Adjourning Property Settlement Proceedings

Chapter contents

• Introduction – the court’s powers to adjourn property settlement proceedings
• Case examples

Introduction – the court’s powers to adjourn property settlement proceedings

The court’s powers to adjourn property settlement proceedings are contained in:

• The general discretionary power of courts to adjourn any proceedings (see Emmett & Emmett [1982] FamCA 14, in which the Full Court majority dismissed an appeal against an adjournment of divorce proceedings granted to allow property settlement proceedings to be heard first. The court found that the trial judge was entitled to exercise his discretion to adjourn the divorce proceedings, “taking into account the potential detriment to the wife as a relevant matter and, balancing competing interests” (at [45]);
• The powers under section 79AA(5) Family Law Act 1975 (Cth) (“the FLA”) and section 205ZG(5A) Family Court Act 1997 (WA) (“the FCA”);
• The power under section 79AA(2), (2A) and (3) FLA, which is not commonly used.

Section 79AA(5) FLA and section 205ZG(5A) FCA allow the court to exercise its discretion to adjourn property proceedings in certain circumstances if either party requests it, and if the court considers it appropriate to do so.

The 4 preconditions are:

1. There is likely to be a change in the parties’ financial circumstances
2. The likely change is significant
3. Having regard to the significant change, it is reasonable to adjourn the proceedings, and
4. That an order made if that significant change occurs is more likely to do justice and equity as between the parties than an immediate order.

Sections 79AA(5) FLA and 205ZG(5A) FCA do not limit the court’s general powers to grant adjournments.

In deciding whether there is likely to be a significant change in financial circumstances of either or both of the parties, the court may consider any change in financial circumstances which may occur, for example, because a party:

• is a contributor to a superannuation fund or scheme, or participates in a scheme of that nature (s 79AA(7)(a) FLA and s 205ZG(7)(a) FCA)
• may receive a personal injury damages settlement, or
• may become entitled to property because a trustee of a discretionary trust exercises the power to distribute trust property to them (s 79AA(7)(b) FLA  and s 205ZG(7)(b) FCA).

Case examples

1. Bailey & Bailey [1989] FamCA 45

The Full Court upheld a stay of property settlement proceedings while the Supreme Court of New South Wales determined common law claims in relation to the deceased’s psychiatric practice.

In the late 1970s a number of the husband’s former patients commenced proceedings against him in the Supreme Court. In 1985 the wife commenced property settlement proceedings. Shortly afterwards and before the Supreme Court proceedings, the husband died. Under the husband’s will, the wife was the sole executor and sole beneficiary of the estate.

Two of the former patients sought leave to intervene in the Family Court proceedings, seeking that the wife’s proceedings be stayed until the determination of their actions. They had a pending action in the Supreme Court against the wife (as executor of the estate) and a separate action against the Medical Defence Union. If the action against the union was successful, the union would indemnify the estate for any damages awarded. If the action was unsuccessful, the estate would become liable without this indemnity, and the damages would far outweigh the estate’s net assets.

The trial judge ordered a stay in the wife’s property proceedings until the Supreme Court made a determination. The wife appealed.

The Full Court held that:

1. In altering the parties’ property interests, the court must take into account any liabilities of the parties, whether “actual or contingent” or arising out of contract or tort (at [23]). Failure to do so would, in many cases, defeat third parties’ legitimate claims, which is not permitted (at [25]).
2. The court should not proceed with a property application without sufficient consideration of a party’s liabilities, whether “established” or “in the process of being determined”, if the liabilities are so significant that they could be “defeated” by the property application (at [27]).
3. The court cannot determine the nature and extent of the parties’ property until their liabilities have been ascertained. If the liabilities are not fully ascertainable, it may be appropriate to stay the proceedings until they can be determined (at [29]). In this case, until the Supreme Court proceedings were determined, the court could not know if there was any property in the estate which could form the subject of orders under s 79 FLA (at [29]-[30]).
4. Justice required a stay to be granted. Any detriment to the wife was minimal as she was in possession of the home and could apply to the court to proceed with her claim if her circumstances changed in the meantime (at [31]).

2. Kearney & Kearney [1990] FamCA 159

The Full Court granted the wife’s appeal against the trial judge’s orders for property settlement. On appeal the wife argued that the award was inadequate and applied under section 79(5) and (6) FLA (since 10 June 2025, section 79AA(5) and (6) FLA) to adjourn the property proceedings until after the husband’s retirement, at which time he would receive significant retirement benefits.

The Full Court allowed the appeal and granted the adjournment, holding:

1. The wife had not applied for the adjournment at first instance and in many cases an appellate court would not permit it to be made on appeal for the first time. However, the interests of justice meant that the wife’s application had to be granted. If not, it would be likely to produce a substantial injustice to her, which the Full Court could not allow. If the husband retired now, he could obtain around $300,000 in superannuation, yet the trial judge’s award meant the wife would receive only $125,000 in assets, which was too low given the lengthy marriage, her role in caring for the four children and her continued responsibility for the care of the youngest child.
2. The husband was required to transfer his interest in the family home to the wife as an interim order pursuant to section79(6) FLA (now s 79AA(6) FLA).
3. The husband was to pay the wife $100 per week in spousal maintenance.
4. The husband was to notify the wife if his superannuation payments commenced or if he left his employment.
5. The parties had liberty to relist on reasonable notice to the other.

