It is not unusual in a family law property settlement to see two parties agree for one person to keep the house and in exchange for this, pay the other person an agreed upon sum of money..
If parties are in agreement about a property settlement then Consent Orders are prepared and filed with the Court. The Court then makes these Consent Orders into formal Court Orders.It is standard for parties to have between six to eight weeks to organise the transfer, refinance the mortgage and the make the lump sum payment to the other party once the Court Orders are made. Whilst such an agreement may seem straight forward, problems arise when these time frames are not complied with, particularly when one party is deliberately not complying with Court Orders.
In a recent family law case, the Family Court made Court Orders by consent in relation to parties to a de-facto relationship that Mr B would retain the investment property in Sydney and within 90 days pay to Ms S the sum of $130,000. This meant that the parties would have an overall 50/50 split of their assets.
Mr B did not make the payment within 90 days. It took him 13 months to pay Ms S the sum of $130,000. During those 13 months, house prices in Sydney were booming and the value of the house increased by around $150,000. This meant that only Mr B was going to benefit from the increase in the value of the house and that the payment to Ms S no longer represented a 50/50 split.
Ms S made an application to the Court for the Court Orders to be set aside on this basis. The Court set aside the Orders. However, Mr B appealed the decision but did not succeed. On appeal, the Court found that the purpose of the Orders was for a 50/50 split and this was no longer the case due Mr B not complying with the time frame ordered. This means that the parties will now have to attempt to negotiate another property settlement!
This case acts as a reminder of the importance of complying with Court Orders and more particularly timeframes!
If you have separated from your partner or spouse and require assistance negotiating a property settlement or you have reached an agreement with your partner or spouse about settling property matters you should talk to a Family Lawyer without delay.