The separation of celebrity super-couple Miley Cyrus and Liam Hemsworth has flooded the news in the last few weeks. Having married in December of 2018 at their home in the United States, the pair, who share ‘fur-children’ together, will now likely need to go through the process of dividing their assets, despite the brief length of their marriage. Liam Hemsworth has a fortune estimated at $26 million USD, whilst Miley an estimated $160 million USD.
How are assets divided after a couple splits?
In Australia, Family Law Courts go through a “four stage approach” of dividing assets, namely:
- Assessing the Assets and Liabilities;
- Assessing the Contributions of the parties;
- Assessing the future needs of the parties; and
- Confirming that the proposed split is ‘Just and Equitable’
Approach for dividing assets in brief marriages:
Brief marriages can often make asset division complicated, as a Court in Australia would focus heavily on the contributions made by the parties in the marriage. Initial contributions into the relationship in particular will likely play a very significant role in any determination; the higher the value of assets brought into the relationship by one person, the greater the Court is likely to assess their contributions and therefore the more recognition they would receive by way of a final settlement. Noting de facto couples are treated the same under Australian Law in terms of asset division as their married counterparts, a Court would likely assess their contributions not at the time they were married, but the commencement of their de facto relationship.
Assessing the assets and liabilities
The Court however would likely first need to consider whether it would approach the assessment of the assets and liabilities (the first step of the four stage approach) on a ‘global approach’ or ‘asset by asset’ approach.
The global approach
he global approach, used in most cases, involves the division of the parties’ assets whilst essentially looking at the entirety of assets available.
The asset-by-asset approach
The asset-by-asset approach looks at division of assets based on the contribution each party has made with regard to individual assets, which is used more often in short relationships.
Whichever approach adopted by the Court in individual cases is entirely discretionary based on the context of the matter.
Asset division for Miley Cyrus and Liam Hemsworth
What might make things even more interesting (and likely more complicated) for Miley Cyrus and Liam Hemsworth is the history of their relationship. Having first got together in 2009 and ending their relationship in September 2013 after having been engaged for approximately a year, the couple then got back together in 2016, were married in 2018 and have now again separated in August 2019.
How the period of separation in the middle of their relationship would impact any overall financial settlement would likely depend on whether they had formally divided their assets after their 2013 separation as well as any significant changes in financial circumstances during their three year relationship hiatus. Ultimately, this breakup has the potential to be quite complicated in terms of asset division, which would require some very specialised and tailored advice.
What's the best way to divide assets?
Early advice is often the best way to ensure that any asset division has the best possibility to be completed with minimal stress and minimal cost. A case like this is also a good example of one where a Binding Financial Agreement (a pre-nuptial agreement) would have been of significant benefit noting Miley Cyrus’ significant wealth by comparison to her husband Liam Hemsworth. There is no ‘cookie-cutter’ approach to asset division so it is important you speak with an experienced lawyer to understand your rights.
Andersons Solicitors' Family Law team specialise in asset division and Binding Financial Agreements, contact the team today.