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My spouse and I are separated. Do we need to get divorced before we can divide the property?

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When parties to a marriage separate there is generally property that needs to be divided to allow each party to have a clean break and move forward financially. There is no law that prevents separated parties from dividing property while they are still married.  When we use the term "property", we don't just mean the family home. We are referring to all assets and liabilities of the relationship; family home, investment properties, vehicles, house contents etc...

There are many reasons to do a property settlement sooner rather than later. This is because the longer parties wait before dividing the property, the greater the chance that problems may arise.

For example, it may be impossible for one of the parties to put a deposit on a new home or purchase a new car until money is released through a property settlement.  One of the parties may be reducing the property pool by wasting, selling or disposing of property.

It should also be noted that the Court will usually identify and value property that exists at the date of the final hearing and the Court has the power to alter the party's interests in property, regardless of when or how that property was acquired and in whose name it is owned.

This means that property acquired by the parties after the date of separation can be taken into account, even in cases where property was acquired years after the date of separation. Any increase in the value of existing assets will be taken into account by the Court.

These are all compelling reasons for separated parties to do a property settlement as soon as possible.

It is also important to note that there are strict time limits that apply. Parties must wait 12 months from the date of separation before commencing divorce proceedings and, once divorced, parties only have 12 months from the date of divorce to either finalise their property settlement by way of a formal agreement or otherwise commence court action.

Once the 12 month time limit after divorce runs out, if the parties have not reached an agreement, they will no longer have the automatic right to take the matter to court. This can cause serious problems as parties may then find themselves in a position where they cannot resolve the matter with their spouse and cannot ask the courts to intervene either.

If you find yourself in this position, your only option is to apply to the court for an extension of time to commence a court action, however, there is no guarantee that an extension of time would be granted. Applying for an extension of time is a last resort and adds unnecessary complexity, stress, and costs to the matter. In some circumstances, where the time limit has run out and an extension of time has been refused by the courts, people may forever lose their claim to property. Remember, the courts will not automatically grant an extension of time.

For these reasons it is usually better for parties to divide their property first and apply for a divorce once property settlement is complete to ensure these issues are avoided.

We have an experienced team in our Family Law practice that can help you with your property matters as well as any other Family Law inquiry or issue you may need assistance with. 

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Get in touch with today's blog writer:
Ryan Thomas

Partner in Family Law

Please note, this Blog is posted in Adelaide, South Australia by Andersons Solicitors. It relates to Australian Federal legislation. Andersons Solicitors is a medium sized law firm servicing metropolitan Adelaide and regional South Australia across all areas of law for individuals and businesses.

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