Divorce and Property Settlements: What You Need to Know
Going through a divorce is never easy – emotionally, practically, or financially – and then you need to deal with a property settlement! At Swanwick Murray Roche, we assist people throughout Rockhampton and Central Queensland to understand their legal rights and responsibilities during separation.
If you are ending a marriage, one of the most important issues to address is the division of assets and liabilities – known as a property settlement.
Here’s what you need to know about property settlements, and how our team can help protect your financial future.
What Is a Divorce? Property settlement in Queensland.
A divorce is the formal, legal end of a marriage. It is handled separately from any financial or parenting issues.
To get divorced in Australia, you must:
- Be separated for at least 12 months
- Prove that the marriage has irretrievably broken down
- Have been married for at least 2 years (or attend counselling if married less than 2 years)
Divorce applications are made through the Federal Circuit and Family Court of Australia. Once a divorce is granted, the property settlement process must be finalised within 12 months of the divorce becoming final.
What Is a Property Settlement?
A property settlement is the legal process of dividing:
- Property and real estate
- Superannuation
- Business interests
- Vehicles, shares, and investments
- Debts and liabilities
The settlement can be negotiated privately, through lawyers, or decided by the Court if an agreement cannot be reached.
Important: You do not need to be divorced to start a property settlement. You can begin negotiations as soon as you separate.
How Is Property Divided After Divorce? Property settlement process.
Property division after divorce is not a simple 50/50 split. It’s a carefully considered process under the Family Law Act 1975 (Cth) that aims to deliver a just and equitable outcome, based on each party’s contributions and future needs.
The Court applies a structured four-step approach, which includes the identification and valuation of all assets—regardless of whose name they are in or how they are legally structured.
Step 1: Identify and Value the Property Pool
The first step involves identifying the entire asset pool, which includes:
- Real estate
- Vehicles
- Savings and investments
- Debts
- Superannuation
- Family trusts
- Private companies
- Business interests
- Any other financial resources
Superannuation
Superannuation is treated as property under the Family Law Act, but it is dealt with differently because it’s held in a trust structure and cannot be accessed until retirement age (in most cases).
Key points:
- Superannuation entitlements can be split between parties under a superannuation splitting order or binding financial agreement.
- Splitting does not convert super into cash—it simply transfers the entitlements to the other party’s fund.
- Defined benefit funds (e.g. government or military pensions) and self-managed super funds (SMSFs) may require expert valuation and legal advice due to complexity.
At Swanwick Murray Roche, we work with actuaries and financial advisors to properly assess the value and tax implications of superannuation in settlements.
Trusts
Many clients assume that if assets are held in a discretionary family trust, they are protected from family law claims. This is not necessarily the case.
The Court will look beyond the legal structure and assess whether one or both parties:
- Control the trust (e.g. as trustee, appointor, or director of the corporate trustee)
- Benefit from the trust distributions
- Have treated the trust as a personal or family asset during the relationship
If a party has significant control or financial interest in a trust, the Court may include the trust assets in the property pool—or at the very least, treat them as a financial resource that affects the outcome of the settlement.
It is important to note that:
- Mere beneficiaries without control may not have the trust included in the asset pool.
- If a trust is found to be a sham or alter ego of one of the parties, it will be scrutinised very closely.
Companies and Business Entities
Where one or both parties have ownership or control of private companies, those interests are also considered part of the asset pool.
The Court will assess:
- Shareholdings
- Directorships and management control
- Financial benefits received (e.g. dividends, wages, loans)
- Whether the company has been used to accumulate or shelter family wealth
If a company is effectively run as a personal asset, the Court may include its value in the settlement or look to the company’s assets as part of the available property.
We frequently see situations where:
- A spouse holds assets through a company structure to reduce their apparent net worth
- Loans from the company are used to fund lifestyle expenses
- The business supports the family’s income and standard of living
We work closely with forensic accountants to uncover the true value of corporate structures, determine whether there is any attempt to hide or minimise assets, and ensure a fair division.
Why It’s Risky to Leave Things Informal
Many separating couples believe that if they’re getting along, or have “agreed” on how to split things, there’s no need to involve lawyers or the Court. While an amicable split is always preferable, relying on informal or verbal agreements is a serious legal and financial risk.
Until your property settlement is legally finalised—either through Consent Orders or a Binding Financial Agreement—you remain financially connected to your former spouse. This means that either of you could make a legal claim against the other, months or even years after separation.
Here’s why this can be dangerous:
⚠️ Future Claims on Your Assets or Superannuation
Even if you have already divided assets informally, your ex can later bring a claim for:
- A share of property you’ve acquired since separation, including a new home or investment
- Your superannuation entitlements, even if you’ve changed jobs or increased your balance
- Your inheritance, business income, or lottery winnings received after separation
Without a formalised settlement, the asset pool for division can still include property acquired post-separation if the Court considers it part of the parties’ financial relationship.
💬 Example: You separate amicably and agree to “walk away” with what you each had. Three years later, your ex brings a claim for a share of your newly purchased house and your accumulated super.
Without formal Consent Orders or a Binding Financial Agreement, that claim may succeed.
⚠️ Liability for Post-Separation Debts
Informal arrangements do not protect you from liabilities your ex may incur after separation. If your name remains on:
- Joint mortgages
- Personal loans or car loans
- Business debts or credit cards
You may still be legally liable—even if your ex verbally agreed to take responsibility.
💬 Example: Your ex keeps the family car and agrees to keep paying the loan. They later default, and the lender comes after you because the loan is in joint names.
Only a formal property settlement can apportion financial responsibility and prevent this outcome.
⚠️ Changing Life Circumstances
What may seem “fair” now might not be fair in the future—especially if life changes for either party. Informal arrangements offer no protection if:
- Your ex becomes bankrupt or insolvent
- You become ill or disabled and are less financially secure
- Your financial position improves (e.g. successful business, new investments)
- You pass away without updating your legal documents
An ex-spouse can still make a property claim or even a claim on your estate unless your financial relationship is legally severed.
⚠️ No Legal Protection or Finality
Unless your agreement is legally formalised through:
- Consent Orders approved by the Court, or
- A Binding Financial Agreement prepared by lawyers,
…it is not legally enforceable. This means you have:
- No protection if your ex changes their mind
- No finality to your financial relationship
- No safeguard against future legal costs and disputes
An informal settlement is simply a handshake deal—and handshake deals don’t hold up in Court.
How Swanwick Murray Roche Can Help with Property Settlement
At Swanwick Murray Roche, we help clients in Rockhampton and across Central Queensland to:
✅ Review and formalise agreements they’ve made with their ex
✅ Protect future assets, superannuation, and inheritances
✅ Avoid legal disputes by getting things done properly the first time
✅ Ensure they are free to move on with certainty and peace of mind
Whether your separation is amicable or contentious, it pays to do it right. A legally binding property settlement gives you closure, financial independence, and long-term security.
Contact us today to discuss your situation with a qualified family lawyer and protect your financial future.
Disclaimer
This article provides general information only and does not constitute legal advice. For specific advice tailored to your circumstances, please contact one of our experienced family lawyers.
