PROPERTY SETTLEMENT

During a marriage or any other long term cohabiting relationship, the parties may have acquired assets for each other's benefit and that of their family. However, what becomes of these assets when the relationship ends? This is where the concept of property settlement comes in. 

When we speak of property settlement in the context of a divorce or separation, we are talking about the division of the property, debts and other financial resources of a couple when their relationship ends. The question then arises, how would this division typically unfold? Are the assets split evenly and would all the assets be subject to division? 

This Article will explore these issues in further detail and will explain the key factors the Court will consider when determining how property should be divided between former partners.

DISTINCTION OF PROPERTY

Not every property owned by the parties may be considered for division. Also depending on the characteristics of the property in question, the Court may opt to deal with them differently. 

The Court makes two distinctions:

1. Matrimonial property: that is those assets that were accrued during the marriage.

2. Non- matrimonial property: that is property that was inherited, gifted or acquired before or after the marriage.

Non- matrimonial property is generally not automatically included into the pool of assets subject to division. However, the Court will still consider such assets if they were used for the benefit of the family.

Therefore, non- matrimonial property obtained by a spouse post divorce, without more, would usually not be included for division.

FACTORS THAT THE COURT WILL CONSIDER

Under section 27 of the Matrimonial Proceedings Act, the Court must consider all the circumstances of the case in determining how to fairly divide the relevant property. 

In particular, they must consider:

1. The income and financial resources of the parties: 

For this consideration, the court will examine and compare how much each party earns, what their earning capacity is currently, what other financial resources they have and are likely to have in the future.

2. The financial needs and obligations: 

For this consideration, the Court will compare what are the present and financial needs, obligations and responsibilities of each party. 

3. The standard of living enjoyed before the breakdown of the marriage: 

This can help the Court to gauge what order would bring the fairest resolution in ensuring that both parties do not experience a significant reduction in their standard of living post the divorce. 

4. Contributions made by each of the parties to the welfare of the family:

The court also considers non financial contributions such as any contribution made by looking after the home or caring for the family in determining how to divide the assets between the parties.

5. Any physical or mental disability of either of the parties to the marriage and the age of each party to      the marriage and the duration of the marriage:

These are other factors in which the Court will consider when determining the most appropriate order to make regarding the division of the parties assets.

Therefore, the Court’s decision is not based on an automatic 50/50 split but rather on a careful analysis of these factors and the evidence provided.

HOW WILL THE PROPERTY BE SETTLED?

After considering these factors and appropriately identifying the properties in dispute, the Court then has the power to make either of the following orders:

1. An order that the property be transferred by one party to the other or to a child of the family or to any other person specified in the Court's order for the benefit of the said child. However, the party can only make this transfer if they themselves are entitled to possess the property.

2. An order that the property be transferred by one party to the other either for the benefit of that party and/or for the children of the family. Again, the party making the transfer must be entitled to the property.

3. That there be a reduction or extinction of the interest of either of the parties to the property.

Even where an agreement, whether before or after the marriage, the Court still has the power under section 26 (c) of the act to vary said agreement for the benefit of the parties and/ or any children of the family.

HOW DO YOU START THE PROCESS?

The question then remains, how do the parties begin the process of property settlement?

If it is the desire of either party to seek Court intervention the process generally entails:

1. Filing a form 8 application: for financial relief: 

This application includes details of the applicant's expenses, financial responsibilities and the orders they are seeking the court to make in relation to the desired property and is supported by an Affidavit explaining their current financial situation and why they need the reliefs they are seeking from the Court.

2. The Respondent's Reply: 

After the Form 8 Application for Financial Relief, the Respondent would answer by filing what is known as a Form 9 Evidence of Financial Position and an Affidavit in Support.

3. Court hearing:

Once all of these Forms are filed before the Court, a hearing will then be set to deal with the applications that were filed.

The parties can opt to settle even in the midst of the proceedings. If a settlement has been arrived at, the Attorneys will lay out the agreement the parties have come to regarding the property in the form of a Consent Order.

It is important to note that you can choose to negotiate privately and reach an agreement without court involvement.