Where To Start When You And Your Spouse/partner Are Separating

Written by Valentina Tahmizian and Elizabeth Zouein

Separation occurs when one or both parties in a relationship acknowledge that their relationship or marriage has come to an end. This can happen in various ways: the parties may continue living together under the arrangement of ‘separation under the same roof,’ or they may choose to live separately. The post-separation process typically involves addressing property and financial matters, as well as making parenting arrangements for any children involved in the relationship or marriage.

1. TIME FRAMES

There are 3 separate components of a separation, each component can be settled separately or simultaneously, the components are:

• Property and financial matters.
• Parenting matters (if there are children of the relationship).
• Application for a Divorce.

Property and parenting settlements can be entered into prior to the granting of a divorce order. However, it is important to note that once a divorce order is issued by the Federal Circuit and Family Court of Australia, you and your spouse have only 12 months to resolve property matters from that date (this is extended to 2 years from the date of separation for de facto couples). If you fail to reach an agreement within this timeframe, ordinarily, each party will retain ownership of any asset or liability in their name or possession and you are ‘timed out’ from asking the Court to make a determination. There are exceptions to this rule, however, in general, property matters must be settled within that time frame. Parenting matters on the other hand do not have the same application of time limits. 

2. COMMUNICATION

Separation can evoke a range of emotions, including relief, grief, anger, loneliness, and even guilt. These feelings are entirely normal, but they can effect a party’s ability to make reasonable and informed decisions. It’s important for both parties to do their best to avoid letting emotions interfere with the process. If no agreement is reached and the matter proceeds to litigation, it will not only delay the resolution, but also incur significant costs, depleting the assets that are meant to be divided. If the correct dispute resolution steps are followed, and parties engage in the process with an open mind, settlement can be achieved in a lot of cases.

Separately, communication is equally as important if children are involved. It is important that to keep all interactions respectful and child-focused because all parenting arrangements must keep the best interests of the children at the forefront of all agreements.

3. FINANCIAL MATTERS

The most cost-effective way to reach a financial settlement is to sit down with your partner or spouse and list all of your assets and liabilities to determine the net matrimonial pool available for distribution. Once this is done, the parties can discuss and agree on a percentage split, deciding who will retain specific assets or liabilities, or whether certain assets need to be transferred between them. If the parties are unable to negotiate a financial settlement on their own, this is where we, as lawyers, can assist in facilitating the negotiation process.

All parties are required to engage in ‘pre-action procedure’ (for financial and parenting matters). The first step in this process is financial disclosure, where both parties disclose all their financial information in order to determine the net property pool. This allows us to understand the total assets and liabilities, helping to draft a fair and equitable division in preparation for settlement offers.

It’s important to note that the division of property is not always an even split. Factors such as the length of the marriage, financial and non-financial contributions, future needs, earning capacity and the care of children all influence how assets and liabilities are divided. This includes both tangible assets like the family home, vehicles, and savings, as well as intangible assets like investments and business interests.

In situations where there are points of contention, mediation can provide an effective avenue for both parties to address their differences in a controlled, neutral environment. Mediation allows individuals to ventilate their concerns, explore all issues, and work together towards a mutually acceptable resolution. With the guidance of a trained mediator, both parties can engage in open dialogue, facilitating a resolution that may otherwise be difficult to achieve through direct negotiation alone.

Mediation is often preferred as it is generally less costly, less adversarial, and quicker than going to court. It also offers the flexibility to address both financial and parenting matters in a way that suits the needs of the children and the parties. While mediation may not always result in a complete agreement, it can help narrow down the issues, making it easier to resolve them in the future.

When parties are able to reach a financial settlement, they have the following legally-binding options to formalise the agreement:

•  A Binding Financial Agreement (BFA): A BFA is a private legally binding document which essentially confirms the agreement that has been reached between the parties. It includes a schedule of the parties assets and liabilities to evidence that the agreement is based on the net asset pool reflected and to ensure transparency. However, it is not overseen or endorsed by the court, meaning that it remains outside the court’s jurisdiction unless a dispute arises.
• Consent Orders: Consent Orders are formalised through the Federal Circuit and Family Court of Australia, the Court will determine if the orders the parties have agreed upon are seen as ‘fair and equitable’. These orders are sealed by a judge and are legally enforceable. Once sealed, Consent Orders carry the full weight of the law, and there are legal consequences for non-compliance. A significant benefit of Consent Orders is that they are court-approved, which can provide additional assurance to both parties that the settlement has been reviewed and agreed upon by a judicial authority.

In cases where a settlement cannot be reached, the matter will be judicially determined by a judge at the Federal Circuit and Family Court of Australia. This process may take longer and incur higher costs, but the judge’s decision will be final and legally binding.

Tip: Don’t forget to update your will and beneficiary designations after separation. We at Legal One can assist you with updating your will and estate documentation, and you may also require a Deed of Release.

4. PARENTING

When negotiating parenting arrangements, the emotional and psychological well-being of the children should always be the top priority. It is essential that both parents approach these arrangements with the intention of providing stability, security, and a nurturing environment for the children. Separation can be a confusing and stressful time for children, so ensuring that they have a sense of routine and consistency will help them adjust to the new family dynamics.

Parenting agreements should clearly define the specifics of spend time arrangements, changeovers, special occasions such as public holidays, Mother’s and Father’s Day, and both the child’s and parents’ birthdays. They should also address communication, medical care, travel, schooling, and school holidays, among other factors.

Parenting arrangements can be formalised either as a parenting plan or through parenting orders. 

• Parenting Plan: A Parenting Plan is a written agreement between parents that outlines the agreed-upon parenting arrangements. While a Parenting Plan is an excellent starting point for parents who can work together amicably, it is non-binding and not legally enforceable. This means that if either parent fails to adhere to the terms of the plan, the other parent has no legal recourse to enforce it. A Parenting Plan can be a useful tool for keeping parents on the same page and ensuring that both parties are clear on expectations. However, if one parent does not follow the plan or if conflicts arise, the arrangement may need to be formalised through Parenting Orders.
• Parenting Orders: If parents are unable to reach an agreement or if compliance with a Parenting Plan is an issue, Parenting Orders may be sought through the Federal Circuit and Family Court of Australia. These orders are legally binding and enforceable by law, meaning there are consequences if either party breaches them. Parenting Orders provide both parents with a greater sense of security, as they are court-ordered and ensure that the arrangements will be upheld. In the event of non-compliance, the breach may result in legal action or penalties. Parenting Orders are a more formal and legally secure option for parents who require a higher level of certainty regarding their parenting arrangements.

Child support is another important consideration, which can be addressed through a private child support agreement or through an assessment by the agency.

• Private Child Support Agreement: Parents can come to a private arrangement about how child support will be paid. This can include regular payments, lump sums, or other forms of financial support, depending on the parents’ agreement. A private child support agreement provides flexibility and allows the parents to determine the terms that suit their individual circumstances. However, it is important to formalize the agreement to ensure that both parties are clear on expectations, and the arrangement is legally binding.
• Assessed Child Support:  This assessment calculates the amount of child support one parent is required to pay based on their income, the amount of time spent with the children, and other relevant factors. This approach provides an objective, government-backed solution, and ensures that child support obligations are fair and standardized

If you’re unsure about any part of the separation process or need assistance with navigating financial settlements or parenting arrangements, our expert team at Legal One is here to help. Contact us today for personalised advice.

Information accurate as at 18.2.25