In this article, Rachell Davey and Cheryl Chua, of Landers & Rogers, discuss what Courts in Australia would take into account in a divorce similar to the recently announced split between Jeff and MacKenzie Bezos.
Will the (bread) winner take it all?
The short answer is: not necessarily. Even if all the assets including business interests are held in one party's name, there are other important factors such as the other party's financial and non-financial contributions to be considered in a property settlement.
The Family Law Act 1975 (the Act) sets out the factors that a Court must take into consideration when dealing with financial disputes / property settlements.
Broadly speaking, if there is no Financial Agreement between parties, the Act requires consideration of:
These considerations and other factors — such as the duration of a relationship/marriage — mean that the business interests of one party or the wealth of the bread winner can be identified as matrimonial property. This can be perceived as being "up for grabs" but really is (fairly) available for division in the circumstances of the relationship / marriage being recognised as a joint venture.
A Financial Agreement can offer various advantages depending on your unique circumstances, including:
It is possible to enter into a Financial Agreement before, during or after a relationship / marriage. There are, however, strict requirements that need to be met to ensure the Financial Agreement is valid and binding on the parties if or when relied upon.
Financial Agreements can be overturned by a Court, but it is also possible for a Court to exercise its powers to declare it binding.