5 What are the consequences of divorce/separation?

5.1. How is the property (rights in rem) divided?

The principle of separation of property applies until separation or divorce. Upon both separation and divorce, the division and distribution of the property held solely or jointly by the parties is subject to the over-riding requirement that proper provision must be made for the spouses and any dependent children (section 3(2)(a) Judicial Separation and Family Law Reform Act 1989 and section 5 Family Law (Divorce) Act 1996) and also to the statutory requirement that all ancillary relief orders made must be in the interest of justice section 16(5) Family Law Act 1995 and section 20(5) Family Law (Divorce) Act 1996) and subject to the court having regard to the 12 statutory factors set out in section 16(2)(a)-(l) Family Law Act 1995 and section 20(2)(a)-(l) Family Law (Divorce) Act 1996. Thus a spouse’s share in property is determined on a subjective basis by the presiding judge in each case, with reference generally to the circumstances of the marriage, including, but not limited to, an examination of the impact of the roles adopted by the spouses in the course of the marriage, any sacrifices and/or contributions made by one or both of the spouses and their current and future earning capacity. In lower income cases, the courts are typically most concerned with providing for the basic needs of the dependent spouse and children and this will include securing a home for these parties. However the courts are not limited to simply providing for the needs of the dependent spouse and thus in ample resources cases, a trend of awarding one third of the assets to the non- earning or less wealthy spouse has emerged in the courts. As regards fault, unless the fault on the part of one of the spouses is regarded as “gross and obvious” it will not influence the division of property.

5.2. Who is liable for existing debts after the divorce/separation?

The liability for debts incurred by one spouse remains the responsibility of that spouse post divorce/separation, unless the court orders otherwise. Such a court-ordered transfer of responsibility may form part of the settlement package ordered by the courts in the interests of fairness.

5.3. Does one spouse have a claim to an equalisation payment?

The court can make an order for the payment of a financial lump sum by one spouse to the other where it is in the interests of justice to do so (section 16(5) Family Law Act 1995 and section 20(5) Family Law (Divorce) Act 1996) and in light of the 12 statutory factors to which the court must have regard (section 16(2)(a)-(l) Family Law Act 1995 and section 20(2)(a)-(l) Family Law (Divorce) Act 1996).

5.3.1. In case of a property regime of the community of surplus:
- Does the claim have to be satisfied by means of a payment or in kind?
- How is the claim assessed?
- What is the amount of the equalisation payment?
- When is the claim prescribed?