What is a Pre-nuptial Agreement in Australia? (Beginners Guide)
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Financial agreements Sunshine Coast
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What is a financial agreement?
A financial agreement binding two parties sets out how they would like to divide their finances if the relationship ends. For those looking to enter financial agreements, family law regulates their implementation. Under the Family Law Act 1975, you can enter into a financial agreement before, during, or after your relationship ends. Financial agreements can cover a married couple or a de facto relationship.
What’s in a financial agreement?
As a family law matter, there are vital prerequisites for creating Binding Financial Agreements (BFA’s). Every lawyer must sign a certificate of independent legal advice. This certificate indicates that the client has been advised of the agreement’s effect. Both parties should understand the advantages and disadvantages of the contract.
Spouse maintenance matters arising from divorce can also be dealt with in these agreements. If the parties wish, the agreement can indicate that neither party will claim spousal maintenance against the other. A binding financial agreement does not require the Court to oversee the contract terms. This allows you and your ex-spouse to arrive at an outcome without the Court intervening.
Obtaining independent legal advice from an experienced family lawyer before entering any financial contract is essential. Poorly drafted agreements can be disastrous and often go hand-in-hand with unreliable family law advice. Ineffectively structured agreements often lead to later litigation. This leaves parties out of pocket and open to interference by the Courts. Shanahan Family Law can give vital and tailored advice about your circumstances. We will ensure a complete and final property settlement.
What’s in a financial agreement
Asking the questions
There are significant and exacting conventional prerequisites for the creation of Binding Financial Agreements (BFA’s) also known as prenups. Every lawyer must sign a certificate of independent legal advice indicating that advice has been given concerning the effect of the agreement and the advantages and disadvantages of it.
Spousal maintenance can also be dealt with in these agreements or, if the parties wish, the agreement can indicate that neither party will make a claim for spousal maintenance against the other. Entering into a binding financial agreement effectively removes the authority with jurisdiction of the Court, allowing you and your ex-spouse to arrive at your own outcome without the court intervening.
Getting expert family law guidance about prenups and spousal maintenance is essential. Poorly or inadequately drafted agreements can be disastrous and often go hand-in-hand with unreliable family law advice. Ineffectively structured agreements often lead to later litigation, leaving parties fundamentally out of pocket and exposed to unwanted interference by the courts. Shanahan Family Law can give vital, bespoke advice about your circumstances to ensure a full and final property settlement.
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Joint applications for divorce
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Even a joint divorce application can be daunting, let alone when you’re considering filing for a divorce online. Perhaps you have questions about submitting your application to the courts, or you aren’t sure where to start. We’re here to help guide you through the process.
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As principal solicitor of Shanahan Family Law in Maroochydore, Luke Shanahan is a reliable and experienced Sunshine Coast family law expert, offering compassionate support to people and families experiencing the most difficult circumstances through a divorce or separation. Whether you’re seeking help with child support, parenting matters, divorce, property consent orders, financial agreements, domestic violence, joint applications for divorce, or the preparation of DIY affidavits and consent orders, Luke can help.
As sad as it is to see couples and families split, he feels privileged to be able to help his clients find a better life through their family law services. “I believe we all deserve a second chance at finding a better life, and if this is through a divorce, then we will do everything we can to ensure our client’s success through whatever means.”
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Facing the uncertainty of financial matters after a separation can be daunting. At Shanahan Family Law, we understand the complexities of securing your financial well-being during these challenging times. Our experienced team is dedicated to crafting tailored financial agreements that protect your interests and pave the way for a secure future. Let us navigate the legalities, ensuring your peace of mind and a fair outcome.
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Frequently Asked Questions
To help you understand your circumstances, Shanahan Family Law has created some of the most common questions with these FAQs.
In Australian law, there are certain matters that a divorce financial agreement cannot cover:
- Parenting Arrangements: Financial agreements cannot dictate parenting orders or custody arrangements.
- Child Support: Child support falls outside the scope of these agreements. A child support agreement is more appropriate to organise support payments.
- Personal Non-Financial Matters: Issues like marital conduct or personal obligations aren’t appropriate for inclusion.
- Anything Unlawful: Any terms that promote illegal activities or are against public policy are void.
- Future Assets: Speculative assets or those not yet acquired generally won’t be included. A typical example is a future inheritance. The inheritance isn’t in the party’s possession when the financial agreement is made. As a result, it isn’t considered property for a property settlement.
- Violations of Third Party Rights: The agreement cannot infringe on the rights of third parties. Some circumstances where a third party’s interests may be affected include the following:
- Joint Debts: If a couple has joint debts with a third party, an agreement that doesn’t adequately address repayment might affect the third party’s financial interests.
- Business Partnerships: If one spouse is in a business partnership, an agreement that transfers assets or shares without considering the partnership agreement can impact the partner’s rights.
- Family Trusts: If assets are held in a family trust, an agreement that seeks to divide or access these assets might conflict with the interests of other beneficiaries.
- Guarantors: If a third party has guaranteed the couple a loan or financial commitment, an agreement that changes the responsibility for that loan might affect the guarantor.
- Real Estate Co-ownership: If a property is co-owned with a third party, an agreement that changes ownership rights without the third party’s consent can create conflicts.
- Shared Investments: If the couple has investments with third parties, an agreement that liquidates or transfers those investments can impact the third party’s financial position.
Financial agreements are a central component of family law. They offer couples a pathway to outline their financial future. However, they aren’t the exclusive choice. While financial agreements provide clarity, there are alternatives. For example, consent orders are available for parties to consider.
What are the Consequences for Breaching a Binding Financial Agreement?
Breaching a binding financial agreement can lead to significant repercussions. Such violations might result in court interventions. This will lead to accumulating legal fees and potential financial penalties. Fully grasping these implications is vital before committing to such an agreement.
Breaching a binding financial agreement can lead to significant repercussions. Such violations might result in court interventions. This will lead to accumulating legal fees, and potential financial penalties. Fully grasping these implications is vital before committing to such an agreement.
Certain factors, such as fraud and undue influence, can invalidate a financial agreement. If a party is deceptive about their financial resources or exerts pressure on the other to sign, the agreement might not be legally binding. Securing independent legal advice is crucial to ensure the agreement’s integrity.
If assets are concealed or if misleading financial information is presented by one party, the agreement can be contested. Undue influence pertains to coercive actions that unwillingly compel a party into an agreement. Both scenarios can void a financial agreement.
Parties can draft informal arrangements concerning property division after a relationship’s dissolution. However, these are less robust than binding financial agreements. Formalising any agreement is recommended for those in de facto relationships or marriages. Doing so will ensure its recognition under the Family Law Act.
Navigating these agreements requires expert legal advice. Consulting experienced family lawyers is essential when contemplating a financial agreement. They can advise on spousal maintenance matters, the technical requirements, and their implications. An adept family lawyer ensures the agreement safeguards assets acquired during the relationship and addresses spousal maintenance adequately.
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