and emotionally turbulent time in your life.
After all, your financial security gives you the ability to financially support yourself and your children, so splitting assets in a way that allows you to provide for yourself and your children in the future, is very important.
A property dispute can divide parties and result in vicious litigation in order to win the prize, that being, a bigger share of the pool of assets.
Are you wanting to ensure the best possible outcome for your property dispute?
Read on to find out the top 15 things people do wrong in a property dispute.
1. Not communicating to the other party that you want to separate
One of the most common questions we are asked by our clients is ‘what is my separation date?’.
Your separation date is not the date you informed centrelink. It is not the date that you told your friends. It is not the date you moved into a separate room of the house or to another house altogether. Your separation date is the date that you communicate to the other party that you want to separate with them, and you action that intention with conduct, which might include, for example, moving to a separate room or another house.
Sometimes the date of separation can be important, including in a de facto matter, as the date of separation determines the time limit to commence property settlement proceedings if an agreement cannot be reached. Check out our article on Time Limitations for more information on this topic.
The date of separation can also be important if you are arguing that you made a financial contribution to the property pool, for example an inheritance, post separation, and therefore it should be treated differently to if it was received during the relationship.
2. Not redirecting your salary, not closing down accounts they have access to and not opening up a separate bank account in your sole name
Following separation, it is very important that you protect your finances by in the appropriate circumstances, closing down all bank accounts in your name which your former partner has access to or alternatively, in the case of joint accounts, redirecting your salary to an account which only you have access to.
The last thing you want is for your former partner, to withdraw the entirety of the balance of the account, including your wage, and use it for their own benefit, without your consent to do so.
This recommendation is not universal however and it will depend on the circumstances of your case. If you are the breadwinner and your former partner is not earning an income/cannot support themselves without your assistance, you should ensure you continue to financially support them to the extent you are able to. As such, in these situations it is often better to retain joint accounts and for your income to be deposited into this account and to each continue using the joint account for the payment of living expenses.
3. Not changing your passwords
This is something that is often forgotten. Separation can turn ugly quickly if the other party accesses your personal or business bank account without your consent to do so. You should change your internet banking passwords for any accounts held in your name or for accounts that they have access to.
4. Not closing down any credit cards in joint names or where the other party is a secondary card holder
You should close down any credit cards in joint names or in your name which the other party has access to, or otherwise remove them as a secondary card holder.
The last thing you want is them racking up the credit card bill after separation.
5. Not putting joint signatures on joint accounts including also any joint loan accounts
If there are any joint loan accounts or lines of credit, you should notify your bank that you require that any further withdrawals only be made with the prior written consent of both parties.
We have had situations occur time and time again where the other party redraws funds from the mortgage without our client’s consent, thereby reducing the equity in the property and our client’s entitlements.
You can avoid this by proactively contacting your bank to ensure that there are joint signatures for all loans so the other party cannot redraw funds from the mortgage without your consent.
6. Cutting your spouse/ex partner off from any income/resources post separation and stopping paying all of the bills when they need financial support
If you were the breadwinner in the family, it is not smart or ethical for you to cut the other spouse off from the financials after separation, leaving them with no way to support themselves.
If you do this, you will likely end up being the respondent to an application by your spouse for you to pay them spousal maintenance in the family law courts.
To avoid this, you should continue to support your ex partner after separation if they are unable to support themselves, if you have the capacity to do so. This is referred to as ‘spousal support’ or ‘spousal maintenance’. See our page on Spousal Maintenance for more information on this topic.
Spousal support is separate from child support, so don’t think that just because you are paying your former partner child support for the children, that you don’t have to continue to support your former partner after separation, if they are unable to support themselves without your assistance.
Spousal support can be a weekly payment from you to your former partner. It can also include, for example, continuing to pay the mortgage for the matrimonial home and the other expenses such has electricity, water, rates and the like.
If possible, to avoid conflict, have a discussion with your former partner following separation and come up with a plan, if necessary through lawyers, as to who will pay what bills in the interim period, pending a property settlement taking place (e.g. the mortgage, rates, utilities, phone bills, credit card bills and other joint debt).
If your bank will allow you both to put your mortgage on hold and make interest only repayments for a period of time, do it.