3. Grace & Grace [1997] FamCA 59

The wife successfully appealed the trial judge’s refusal to adjourn property proceedings pursuant to section 79(5) FLA (now s 79AA(5) FLA). The wife had applied to adjourn the proceedings pending the vesting of the husband’s interest in a family trust by 30 June 2000 or until his 80 year old mother died (when he would realise 50% remainder interest in the estate of his late father). The husband’s interest in the estate and trust was valued at around $10,000,000. The wife’s main source of income was social security benefits.

The Full Court held that the trial judge’s decision put the wife at “a risk of substantial injustice by excluding identified sources of expected property…from the pool of assets”. In considering the preconditions invoking the power to order an adjournment in this case:

1. The prospect of the vesting of the husband’s remainder interest in the estate was significant to the property pool; and
2. The husband had nothing to lose if the proceedings were adjourned, but there was a clear detriment to the wife if the proceedings were not adjourned.

The Full Court granted the adjournment until 30 June 2000 or until the trustee made a final distribution (if that occurred earlier than 30 June 2000).

4. Van Essen & Van Essen [2000] FamCA 775 

In this case a differently constituted Full Court agreed with the principles set out in Grace.

Here the husband appealed an order adjourning the wife’s property application and spousal maintenance under to section 79(5) FLA (now s 79AA(5) FLA) pending the promulgation and enactment of the Family Law Legislation (Superannuation) Act 2001. The legislation had been introduced to parliament but had not yet passed.

Applying Grace, the Full Court allowed the appeal, holding that the trial judge could not conclude on the evidence that the legislation would pass and could not form any conclusion as to the final form of the legislation if enacted (at [48]). The trial judge therefore could not determine whether any change in the parties’ financial circumstances would likely result from the proposed legislation (at [49]).

5. Pratt & Pratt [2012] FamCAFC 81

The husband successfully appealed against an order to adjourn property and spousal maintenance proceedings for a minimum of 3 years pursuant to section 79(5) FLA (now s 79AA(5) FLA).

The parties were graziers and owned two pastoral properties. The values of the properties had decreased, and valuation advice was that it was a “buyers’ market” due to an oversupply of properties for sale and due to live export restrictions, but that this could change after two years with restrictions potentially easing or new markets opening up.

The wife relied on this evidence in support of her application for an adjournment for two years.

At the time of trial, the parties’ liabilities exceeded their assets.

The Full Court held that the trial judge’s determination that there was likely to be a significant change in financial circumstances for the parties was not supported by the evidence (see [38]-[45] and [49]). The valuation evidence about an improvement in the market contained no “certainty or even a possibility”, it was simply a “hope”. Of itself, it could not support a finding of significant change. Further, the trial judge did not take into account the costs of running the properties and servicing the debts in the adjourned period, so his Honour could not properly evaluate whether any change would be significant. Additionally, the evidence did not support a finding that the value of the properties would increase to the extent that it would exceed the level of debt.

6. Helms & Helms [2016] FamCA 389

Tree J granted the wife’s application to adjourn a trial of property proceedings from March 2016 to not before January 2017 under section 79(5) FLA (now s 79AA(5) FLA). One of the parties’ major assets was an interest in a company. The valuer had assumed that none of the company’s franchisees would renew their agreements (due to expire within 12 months) and attributed no value to the goodwill of the company after those dates. The wife argued that there was a realistic prospect of renewal of one or more of the franchises.

Applying Grace, his Honour held:

1. There was likely to be a change in the parties’ circumstances because by 1 January 2016, the franchises would have been renewed or not, therefore they would have no goodwill attached to them or it would potentially be significant (at [29]-[30]).
2. The likely change was significant (at [31]).
3. Considering the likely and significant change it was reasonable to adjourn the proceedings for the period requested (at [34]-[37]).
4. Deferring the trial until the franchise renewal uncertainty was resolved was more likely to do justice and equity between the parties (at [38]-[40]). Making final orders now would involve “an imprecise assessment” about the prospects of renewal. Further, if the franchises were then later renewed, the husband would receive “something in the nature of a windfall” and the wife would receive nothing in relation to it. There was little detriment to the husband in deferring the matter.
5. It was appropriate to exercise the discretion to adjourn the matter as requested (at [41]-[45]).

7. Gayner & Gayner [2020] FamCA 265

Bennett J adjourned a property settlement trial listed for June 2020 amidst the COVID-19 pandemic at the joint request of both parties (who agreed the trial could be run electronically). His Honour stated (at [6]):

“However, the parties and their practitioners are ad idem about the pandemic making the business environment so uncertain that it would not be safe or fair for me to make a determination at this time or for at least the next six months or so. Accordingly, by consent, I adjourn this proceeding to… for review.”

 

Reviewed: 20 August 2026