What is a Binding Financial Agreement?
A binding financial agreement is a legal agreement that complies with various sections of the Family Law Act for both married couples and de facto couples. These agreements can be made before, during, or after a marriage or de facto relationship.
When Can You Make a Financial Agreement?
Before marriage (a “prenuptial agreement”)
During marriage or de facto relationship
After separation or divorce
These agreements are commonly made to protect assets, businesses, or inheritances, or to provide financial certainty between parties.
Legal Requirements for a Binding Financial Agreement
To be binding, a financial agreement must comply with the strict legal requirements of the Family Law Act, this includes factors such as:
- The agreement must be in writing and signed by each party.
- Each party must receive independent legal advice before signing.
- The agreement must not have been terminated or set aside by a Court.
Independent Legal Advice
Each party must obtain independent legal advice before signing the agreement.
- A Binding Financial Agreement can have long-term consequences for both parties.
- Each person should get their own legal advice and must avoid using the same lawyer because it is more convenient or cheaper.
- Independent advice helps ensure both people understand the agreement (and their obligations) before they sign.
Can a Binding Financial Agreement Be Set Aside By A Court?
A financial agreement can be set aside by the Court in certain circumstances, including where:
The agreement was obtained by fraud (including non-disclosure of material matters);
A party entered the agreement for the purpose of defrauding or defeating creditors;
Circumstances have changed making it impracticable for the agreement to be carried out; or
There has been a material change in circumstances relating to the care, welfare, and development of a child of the relationship.
It is therefore important that the agreement is drafted carefully and with full disclosure.
How Aitken Partners Can Help
Our experienced family law team provides comprehensive support throughout the entire BFA process.
Frequently Asked Questions
While it's not strictly necessary to have a lawyer for property settlement, it's highly recommended. A lawyer can provide expert advice, help you understand your rights, and represent your interests during negotiations and legal proceedings.
The time it takes to complete a property settlement can vary significantly depending on the complexity of the case, the willingness of both parties to cooperate, and any legal disputes that may arise. In some cases, it can be resolved relatively quickly, while in others, it may take months or even years.
The allocation of court costs in property settlement is typically determined by the court based on various factors, including the behavior of each party and the overall fairness of the outcome. In some cases, the court may order each party to pay their own costs, while in others, one party may be ordered to pay the other's costs.
Yes, a property settlement agreement can be changed, but it typically requires the consent of both parties or a court order. If circumstances change significantly or if there is a dispute, either party may seek to vary or set aside the agreement.
Yes, you can get a divorce before finalising the property settlement. In many cases, the divorce process and the property settlement process can proceed concurrently. However, it's important to note that the divorce itself does not automatically resolve property matters.
Generally, you cannot sell a property before settlement is finalised. However, in some circumstances, it may be possible to sell the property subject to the completion of the settlement process. This would typically require the consent of all parties involved and may involve specific legal arrangements.
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Please note: The information in this article is provided for general information purposes only and does not constitute legal advice. It is not intended to be comprehensive or to apply to any specific circumstances. You should seek independent legal advice before acting on any information contained in this article.