Binding Financial Agreement
Suitable For Use : ACT, NSW, NT, QLD, SA, TAS, VIC and WA
Binding Financial Agreement
Married but Separated
Married but separated: s 90C
A Separation agreement 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 in order to record an agreement as to the division of assets between the parties.
Agreement for parties who are still legally married but separated. Fully formatted in Microsoft Word, ready to download edit and use. 14 pages long.
- Assets and liabilities.
- Transfer of real property.
- Sale of real property.
- Moveable possessions.
- General provisions.
- Maintenance [delete if not applicable]
- Independent legal advice.
- Claims for provision out of the estate of a deceased party.
- Governing law and jurisdiction.
- Further assurance.
ANNEXURE A – Assets and liabilities.
Statement under section 90G of the Act 1975.
Separation declaration pursuant to section 90D Act 1975.
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Binding Financial Agreements
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.
BFA’s need to be set up correctly to be legally binding. To be binding, there are certain requirements that BFA’s need to meet, if these items are not met, then the agreement can be void or set aside.
It is advisable that a BFA be reviewed every 24 months or after, during any changes in relationship.
A correctly executed BFA may provide some degree of certainty to the parties and thus avoid unnecessary arguments, in the event that a relationship ends, as they have agreed in advance as to how the property will be divided.
It can also make parties feel secure knowing that the property they have accumulated before the relationship or marriage is safe. By reaching agreement in advance, the issues that occur after a break up are more likely to be carried out without costly legal expenses or court delays.
Binding Financial Agreements can provide comfort to relationships if issues arise.
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.
Author: Family Law Practice Manual
Family Law Expert
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