Can you make a Binding financial Agreement when you do not intend for a separation or a divorce?

The Family Law Act 1975 (Cth) (‘the Act’) provides for parties to a marriage or a de facto relationship to enter into a binding financial agreement (‘BFA’) which sets out their financial arrangements should their marriage or de facto relationship break down. In simpler term, BFA is a contract between two partners to a relationship who wish to secure their portion of the matrimonial assets and individual assets.

People often recognised BFA as an agreement that was made only for partners who are separated or intending to separate and file a divorce. That is not entirely accurate. The Act allows couples to enter into financial agreements before registering a marriage or a de facto relationship or at any time of the marriage or the de facto relationship. In fact, it is encouraged that a BFA is put in place before partners enter into a marriage or a de facto relationship.

Benefits of Entering into a Financial Agreement Before a Marriage or Registering a De Facto Relationship
Regardless of whether you are thinking about getting married or continue to remain in a de facto relationship for the foreseeable future, establishing a BFA while both parties are still happy in the relationship is far more beneficial. When both parties are still happy and content with the relationship, it is likely to result in an agreement that is fair to both of them and it will ultimately save them some time and money should their relationship break down.

Not having an agreement could result in partners being unable to agree on a division of property and assets, each party’s contributions, the value of assets and whether there should be compensatory payments made for future needs. This could also result in assets owned before the marriage or de facto relationship commenced, or, inheritances or gifts received by a party during the marriage or de facto relationship to be included in the assets pool to be divided should the relationship break down. This could be an outcome you or your partner may not want, or, may not have intended.

These kinds of disputes can lead to litigation in Court which can be stressful, time consuming and expensive for both parties. To avoid these scenarios we encourage clients to have a BFA established.

If you would like to have a Binding Financial Agreement drafted or find out more about your rights and options, Straits Lawyers are here to help. Simply send us an email at info@straitslawyers.com or give us a call on 8410 9069 to arrange an appointment for an online interview.

Please note that this article does not constitute legal advice and Straits Lawyers will not be legally responsible for any actions you take based on this article.