Legal Hypothetical: Add-backs and spousal maintenance claim

PENNY and Nick separated after a four year marriage.

They have one child, now five years old.

They have resolved their parenting dispute but Penny now applies to the Court for a determination regarding a property settlement and spousal maintenance.

Penny seeks 60 percent of the parties’ assets but Nick proposes a payment equivalent to just 30 percent.

Another issue in dispute is the nature of “add-backs” claimed by Penny.

Add-backs are sums that are added-back to the parties’ present assets.

They can include funds expended on legal fees, funds relating to the premature distribution of matrimonial assets or the dissipation of assets.

The Court states that add-backs are “exceptional and discretionary”.

The Court hears that after their separation, Nick continued to draw on their home loan, ultimately withdrawing $300,000.

The Court finds that the withdrawals were unnecessary to meet his reasonable expenses, describing them as “wanton” and adds-back the whole of the funds into the property pool.

The Court therefore assesses the total value of the parties’ assets at $2 million.

The Court considers it “just and equitable” to make property settlement orders and accordingly considers the parties’ financial and non-financial contributions to their assets and the welfare of the family.

On the basis that Nick brought considerable assets into the relationship, the Court assesses his overall contributions towards their non-superannuation assets at 62.5 percent.

In adopting a two-pool approach, the Court accepts that Nick had substantially more superannuation at the commencement of their relationship and assesses his contributions towards the superannuation pool at 74 percent.

By way of a final property settlement consideration, the Court awards Penny adjustments in her favour due to the “vast” earning capacity difference of the parties, equating to 12.5 percent in relation to the non-superannuation assets and ordering that the superannuation pool is to be split equally.

Penny is also ordered to receive $400 per week by way of spousal maintenance for two years.

Email Manny Wood, Principal Solicitor and Accredited Specialist in Wills and Estates at TB Law at or call him on (02) 66 487 487.

This column is only accurate at today’s date and is not legal advice.

By Manny WOOD, Solicitor

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