Introduction
On American television shows and in movies, the term ‘pre-nup’ is often thrown about. You may be interested to know that there is actually no such thing as a pre-nuptial agreement in Australia. Rather, under Australian law, people can enter into a Financial Agreement at any stage of their relationship to deal with their financial settlement or financial support after the breakdown of the relationship.
Financial Agreements at Law
Under the Family Law Act 1975 (Cth) (“the Act”), parties can enter into a Financial Agreement before, during or after a marriage or de facto relationship. The respective provisions are Sections 90B, 90C and 90D for married or divorced couples and Sections 90UB, 90UC and 90UC for de facto couples (although de facto couples in Western Australia are dealt with under specific Western Australian legislation).
For a Financial Agreement to be legally binding and enforceable, the following requirements must be met (Section 90G for married couples and Section 90UJ for de facto couples):
- The agreement must be signed by all parties;
- Before signing the agreement, each party must be provided with independent legal advice from a lawyer about the effect of the agreement on the rights of the party and about the advantages and disadvantages of entering into the agreement;
- Either before or after signing the agreement, each party must be provided with a signed statement by the lawyer confirming that the advice was provided to that party;
- A copy of this statement must be provided to the other party or a lawyer acting for the other party; and
- The agreement must not have been terminated or set aside by a court.
A Financial Agreement must also be expressly stated to be made pursuant to the relevant provision of the Act, noting the parties’ particular relationship status.
The effect of a Financial Agreement is to allow people to “contract out” of the provisions of the Act relating to property and spousal maintenance. It must be noted, that parties cannot opt out of the operation of the Act in relation to children’s issues or child support.
A Financial Agreement that is binding on the parties continues to operate despite the death of a party and operates in favour of and is binding on that party’s personal representatives: Sections 90H and 90UK of the Act.
Conclusion
For a Financial Agreement to form a binding agreement between the parties, it must meet the strict requirements stipulated under the Act. Therefore, it is imperative that if a party is seeking to enter into a Financial Agreement before a marriage or de facto relationship, during a relationship or after separation, they obtain independent legal advice as to their rights, entitlements and the appropriate document by which to formalise their agreement.
This is not legal advice.
Photo by Scott Webb on Unsplash
