Binding Financial Agreements
Binding Financial Agreements can be drawn up before, during or after a marriage or de facto relationship commences. In certain circumstances, these Agreements can also be referred to as Prenuptial Agreements or “prenups”. These documents are designed to protect the assets of each partner and establish a mutual understanding as to what will happen in the event the relationship comes to an end.
Financial matters can put a strain on a relationship in many ways. How we manage, invest, spend and save our money can be a source of contention when you start sharing bank accounts or financial burdens. Love may bring two people together, but in many instances, money can drive them apart.
There are different types of financial agreements available to provide peace of mind to couples in the event a relationship breaks down. Family law disputes can be extremely costly; if you can establish an understanding about financial matters early on, it can save you a lot of stress and money in the long run.
When a Financial Agreement is discussed prior to or at the commencement of a relationship, the process of drafting the Agreement promotes transparency and can give partners a chance to disclose and address any issues such as debts they may have, so that they won’t come as a surprise later. In addition to deepening communication, financial agreements can help eliminate some of the fear of the unknown, which allows couples to better focus on building their lives together.
A Financial Agreement can also be entered into in the event that a relationship breaks down. If a property settlement is documented by way of a Binding Financial Agreement, it does not require approval of the Court, but is still considered to be a formal property settlement.
Getting expert legal advice is crucial when preparing a Binding Financial Agreement. At Attwood Marshall Lawyers, our family Lawyers will tailor your agreement to ensure it meets all the necessary requirements and is correctly executed. We will provide you with guidance on what should be included in a financial agreement and will take into account your unique circumstances.
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A Prenuptial Agreement, otherwise known as a prenup, is a written agreement entered into by a couple prior to or at the commencement of a marriage or de facto relationship. It generally clarifies how matters will be settled in the event of a relationship breakdown.
Unlike Prenuptial Agreements, a Financial Agreement (commonly known as a Binding Financial Agreement) can be made either during a relationship, after separation, or after divorce.
If a Financial Agreement is not carefully drafted and executed in a legally binding way, the Court can set the document aside. The most common reasons this may happen are:
- If the agreement was made under duress or by way of unconscionable conduct;
- If one party failed to disclose assets or liabilities which would have been relevant to the agreement;
- If one party entered the agreement in an attempt to defraud or defeat a creditor;
- If there have been significant changes in circumstances to either or both parties which makes it impractical to uphold the agreement.
If you do not have a financial agreement in place and your relationship breaks down, you would need to commence the negotiation and property settlement process “from scratch”. If an agreement can’t be reached, and in the absence of a Binding Financial Agreement, you would then need to make an application to the Court for a determination of the matter.