The method of working out what is a "just and equitable" property settlement is set out in the Family Law Act 1975.
This Act gives the Court a wide discretion to determine what is fair in the circumstances.
When the Family Court is required to make a determination of the respective entitlements of the parties it conducts a three stage inquiry:
Firstly, it looks at the extent of the assets of the parties. This involves an analysis of the various assets and the debts associated with them. The parties are obliged to provide to the Court valuations of the relevant assets. Sometimes this is very straightforward but sometimes when family trusts and/or companies and partnerships are involved, the identification and valuation of assets can be a complex matter.
The second stage of the process is for the Court to determine the proportions in which the parties can be said to have "contributed" to the acquisition, conservation and improvement of their assets and how they have contributed to the welfare of the family.
The third stage requires the Court to look at the "future needs" of the parties – that is, the Court considers whether any adjustment should be made to the shares to which the parties are entitled by reason of their "contributions" because of certain matters. Those matters are set out in Section 75(2) of the Family Law Act and are quite extensive.