L Legal
Wendy Barry, Partner Tindall Gask Bentley Lawyers
Protect your assets after separation “I
’ve separated from my partner and I’m worried (he or she) is trying to hide and move assets. What can I do to protect them?” It is common for people who have just separated to fear their former partners will drain shared assets or amass debt in joint accounts, exposing them to financial risk. But there is much that can be done to protect assets and limit exposure to increased debt. The key to being effective in these areas is to be proactive and prepared. Once a former partner has sold or drained equity in a property, drawn down on lines of credit, or withdrawn joint savings, there are limited avenues available to restore or add back what has been removed. So prevention in these circumstances is the key.
Caveats Consider caveating a property when that property is held solely in your former partner’s name. A caveat effectively prevents the property being sold, transferred or refinanced until your caveat is dealt with. It compels the person whose property has been caveated to talk to you about the interest you are asserting in the property. A caveat should not be lodged without receiving legal advice as there can be cost consequences for caveats that are not correctly or appropriately lodged.
Injunctions Obtain an injunction preventing your former partner accessing and potentially draining assets of the relationship. An application to the court is required to obtain an injunction. It is not a simple process and legal advice should be obtained before making such an application.
Bank accounts Review all your bank accounts to work out those that are held in joint names. Then contact the bank to ensure no monies can be accessed without the signature of both parties. Review also lines of credit and where you might be ahead in your mortgage repayments. Remember that making the account “two-to-sign” puts it off limits to you (individually) so be sure this is appropriate in your circumstances. You might prefer to withdraw some of the monies in the account and, then, effect a “two-to-sign” regime with the bank. You should get advice about what is best in your circumstances before taking action.
Credit cards Drop limits on credit cards or, if appropriate, close the credit facility.
Once a former partner has sold or drained equity in a property, drawn down on lines of credit, or withdrawn joint savings, there are limited avenues available to restore or add back what has been removed. So prevention in these circumstances is the key.
You might need to pay off the card before closing it. Make sure you keep a statement of the credit facility showing the balance at separation so that if it increases post separation you will be able to prove the increase and, in certain circumstances, limit the debt to the balance at separation.
Passwords Change passwords to bank accounts, social media accounts and computers.
Updates Update your: • Binding death nominee – in the event of your death your superannuation will be paid to your binding death nominee. If your nominee is your former partner and you do not want him or her to receive it, you might wish to arrange to change it to the person you now want to receive your superannuation • Will to ref lect your new circumstances. • Life insurance policy to reflect who you wish to benefit under the policy. If your partner has already depleted the pool do not despair. There are some remedies available, but they could come at considerable legal cost because, often, they will involve proceedings in court and, if not court proceedings, then potentially lawyer-to-lawyer negotiations.
Continued page 40 February 2020
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