Legal templates

Binding Financial Agreement Template

There are many names for Binding Financial Agreements, including;

Pre-nuptial Agreements (commonly known as pre-nups),
Post-nuptial Agreements (post-nups); and
Cohabitation Agreements.

They are known by the courts as Binding Financial Agreements (BFA)

A BFA provides an agreement in advance for a division of assets if the relationship or marriage breaks down.

Virtually everyone at some stage in their lives will be in a relationship which is subject to the Family Law Act. Most defacto and same sex couples are, after 2 years, treated the same way as married couples.

Young couples commence living together without any consideration of the legal consequences. Older couples seeking company can be deemed to be in a de Facto relationship even if it was not their initial intention. On a separation and despite prior promises not to, a claim can be made.

Before considering solutions, an understanding of how the Court deals with those assets would be useful.

Binding Financial Agreements can be entered into before the commencement of a marriage, de facto relationships or even during or after a marriage or separation. relationship and even after separation.

When should I enter into an BFA

Before getting married (a pre-nuptial agreement, commonly referred to as a “pre-nup”) or before entering into a de facto relationship;

While married or during a de facto relationship;

During a separation but before filing for a divorce; or

After a divorce or the breakdown of a de facto relationship.

Prenups can cut financial stress in blended families?

Second marriages have a greater failure rate than first marriages. How often are the step children blamed for scuttling the relationship? There are many issues but one of them is almost certainly financial.

In the early days of “No Fault” divorce an inheritance was given far more credit than now. Even inheritances received after separation are included in the property pool for distribution. But not dollar for for dollar. The value of the bequest diminishes over time. Pre owned assets are treated the same way. It is the dreaded “Erosion Principle”. This “throw it all in the pool concept” is becoming far more common as.the baby boomers die and leave their assets to separating children.

A Prenup can solve that problem.

The most logical and fair Prenup is where both parties have adult children to whom they want to leave their assets, not a separating step parent. To quarantine those assets you must have.a Prenup. There is no other way to oust the jurisdiction of the Family Court. Will the Prenup be binding? Done properly by an Accredited Specialist Family Lawyer, it is very likely be found binding if challenged. It is in any event much better to have one than not.

Then you can tell your children that you have not married a gold digger.

Of course, the children must have their own Prenup in place to protect their inheritance when received.

Sorry, I can’t help you deal with a 14 year old feral step daughter.

The above legal issues also apply to de Facto and Same Sex relationships. For more information and articles, see my website under the Prenups tab. For the purists – they are legally known as Binding Financial Agreements under 90B or 9UB of the Family Law Act. But everyone knows what a Prenup is.

Peter Szabo

Author: Family Law Pratice Manual

BFA - Before Defacto

A Binding Financial Agreement before a defacto relationship: S90UB A Binding Financial Agreement-before defacto is a financial agreement for parties who intend to move in together but have not done so yet.

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BFA - DEFACTO

90UC. The Family Law Act 1975 provides for parties to a marriage or defacto relationship to enter into a binding legal agreement about the financial arrangements should their marriage or defacto relationship break down.

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bfa - before marriage

An Agreement before marriage s 90B is for parties who intend to get married but are not married yet.

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bfa - separation

Married but separated:

s 90C is intended to avoid the need for Court proceedings. It is a versatile document as it can be entered into before or during marriage, after separation or after divorce.

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