Financial Agreements under the Family Law Act
What is a Financial Agreement?
Couples are able enter into a private legal contract about their financial affairs and make provision for the distribution of their assets and liabilities, such as rights to real property and/or personal property, and mortgages, regardless of whether such items are held solely or jointly by a party as well as make provision for spousal maintenance. Financial Agreements are an alternative to process to Court or Arbitration that parties can engage to settle their dispute about property settlement matters.
Financial Agreements are a useful mechanism that a party of a relationship can utilise to make arrangements in circumstances where there are children from previous relationships, where one party may have unbalanced wealth, or may be entitled to an inheritance in the future, or where a party aims to preserve a family business.
Types of Financial Agreements
The type of Financial Agreement that parties are able to enter into pursuant to the Family Law Act 1975 (Cth) is depended upon whether the parties are firstly, either in a de facto or married relationship, and secondly, the stage of their relationship, or post-relationship.
Financial Agreements for De Facto Couples:
- Before the commencement of a de facto relationship – section 90UB of the Family Law Act.
- During a de facto relationship – section 90UC.
- After a break down of a de facto relationship – section 90UD.
Financial Agreements for Married Couples:
- Made before marriage, commonly known as a “pre-nuptial” – section 90B.
- Made at any time during a marriage, but before a grant of divorce – section 90C.
- Made after a grant of divorce – section 90D.
Whilst the legal framework of a specific Financial Agreement may differ due to the nature and stage of a relationship, and the provisions that such a Financial Agreement must entail, all Financial Agreement must meet the formal requirements in order to be binding upon the parties and be capable of ousting the jurisdiction of the Courts.
Requirements of all Financial Agreements to be binding:
- The Financial Agreement must be in writing and signed by all parties;
- The Financial Agreement must expressly state under which specific provision of the Family Law Act it is being made;
- Neither person of the couple is a party to any other Financial Agreement;
- Before entering into a Financial Agreement, each party must obtain independent legal advice from a solicitor about: (a) The effects of the proposed Financial Agreement on their rights, and (b) The advantages and disadvantages of entering the Financial Agreement to the party at the time of entering the proposed Financial Agreement;
- A signed declaration from the solicitor representing the respective party, stating that respective party has received the mandatory advice from their solicitor (this is usually annexed to the end of the Financial Agreement); and
- A signed copy of the solicitor’s declaration provided to the party has been given to the solicitor representing the other party; and
- The Financial Agreement is effect, meaning that it has not been subsequently terminated or set a side by a Court.
Disclaimer: This publication provides general information of an introductory nature and is not intended and should not be relied upon as a substitute for legal or other professional advice. While every care has been taken in the production of this publication, no legal responsibility or liability is accepted, warranted, or implied by the authors or our firm, and any liability is herby expressly disclaimed.
Ge Wu is the solicitor director of Legal Point Lawyers & Attorneys. He has been admitted to practise law since 2005. Throughout his practice, Ge Wu predominantly practises in the areas of Property Law, Immigration Law, Commercial Law, Civil Litigation and Family Law.
His experience covers all aspects of property law, commercial/retail lease, immigration law and civil litigation, while at the same time, he also has experience in family law, criminal law and other areas such as will-drafting and general advice.
He has frequently been instructed by corporate clients in pre-acquisition due diligence reports, structuring property development, land/shopping centre acquisitions, G.S.T. and stamp duty advice for buying/selling businesses, as well as share transfers and company re-structures.
Ge Wu has been appointed as Notary Public since 2011 and started to provide Notary Public service to clients from different cultural backgrounds.
Georgia holds a Bachelor of Laws and Bachelor of Business Administration from Macquarie University and a Graduate Diploma of Legal Practice from The College of Law. Georgia was admitted as a Solicitor of the Supreme Court of New South Wales and her name was entered on the High Court Register of Practitioners.