A Family Court Judge has ruled that the invalidity payments of defence veterans are immune from divorce settlements.
Under the Family Law Act 1975, superannuation is part of the net asset pool to be divided in a property settlement. Further, a splitting order can be made in relation to one person’s superannuation interest to be transferred to the other.
The recent decision however means that the advice given by the Commonwealth Superannuation Corporation (CSC) to many veterans has been incorrect. The advice that the payments under the Military Superannuation Benefits Scheme (MSBS) were “superannuation” is incorrect.
Previously, a value would have been attributed to the veterans payment received, and considered part of the recipient’s share of the asset pool.
Justice Kent of the Family Court made the ruling that the payment was an insurance rather than a superannuation.
Already the decision has been recognised by family lawyers as having a significant impact on relevant cases involving veterans and their ex-spouses.