Freezing Bank Accounts During Divorce

Protecting Your Assets After a Relationship Breakdown

Freezing Injunction and Family Law Parramatta

Sadly, separating or divorcing from a partner or spouse isn’t always amiable — meaning you may need to consider freezing bank accounts during divorce to defend your assets.

At highly emotional times — such as going through divorce or separation — people usually considered sensible, thoughtful, and balanced can act surprisingly out of character. This can lead to rash or malicious decisions, which may involve them trying to dispose, sell, or give away valuables and/or cash in order to prevent their ex-spouse or partner from having rightful access.

Falzon Legal, specialists in Family Law, will compassionately and patiently advise and guide you on obtaining freezing injunctions. Ceaselessly supportive, we will explain your options, suggest the best course of action, including less adversarial solutions, and act professionally in your best interests.

Injunctions in Family Law

Under Australian Law, an injunction refers to an order, issued by the Court, that either forbids or requires a particular individual to do, or refrain from, a certain action. These are known as Prohibitory or Mandatory Injunctions respectively.

And, in financial matters relating to Family Law, injunctions are typically granted in relation to persons in a de-facto relationship or marriage.

While not exhaustive, these are often issued to prevent one party from:

  • Commencing seriously risky business practices.
  • Disposing of investments, bonds, shares, and superannuations.
  • Maliciously vandalising the second party’s property.
  • Living in, or using, the former matrimonial home.
  • Selling property held by both parties — or increasing its mortgage.
  • Withdrawing or spending funds from a bank account.

However, most frequently in Family Law injunctions, the Court deals with cases of freezing assets and bank accounts during or after a Property Settlement — known as Mareva Injunctions.

This is because it’s not unusual for one party of a marriage or de-facto relationship to attempt to dispose or hide cash and investments — with the intention to deny their former spouse or partner their entitled share.

An injunction, whether freezing bank accounts, financial bonds, or property — can protect your interests.

Obtaining a Freezing Order Under Family Law

First, speak to a lawyer with expertise in Family Law and freezing assets — such as Falzon Legal.

Injunctions are not granted lightly by the Court — and it’s crucial that you have sufficient grounds to make an application.

Typically, a freezing order — whether on bank accounts, property, or investments — is only granted where there is an evidential risk of assets being disposed of or removed, or a threat of the other party absconding. Acts which would prevent any future judgements from being satisfied — typically under a Property Settlement.

If you are applying for a bank freezing injunction, under UCPR (Uniform Civil Procedure Rules) 25.14, you will need to prove:

  • You have a judgement in your favour, or have a case arguable in your favour.
  • That such a judgement is unlikely to be met — whether in part or in full — due to the removal or disposal of assets.
  • That a judgement will not be satisfied, due to a third party having control and ability to dispose of assets.

    Most commonly, the Court will require you, as the applicant, to give an undertaking agreeing to reimburse for any damages encountered by the frozen person — should the judgement fail.

    If the freezing order is granted, and consequently your ex-spouse or partner violates it by removing cash from the bank account — or disposes of assets — this will be considered contempt of court. In such an event, this can be punished by a fine, or possibly even imprisonment.

    Are Freezing Orders on Bank Accounts Always Granted?

    Not only does the Court require the evidential proof outlined above to grant a Mareva Injunction — even if it does so, it’s usually time limited. The Court needs to be convinced of a substantial risk of asset disposal before a judgement.

    Furthermore, bear in mind that the Court will only issue an order in relation to funds that have not yet been disposed of (Qian & Xue, FedCFamC1A 93, 2022)

    Hence if your ex-spouse transfers money to friends, and you later apply for an injunction, only the funds remaining are applicable for protection — not those that have been allocated elsewhere.

    And what’s more, the application to freeze bank accounts needs to be reasonable.

    For example, if a pending Property Settlement is likely to result in you receiving $100,000 — the Court will not entertain an application to freeze $500,000. As remarked upon in Cardile vs LED Builders Pty Ltd (1999) — any injunction should cause the ‘minimal disturbance’ as required, and the granting of freezing orders needs to be applied with caution.

    Wondering if Freezing Your Partner’s Bank Account Is Needed? Call Us Now

    What Does Ex Parte Mean in Family Court Injunctions?

    Coming from the Latin meaning ‘from one party’ — an ex parte application in the Family Court refers to requests to freeze bank accounts where the respondent (the ex-spouse or partner in Property Settlements) isn’t present.

