Throughout the course of your life, and your marriage or de facto relationship, most people accumulate superannuation through their employment. You cannot usually access your superannuation until you reach preservation age, or other limited circumstances, such as if you sustain an injury and are unable to return to work. However, notwithstanding this, superannuation entitlements are treated as assets of a matrimonial property pool and can be split between two parties following the breakdown of a relationship.
Under the Family Law Act 1975 (Cth), superannuation can be split in two ways:
1) By identifying a specific dollar amount; this is known as a “base amount” split; or
2) By identify a specific percentage; this is known as a “percentage” split.
Regardless of the type of superannuation split, following service of a sealed copy of the Court Orders that detail the superannuation split, the amount identified (plus/minus earnings/losses incurred since the operative date, and any applicable administration fees) is usually deducted from the member’s balance and deposited into a new account for the non-member. The non-member’s new superannuation interest will operate completely separately from the member’s interest.
However, this has not always been the case. Amendments were made to the Family Law Act 1975 (Cth) in 2001 for married couples, and in 2008 for de facto couples introducing and permitting the division of superannuation between two parties. Prior to these amendments, while superannuation was an asset of a matrimonial property pool, it was not capable of being “split” or “divided” between two parties.
This meant that there was often one party who retained most of the superannuation in a property settlement. In recognition of this, notwithstanding a property settlement could be, and often was completed, it may be that the superannuation aspect of the property settlement was adjourned until at time upon which one or both parties were entitled to receive their superannuation entitlements. If this occurred in your property settlement, then keep reading!
If the original orders (which would have been entered into prior to the changes to the Family Law Act 1975 (Cth)) adjourn the superannuation aspect of the property settlement, the Court will need to determine a just and equitable resolution of the issue now, notwithstanding all other assets will have been dealt with, and many years will have passed.
The Court has been required to navigate these matters. In the Full Court case of Gabel and Yardley [2008] FamCAFC 162 the Court found that:
- It has power to make more than one set of Orders with respect to property settlement matters provided its power to do so is not exhausted by the original orders;
- The original orders can be varied or reversed without a party making an application to set aside the Orders, as “the power to make such Orders not having been “spent” or “exhausted”’; and
- Each case is unique, and the Court’s decision to vary or alter the original orders will depend upon the circumstances of each case and whether it is just and equitable for the Court to do so.
If you completed your property settlement prior to the superannuation splitting legislation coming into effect, and your Orders adjourn a superannuation split until a later date, you should seek specialist advice from a family law solicitor. As family law solicitors, we at Robinson + McGuinness will be able to advise you in relation to your rights and entitlements and assist you to finalise your property settlement.
If you would like to discuss your options and how we can assist you, contact us today on (02) 6225 7040 or by email at info@rmfamilylaw.com.au
Author: Peta Sutton, Associate