Making a Family Law Settlement Proposal: What to Include and How to Present It

A note on safety first. If family violence, coercive control, or a serious power imbalance is part of your situation, preparing and sending a settlement proposal directly to a former partner may not be appropriate, and you should get legal advice before taking that step. The rest of this article assumes a matter without that dynamic.

Once two people have separated and started thinking seriously about how to divide property or arrange parenting time, the conversation eventually has to move from general discussion to something concrete. That is where a family law settlement proposal comes in. Done well, it can move a negotiation forward and save both people significant time, cost and stress. Done poorly, a settlement proposal can stall talks entirely, or even make the other side more defensive than before it was sent. This article explains what a family law settlement proposal typically includes, how to write one and present it, the mistakes that most often undermine one, and how legal input strengthens a proposal before it goes out, whether your matter involves a divorce, a property settlement, or both.

What Is a Family Law Settlement Proposal and Why It Matters

A family law settlement proposal is a document, usually structured as a formal offer letter, that sets out one party's proposed resolution of a property or parenting matter, sent to the other party or their lawyer with a view to reaching agreement without going to court. It is distinct from casual conversation about "what feels fair" and distinct from a court application. A settlement proposal is a deliberate, considered position, put in writing, that the other side can actually respond to.

Settlement proposals matter because family law disputes are not resolved only in courtrooms. Most property and parenting matters in Australia settle by agreement, whether through direct negotiation, lawyer-assisted negotiation, or family dispute resolution. Under the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth), once property proceedings are actually on foot in court, parties are required to make a genuine offer to settle within a set period after mediation or conciliation conference, so a well-prepared proposal is not simply good practice once litigation has started. Even before any court application is filed, though, a genuine, reasonable proposal sent early can also become relevant later if the matter does go to a final hearing, because a court has discretion to take into account whether a party unreasonably rejected an offer that was, in hindsight, a fair one. That said, costs orders in family law remain the exception rather than the rule, since each party usually bears their own costs, so a proposal should never be pitched around the threat of costs consequences rather than on its own merits.

A settlement proposal is usually sent on a "without prejudice" basis, meaning it cannot generally be shown to the court as an admission during the matter itself. That protection is what allows people to put forward a genuine compromise position without it being used against them if negotiations do not succeed. Whether a particular document should be marked without prejudice, and how that interacts with any formal offer requirements under the rules, is worth checking with a lawyer before you send anything, because the wording and framing can affect how the offer is treated later.

Family Law Settlement Proposal: Key Elements to Include

A credible settlement proposal usually contains two core components: a clearly stated proposed division or arrangement and justification for seeking such division or arrangement having regard to the considerations outlined in the relevant sections of the Family Law Act.

For property matters, the proposal should be built on an accurate and reasonably complete picture of the asset pool. Since 10 June 2025, the duty of full and frank financial disclosure has been set out directly in the Family Law Act 1975 (Cth), in sections 71B and 90RI for married and de facto couples respectively, rather than sitting only in the court rules. That duty applies from the start of a dispute and continues until it is resolved, whether or not the matter is in court. A proposal that is not grounded in disclosed financial information, even where disclosure has been informal rather than through a court process, tends to be treated with suspicion and is far less likely to be taken seriously by the other side or their lawyer. Where financial disclosure has already occurred, summarising the key figures, assets, liabilities, superannuation and income, gives the proposal a factual foundation the other party can actually engage with.

The second core element is the proposed outcome itself, set out clearly rather than left to be inferred. For a property matter, this means specifying who retains which assets, how any equalising payment would be structured and by when, and how superannuation would be treated. For a parenting matter, it means setting out a proposed care arrangement in enough detail that the other party can picture how it would actually work day to day, including regular time, special occasions and holiday periods, and how decisions would be made. A proposal that says only "I think we should split things fairly" gives the other side nothing to respond to and often invites a stalled or frustrated reply rather than a considered one.

It is worth being deliberate about how much detail and reasoning to include, particularly before financial disclosure between both parties is complete. A proposal that commits too early to a very specific figure, or that explains every piece of reasoning behind a position, can leave less room to move later if new information comes to light. Setting out a considered position is different from disclosing your entire negotiating strategy, and a lawyer reviewing a proposal before it is sent can help strike that balance.

