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Sam Fung

Published: 27 March 2020
Author: Samuel Fung

PPP - A more affordable way to settle a property dispute

Are you in the middle of a separation where the asset pool is likely to be $500,000 or less? Now the law offers a more affordable and more efficient means of dispute resolution.

Where in such disputes there are no family trusts, companies or self-managed super funds involved which parties need valued or investigated, it is now possible for cases to be guided through the court process with close monitoring by a Registrar.

These cases are collectively known as “Priority Property Pools under $500,000” (“PPP500”).

On 7 February 2020, a new Practice Direction was published by the Family Court. As of 1 March 2020, new arrangements will apply for parties with small asset pools who choose to issue proceedings in the Adelaide, Brisbane, Melbourne and Parramatta registries of the Federal Circuit Court (“the Court”) seeking property orders.

Tightening disclosure

Currently, a major challenge that parties with small asset pools often face is fulfilment of disclosure obligations. Especially where one party is self-employed, often the requirement of full and frank disclosure becomes the main element of frustration in negotiations and subsequent court proceedings.

It is therefore apparent that, compared to the existing court procedures and requirements, a main advantage of the new arrangement is that it offers a more intensive, and ideally more stringent, monitoring of disclosure obligations which in turn lowers the possibility of parties spending time and money on unnecessary court appearances.

Court-referred conciliation conference

The move has come as an attempt by the Court to deal with the increasing number of applications that have been flooding the family law court system.

Previously, conciliation conferences or external mediations (“alternative dispute resolution”) were ordered by Judges, whereas the new arrangement will give Registrars discretion to make this call.

One uncertainty right now at this early stage of affairs, however, is the circumstances under which a Registrar will direct parties to attempt external mediation. While previously a $500,000 pool may well have been characterised by a Judges as one that is suitable for a conciliation conference, it may be that moving forward, the Court will lower this limit to preserve its resources for those parties who are more financially challenged.

A change in initiating procedural requirements

Procedurally, the new arrangements will mean that eligible cases will, at least initially, be exempt from filing an Affidavit and Financial Statement when initiating proceedings in the Federal Circuit Court.

The documents that are now required will include the Initiating Application and the new PPP500 Financial Summary, the latter of which can be downloaded from the Court website. Whether or not you are considering obtaining legal representation for assistance throughout your separation, this form will be a useful starting point for developing an idea of what type of information you may be required to gather as you go through the negotiation and court process.

Nevertheless, for purposes of preparedness, parties should ensure that sufficient groundwork and discussions with their solicitor and barrister takes place prior to any conciliation conference or mediation so that meaningful discussions may be had at the alternative dispute resolution session.

Further reading regarding the PPP500 can be found at the Court’s website.

For advice on whether the new PPP500 arrangement above may be applicable to your financial separation, contact our Family and Relationships Law team on (03) 9238 7878 or familylaw@rctlaw.com.au.

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