Financial Agreements
A Binding Financial Agreement (BFA) can be a way to protect assets and resources in the event that a relationship breaks down.
Financial Agreements can be made before, during or after the relationship
BFAs can be used by both married as well as defacto couples. It is essentially a binding contract between two individuals that sets out how property will be divided if the couple’s relationship comes to a close. BFAs allow the couple to make decisions on their property that will differ from the Family Law Court’s normal approach. BFAs can also cover issues of spousal maintenance and issues concerning children.
BFAs are commonly known as pre-nuptial agreements, post-nuptial agreements, cohabitation agreements, separation agreements or divorce agreements.
The rise of BFAs
The Family Law Act 1975 (Cth) allows for parties to enter into Binding Financial Agreements (BFAs) as a way of managing their finances during their relationship. And to use it to manage disputes if the relationship ends.
BFAs are often challenged. For them to be legally binding, they need to comply with the regulations defined in the Family Law Act. This includes both parties having entered the agreement whilst being fully informed, and of their free will.
Structuring a Binding Financial Agreement
A BFA should address all asset classes – real estate, shares, stocks, investments, vehicles, inheritances, property or corporate assets owed through companies or trusts. You cannot draft your own BFA. The use of a lawyer is a requirement to make the document binding. It needs to be a comprehensive document that covers as many different situations as can be planned for.
If your relationship breaks down and there is no BFA in place, then you will need to negotiate a property settlement with your ex-partner. This will be presented to the Family Court for them to make a final determination on.
Binding Financial Agreement FAQs
Prenups are formally known as Binding Financial Agreements. They are also referred to as prenuptial agreements, postnuptial agreements, cohabitation agreements, separation agreements or divorce agreements.
Yes, a prenup can be challenged and potentially overturned by a court, but only under specific circumstances. Grounds for challenging a prenup include fraud, duress, unconscionable conduct, or significant changes in circumstances.
If a Binding Financial Agreement is breached, the party harmed by the breach can seek legal remedies through the court system. These remedies may include seeking compensation or enforcement of the agreement's terms through specific court orders.
Both Consent Orders and BFAs provide a structured approach for dividing assets, finances, and property at the end of a relationship.
If a prenup is not in place, then the alternative is commonly to resolve unresolved issues through negotiations, lawyers, or before the court.
No, you do not need to visit our office in person. We are fully equipped to conduct meetings with you through various digital platforms such as phone, WhatsApp, Zoom, or Google Meet for your convenience.
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