• Is Your Inheritance Safe From Divorce ?

Just how an inheritance or prospective inheritance will be treated in the event that you and your partner separate will vary in each individual case from being not relevant at all, to being included in the assets to be divided.

There are two main categories to be considered:

• Prospective inheritances
• Inheritances received either during the relationship or after separation

Prospective inheritances:

Usually prospective inheritances are not considered as property, or even a financial resource to be taken into consideration when deciding how to divide the property of the parties to a marriage or de facto relationship.

Generally speaking, it is only in extreme cases where a prospective inheritance would be taken into account. Some of the considerations the Court would make in deciding whether or not to include a prospective inheritance are:

• Whether or not the person who has made the Will has legal capacity to change it.

• Whether or not that person is close to death or are as “fit as a flea”. If they are not near death or gravely ill, the inheritance is unlikely to be received for some considerable time it won’t be considered at all.

• Whether or not there is any other fact or circumstances that is relevant that the Court should take into consideration, such as, whether a party to the marriage has contributed to the asset to be inherited.

• The size of the anticipated inheritance may also be a factor particularly where the property owned by the parties is very small by comparison and in circumstances where the Court cannot properly compensate the non beneficiary spouse properly out of the parties’ own asset pool.

Received Inheritances:

Again depending on whether the inheritance was received during the relationship or after separation influences how the Courts will treat it. If it has been received during the course of the marriage, it will form part of the asset pool to be divided, however the Courts will usually assess the contributions of the person who received the inheritance as being greater than what it would otherwise be. How much extra weight is given to this contribution is in part dependant on its size and how the proceeds were applied, that is whether it was applied to an asset that still exists, or whether it was spent on holidays or general living or lifestyle expenses.

If an inheritance is received after separation, it may still be included in the asset pool, or if not, is at the very least included in the Court’s considerations when assessing each of the parties respective financial circumstances.

The Family Law Act defines the property to be divided to be “the property of the parties or either of them”. In circumstances where there is a small asset pool in comparison to the inheritance, the Courts are more likely to include the inheritance as part of the asset pool and make whatever adjustments it believes are appropriate, having regard to it.

In other cases, post separation inheritances have not been included, but certainly the Courts take it into account when deciding how to divide the other assets.

Family Law is complex and ever changing. Just how inheritances or expected inheritances will be relevant to you will vary in each individual case. If you have an inheritance that you are concerned about, please contact our Specialist Family Lawyers for proper and detailed advice so you can stop worrying.

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