Mediation about Property
Working out how to divide your assets after separation or divorce can be very stressful. If handled badly it can create, or increase, resentment between a separating couple. Using Family Dispute Resolution (often called mediation) to make these decisions gives you the best chance of keeping things amicable - which is especially important if you have children together. It is also cost-effective and efficient.
To learn more about property mediation - click on any of the headings below.
What is property mediation?
Property mediation (which is also sometimes called Family Dispute Resolution) is a process in which a neutral third party helps couples who have separated to talk through and make decisions about how to divide up their assets, liabilities and superannuation entitlements so that they can establish separate financial lives for the future.
What happens in a property mediation?
The first step in any property mediation is for me to meet individually with each of you. At these meetings I’ll learn more about your situation, from both your perspectives, so that I can work out the best way to run the mediation sessions (and to make sure that mediation is appropriate, because it isn’t the right fit for everyone).
After these individual meetings I will organise a joint session, or sessions. Most times two sessions are needed. Each session will be up to three hours. We might be all together in the one room for these sessions, or it might be that you stay in separate rooms and I carry messages between you.
There is a legal obligation for each of you to make ‘full and frank disclosure’ about your financial circumstances, so we’ll start by gathering that information. We’ll identify the assets, liabilities and superannuation entitlements you each have. I’ll help you share and record each of your understandings of the financial history of your relationship - what your financial positions were at the beginning of your relationship and the contributions you have each made (financially, and non-financially) since then. You’ll also share information, with my assistance, about what the future is likely to hold for each of you, from a financial perspective.
It is common in this process to find that there are gaps in your information, or disagreements about the facts. As part of this information gathering exercise I’ll be helping you make decisions about how to fill in those gaps, and how to resolve those disagreements.
Once the information gathering is complete you’ll each need to get legal advice. You’ll need to see separate lawyers because lawyers aren’t allowed to advise both people. Sometimes people have engaged lawyers before coming to mediation. If this is the case some of the information gathering may have already occurred, and you may not need further advice at this point.
There are significant benefits to doing the ‘information gathering’ jointly in a mediation process, before engaging lawyers. It is usually more efficient and less expensive. And it will help you maintain or build an amicable relationship because you will be sharing this information in a facilitated conversation where misunderstandings and different memories can be discussed respectfully and promptly. It will also mean that when you do get legal advice you’ll be taking the same set of facts to your lawyers. When lawyers give advice based on only one person’s view of the facts, they’re likely to end up with very different advice about what will be a fair settlement.
There are circumstances though where it is important for people to have legal advice before they do any information sharing. If I think this is the case for you I will let you know before any joint sessions. And if you would prefer to get legal advice before a joint session then you absolutely can.
Once you have each had legal advice and the information gathering is complete, you’ll be ready to start making decisions for the future. You will each know what the law considers a fair settlement. I’ll help you identify options for how you might divide up your assets, liabilities and superannuation. We’ll examine those options together - seeing how they compare to what the law considers fair, and how well they meet each of your needs and goals for the future. Chances are that in this process you’ll find an option that is acceptable to both of you.
How do video mediation services work?
I run some mediations in a video-conference environment.
In a video mediation we might all meet in the same video-conference 'room'. Or I might have a series of separate video-conference conversations with each of you. If you will have a lawyer or other support person present I will join them to the conversations I have with you. And if using this technology is new for you I will spend time helping you get set up and comfortable with the technology before the mediation (without charging any fees for the time I spend helping you with this).
At the beginning of the mediation I will check in with each of you briefly to make sure the technology is working and then we'll get started. If you'd like to know more about what will happen in these conversations have a look at the section of this page titled "What happens in a property mediation?".
What happens after a property mediation?
If you reach an agreement - It is almost always a good idea to formalise any agreement you reach about property settlement. It will ensure that the property settlement really is final. There are also often major stamp duty and tax benefits to formalising a property settlement. There are two options for formalising a property settlement. Consent Orders are generally the less expensive and less complicated option. However they have to be reviewed and approved by a Registrar of the Family Court - so if the settlement you have agreed to might not be considered fair in the eyes of the law, then you will need to consider using a binding Financial Agreement (sometimes called a ‘BFA’).
