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Informal Property Settlement Risks in Family Law




Clients often mistakenly believe that a formal property settlement is not required if they have entered into an informal agreement with their former spouse or de facto partner. An informal agreement is often verbal, sometimes in writing. It has the benefits of not requiring the involvement of lawyers and costs associated with that and often avoids upsetting the other party by not insisting on formalising the agreement.


However, by choosing not to formalise the agreement, clients unknowingly place themselves at risk of future claims from their former spouse or de facto partner sometimes years down the track after the parties have re-partnered which further complicates matters. This is because while a Court may consider an informal agreement made between parties, there is no requirement in law for the Court to uphold the agreement and it is unlikely that they would make the agreement binding on the parties.


Further, if the informal agreement is not upheld by the Court parties are required to start the property settlement process from the beginning. This means that assets and liabilities acquired post separation by both parties are usually included in the property pool for division, values attributed to the property pool are current date values rather than separation values and your current circumstances are taken into consideration regarding any adjustments to either party which may be disadvantageous for you.


Overall, to best protect your interests it is recommended that you formalise your property settlement through Consent Orders, with the guidance of a solicitor, as soon as possible after separation. Consent Orders ensure that no future claims can be made by your former partner or spouse regarding your property so you can rest easy and move on with your lives.


Let the experienced team at Mal Ryan and Glen assist you in securing your arrangements today.


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This article is general in nature. It does not constitute legal advice and should not be taken as such.



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