As mentioned in our earlier articles there are 5 steps a Court will work through when deciding how to divide the assets of a couple. The fourth step relates to the parties’ future needs after separation and could lead to an increase in the assets you may receive after the property is divided.
You can find Future Needs Factors in the Family Law Act under section 75(2), but you will notice that your lawyer will often describe this section as your future needs. The Act provides a list of considerations and you can read the full list here.
Please note that these factors are mirrored for defacto/non-married couples later in the Act so married and non-married couples are treated the same.
Some of the most common future needs that arise include:
- care for any children;
- earning capacity, ie. How much money you earn; and
- the duration of the marriage and its effect on your earning capacity.
For example, if you are to have the majority care of the children you will likely receive a percentage increase to wheat you are entitled to of the asset pool.
Duration of the relationship is also important as often one parent has stayed home to look after the children whilst the other has been the main breadwinner/working parent of the home. Depending on the circumstances of your relationship the court will often consider that the parent who has still been at home, will be entitled to a percentage increase of the asset pool as their future needs are higher. This is because they must re-enter the workforce and may not have worked in many years.
A recent case highlights just how important these future needs factors can be in certain circumstances. The case dealt with a husband and wife where the husband had been the main breadwinner during the entire relationship and the wife was the homemaker who looked after their 17 year old son with autism.
The case is interesting as the husband received a $1.4 million injury compensation payment which totalled to 60% of the entire net asset pool at trial. It was agreed that the wife could work and the husband would have difficulty due to his injury, but the Judge noted that her ability to work was affected by three factors, namely –
- Since she has been home looking after the children and the house, she had not worked for 24 years;
- She had no formal qualifications, skills, or training and as a result would have to retrain at the age of 52; and
- The care of the child required significant day to day care.
The Judge assessed the parties’ contributions as 75-25 in favour of the husband. However, after considering the wife’s future needs his Honour made a 15% adjustment to the wife bringing the final percentage split to 60-40 split in favour of the wife. This led to the wife receiving $1,156,478.40 of the $2,891,196.00 net asset pool.
If you need help with your Family Law matter, call Kate Walker now on 4324 7699.