If bills are not paid, both parties credit ratings will be affected, so your former partner will be open to negotiating this point, as an act of self preservation.
If you have bills in your name for things that are for the benefit to the other party, give them notice of your intention to close down the account (e.g. utilities) so they can transfer the account into their sole name.
7. Increasing your expenses so as to avoid paying spousal maintenance to the other party
When the court assesses a spousal maintenance application, they assess the applicant’s need for support and the respondent’s capacity to pay. In assessing the respondent’s capacity to pay, if the respondent has expenses that are equal to or in excess of their income, one would argue that the respondent does not have capacity to pay maintenance to the requesting party.
However, if you are the respondent to a spousal maintenance application, the Court will closely scrutinize your financial statement to assess the reasonableness of your living expenses. For example, if you are paying $500 per week towards your credit card when the minimum repayment is only $50, or you are making weekly transfers to a friend/partner/family member, or you are paying other expenses that are not reasonable from the Court’s perspective, the Court may assess that you have the capacity to pay your ex partner maintenance.
8. Not changing the locks on the matrimonial home
Countless times we have had our clients say that their former partner came to the home and took furniture and belongings while they weren’t there, without their agreement. This can be a stressful and emotionally traumatic event.
Just because the house is in joint names does not mean you have to allow your former partner to have access to the home you continue to live in, when they please. You have a right to privacy and to request sole occupation of that home, if they have left and are living elsewhere.
You are allowed to change the locks at any time if you are fearful that your former partner will attend the property without your consent to do so.
If you are agreeable to them attending the property to obtain certain belongings, our strong suggestion is to ensure that you or another person you trust is present when they attend the property and you should agree prior to them attending the home on:
- When they will attend;
- What they are permitted to take with them.
At times, we have had clients tell us that the ex partner rocked up at their home with a police escort demanding to be let in to obtain certain furniture and belongings. Then the ex partner raids the property and takes various things, that you did not consent to them taking. Remember this – just because a police officer demands that your former partner should be able to enter the property, does not mean you have to let them in! The police can be intimidating but they have no right to walk into your house, nor do they have a right to enable your ex partner to walk into your house, unless you permit them to do so. Tell them that you do not agree to them coming in and politely ask them to leave. Suggest that they can make a request through your lawyer to arrange a time to attend the property by agreement on a later date.
9. Entering into a contract to purchase a new property, when a property of the relationship is listed for sale, but there is no agreement regarding distribution of the sale proceeds and/or before a formal property settlement agreement is entered into
This is a big no no. Do not enter into any contracts which involve the expenditure of funds from your property settlement until such time as there is a formal agreement signed (preferably consent orders) with respect to the division of all assets between you and your former partner.
The reason you should not enter into any contracts that rely on funds you will receive to purchase the new property, is because:
- there is no guarantee the other party will agree to the release of those funds to allow you to purchase that property; and
- Even if they have agreed to it, if you release these funds now prior to agreeing on the division of all other assets, you lose all your leverage in a property settlement to negotiate the division of those assets.
The most common example is if the parties agree to split the proceeds of the matrimonial home 50/50 but they haven’t reached agreement on a superannuation split yet. If the funds are released 50/50 to each party from sale of the property, you have no leverage to negotiate the superannuation split you are entitled to in a property settlement, which effectively means if your former partner is unreasonable about it, you will have to spend thousands of dollars to go to court and negotiate the split that you were entitled to.
This is why our strong suggestion to all clients is that funds from sale of a property remain in trust until such time as a property settlement agreement is reached, signed and filed by way of consent orders. By doing this, the other party’s desire to receive those funds can act as leverage for you to negotiate the reasonable property settlement split, including the split of superannuation, that you are entitled to.
10. Trusting the other person that they will do what they say they will and not to screw you over
Don’t give your ex partner back the car if they ask for it. You probably won’t get it back.
Don’t sign over your business interest to your ex partner without a legally binding property settlement agreement. If you do, they can deal with the business as they like, and they may dwindle its value.
Don’t trust your ex partner that they will continue to pay the mortgage while you are living there. Get an agreement in writing that they will do this.
