How Does The Court Consider The Value Of The Asset Pool?

The court takes the value of the asset as at the date of the trial, not as at the date of separation.

When the matter is set down for Final Hearing, the court will order the parties to file a joint Balance sheet, such Balance sheet will inform the Judge:

1. The Applicant’s asserted value of the asset Pool
2. The Respondent’s asserted value of the asset Pool
3. The agreed values of any assets
4. The disputed values of any assets
5. The agreed liabilities
6. The disputed liabilities
7. The “add-back” of any wasted / unaccounted funds as asserted by each party

The parties will then be invited to give evidence about their case, and submissions will be made as to the approach the Court should take when making an order that is “just and equitable”

ONE POOL OR TWO POOLS?

Sometimes, the parties wish to exclude a portion of the asset pool, such that the court is asked to deal with each asset pool differently. Such argument may be raised where for instance:

1. There are assets overseas
2. One party acquired/ inherited or was gifted an asset post separation and wishes to exclude that property from the pool available for division

In support of the adoption of the two pool approach, parties have historically relied on the decision of Zaruba & Zaruba. That was a fact-specific decision yet it is commonly called in aid as being authoritatively demonstrative of the validity of a two pool approach. 

The relevant passages are as follows –

38. In the vast majority of cases, it will be appropriate to address the s 79(2) question by ascertaining the legal and equitable interests in property without making distinctions between individual assets. That is because the “express and implicit assumptions that underpinned the existing property arrangements” can be seen to apply (to the extent and degree to which they do apply) to all of the property of the parties or either of them, including property in which the legal interests vary.
39. However, the position is likely to be different in circumstances where, as here, the characteristics of the property and the circumstances of its acquisition, improvement and the like can be seen to differ significantly and where, as here, the parties’ relationship had taken on quite different characteristics during the period to which the s 79 inquiry is directed.

Subsequent to the decision of Zaruba, is the decision in Jabour v Jabour^. That case did not mention Zaruba & Zaruba nor did the court in Jabour address the two pool approach addressed in Zaruba. 

The statements of principle from Jabour may be summarized as follows: –

1. the weight to be attached to initial contributions must be assessed against the rubric of all of the financial contributions made by the parties over the relationship;
2. where a sudden increase in the value of an asset is evident, yet that increase is unrelated to the efforts of the parties (say, rezoning of land), the authorities show that such an increase is referrable to the contributions of both parties, citing In the Marriage of Zappacosta and In the Marriage of Zyk; 
3.  the myriad of contributions made by the parties must be weighed against all other contributions. 

Since Jabour, judges have been instructed to take a holistic approach towards the assessment of contributions. If you have a question on the division of your assets, it is important to  consult with your lawyer as no two cases are the same and it is important to get legal advice tailored to your case.

Call Hillcrest Family Lawyers to book your first consultation.