If you choose to consider a Binding Financial Agreement as opposed to a court order there are strict requirements attached to this. For example each party is required to obtain independent legal advice about the effects of the Binding Financial Agreement including their rights and the pros and cons of entering into the agreement.
One party’s lawyer will draw up a draft of the agreement and the other party’s lawyer will review this. When both parties agree on the contents of the document the lawyers must sign a statement that their advice has been provided and the parties sign the agreement.

What are the risks with a Binding Financial Agreement?

If any of the requirements are not complied with by either party it will not prevent a party from making an application to the court for property settlement, so it will not necessarily finalise the matter. It is easier to set aside a Binding Financial Agreement than a Court Order. Our preference is to seek Court Orders which will finalise the matter once and for all. Binding Financial Agreements may be set aside for reasons such as:

• One party defrauding the other or acting unconscionably in entering into the agreement.
• If a material change has occurred with respect to the care, welfare or development of a child of the relationship since the agreement was made.

When Are Binding Financial Agreements Entered Into?

Binding Financial Agreements are often referred to as pre-nuptial agreements and can be entered into at the following times:

• Prior to marriage.
• Prior to a relationship.
• During a marriage.
• During a de facto relationship.
• After a breakdown in a marriage or relationship.

These agreements are not appropriate in every situation and we will assist you to make a decision as to whether it will be appropriate for your particular situation. This type of agreement will set out how your property will be divided should you separate. This will include all assets as detailed for property settlement.

Why would I get a Binding Financial Agreement?

For various reason such as:

• One person has more property than the other at the beginning of the relationship including residential, farms, businesses
• One person may receive or soon be entitled to a large inheritance or gift/lottery winnings
• Children from former relationships may require financial protection
• Both parties do not wish to have court involvement and ensure the terms of property division are agreed up front
• May exclude certain assets from being included

You may also be entitled to seek orders for Spousal Maintenance to support your living expenses following separation but generally, this only extends for a period of, at most two years.

We can offer further advice on Binding Financial Agreements and how the law applies to your unique circumstances. Book in for a free consultation with us to start the process.

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