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Property Settlements & Special Skill

Property Settlements & Special Skill

The Family Law Act sets out a clear pathway for the courts to following when faced with competing applications for property settlement.

The pathway is commonly referred to as 'the four step process' and requires the court to do the following:
download.jpgAssess what the total property pool is.Determine who has contributed what to the property pool (including financial and non-financial contributions, and contributions as homemaker and parent).Assess each party's future needs (including issues such as age, health, capacity for employment, etc).Ask whether the result is just and equitable.
Sometimes, an applicant will make the argument to the court that his or her contribution to the property pool was exceptional and was enabled by his or her 'special skill'. Recently in the case of Kane & Kane [2013] FamCAFC 205.

In Kane & Kane, the husband and wife had been married for 30 years. During that time, the husband had worked as a professional and the wife had been the homemaker. In 2008, the husband used the sum of $539,500 to purchase shares in a company. He did this without the wife's involvement. When the court heard the matter in 2013, the value of the shares had increased to $1,850,000. As a general principle, the contributions of two parties in their respective roles of homemaker and breadwinner are valued as equal contributions.

The judge held that the total property pool should be split into thirds, and that the husband and wife should each receive one third to account for their equal contributions as homemaker and breadwinner. The judge also held that the husband should receive a further third of the property pool to account for his special skill in purchasing the shares which significantly increased in value.

The wife appealed the judge's decision. On appeal, the court held that the judge should not have assessed the husband's contribution as being worth more due to his 'special skill'. The court found that often, a person might have a special skill (for example, an academic) but the application of that skill might not result in any great financial reward. The court found that there is no doctrine of 'special skill' which requires courts to take account of some unusual talent or skill of a party to a relationship.

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Disclaimer: The information contained in this blog is for informational purposes only and is not legal advice. Nothing in this blog should be deemed to create or constitute a solicitor-client relationship between any readers and Swan Family Lawyers. A solicitor-client relationship is created only when this firm agrees to represent someone and a written engagement agreement or engagement letter is signed by both the client and solicitor. In all cases, the reader should consult his or her own solicitor for advice. The information in this blog is based on Australian law.