Family Law: Long Term Assets Require Long Term Solutions

You were smart - you and your partner thought long and hard in your youth and invested for your retirement. It was a great decision at the time. Sure, a ten year investment seemed a little long but think of the returns! In 10 years, you would be reaping what you had so carefully sown.

 Unfortunately, the best laid plans are sometimes put to waste when a couple suddenly separates. However, there are ways to preserve your asset despite separating as a couple.

 In a property settlement the first step is to identify the asset pool. Some assets are easy to identify and value, such as a bank account. However, if you have a long term investment, there are a couple of questions which need to be answered first:

• How do you assign a value to your asset? Can you assign a value to the asset? Or is the asset something that cannot be valued until the asset has matured?
• Is the asset divisible or transferrable in its current state? Or do you need to wait for the asset to mature before you can divide the dividends/transfer it wholly into one parties name?

Unfortunately, many of these questions are difficult to answer. In the end, cooperation and full and frank disclosure are the best ways to deal with long term assets. You may be able to contact the investment manager to see if and how the asset may be valued.

Alternatively, both parties agree to split whatever the eventual value of the asset is evenly once it matures. Admittedly, this makes it very difficult to assign a value to the overall property pool to ensure a just and equitable division of property because a significant asset is missing. However, luckily consent orders provide parties with the degree of flexibility required to produce a solution which works for both parties.

If you have a family law matter, concerns about your investments or questions about family law and finances in NSW and want to find out more please do not hesitate to contact us on 9688 6023 or email us at info@franklegal.com.au.

This article is provided to the reader for general information. It is not legal advice. It was written by Andrea Spencer & Emily Graham and edited by James Frank.

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