Secure your future with the Gold Coast’s best financial agreement lawyers.
Every relationship starts out strongly.
Unfortunately, stress, time and a variety of other factors can eventually lead to you and your partner becoming incompatible.
No-one expects a relationship to end, but, if it does, it’s important to be financially secure. One separation shouldn’t define your future.
At Bell Legal, we use our professionalism, expertise, and exceptional reputation to create financial agreements that protect your assets from the worst-case scenario. It doesn’t matter whether you’re married or in a de facto relationship – financial agreements are the insurance your future self deserves.
Get in touch with us, and find out how a financial agreement can help keep you safe.
What is a binding financial agreement (BFA)?
An agreement that sets out how you and your partner’s property will be divided if you separate is legally known as a ‘financial agreement’. Many people also know them as Binding Financial Agreements (BFAs).
A BFA is an agreement between two or more people that outlines how their property, superannuation and spousal maintenance will be divided if their marriage or de facto relationship breaks down. The purpose of a BFA is to simplify property settlement during a separation so the people who have signed the BFA don’t have to go to court.
Before a BFA is valid, both you and your partner must obtain your own independent legal advice. This is the law’s way of making sure you fully understand what you’re signing.
Types of Financial Agreements
Not all BFAs are the same. There are different types of BFAs for different times in your relationship. The Family Law Act 1975 sets out the requirements for entering a BFA at the varying stages of your relationship. The three stages are:
- Before your marriage or de facto relationship (also known as a ‘pre-nup’ or prenuptial agreement)
- During your marriage or de facto relationship
- After your divorce or the breakdown of your de facto relationship
Binding Financial Agreement Versus Consent Order
As an alternative to entering into a BFA, you can seek to settle the division the property of the parties by making an application for consent orders to the court. Consent orders can only be obtained once the relationship has ended.
Essentially, consent orders set out how the financial affairs of the parties are to be dealt with following the breakdown of the relationship. Once the parties have agreed (or consented) to how their property is to be divided, they ask the court to grant orders that reflect the agreed division of property or superannuation, as well as any spousal maintenance arrangement.
Although you don’t need to obtain legal advice to obtain a consent order, we strongly recommend talking to a financial agreement lawyer first. Consent orders and the process of getting them can be complicated, and they may have unintended effects on other aspects of your life, like your Will.
Additionally, consent orders are more difficult than BFAs to change or overturn once they have been made, although similar reasons to set them aside will apply. Consult a lawyer before you either create a BFA or obtain a consent order – they’ll be able to advise you as to which option is best, and help you set your agreement up in the best possible way.
Why Financial Agreements Are Important in Relationships
Most people agree that having insurance is a good thing. Property insurance, car insurance, health insurance and even life insurance are all commonplace in Australia, because we know that, sometimes, things go wrong in life.
Most of us will probably never need hospital cover or life insurance, but we get it anyway, just in case the worst-case scenario occurs.
A financial agreement in a relationship is no different. It’s not a business contract, or a sign you don’t trust your partner. It’s a type of insurance. Although you and your partner may never need a financial agreement, it’s important to be prepared for the worst-case scenario.
How much does a binding financial agreement cost?
The cost of obtaining a BFA can vary greatly depending on your circumstances. You can keep the cost down by doing things like:
- Making a detailed list of all the assets and liabilities of each party to give to your lawyer
- Agreeing to as much of the property settlement as possible with your ex-partner before you seek legal advice
The cost of obtaining a BFA depends on the complexity of the agreement and assets, as well as whether issues still need to be agreed between the parties.
Can I just use a binding financial agreement template?
While a BFA template can give you an idea about what information is required for a BFA, simply filling in the blanks on a template won’t adequately protect your rights.
As the financial affairs of each relationship can vary greatly, a one-size-fits-all template is unlikely to adequately protect the interests and intentions of each party. Each relationship needs a BFA to be drafted to fit the specific circumstances of that relationship.
Financial Agreement FAQs
Who can witness a binding financial agreement?
A Justice of the Peace or a solicitor can witness your BFA. The Certificate of Legal Advice must be issued by a solicitor before your BFA can be signed, so your solicitor, upon issuing the certificate, will generally also witness the BFA being signed.
How can I overturn or set aside a binding financial agreement?
A BFA may be set aside (deemed invalid) if the person challenging the BFA can prove that:
- the agreement was obtained by fraud (including non-disclosure of a material matter);
- a party to the BFA entered into the agreement for the purpose of defrauding or defeating a creditor of the party, or was entered with reckless disregard of the interestsof a creditor of the party;
- the agreement is found to be contractually void or unenforceable;
- the circumstances of the parties have changed to the extent that it would be impractical or impossible to carry out the BFA or that it would cause a party to suffer excessive hardship; or
- it would be just and equitable in the circumstances to have the BFA set aside.
If you believe any of the above circumstances apply to you, we strongly recommend contacting one of our Gold Coast financial agreement lawyers to discuss whether an application can be made to set aside the BFA.
Can you have financial agreements in de facto relationships?
Yes, you can have financial agreements in de facto relationships. While they are dealt with in different sections of the Family Law Act, marriages, de facto relationships, and same-sex relationships all share the same essential rules about BFAs.
What is a financial separation agreement?
A financial separation agreement is another term for a BFA.
What’s the difference between a prenuptial agreement and a BFA?
A prenuptial agreement (‘pre-nup’) is a type of a BFA. A prenuptial agreement is a term used to describe a BFA that is entered before marriage or a de facto relationship. Like all BFAs, a prenuptial agreement sets out how the financial affairs of the parties to the relationship will be dealt with following the breakdown of the relationship.
How can I get my partner to sign a BFA without them being offended or concerned?
That’s a tough one – the team at Bell Legal have found that honesty, fairness, empathy and a dash of compromise are really important when seeking to have your partner agree to enter a BFA. It’s also helpful to understand that, as many people may have significant assets that they want to protect when entering a new relationship, BFAs are becoming a more acceptable way of parties arranging their financial affairs.
Your partner might feel that a BFA represents a lack of trust in the relationship or your intention to separate at some point. Try assuring them that this is not the case, and that a BFA isn’t really any different to house or life insurance – it’s unlikely that your house will burn down, but it’s smart to prepare for the worst-case scenario.
Please note that the information on this page is general information only. It is not legal advice and should not be taken as such or relied upon. If you think you might need to talk to a solicitor, get in touch with one of our Gold Coast financial agreement lawyers.