Binding Financial Agreements

When a relationship breaks down, emotions are high and disagreements over financial matters can arise adding to the stresses of the situation. One way to avoid having to deal with these disagreements during this difficult time is to have a binding financial agreement in place. These can be very useful and help you determine how your property would be divided if you were to separate. These can be entered into at any stage – before you enter into a relationship (sometimes referred to as prenuptial agreements), during a relationship or even after the end of the relationship. Although it can be a depressing thought, discussing the end of a relationship – especially when the relationship is still new – mean that if things do go wrong, you have agreed the arrangements during an amicable time without the added stresses of dealing with the emotions of separation. At Bateys, our expert lawyers can assist in the preparation of a binding financial agreement to ensure that it adheres to your specific needs and requirements, as well as the necessary rules to ensure your future is correctly protected. Contact Bateys Law Firm now.

What is a Binding Financial Agreement?

A Binding Financial Agreement is a formal document that sets out how property will be divided between the parties in the event of a relationship breakdown. It is no longer necessary to obtain approval from the courts for the agreement to be binding and enforceable. However, since it is not examined by the courts to ensure it is valid, it is therefore essential that both parties receive expert legal advice before the agreement becomes legally binding since there are very strict rules that must be adhered to. There is an increasing amount of case law on agreements that have not been recognised and have been declared non-binding or set aside by the court.

The contents of a financial agreement will depend on the particular circumstances of the relationship, but can cover a range of issues, such as:

• Spousal maintenance.
• Determining what will happen to any business that is owned or managed by the parties.
• The division of any real estate owned by the parties including investment properties and the relevant furniture.
• The division of other assets such as jewellery, shares and bank accounts.
• How both parties’ income will be divided.
• How any debt will be covered.
• How children or other dependents will be financially cared for.
• What will happen to any future assets that may be received such as an inheritance.

Do I need a Binding Financial Agreement?

While it may give you some peace of mind immediately, certain risks come with having a Binding Financial Agreement. Firstly, it can allow for a level of uncertainty as your relationship progresses. Relationships will inevitably change and evolve, and the birth of children, a serious illness or injury, a significant change in the value of assets or the employment of one of the parties, are all factors that should be considered. These can result in the courts deciding that a financial agreement that was valid is now no longer enforceable due to the change in circumstances.

Financial agreements are not appropriate in all situations which is why parties should always take expert legal advice to ensure that such an agreement is suitable in their case. At Bateys, our lawyers can discuss some alternative approaches where we can achieve certainty and often do so at a lesser cost. Contact our family law solicitors to discuss what options are available to you and your particular circumstance.

Can a Binding Financial Agreement be amended or terminated?

It is not possible to vary a financial agreement once it has been entered into and if the court finds the agreement to be biding, then it is rare that the courts will set them aside. However, both parties can either:

• decide to terminate the agreement if they both sign a terminating agreement; or,
• decide a new agreement should be drawn up to include a provision terminating the previous agreement.

Contact our expert family lawyers in Revesby, NSW today

At Bateys Law Firm, our empathetic lawyers can offer you a friendly environment to discuss your personal circumstances and help you decide which route is right for you and your family. Our professional and straight-talking lawyers can guide you through every step of your case, giving you peace of mind about your situation and your future. We will advise you on all legal issues surrounding your case in order to achieve your desired outcome as quickly and cost-effectively as possible.

Do not delay and get in touch with South West Sydney’s experienced and reputable family law firm on 02 4708 9507, or complete our online contact form for an initial consultation.