Family Law: Disclosure and Binding Financial Agreements

For a Binding Financial Agreement(or ‘BFA’) to be legal and binding, the couple must enter into the agreement of their own free will and be fully informed.

This means there must be full disclosure between the couple about their assets, debts and financial resources (including superannuation). A list of the assets will not suffice – the value of the assets also needs to be included. If full disclosure does not occur, then a Court may find that the BFA is not valid.

 If you are entering into a financial agreement with your partner, you need to not only consider matters such as what happens with the property and assets you already own, but also what will happen with the property and assets you might acquire in the future. For example, if you were to buy a house next year, will it be in the name of one person or both of your names jointly? Alternatively, consider whether you would own the property according to the percentage you contributed to it. 

 Your BFA can also include provisions for financial matters if there was to be a change of circumstances in your futures. For example, you might consider how your financial contributions might change if one of you becomes a stay-at-home parent, or changes to part-time instead of full-time work.

This may mean you have to regularly review your BFA to keep it in date.

 And don’t forget about your debts! Consider how you might deal with the debt either or both of you already have, as well as any liabilities you may acquire in the future.

To find out if a BFA is right for you, or if you have any other questions about family law, please do not hesitate to contact us on (02) 9688 6023 or email us at info@franklegal.com.au.

 This article is provided to the reader for general information. It is not legal advice. It was written by Karla Elias and edited by Andrea Spencer.

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