Treatment of Superannuation in Family Law Property Settlements
Most separated couples would like to know how their superannuation and property will be divided between them. The amount of superannuation a party has can be a significant portion of the total net property of the parties.
It is important to remember that the Family Court can only make orders dividing (splitting) superannuation, as if it were property, in cases concerning the separated parties to a marriage (?marriage cases?). The Family Court cannot make orders splitting superannuation in cases concerning separated parties to a de facto relationship (?de facto cases?).
In ?de facto? cases, the Family Court takes into account the value of the superannuation interests and all other property, and the contributions and likely future circumstances of the parties, in deciding how to divide the property between parties. The party with significant superannuation interests may get less of the property being divided, because he or she is keeping significant superannuation. Valuing the superannuation interest and assessing the contributions can be problematic.
In ?marriage? cases the Family Court does not have a consistent approach to the treatment of superannuation interests. Instead:
- Sometimes orders are made splitting superannuation and dividing property;
- Sometimes the property is divided in proportions which are different from the proportions in which superannuation is split.
- Sometimes orders are made dividing the property and leaving one party with his/her superannuation, in such a way that the party with the superannuation gets less property and all or most of the superannuation and the other party gets more of the property and no or very little superannuation.
While each case has to be considered and decided on its own set of facts, some helpful guidelines are:
- If you are the spouse with most of the superannuation, and you want a significant share of the property, you should propose a superannuation splitting order plus a property division order. If you do not, then there is a risk that no super split will be ordered and you will be left with all the super and less of the property.
- If you are the spouse without super and you want all or most of the property then do not apply for a super splitting order. Instead, apply for more of the property with the super being left to the other spouse.
- Generally, if there are young children and one party's super is a significant proportion of the total property (including the super) it is likely the Court will leave most of the property with the party with the children and all of the super with the other party. However, this is where the Court's approach has been most inconsistent. The Court
- may or may not treat the superannuation as if it was property and
- may, or may not, count the superannuation as part of the property being received under its order, and
- may or may not give the party receiving more of the property a smaller proportion of that property, to compensate for the fact the other party cannot access the superannuation for many years.
- Obtain a valuation of superannuation interests that reflects the true value of the superannuation. Sometimes, and this will often depend on the nature of the superannuation interest (e.g. defined benefit, pension only benefits) it may be necessary to engage an expert to do this.
At O'Sullivan Davies we have Family Law Specialists and experienced Family Lawyers who are able to assess your situation and advise you on the likely treatment of superannuation interests in your particular case.
Get in Touch
