It is crucial to be aware of the time limitations that apply to both married and de facto relationships, as having these time limits expire may impact on your ability to commence legal proceedings for your family law property matters.
Key Takeaways
- Married couples must finalise property settlement within 12 months of the date of divorce.
- De facto couples have 2 years from the date of separation to commence proceedings.
- Failing to act within these timeframes may require the Court’s permission to allow you to commence proceedings, which is not guaranteed.
Why Property Settlement Deadlines Matter
When a relationship ends, it is common to focus on the emotional and personal aspects of the separation. However, one of the most important practical steps to take is resolving the division of property, finances, and liabilities. In New South Wales, there are strict time limits for when you can commence proceedings in the Federal Circuit and Family Court of Australia (“the Court”), and missing those deadlines can have serious consequences.
Understanding your rights and acting promptly can protect your financial future and reduce the risk of prolonged disputes.
Property Settlement Deadlines in NSW
For Married Couples
If you are currently married but not legally divorced, there are no time limits that apply to you.
However, if you have legally divorced, you have 12 months from the date your divorce becomes final to commence property proceedings under the Family Law Act 1975 (Cth).
This means you have one year from the finalisation of the divorce order (not the date of separation) to file an application in the Court for your property settlement.
For De Facto Couples
If you were in a de facto relationship, the law provides 2 years from the date of separation to initiate property settlement proceedings.
This applies to both same-sex and opposite-sex couples in NSW.
If you are unsure whether you are in a de facto relationship or not, please see our below article which explores what a de facto relationship is: https://www.conditsisnewcastle.com.au/is-it-de-facto-or-just-dating-how-australian-law-defines-your-relationship/.
What If You Miss the Time Limit?
If you do not commence legal proceedings within the required time frame, you will need to apply for leave of the Court, essentially asking the Court for permission to proceed outside of the standard limitation period.
The court will only grant leave in exceptional circumstances, such as:
- A compelling explanation for the delay (e.g., serious illness or misleading conduct by the other party).
- Demonstrable hardship that would result if the application were denied.
However, the Court does not approve out-of-time applications lightly. The burden is on the Applicant to prove why their case should proceed despite the delay.
For example, in the recent case of Waldmann & Paddack, the Wife attempted to bring an application for her property settlement two and a half years out of time. Ultimately, the application was dismissed because, although there was hardship, there were not sufficient reasons for the delay. The Wife argued that she was not advised by her solicitor about the time limits, and it was found that ignorance of the law, even if a result of inadequate legal advice, is not a valid reason to extend the time limitation.
Consent Orders After the Time Limit Expires
Should you reach an agreement by way of Consent Orders outside of the time limitation, you can still ask that the Court formalise this agreement. There is a box you can tick which provides the consent of both parties to the Court to allow them to make these Orders.
Why You Should Not Wait to Formalise a Settlement
Even in amicable separations, many people delay formalising property settlements—often due to emotional fatigue, false assumptions, concerns as to potential legal costs, or because they trust their ex-partner.
However, without a legally binding agreement:
- Verbal or informal agreements are not enforceable.
- One party may return months, or even years later, to claim additional assets.
- Future windfalls or assets acquired post-separation can become points of contention.
In contrast, a timely property settlement:
- Finalises and severs your financial ties.
- Prevents future legal claims.
- Provides certainty and peace of mind.
Common Misconceptions About Time Limits
Here are a few frequent misunderstandings:
“We’ve divided everything informally, we are fine.”
Not necessarily. Unless your agreement is formalised by Court orders or a Financial Agreement, either party may still seek a further division of property in the future if the time limitation has not passed.
“We are still sorting things out; there is no rush.”
This is not true. Once the deadline passes, you may lose the ability to claim what you are legally entitled to without the Court’s permission.
We do not have much to divide, so it is not important.”
Even modest asset pools can become contentious, especially if one party has made significant financial or non-financial contributions, or if superannuation is involved.
Property settlements also address debts, which are equally important.
Steps to Take Before the Deadline
To avoid unnecessary complications:
- Get legal advice early. A Family Lawyer can explain and guide you through the process of your property settlement, and provide advice as to your entitlements.
- Exchange full financial disclosure with your former partner, which is a requirement of the Court for all property settlements.
- Negotiate and reach agreement, either through negotiations or through mediation.
- Formalise the agreement by completing an Application for Consent Orders or a Financial Agreement.
If you cannot reach an agreement with your former partner, you should then file an Initiating Application with the Court for your property matter before the relevant time limit expires.
Conclusion
Property settlements are one of the most crucial legal steps following separation or divorce in NSW. Whether you are ending a marriage or de facto relationship, strict time limits do apply, and not dealing with your property matter before the relevant time limit expires may complicate your property matter, or impact on your entitlements.
The safest course is to seek advice from a qualified family lawyer in NSW as early as possible. They can help you understand your options, negotiate fairly, and ensure your financial future is protected—within the timeframes that the law allows.
At Conditsis Lawyers, our family lawyers are highly experienced in helping clients navigate all types of property settlements, from simple to complex. Call our Newcastle office on 02 4058 5844 or email us to arrange a free first consultation about your property settlement with one of our family lawyers today.
