Don’t Panic – Your Spouse does not usually get half!
I have had a case recently, whereby one of my clients, prior to seeing me, set about on a course of conduct designed to remove certain property (represented by inheritances and gifts) that had come into her name late in a relationship. At the time, she was fearful that her separating spouse would receive half of those inherited assets. In fact, she had been told this by lawyers, accountants and other friends and associates.
The reality of the situation is far removed from this. In all cases, there is simply no automatic entitlement at all to 50% of the assets, let alone 50% of any late inheritance or gift received by one party.
The Law on gifts and inheritance in matrimonial property settlement is not straight forward, however, sizeable gifts and/or inheritances received very late in a relationship, or even after separation, must be accounted for and valued, but that itself does not necessarily mean that the other party will receive any part of such late gift or inheritance at all.
In many cases, a late inheritance or gift is notionally excluded from the pool of assets available for division. In some other cases, the pool of assets are divided into two pools – one pool representing assets built up during a long relationship and the other pool representing assets that may have been inherited or gifted later on in the relationship or subsequent to separation. The contribution exercise and division is then undertaken on both pools based on direct and in-direct contributions made by both parties to those pool of assets.
In other cases, inheritances/gifts of assets may be included with other assets, but the division is not equal. Substantial weight is placed upon the fact that there was an inheritance or a gift later on in the relationship and in the contribution exercise the assets are divided substantially in favour of the party who received the inheritance and/or gift.
In all cases, it is very important for a party to immediately seek proper legal advice from an accredited family law specialist about the impact of any inheritance or gift that they have received or may receive late in their relationship. In most cases, the other party will not be entitled to anything close to 50% and in many cases, will have no or little entitlement to such late inheritances and gifts received by the other party.
Brett.
