What’s included in the asset pool in a family law property settlement?

5 January
Property Settlement

After the breakdown of a marriage or de facto relationship, you may need to divide your assets with your ex-partner. In family law matters, this process is referred to as a property or financial settlement. An important step in property settlement matters is determining the assets and liabilities of each party. This is referred to as the matrimonial or de facto “property pool” or the “asset pool”.

What is included in the property pool?

In a property settlement, the property pool of the parties includes all assets and liabilities acquired during a marriage or de facto relationship. This includes assets held jointly or individually.

The property pool is assessed at the time of the property settlement and not at the time of separation. Therefore, it is important to note that post-separation assets or liabilities (such as a loan taken out or a car purchased after separation) can be included in the property pool.

Examples of assets in the property pool for inclusion in property settlement negotiations may include:

real estate – residential or investment properties;
furniture, furnishings and effects;
business or trust assets;
motor vehicles;
bank accounts;
investments and shares and cryptocurrency;
jewellery;
superannuation; and
digital assets like monetised social media accounts.

Examples of liabilities in the property pool may include:

mortgages;
personal loans;
income tax liabilities;
vehicle finance;
credit card balances.

Often, property pools are presented in a table. An example of a property pool where “John and Louise” have separated and are negotiating property settlement is outlined below.

Matrimonial Property Pool
Assets	Owner	Value ($)	Comments
123 Adams Street (the former family home)	Joint	1,000,000
John’s motor vehicle	John	25,000
Louise’s motor vehicle	Louise	15,000
Home contents	Joint	20,000
Funds in personal bank accounts	John	2,000
Funds in personal bank accounts	Louise	1,500
Funds in joint bank accounts	Joint	5,000
Cryptocurrency	John	7,500
BHP shares	Louise	500
Boat	Louise	3,500
Total assets		1,080,000
Liabilities	Owner	Value ($)	Comments
Mortgage secured against former family home	Joint	500,000
Credit card	Joint	2,000	Amount owing
Vehicle Finance	John	10,000
Personal loan	Louise	6,000
Total liabilities		518,000
Net assets & liabilities		562,000
Superannuation	Owner	Value ($)	Comments
HESTA	John	200,000
HostPlus	Louise	125,000
Total superannuation		325,000
Net including superannuation		887,000

Do the parties need to disclose their assets and liabilities to each other?

In a property settlement, each party has a duty to the Court and each other to make full and frank disclosure of their financial circumstances. This means that the parties need to provide each other with copies of documents such as:

proof of income (payslips, tax returns, Centrelink payments);
assets (bank account statements, real estate valuations, Redbook valuations for motor vehicles, share portfolios);
superannuation statements;
business activity statements and financial statements; and
any other relevant documents.

If a party does not comply with the duty of disclosure in a property settlement, there are certain consequences to the non-disclosing party, including:

any final Court order or agreement can later be set aside or overturned;
the Court may dismiss your case;
the Court may include or exclude the evidence that has not been disclosed;
the Court may make a Costs Order against you;
the Court may find you guilty of contempt of Court, which can result in fines and, in some cases, imprisonment;
the Court may impose penalties.

What if the values of items in the property pool are not agreed?

It is important that both parties agree on the value of each item in the property pool. In the event that the parties cannot agree on the value of items, the dispute may be resolved by providing disclosure documents that indicate the value of items (such as a free real estate market appraisal or a Redbook valuation of a car).

If the parties still do not agree on certain values, formal valuations must be obtained.

For any real estate that is being retained by one party at final settlement, parties will often obtain a joint valuation by a qualified property valuer. In this instance, it is common that parties will agree on the valuer to be appointed and will each be responsible for half of the valuation costs.

What can I do if my ex-partner tries to dispose of property after separation but before property settlement?

Occasionally, a party may sell or attempt to sell an asset that they owned during the relationship. If the property is legally jointly owned, such as a house in the joint names of the parties or a motor vehicle, then both parties must consent to the sale and sign all necessary documents to dispose of the asset.

However, this can be more complicated if only one party is the registered owner of the asset or if the legal ownership is unclear (such as household contents). In this case, it is important to seek legal advice and consider whether there are options to apply for Court Orders to stop the other party disposing of property, or if the value of the property can be “added-back” to the asset pool during the settlement negotiations.

How can a family lawyer help?

Family Law Resolutions has an expert team of family lawyers who can assist with Consent Orders or Binding Financial Agreements. We can help you analyse the pros and cons of both options in order to reach a decision on what is best for your specific and unique needs.

If you would like to discuss your situation in more detail, you can book a free no obligation phone consultation with one of our lawyers. We assist separated couples across Australia with all aspects of separation and family law.