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Consistency needed with superannuation splitting in family courts review
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Consistency needed with superannuation splitting in family courts review

Man putting coins inside the jar

Greater certainty is needed in both the orders for splitting of super funds and in the early release of super in the event of hardship, a national firm has argued in a submission to the Australian Law Reform Commission.

In its Response to the ALRC Review of the Family Law System Discussion Paper, national firm Gadens mused that where super splitting orders are sought, or when proposed splits are drafted, a lack of consistency between funds means that orders and agreements are often rejected, causing delays and additional costs of correspondence back and forth.

“Some but not all funds require the inclusion of the parties' full names and dates of birth or a superannuation member number within the specific superannuation splitting order, even though the parties are identified elsewhere in the orders and the member number details would be readily known to the fund or incorporated in service documents,” the firm wrote in its submission.

“Even where amendments are not required by the super fund trustee, additional cost and delay is incurred in the provision of draft orders/agreements by way of procedural fairness to the trustee(s).”


As such, Gadens is backing the Attorney-General’s proposal for his department to work with superannuation funds to develop a uniform splitting order for super agreements, which would “streamline the process, as would ‘deemed procedural fairness’”, the firm said.

“This uniformity of splitting order or provision could also possibly make super splitting a more attractive option for separated parties to consider, particularly in smaller asset pool cases where parties cannot afford and should all the more wish to avoid incurring legal costs, as well as delays in liaising back and forth with super fund trustees, with respect to an intended super split.”

The firm also noted that it supported the proposal to work with the financial service sector to establish protocols regarding financial hardship post-breakdown of relationships, particularly provisions for early release of superannuation to assist parties who may be experiencing hardship as a result of separations.

“If a party could access superannuation funds earlier than the present superannuation law allows, it may permit the party retaining all or most of the superannuation available for division to purchase a home for themselves and their children. In turn, this may also avoid a forced sale of the other party’s business which would allow them the ability to meet their own needs and provide for the children’s continued financial support,” Gadens wrote.

“Access to superannuation funds may also address a parties’ interim and urgent maintenance needs, where the other party does not have the capacity to meet that need either from their own income or from assets under their control. Reform in this area may obviate or reduce dependence on social security entitlements.”

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