When the Family Courts are deciding how much property each party to a marriage or a de facto relationship should get, one of the factors they have to consider is the future needs of those parties. That is because it’s the court’s responsibility, not only to divide the assets between the separated couple, but to consider, so far as possible, what assets the parties will need in the future, after the court case is over and they are getting on with their separate lives. So, what kinds of “future needs” do the courts look at?
The future needs of a parent who has the primary responsibility of raising children
That is, the parent who has the children living with them most of the time, usually, but certainly not always, the mother. That parent will have additional needs, for housing, feeding, clothing and educating the children, transport, medical and dental expenses, that are more than the other parent. In other words, that parent has greater “future needs” than the other one. The courts will usually give that person a larger share of the assets, to help them with their future needs.
The future needs of a party who suffers from a physical or mental disability
That party may have greater medical expenses than their former partner and/or their ability to work in paid employment might be less than the other party, so that they have greater future financial needs than their ex. Again, the courts can adjust the property settlement towards that party.
The future needs of a party who earns significantly less than the other person
If there is a big “income earning disparity” between the parties – one earns a lot more than the other, that can affect the economic future of the lower income earner: for example, their ability to buy, or rent, a home. That’s another area where the courts can make an adjustment for that person’s future needs.
Future needs and the standard of living the parties had during their relationship
One of the matters the courts look at in deciding property cases is the standard of living that they achieved during their relationship. That doesn’t mean that their assets will be divided up so that they can both continue to have that standard – that’s just not possible in most cases, where the same asset pool has to be distributed between two people. But the courts can take the standard of living issue into account when distributing the family assets.
What if a person’s “future needs” are met by their new partner?
If a party remarries or renters into a new de facto relationship, and their new partner is able to provide for them, it may be that they don’t have any future financial needs. In that case, the court may not make any financial adjustment in that person’s favour, because their future needs are being satisfied by their new partner.
The effect of pensions on future needs
Section 75(3) of the Family Law Act says that the court, in exercising its powers to make spousal maintenance orders in favour of a party (usually the woman), “shall disregard any entitlement of the party whose maintenance is under consideration to an income tested pension, allowance or benefit.” In other words, if the court, in deciding whether a party has future financial needs which may require the other party to pay maintenance, the fact that a pension (like a Centrelink benefit) is being paid, is not to be considered in assessing whether such maintenance is to be paid.
While I have been saying what the courts do, of course the vast majority of Family Law cases are settled by negotiation, through the solicitors for each party and often with the help of mediation, but these are the sorts of issues that are considered during those negotiations.
Our highly experienced and friendly Family Law team at Tonkin Legal Group are here to help you negotiate a successful property settlement.
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