By Jack Job – Associate
If you have separated from your spouse / de-facto partner, there are time limits for when you can start Court proceedings to seek a property settlement and/or spousal maintenance.
What time limits apply to me?
If you were in a de-facto relationship, you can start Court proceedings to seek a property settlement and/or spousal maintenance within two years after the date of separation. After this time, you can only start Court proceedings if you and your former partner agree, or if you obtain permission (also known as ‘leave’) of the Court, to do so.
Accordingly, if you have recently separated from your de-facto partner, it is important to carefully consider when you separated, as the two-year time limit will start running from that date.
Married couples can commence Court proceedings to seek a property settlement and/or spousal maintenance within 12 months from the date a Divorce Order is granted. Once this 12-month period has expired, you can only start Court proceedings if you and your former spouse agree, or if you obtain permission of the Court, to do so.
You and your spouse must be separated for more than one year before you can apply for a Divorce Order. Depending on your individual circumstances, it may be preferrable to apply for a Divorce Order as soon as possible after this one-year period has ended.
Conversely, it may be preferrable to postpone applying for a Divorce Order if you and your spouse are endeavouring to finalise your property settlement and spousal maintenance entitlements out of Court. In such circumstances, it may be undesirable to have the added pressure of finalising those matters before the expiry of the 12-month time limitation period from the date of your Divorce Order.
Commencing Court proceedings out of time
If you and your spouse / de facto partner do not finalise your property settlement and/or spousal maintenance entitlements before the applicable time limit expires, you will need the Court’s permission to start Court proceedings in relation to such matters.
The Court must not grant permission, unless it is satisfied that:-
- Not granting permission will cause hardship to one or both parties or to a child of your marriage / relationship; or
- In the case of spousal maintenance, at the end of the applicable time limitation period, the circumstances of the party applying to commence Court proceedings were such that he / she could not support himself / herself without an income tested pension, allowance or benefit.
Obtaining permission from the Court cannot be guaranteed. This was demonstrated in the recent decision of Waldmann & Paddack [2024] FedCFamC1A 100. Accordingly, it is important to obtain expert Family Law legal advice as soon as possible after separation to ensure that undesirable problems resulting from these time limitation periods are avoided.
A case study – the recent decision of Waldmann & Paddack [2024] FedCFamC1A 100
Background
A de-facto Husband and Wife commenced a relationship in 1999 before finally separating in late 2018. Following their separation, the parties discussed a final property settlement (with such discussions being initiated by the de-facto Wife). However, those discussions did not progress past preliminary stages, and the last communication about a final property settlement was from the de-facto Wife’s solicitor to the Husband in May 2020.
Court proceedings
In April 2023, the de-facto Wife filed an application to commence Court proceedings. This was more than two years after the applicable limitation period had expired. Her application sought, amongst other things, the Court’s permission to commence proceedings out of time for a final property settlement.
The de-facto Wife’s application was dismissed at the first Court Hearing. However, she subsequently filed an application for a review of that decision, which was upheld by the Primary Judge. The de-facto Wife was granted permission to commence proceedings out of time for a final property settlement.
The de-facto Husband later filed an application to appeal the Primary Judge’s decision.
Appeal
In granting the de-facto Husband leave to appeal, the Appeal Judge was satisfied that the de-facto Husband had satisfied the two-limbed test of Medlow & Medlow (2016) FLC 93-692, namely that:-
- The Primary Judge’s decision had sufficient doubt; and
- A substantial injustice would occur if leave to appeal was refused.
With respect to the first limb, the Appeal Judge held that the Primary Judge failed to give adequate reasons about the probability of the de-facto Wife successfully obtaining the final property settlement sought in her application.
As to the second limb, the Appeal Judge held that the de-facto Husband would suffer a substantial injustice if he was made to participate in Court proceedings for a final property settlement, particularly where the likely costs to be incurred by both parties was disproportionate to the amount in dispute.
In re-exercising discretion of the Primary Judge, the Appeal Judge dismissed the de-facto Wife’s application to commence proceedings out of time for a final property settlement.
In arriving at that decision, the Appeal Judge held the de-facto Wife had not given a sufficient explanation as to why she failed to commence Court proceedings within the time limitation period, particularly after May 2020, being when her solicitors had last communicated with the de-facto Husband regarding property settlement. Since that time, the Appeal Judge observed that the de-facto Husband had arranged his personal and business affairs post-separation, and likely on the presumption that the de-facto Wife did not intend to commence Court proceedings.
The de-facto Wife’s evidence indicated her solicitors had not advised her about time limitation periods. The Appeal Judge held that explanation was inadequate, as “ignorance of the law, including ignorance as a result of inadequate information being provided by a party’s legal advisor, is not a valid reason to extend time” [at paragraph 120]. The Appeal Judge observed that if ignorance was an excuse, any self-represented or poorly advised litigant would be able to by-pass time limitation periods, and that would be contrary to the public policy goals of having limitation periods.
The Appeal Judge also observed that, even if the de-facto Wife achieved her best outcome at a Trial, the assets she might receive from the de-facto Husband were likely to be offset by the anticipated legal costs of the parties if leave to proceed out of time was granted. In other words, it was not commercially viable.
Significance of the Court’s findings
The Court’s decision in Waldmann & Paddack illustrates that ignorance of time limitation periods may not be a satisfactory reason to obtain the Court’s permission to commence proceedings out of time.
If you have separated from your spouse / de-facto partner, it is important that you obtain expert Family Law advice as soon as possible, particularly with respect to applicable time limitation periods.
If you require legal advice or representation with respect to your Family Law matters, please contact our highly experienced Family Lawyers at MST Lawyers on (03) 8540 0200 or at familylaw@mst.com.au.