Don’t let them come to the house when you are not there to take ‘personal belongings’. They will probably take much more than their personal belongings.
Don’t let your ex partner have the proceeds of sale of the matrimonial home prior to entering into a legally binding property settlement agreement. Once you give them what they want, you lose your leverage to negotiate a settlement of the other assets, for example, a superannuation split.
11. Failing to provide full and frank disclosing of your assets and debts in a timely manner
You have a legal obligation to provide full and frank disclosure to your former partner in relation to the assets, liabilities, superannuation in your name as well as your income and financial resources.
If you fail to disclose any assets you own or have an interest in to your former partner in a property dispute, and the other party is required to commence court proceedings, you may find that the court makes a costs order against you, because the court proceedings would not have been necessary if you fulfilled your disclosure obligations.
Furthermore, if you fail to disclose an asset or a debt to your former partner and/or in a consent order that is relevant and significant to the outcome of a matter, the failure to disclose can derail your consent orders. See our article on Beware: failure to disclose may derail your consent order for more information
12. Not being honest with your lawyer about relevant facts in your property dispute
We can only give you advice based on your instructions and our strategy to assist you in achieving a positive outcome in your property dispute may vary if your instructions vary.
If you are not honest with your lawyer, whether it be about the ownership of your assets, your interests in them or your contributions during the relationship, this will effect our ability to progress your matter to a conclusion quickly and cost effectively. You may also find that the Court makes negative inferences against you at a Trial, which will negatively impact the outcome of your case, if you are caught out in a lie and you are found not to be a credible witness.
It is also important to bear in mind that the Courts frequently make costs orders at a Trial if the order that is made by the judge is in line with an offer of settlement you have received, but did not accept, from your former partner.
Check out our family law video What happens if you are not honest with your lawyer, for more information.
13. Not providing complete instructions to your lawyer to enable them to progress your matter
If you are not prompt in providing instructions to your lawyer about your property dispute, this can affect the timely and positive progression of your matter.
Whilst this time in your life can be a very stressful time, time is often of the essence in family law matters. You should be quick to respond to your lawyer to provide instructions, so they can do what they need to to, otherwise, this could result in your matter dragging out and it could even affect the outcome of your case.
14. Focusing on the past and not the future and getting caught up in emotive issues and losing sight of the ‘bigger picture’
It is completely understandable for you to feel emotional about some of the issues in your property dispute, and your decisions about what you do are often impacted by conduct of the other party that is seen as reasonable/unreasonable.
However, focusing to heavily on the past conduct of the other person means you are losing sight of how to create a positive future for yourself. It is important not to lose sight of what is really important to you because you are focusing on the past.
We try and move our client from the past problem to the future possibilities. In this regard, one of our first questions to our clients is, if you could wave a magic wand, what is your wish list?
Then when we find a client feeling quite emotional about an issue, we bring our clients back to their wish list and remind them that we don’t need to fight every battle to win the war.
Sometimes, its the battles that we choose not to fight or to concede that make the biggest difference in settling a matter quickly and at the least possible financial and emotional cost.
15. Negotiating a settlement with your ex before receiving legal advice / waiting too long to receive legal advice
It is not uncommon for separating parties to attempt to negotiate an agreement in a property dispute without lawyers. This is fraught with risk, if you have not seen a family lawyer first.
Do not assume that google can tell you what your equitable entitlements are or how to achieve the best possible outcome in your case. Every case is different and each case is determined on its own individual facts. Talk to a family law expert about the range of your entitlements so you have a clear understanding of your best and worst possible outcome, before engaging in any negotiations directly with the other party.
By engaging one of our experienced Brisbane Family Lawyers, we will develop a plan of action, unique to your individual case, to get you from where you are to where you want to be as quickly and cost effectively as possible whilst avoiding bitter and drawn out litigation.
Take a proactive approach and don’t wait until things go wrong until you see a family lawyer. The most common mistake we see being made is that people sometimes wait months or even years to obtain family law advice and they will often do so after a climactic event that has caused them emotional or financial stress.
By proactively engaging an experienced family lawyer to assist in resolving your property dispute, you receive the benefit of invaluable advice and we can give you the tools to avoid a disaster in the first place.
