Asset protection

Hello, just wondering if someone would be able to help / point me in the right direction of who to speak to:

What are the options available to ensure protection of assets when associated with 'very new' defacto relationships ??

My mum owns her house outright and her 'very new' partner has just moved in. Not that I dont trust the guy, but i worry that mum doesnt have much to loose if things don't work out. If she was happy to transfer the title into mine and /or my brothers name, would this mean he wouldnt be able to lay claim on half of her house down the track if things dont' work out between them ?
Apart from title transfer fees/conveyencing fees would there be any other costs involved ??
Are there any other options for her ??

It's me who is worried, but looking to bring it up in conversation with my mum. She is not very money wise and i dont think she has even considered the consequences of a defacto relationship that turns sour.

Thanking everyone in advance who is able to respond and offer anything.

eilatan28

Best to talk to a solicitor such as myself.

Transferring assets quickly may give some protection. Especially within the first 2 years. But the family court has wide powers over third parties and your mum would be transferring property with the intent to defeat a claim on it. So if he were later to challenge the transfer it would be weak and he may have a claim. The family act enables orders to be made on third parties such as yourself.

But, even if he did challenge it the court will look at a number of things such as property of the marriage, contributions to the property and then the needs of both parties.

Trasnferring will help your mum a bit, but what if you enter a relationship? Or get sued?

Regards

Terryw

You should also make sure she has a good will in place.

The defacto will have a claim on the place in the future whether he is in the will or not. But still good to have one.

Regards

Terryw

thanks Terry. I was hoping you would respond.  I know there is a will in place.  Im already married, but my brother is not.  So transferring assets really just transfers the risk of loss to someone else too. So if the will stipulates it goes to my brother and I and the defacto was to challange, it would go to court,? (length of relationship etc / how much they had contributed would determine what % they got yeah ??  If the relationship were to break up (not end from a death) would they have to sue  my mum in order to claim ?? The whole '6month defacto' rule seems too short a period of time to be entitled to a claim  in a lifetimes worth of hard work !!!!
I think im worried that if mum lost half of everything it would fall on me to support her financially. maybe thats a really selfish way to look at it, but i have my own family to think about.
Would there be stamp duty payable ?? or would it just be title transfer / conveyencing / solicitors fees??
Thanks

eilatan28

There might be a will in place, what do you know what it says? Wills can be revocked by marriage or by doing  a new one and he can make a claim no matter what is in the will. It would go to court if he challenged it but you can always negotiate out of court. But lawyers would be involved and it could be costly. I was one a similar case a while back and the fees were up to $150k. The risk of him challenging the will can be reduced by talking to him about it beforehand - I mean your mum. And by leaving him something. Some people get a big shock when they find they have nothing in a will. He may also predecease your mum.

By transferring the house to your brother it is adding to the risk in one way. You will have to contend with him getting sued - bankruptcy and family law and if he dies. But you also have the issues with your mum - if she goes bankrupt you have the claw back provisions and then the family law and claims on the will.

I think it is more like 24 months for a property settlement with family law matters. ie defacto cannot claim within 24 months. But this can be varied by the court - i think, going from memory.

stamp duty would be payable.

Regards

Terryw

Hi Terry,

I also have a question, My mum has been in a relationship for about 10 years and her boyfriend holds around $10m in assets which are all in a family trust which is only linked to him and his side of the family, he has also made my mum sign a prenump agreement stating that she can not sue him for half or take him to court etc
How easy would it be for her to make a claim if they were to split, would she have a claim at all seen as there is a prenump in place and that the assets are held in a trust?

Prenups, of binding financial agreements can be set aside in some circumstances such as if there is a major change in the situation of the couple. e.g. new children and this wasn't covered in the agreement. etc.

It may also be possible that it wasn't done properly such as not signed off by a lawyer etc.

If that is set aside then she may be able to have the trust assets taken into account as either or both:
assets of the marriage, and/or
a financial resource of him.

Regards

Terryw

Thanks Terry, I know the prenup was all done threw his lawyer and it has been renewed a couple of times over the years, I would think they would have covered everything as best as possible

Hi Terryw,

Just had a quick question, are your assests fully protected under a trust if the marriage were to split and the your partners name was not in the trust? Or is it best to arrange a prenup/binding financial agreements aswell?

Thanks

No, not protected.

Regards

Terryw

Did he hold the assets before meeting your mum?

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