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QLD Property Settlement - Is HECS Debt included?

Discussion in 'Family Law Forum' started by Jacki, 8 February 2015.

  1. Jacki

    Jacki Member

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    I would like to know if a HECS debt by one party is to be included in property settlement. Consent orders are already drawn up and lodge with court back in 2012 however party is now saying his HECS debt should be included and wants me to take on a % of this debt. I was advised at time by my solicitor as well as a legal aid solicitor that HECS debt is classed as a personal debt and did not get included in property settlement as it is not part of the pool. Thanks
     
  2. Sarah J

    Sarah J Well-Known Member

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    Hi Jacki,

    HECs debt accrued by one partner during the course of the relationship can be taken into consideration as it forms part of the "matrimonial debt". A recent court order (ruling in 2014) considered whether it would be fair and just to have the wife pay a portion of the HECs debt incurred by the husband during the course of their marriage. Although, in this case, the court found that it was not fair and just to have the wife pay toward the HECs debt as (i) she had already contributed toward the HECs debt during the marriage; (ii) the husband was to forthcoming in proceedings about the actual figure of the debt and subsequent repayments toward the debt; and (iii) the general manner of the husband during the proceedings.

    Since individually earned income, assets and gifts are included in the shared pool, so are individually incurred debts. The ultimate question is would it be fair and just for one partner to pay a portion of the other partner's debts?
     
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  3. Sophea

    Sophea Well-Known Member

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    That's interesting as you would think that they would be something that is strictly a personal debt, but lucky we have you on the forum Sarah J!! Great info.
     
  4. Sarah J

    Sarah J Well-Known Member

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    Glad to help!

    If you look on the Family Law Court's financial statement form for an order for property settlement, there is a section under "your liabilities" that asks you about your debts, including HECs.
     
  5. Manitoba

    Manitoba Member

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    Hi Sarah,

    Would you possibly have a reference or link to that ruling? I would very much appreciate it!

    Thanks,
    M.
     
  6. Sarah J

    Sarah J Well-Known Member

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    Hi Manitoba,

    I have not managed to find the case online or published. Not all family law cases are public, in fact, most are private to protect the family members involved. On the financial disclosure form for property settlement orders by court, there is also a section that asks you to disclose any HECs debts. Hence, it should be safe to conclude that HECs debts may be considered. Note though that just because something may be considered, does not mean it actually is considered in the end. It all depends on the circumstances around the incurring of the HECs debt and parties' conduct.
     
  7. Jacki

    Jacki Member

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    Thanks for the information. My solicitor told me pretty much the same thing that it may be but does not have to be as it is a personal debt. At the time our consent orders where drawn up I chose not too include it and my ex agreed. My solicitor advised this was fair as I had not and would not be benefiting from either of the degrees my ex did during our marriage and I was left to support and bring up the children while he went off to uni to do his degrees with no financial or emotional support from him. Also as he has been on a disability pension he has not had to pay it anyway I did not see why I should now after 5 years be incurring his debt. If he where to drop dead tomorrow his debt goes with him. This situation arose due to we still have two properties that we have been unable to sell and I suggested we just split the mortgage and take a property each just to sever the financial connection we still have. The ex is now trying to use this as a lever to try and get me to pay a portion of his HECS debt. I told him that IF I did agree to pay any of it I would pay it direct to the tax department of which he said that could be negotiated and I said No it couldn't, so as you can see he just wants me to give him money (which I don't have) or take on a larger portion of the mortgage (which I am not going to).
     
  8. Jacki

    Jacki Member

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    Also when the consent orders where drawn up he said his HECS was $50,000 and now he is saying it is $65,000 however he has not produced any documents to show what it really is.
     
  9. Sarah J

    Sarah J Well-Known Member

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    Hi Jacki,

    Yes, it appears that your ex has a weak case for the HECs debt given that he did not disclose it up front, agreed to forgo it and may possibly be misleading about the amount of HECs debt. If he is serious about the debt, he will need to produce evidence of the amount.
     

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