Financial Agreement: Understanding Your Rights and Obligations under Family Law
When a couple decides to enter into a relationship or marriage, one of the most important aspects to discuss is their finances. However, in the unfortunate event that a relationship breaks down, financial agreements become crucial. As a result, family law has developed to help couples navigate through this complex area.
In Australia, financial agreements are recognized under the Family Law Act 1975 and can be entered into before, during, or after separation. Financial agreements can be used to divide assets, liabilities, and financial resources. It is necessary to understand the legal implications of these agreements to ensure your rights and obligations are protected.
Pre-Nuptial Agreements
A pre-nuptial agreement, also known as a prenup, is a financial agreement entered into before a couple marries or enters into a de facto relationship. Pre-marriage agreements can be used to protect assets owned before marriage, outline financial responsibilities, and establish the division of assets and liabilities in the event of a separation.
It is important to note that a prenup can only be created with full disclosure of all assets and liabilities. Each party must have independent legal advice before signing the agreement. Courts can set aside a prenup if it is found to be unfair or entered into under duress.
Post-Nuptial Agreements
A post-nuptial agreement, as the name implies, is an agreement created after a couple has married or entered into a de facto relationship. This agreement is used to divide assets and liabilities in the event of separation.
Post-nuptial agreements must be created with full disclosure of assets and liabilities, and each party must have independent legal advice. A court may set aside a post-nuptial agreement if it is deemed unfair or entered into under duress.
Binding Financial Agreements
Binding financial agreements, often referred to as BFAs, are agreements entered into at any time before, during or after a marriage or de facto relationship. BFAs are binding and enforceable under the Family Law Act 1975.
BFAs can be used to divide assets, liabilities, superannuation, and spousal maintenance. These agreements must be created with full financial disclosure and each party must have independent legal advice before signing.
Enforcing Financial Agreements
Financial agreements are legally binding, and any breach of the agreement can have serious consequences. If a party breaches the agreement, the other party can apply to the court for an enforcement order. It is crucial to have a lawyer to help enforce the financial agreement if a party breaches it.
Conclusion
Family law can be complicated, especially when it comes to financial agreements. It is essential to understand the different types of financial agreements available and the legal requirements for creating them. It is vital to have a skilled lawyer when creating a financial agreement to ensure that your rights and obligations are protected. Financial agreements can be a useful tool to protect your assets and finances, but they must be created with full financial disclosure and independent legal advice.