How to Present a Settlement Proposal Effectively

Tone and structure matter as much as the substance of what is proposed. A settlement proposal is a negotiation document, not a statement of grievance, and how it reads can be the difference between a proposal that opens a conversation and one that shuts it down.

An effective proposal is factual and measured rather than accusatory. It explains the reasoning behind the proposed position, briefly, so the other party understands why a particular outcome is being proposed rather than simply being told what to accept. It leaves room for response, generally by inviting the other party to raise questions or put forward their own position, rather than presenting the proposal as a final, non-negotiable demand. And it is realistic. A proposal that is obviously one-sided, or that ignores matters the other party is likely to raise, tends to produce a defensive response rather than genuine engagement, and can end up costing more time overall than a more moderate opening position would have.

It is also worth thinking about format. A settlement proposal does not need to be lengthy to be effective, but it should be organised, easy to follow, and clear about what response or timeframe is expected. A rushed or disorganised proposal can undercut an otherwise reasonable position simply because it is hard for the other side to work through.

Common Mistakes That Weaken a Settlement Proposal

A number of recurring mistakes tend to undermine settlement proposals before they have a real chance to work.

One common mistake is sending a proposal before financial disclosure has occurred or been properly summarised, which leaves the other party with no way to test whether the figures being used are accurate. Another is framing the proposal in emotional or accusatory language, which tends to provoke a defensive reply rather than a considered one, even where the underlying position is reasonable. A further mistake is failing to address matters the other party is likely to raise, such as a particular asset, contribution, or care arrangement, which can make the proposal look incomplete or make the sender appear unwilling to engage with the whole picture. Some proposals are also undermined by unrealistic positioning, an opening offer so far from a fair outcome that it damages credibility rather than leaving room to negotiate. Finally, proposals that omit a clear timeframe or next step often stall simply because neither party is sure what is expected to happen next.

Getting Legal Input Before You Send a Proposal

A settlement proposal carries more weight, and is more likely to be taken seriously, when it has had legal input before it is sent. A lawyer can help confirm that the proposal reflects a realistic assessment of legal entitlements rather than an assumption about what feels fair, check that financial disclosure has been adequately addressed before a position is put forward, and review tone and framing so the proposal reads as a genuine, considered offer rather than an opening salvo in a dispute. Legal input at this stage can also help identify whether the proposal should be framed with reference to the formal offer requirements under the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth), given the potential costs consequences later in a matter if a reasonable offer is unreasonably refused.

This does not necessarily mean handing the whole matter over to a lawyer to run from that point. Many people preparing a settlement proposal want focused, one-off input at this specific decision point rather than full representation, and that is exactly what a Negotiation Support engagement is designed to provide, a lawyer reviewing or helping prepare the proposal itself, with the fee confirmed before you commit, rather than an open-ended retainer.

If you are unsure whether it is safe or appropriate to send a proposal directly to your former partner, including where family violence, coercive control or a significant power imbalance may be present even if it has not been raised earlier in your matter, that is exactly the kind of question to raise before anything is sent, not after.

From Proposal to Formal Agreement: Next Steps

If a settlement proposal is accepted, or negotiation lands on an agreed position, the next step is turning that agreement into something legally binding. An exchange of emails or a verbal agreement, on its own, does not finalise a family law property or parenting matter and does not protect either party if circumstances or intentions change later. For most property and parenting outcomes reached by agreement, the appropriate next step is applying for consent orders, so the agreed terms become enforceable orders of the court. Getting that documentation right, and understanding why some proposed consent orders are rejected by the court, matters just as much as the negotiation that led to the agreement in the first place.

If negotiation through direct proposals does not resolve the matter, the next step is often family dispute resolution or mediation, where a structured, facilitated process can sometimes achieve what direct correspondence could not.

This article, and the services described in it, relate to family law matters only, including separation, property and parenting issues. It does not extend to Wills and Estates or general criminal law matters, which KD & Co Lawyers handles separately and on their own terms. This article provides general information only and is not legal advice. It does not take into account your individual circumstances, and you should seek advice specific to your situation before acting on anything in it.

If you are preparing to make or respond to a settlement proposal and want it reviewed or strengthened before it goes out, KD & Co Lawyers offers Negotiation Support from $1,000, with the fee confirmed before you commit. You can also start with a free 15-minute introductory call to talk through where your matter currently stands.