Wiltshire News

In the current economic climate, it is becoming more prevalent for property settlements to include a “split” of one party’s superannuation.

A superannuation split is where one party, usually the primary income earner of the relationship, has a portion of their superannuation divided so as to vest in the name of their former spouse.

Dependent upon the rules of the superannuation fund and also the manner in which the superannuation is held by the member spouse, the superannuation is either apportioned to a new interest in the same fund in the name of the receiving spouse or otherwise rolled out into a fund of the receiving spouse’s choosing.

When seeking superannuation splitting Orders from the Court, whether by consent or in an Application, what is of the utmost importance is that the Trustee of the superannuation fund will comply with the Orders, known as according procedural fairness to the Trustee.

Part VIIIB of the Family Law Act 1975 (“the Act”) sets out the requirements for the specific Orders to seek from the Court when splitting superannuation. The Orders are complex in nature and need to follow a very strict format in accordance the Act and the Regulations[1].

Whilst ordinarily settlement negotiations can take some time between the parties in terms of reaching a final agreement, the process of settling the superannuation splitting Orders can often itself be a complex and time consuming process.

Most Solicitors practising in Family Law will have their own precedent superannuation splitting Orders; however it is the writer’s experience that each superannuation fund will have different requirements for their Orders. The requirements of the various superannuation funds differ even in circumstances where the framework of the legislation is the same regardless of the type of superannuation being split and the manner in which it is sought to be split.

What is required when splitting superannuation is that the draft Orders (where by consent) or a copy of the Orders sought from the Court (where not by consent) is served on the Trustee of the superannuation fund in order to accord procedural fairness pursuant to Section 90MZD of the Act, given that the Trustee will be bound by the Orders.

Parties and/or their Solicitors should never seek Orders from the Court splitting superannuation unless the consent and approval has first been obtained from the superannuation fund.

The superannuation fund, not being a party to the proceedings, upon service of the Orders, is able to apply to the Court to have the Orders set aside and seek that the fund’s legal costs be paid by the parties, in the event the Fund has not been accorded procedural fairness in accordance with the legislation.

Some superannuation funds will take no issue with the Orders sought and in that event, the Trustee of the superannuation fund will either confirm that they do not object to the Orders, or alternatively, once a period of 28 days has lapsed since service upon the Trustee and there has been no response, the Trustee is deemed under the Regulations to have been accorded procedural fairness.

Occasionally, Trustees will propose changes to the Orders and where they are substantial, they will often require further approval of the revised Orders, such that the Trustee will need to be served with the amended Orders and approve same before the Orders will be enforceable against the Trustee.

What is important is that parties and their Solicitors be patient during this process and realise that unless and until the Trustee of the superannuation fund approves the Orders sought, they will not be binding and effectively the superannuation splitting Orders will be largely pointless.

If you have a complex property settlement matter which may involve the division of superannuation, please don’t hesitate to contact the writer or one of the other Wiltshire Lawyers to discuss the matter further.


Jerome Hey
Family Lawyer
Wiltshire Lawyers

Liability limited by a scheme approved under Professional Standards legislation.

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