    And, Under Newcastle City Council vs Caverstock Group Pty Ltd (2008), the Court has the power to grant a bank freezing injunction in these circumstances. 

    In short, your wife, husband, or partner will not be aware of the action — until the injunction is issued.

    Typically, this occurs under an application for an urgent injunction in Family Law — where there is a significant risk of the second party maliciously disposing or redistributing assets, prompted by an injunction application.

    Alternatives to Freezing Bank Accounts

    An injunction to freeze your former spouse or partner’s bank account during separation, divorce, and a Property Settlement can — if granted — safeguard assets and funds.

    However, it’s a seriously adversarial act.

    In making an application — especially when ex parte — it’s likely to cause resentment, anger, and stress. To both parties.

    It infers a sense of distrust — a possible belief that the respondent is sufficiently malicious, vindictive, and spiteful to proactively dispose of cash, personal effects, and property to the detriment of the applicant.

    Not only is this painful in the short term, but can also cause long-term bitterness and animosity — especially concerning if there are children in the relationship.

    Falzon Legal, will, where possible, strive for a more amiable, peaceful, and genial solution.

    We understand that, in some circumstances where there has been a complete breakdown of trust, this will not always be possible. However, it’s surprising how often olive branches of cordial agreements can be achieved even in hostile disputes. 

    Typically, positive and more constructive remedies include:

    Consent Orders

    If it’s possible, with mediation if required, for you and your ex-spouse or partner to reach an informal agreement regarding cash and assets — we can help you formalise the arrangement with a Consent Order.

    Made under the jurisdiction of the Federal Circuit and Family Court of Australia (FCFCOA) — they are legally enforceable and are ensured by the Court to be equitable and fair to both you and your partner.

    Binding Financial Agreement

    Effectually a contract made between you and your ex, it removes any need to fight for a settlement in the Court. Within, it determines how your assets, cash, and property are divided — if or when you separate or divorce.

    A Binding Financial Agreement can be made at any stage of your relationship — even before you tie the knot. However, as an alternative to freezing bank accounts, it’s attractive as it can be formalised when you feel your relationship deteriorating, or even during a divorce process.

    Falzon Legal — Parramatta’s Family Law Injunction Experts

    If you believe your former spouse or partner may dispose of assets prior to a Property Settlement — speak to Falzon Legal today.

    Working tirelessly and compassionately on your behalf, we can advise and recommend on the suitability of applying for an injunction — and navigate you considerately through the whole process if required.

    Furthermore, we can, where possible, help you achieve a more amiable and less hostile solution through other routes — such as Binding Financial Agreements and Consent Orders. Whatever your decision — you’re assured professionalism, diligence, and understanding.

    Talking face-to-face in our Parramatta office — or your home if more suitable — we will attentively listen to your situation, explain your options, and act accordingly in your best interests.

    Divorce, separation, and Property Settlements can be painful and challenging — let us guide you expertly through injunction Family Law and its alternatives.

    Injunctions to Freeze Bank Accounts FAQs

    Do Freezing Orders Cover All Assets?

    If the Court grants a freezing order, it can address particular assets, assets of a particular type, or all assets. 

    However, any injunction issued by the Court will only amount to a value that will cause minimal disruption, and be reasonable to the outcome of a judgement — such as a Property Settlement.

    Can My Wife Freeze My Bank Account?

    If your wife applies to the Court for a freezing order, it is possible that an injunction may be granted that prevents you from disposing of cash from a bank account.

    Does a Freezing Order Injunction Only Cover Australia?

    Depending on the injunction — which must be reasonable in relation to a judgement — it may address only the contents in one bank account, numerous accounts across Australia, or investments worldwide.

    Can My Husband Freeze My Bank Account?

    If you’re wondering can my spouse freeze my bank account — the answer is yes, under certain circumstances. 

    Should your husband, wife, or partner apply to the Court for an injunction — and it is subsequently granted — you may be prevented from disposing cash from an account, or a portion thereof.

    If My Bank Account Is Frozen, How Do I Live?

    In most circumstances, any freezing orders permit the respondent sufficient access to funds for reasonable living expenses.

    How Do I Protect My Bank Account From My Spouse?

    A Mareva Injunction can prevent your spouse or partner from maliciously disposing or reallocating funds from your bank account.

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