Step Three of The Four Step Process (Ep 14)

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What is step three of the four-step process when it comes to property division in family law?

The third step is all around the future needs of the parties. To put this in a really simple question that is asked, it is this:

Is there one person in the relationship who has a greater financial need than the other party?

OR

Is there one person that is going to struggle more in the future financially than the other?

In this third step, the Court considers various factors regarding the future of the parties after divorce and settlement which may justify an adjustment to the percentage division.

Family lawyers and the Court refer to these as 75(2) factors as outline in this section of the Family Law Act. Here, the court considers whether there is one person in the relationship who is going to be disadvantaged financially in the future more than the other person, now that the relationship is at an end.

Factors that may be considered are any disparities between the parties and their circumstances financially?

These disparities could be but are not limited to, the following:

• Does one person earn a significant amount more than the other?
• Is one of the parties the primary carer of the children?
• Does one of the parties have a higher earning capacity than the other?
• Is one of the parties injured and can’t work?
• Are one of the parties much older than the other and therefore do not have as much working life ahead?
• Is one person a carer and cannot earn what the other can earn?

Essentially, the law provides an uplift in the division of the property pool for any party that is disadvantaged financially in the future. This uplift is a percentage of the property pool.

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