Maintaining a healthy ongoing relationship with your partner would undoubtedly be one of your chief goals in life, but it is also of the utmost importance that your financial security is fully protected. At GMH Legal, we believe that these two goals are not mutually exclusive.
What is a financial agreement?
A financial arrangement, popularly referred to as a pre-nuptial agreement, is a planning tool which sets out how you and your partner’s property will be divided in the case that your marriage or de facto relationships breaks down.
Whether you have recently entered into a new relationship, are currently in an existing relationship, or are considering ending a relationship, you should be aware of your legal rights and obligations under the Family Law Act 1975 and should be fully informed about the most effective way to secure your financial position.
Financial agreements can cover:
- How a couple’s assets and money will be divided
- The financial support of either party (during the marriage and/or after the divorce)
- Any other incidental issues particular to you and your relationship
These agreements are complicated and strictly regulated. There are very precise legal requirements that must be complied with for these agreements to have legal force and be binding in the Family Court of Australia.
A financial agreement is only binding if:
- Both partners sign the agreement; and
- Lawyers from each side sign a separate statement advising that they have provided independent legal advice on how the agreement will affect each person’s right, the advantages and disadvantages to each party and that the agreement is fair for both parties.
The Family Law Court may set aside (dismiss) a financial agreement under section 90K of the Commonwealth’s Family Law Act 1975.
For more information about financial agreements, please refer to the Family Court’s ‘Financial agreements’ section.
Why are financial agreements important?
The role of financial agreements is to:
- Plan ahead for unforeseen circumstances
- Help identify what each partner brings into the relationship
- Provide certainty, objectivity and peace of mind to both partners
- Make it clear to each partner that the possessions which they have worked hard to earn are safe and secure, even if their relationship breaks down.
These agreements are an increasingly common method for clarifying a couple’s intentions in regard to their property and finances. Although we realize that the drafting of such arrangements requires the utmost sensitivity and precision, these contingency plans can potentially avoid much anxiety, animosity and unnecessary costs being incurred if your relationship breaks down in the future.
For more information, please refer to the Family Law Court’s ‘Financial cases’ section.
How to cancel or change a financial agreement?
Couples can agree to change or cancel an agreement.
If one party does not agree to cancelling or changing a financial agreement, the other party must prove to the Court that:
- There was fraud (dishonesty)
- The agreement is not practical to carry out (not just inconvenience)
- The other person has acted in an unethical or unfair way
- It is in the interests of creditors
Can my partner and I have an informal financial agreement?
Couples may choose to have an informal agreement which can be written or unwritten.
At GMH Legal we do not recommend informal agreements as they are not legally binding (enforceable) by a Court, they can only be considered by a Court when making a decision.
An informal financial agreement can only be made binding in limited circumstances by:
- Having it made into a consent order
- A written agreement between ex-partners that is approved by the Family Law Court.
- Making a financial agreement
At GMH Legal, we have the skill and expertise to formulate and draft a financial agreement that is tailored towards your unique needs and circumstances and is fully complaint with the Family Law Act 1975. Please contact one of our expert family lawyers as soon as possible so we can begin working on a financial arrangement between you and our spouse or partner as soon as possible.
Call the experienced team at GMH Legal to assist you in your matter.
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