Caldwell Martin Cox Solicitors : Family Law : Financial Agreements / Pre Nuptial Agreements
We have all heard of Pre-Nuptial Agreements in America but is it possible for Australians to benefit from them too?
For married couples, Binding Financial Agreements under the Family Law Act (commonly referred to as Pre-Nuptial Agreements) are contracts entered into between both parties prior to getting married or during their marriage. This contract determines how their assets and liabilities will be treated in the event of a permanent breakdown of their relationship.
For defacto couples in New South Wales, the Property (Relationships) Act applies and they can enter into Cohabitation Agreements or Domestic Relationship Agreements at the beginning of their relationship. These Agreements confirm the parties’ financial rights when a defacto relationship comes to an end.
Care needs to be taken to ensure that these Agreements are prepared properly and that the strict requirements of each set of legislation are fully met. If the Agreement is prepared properly, the parties forego the right to take the matter to Court, which can have substantial benefits in avoiding the financial and emotional expense of confronting and damaging litigation.
It is important to note however that these Agreements are not suitable in all circumstances. Agreements are likely to be of benefit:
- For couples who have perhaps been married or in a de facto relationship previously.
- For couples where one or both have significant assets.
- For couples unlikely to have more children.
- When one party has children from a previous relationship.
- When you wish to keep pre-marital assets separate.
- When you are concerned about the other party’s debt.
For younger couples or couples planning to have children, the difficulty with entering into these Agreements is that it is quite impossible to predict the future and to provide for every outcome. Care should be taken in their preparation and you should not hesitate to sit down with your family lawyer and discuss your needs. It is essential that independent legal advice is obtained by each party before either type of Agreement will be valid and binding. This is an important protection for both parties.
Commonly the following types of issues are addressed when preparing Financial or Co-habitation Agreements:
- How in the event of relationship breakdown, all or any of the property or financial resources of either or both of the parties is to be dealt with.
- The maintenance of either party during the relationship or after its breakdown.
Please note that in some circumstances, the Court does have the power to set aside both Financial and Cohabitation Agreements. These include situations where the Court feels that one or more of the following has occurred:
- The agreement was obtained by fraud or duress; or
- Circumstances have arisen that make it impracticable for the agreement or part of the agreement to be carried out; or
- The agreement is unenforceable (that is, all legal requirements were not fulfilled); or
- Circumstances surrounding a child of the relationship have changed.
Binding Financial Agreements Fact Sheet
If you feel that a Financial Agreement or a Co-habitation/Domestic Relationship Agreement might be of use to you please don’t hesitate to sit down with one of our family lawyers to discuss your needs.
For further information and assistance please call or email any member of our Family Law Team.
Visit our Reading Room for more information on Family Law issues.
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The information you obtain at this site is not, nor is it intended to be, legal advice.
You should consult a lawyer for individual advice regarding your own situation.
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