Since 2000 couples engaged to be married have been able to enter into what is known as a pre-nuptial agreement. Such an agreement provides how in the event of the failure of a marriage, the property of the parties owned at the time of marriage and property acquired after marriage is to be dealt with. A pre-nuptial agreement can also make provision for spousal maintenance payable in the event that the marriage fails.
Since 1 March 2009 parties who propose to enter into a de facto relationship, and where that relationship would be the subject of jurisdiction by a Court under the Family Law Act, can also enter into the equivalent of a pre-nuptial agreement.
Parties who are already living in a de facto relationship or are already married, can also enter into such an agreement. Such agreements can be important where parties to a de facto relationship decide to purchase a home or an investment property.
A pre-nuptial agreement between parties to a proposed marriage has no force or effect if the parties do not marry. A financial agreement entered into between parties to a de facto relationship has no force or effect if the parties to the de facto relationship marry.
Both agreements are called, in the Family Law Act "Binding" financial agreements. This is because there are limited circumstances in which such agreements can be set aside by the Family Court or terminated.
The intent of both types of agreement is to provide a simple means of finalising financial and property issues between parties, when a marriage or de facto relationship fails and which should not involve parties in substantial legal costs. Because the agreements are "binding", careful consideration and drafting of agreements is essential because, potentially, it might be many many years after the agreement is entered into that the marriage or the de facto relationship breaks down. Before binding financial agreements can be entered into, each party must receive independent advice and the agreement contain a certificate stating that such advice has been given.
If you would like advice about the advantages or disadvantages of pre-nuptial agreements or if you are concerned to ensure that assets of your child about to enter into a marriage or who is already living in a de facto relationship are properly provided for, please contact:
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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
