Consider this example: John and Jill have been married for 10 years and have recently separated. Around 2 years ago Jill’s father died and Jill received an inheritance of $100,000. These monies were deposited into a joint bank account and have been used by the parties to assist in the purchase of a property. Now that the relationship has broken down what becomes of Jill’s inheritance?
In family law matters monies that are received from an inheritance or a gift from a family member or friend are treated as additional ‘contributions’ of the party who received them. This means that in the example listed above Jill would be considered to have given an additional $100,000 to the relationship. These additional funds are all relevant when the parties look to divide the property in accordance with the Family Law Act.
For the purposes of a family law property settlement a gift can be almost anything that has a value. For instance a gift could be monetary, it could be the transfer of shares in a Company from a parent, or the payment for a wedding or honeymoon. Even interest free loans that have been provided by a parent are relevant in family law property settlements.
The money that was received by Jill however does not get ‘refunded’ to her. Jill gets the benefit of receiving the inheritance by way of an additional percentage division in her favour. This means that the inheritance results in Jill potentially receiving more of the pool of assets available for division between the parties. The actual monetary sum that will be returned to Jill depends on the facts and other circumstances surrounding the case.
It is important to remember that in all family law property settlements what each party has financially contributed, by working or receiving inheritances or gifts is very relevant to how the property of the parties will be divided. If you have recently separated and need advice about a property settlement contact the experienced Family Law solicitors at Craddock Murray Neumann for advice about your rights.