There are two ways in which you can finalise how you are going to divide your property and how to create a peaceful property settlement.
• Final Court Orders, either by consent or court-ordered; or
• Binding Financial Agreement.
Final Court Orders
You can get Court Orders in two ways:
• Ordered by the judge — this is when your matter is in court and the judge makes a final determination for you;
• Consent Orders — this is when the parties agree on the orders themselves.
This can be done as part of the court process or simply by agreeing through your own negotiations or a lawyer-assisted or mediated process.
Consent Orders should be your goal. Reaching orders by agreement is the best outcome for both parties. This does not mean it is easy to get there, but what it means is that, in the end, you have reached an agreement.
If your matter is before the court, the Consent Orders will get handed or submitted to the judge and, if they agree that the outcome is fair and equitable, given all the circumstances, the orders will be made.
As I’ve said before, the best, simplest, cheapest path is to reach an agreement without filing in court and then agree to get your agreement drafted into Consent Orders. You do not need to attend court; instead, an application for Consent Orders is made and filed in the Family Court along with a small filing fee ($165.00 at the time of writing this book). Consent Orders are most commonly drafted by lawyers — this is the most sensible way to ensure you are protected and have the certainty you deserve moving forwards. It is not impossible to do them yourself, but I truly don’t recommend this, as it is too easy to get them wrong.
When the orders are filed, this is what is required:
• Minutes of Consent.
Consent Orders will cost between $2000 and $5000, depending on what law firm you use.
Binding Financial Agreement (BFA)
This is another way to finalise your agreement for property division. However, we only recommend this method in a few cases:
• you are out of time;
• your division is not just and equitable; or
• for some other technical reason, it is impossible to file Consent Orders.
Essentially, what a Binding Financial Agreement does is contract you out of the Family Law Act. Basically, you are saying that what the Family Law Act prescribes regarding a just and equitable division of property doesn’t suit your circumstances, and you want to divide your property your way.
The downside with these documents is that
• they are more complex;
• they are more expensive;
• they are more easily set aside; and
• both parties require independent legal advice.
We far more commonly draft Consent Orders. However, Binding Financial Agreements do have their place, and sometimes this is the only way forwards. A BFA is the same document as a ‘pre-nuptial agreement’. It can be entered into before, during or after a de facto relationship or marriage.
It is also important to know that there are certain mechanisms, such as transferring real property or superannuation, that either orders or a Binding Financial Agreement will facilitate. Without these documents, transferring real property will attract stamp duty and super splits can’t be made. There are many advantages to these documents, including your future protection.
Binding Financial Agreements to finalise a property division will cost between $3000 and $10,000, depending on what law firm you go to.
Both Consent Orders and a Binding Financial Agreement are expensive, but it is money well spent, and in my view, they are reasonably cheap compared to the consequences of not having them. If there are property transfers to be done under the agreement, then a stamp duty exemption will be able to be applied, which is another huge financial advantage.