In the vast majority of cases former spouses settle outstanding matters such as property and children matters between themselves. The process to formalise an agreement reached between parties is relatively simple and inexpensive. Litigation is expensive and has, in a small number of cases, ended up costing tens of thousands of dollars when the outcome achieved does not justify it.
Experience dictates that most clients will have already reached an agreement to settle all outstanding matters with their former spouse by the time they see their lawyer. Our task then is to formalise that agreement legally. At elringtons we consider that an essential part of our role is to advise clients whether the agreement reached is appropriate or not. More often than not, it is.
The starting point for achieving an out of court settlement is knowledge and information. Parties should obtain appropriate advice as to their prospects in the event that they are considering litigation. At the same time, parties should consider possible scenarios to resolve their disputes out of court and also consider the negotiation process itself. Normally, the better settlement is the one where each party feels that he or she has been closely involved in the settlement and that each person in part, “owns” the settlement reached.
Once a settlement is reached, it is necessary to formalise the agreement legally. The parties must complete and sign an Application for Consent Orders which is a pro forma document that contains detailed financial information (normally the parties themselves complete a draft version) and the Terms of Settlement which is the legal document that reflects the agreement reached. Those two documents, together with a photocopy of the marriage certificate, must be filed with the Court. In the event that part of the settlement involves the “splitting” of a superannuation fund, it would be necessary to obtain a valuation of the Superannuation interest.
A Registrar of the Court will then consider the documents and issue the orders in accordance with the Terms of Settlement. The Registrar has an obligation to ensure that all formal requirements have been complied with before making the orders. On some occasions, but very rarely, a Registrar may refuse to make the orders if it is considered that it is overtly unfair to one party.
Overall, the process to legally formalise an agreement reached between the parties is relatively simple and inexpensive. However as part of this settlement process it is important for each party to consult a solicitor to ensure that the agreement is fair and reasonable. It is also important that the parties fully appreciate and understand what they are legally entitled to before entering into a property agreement. Once orders are made they are legally binding on both parties and can only be varied or discharged by the Court in exceptional circumstances. For that reason alone it is important that both parties understand their respective obligations under the orders, even in circumstances when the orders are made by consent.
Sometimes former spouses have no choice but to litigate in order to achieve an appropriate outcome. However even in circumstances when the parties commence proceedings, the court will encourage or sometimes require the parties to attempt to resolve the matter themselves. This can be through court ordered mediation or counselling or other informal negotiations. Only a small number of matters progress to a final hearing. Accordingly, litigants should always remain focused and aware of what the intended outcome of the litigation is and whether it is justified or continues to be justified as the matter progresses.
For more information or to make an appointment please contact:
Carlos Turini at: cturini@elringtons.com.au or
Phone the Family Law Team on (02) 6206 1300