If you use a binding Financial Agreement you will have to ask a lawyer to draft the agreement for you and you will each need very detailed advice from separate lawyers for the agreement to be binding. If you use Consent Orders you may be able to draft some of the paperwork yourself. I recommend getting a lawyer to help with the drafting and to each get advice from your lawyer before singing the documents, even though this is not a formal legal requirement for Consent Orders.
If you don't reach an agreement - If you aren’t able to reach an agreement in the mediation then you will need to decide what, if any, next steps you will take to resolve the dispute. This might involve making an application to Court, or engaging an arbitrator. (An arbitrator is a specially trained and certified lawyer who is authorised to make decisions in a similar way to a Judge). It is important to get legal advice before making an application to Court - to get more information about your options and to make sure you have complied with all the Court’s ‘pre-action procedures’.
Do you need a lawyer for property mediation?
Often lawyers don’t need to attend property mediation but you will, almost certainly, need some help from a lawyer along the way. For most people the best approach is to work with a mediator early in the process so that the information gathering and sharing is done efficiently and co-operatively. Once you’ve gathered and shared the information you need, a lawyer can provide advice about your entitlements and then you can work with a mediator to make decisions for the future. Lawyers can help you again after that, with drafting of the paperwork you will need to formalise any agreement you reach in the mediation.
Sometimes though it is important for lawyers to attend property mediation. If you have a complicated asset pool then it will be important to have lawyers present at the sessions with the mediator, to make sure the information you share is correct and to ensure that the options you propose for division are practicable. Sometimes one or both parties will also want a lawyer present to help them present their perspective.
Is property mediation compulsory?
If you are able to reach an agreement about property settlement without a mediator’s help then you don’t need to attend mediation.
But there is a legal requirement that people ‘genuinely try to resolve their dispute’ before making an application to Court for orders about property settlement. Attending a mediation is a common way to meet that requirement. In disputes about children parents need a certificate proving they have attempted mediation before they can file a Court application. There is no equivalent certificate process for property settlement, but if you file a Court application without having attended mediation (or participated in some other qualifying dispute resolution process) there may be adverse consequences later in the Court proceedings.
It is quite common for the Court to order people to attend mediation after an application has been made to Court for property settlement orders. If this is the case then mediation is, obviously, compulsory. Sometimes mediation will be ordered by the Court even when there has been an attempt at mediation prior to an application to Court being filed. Cases will often settle at mediation at this point, even though it was unsuccessful earlier on, because the steps that have occurred in the meantime may have changed one or both people’s views about what outcome is acceptable to them.
What if you feel intimidated by, or scared of the other person?
A property mediation can only go ahead if both people will be physically and emotionally safe and able to negotiate freely in the mediation. It is also important that both people have sufficient understanding of the financial arrangements that are being discussed to make informed decisions. Sometimes extra people (such as lawyers, financial advisers or support people) will attend a property mediation to ensure that there is a level playing field in terms of knowledge and understanding.
At the beginning of the mediation process I will meet with each person individually. During those appointments I will learn more about the situation, from both your perspectives, so that I can make an assessment about whether mediation is appropriate.
A history of one person being intimidated by the other or a history of family violence doesn’t necessarily mean that mediation can’t happen. It is often possible to run the mediation in a way that will ensure that everyone can be safe, and have an equal voice, despite the history. If I do form the view that mediation isn’t appropriate, then I am not allowed to run a mediation.
When is the best time to have a property mediation?
In terms of timing - the most important thing to be aware of is that there is a time limit for making an application to Court in relation to property settlement (which you may need to do if you are unable to reach agreement).
For de-facto couples the deadline is 2 years after separation - but it is important to be aware that ‘separation’ isn’t always the date that you established separate homes. It is common for people to make a decision to separate (or for one person to make a decision and then inform the other) but continue to live in the same house. If this is the case then the date that conversation happened is more likely to be treated as the date of separation.
For married couples the deadline is easier to identify as it is 12 months after a couple divorce. Couples need to be separated for 12 months to get divorced, which means that married couples have at least two years from separation to work out their property settlement, and often longer, because a lot of couples divorce later than 12 months after separation.
Keogh Mediation is a Canberra mediation and family dispute resolution provider. Video mediation services are available Australia-wide.