Financial Agreements

What is a Financial Agreement?

A financial agreement, also known as a binding financial agreement (BFA) or a prenuptial agreement, is a legally binding contract made between parties in a marriage or de facto relationship. It outlines how their property, assets, and financial resources will be divided in the event of a separation or divorce.

Financial agreements provide certainty and control over the division of assets, allowing couples to make their own decisions rather than relying on the court to determine a fair outcome. They can be entered into before, during, or after a relationship and are particularly useful for individuals who wish to protect their assets, business interests, or future inheritance.

In South Australia, financial agreements are governed by the Family Law Act 1975 (Cth) and the Family Court Act 1997 (SA). It is essential to seek legal advice from a qualified family lawyer to ensure your financial agreement is legally binding and enforceable.

Key Elements/Types of Financial Agreements

A valid financial agreement must meet certain requirements set out in the Family Law Act. Here are the key elements:

• Voluntary: Both parties must enter into the agreement voluntarily, without any pressure or undue influence.
• Financial Disclosure: Each party must provide full and frank disclosure of their financial situation, including assets, liabilities, and income.
• Independent Legal Advice: Each party should obtain independent legal advice before signing the agreement. This ensures that both parties understand the implications and consequences of the agreement.
• Certification: The agreement must be signed by both parties and their respective lawyers, who provide a signed statement certifying that the advice was given.
• Formalities: The agreement must be in writing, and each party must receive a copy of the agreement.

There are three main types of financial agreements:

• Pre-nuptial Agreement: A financial agreement entered into before marriage or a de facto relationship.
• Post-nuptial Agreement: A financial agreement entered into after marriage or a de facto relationship.
• Separation Agreement: A financial agreement entered into after the breakdown of a marriage or a de facto relationship.

Each type of agreement serves a different purpose and may have different legal requirements. It is crucial to consult with a family lawyer to ensure you choose the right type of financial agreement and meet all necessary legal obligations.

The Legal Process in South Australia

When it comes to financial agreements, it is essential to follow the legal process to ensure they are valid and enforceable. Here is an overview of the legal process in South Australia:

1. Consultation: Schedule a consultation with a family lawyer to discuss your specific circumstances and objectives.
2. Legal Advice: Each party must obtain independent legal advice from their own lawyer. The lawyers will review the agreement, explain its implications, and provide advice on whether it is fair and reasonable.
3. Financial Disclosure: Both parties must provide full and frank financial disclosure, including assets, liabilities, and income. This information is crucial for ensuring the agreement is fair and meets the legal requirements.
4. Negotiation: If necessary, the lawyers will negotiate the terms of the agreement to ensure both parties’ interests are protected. This may involve making amendments or revisions to the agreement.
5. Signing and Certification: Once both parties are satisfied with the agreement, it can be signed. Each party must receive a signed statement from their lawyer certifying that they received independent legal advice.
6. Registration: While financial agreements do not need to be registered with any government authority, it is recommended to keep a copy of the agreement in a safe place.

It is important to note that financial agreements can be set aside or declared invalid if they do not comply with the legal requirements. Seeking legal advice and guidance throughout the process is crucial to ensure your rights and interests are protected.

Your Rights and Obligations

When entering into a financial agreement, it is important to understand your rights and obligations. Here are some key points to consider:

• Financial Independence: A financial agreement allows parties to maintain financial independence and protect their assets.
• Property and Asset Division: The agreement can outline how property and assets will be divided in the event of a separation or divorce.
• Spousal Maintenance: Financial agreements can address spousal maintenance, including whether it will be paid and in what amount.
• Children’s Issues: Financial agreements cannot determine child custody or child support arrangements. These matters are decided based on the best interests of the child.
• Enforceability: If a financial agreement is properly drafted, signed, and meets the legal requirements, it is generally enforceable. However, the court has the power to set aside or vary the agreement in certain circumstances.

It is crucial to consult with a family lawyer to understand your specific rights and obligations under a financial agreement. They can provide tailored advice based on your unique circumstances.

Common Issues and Solutions

While financial agreements offer many benefits, they can also present challenges. Here are some common issues that may arise and possible solutions:

• Invalid Agreements: If a financial agreement is not properly drafted or fails to meet the legal requirements, it may be declared invalid. To avoid this, it is crucial to seek legal advice and ensure the agreement is legally binding.
• Emotional Factors: Financial agreements can sometimes cause emotional strain within a relationship. Open communication, understanding, and seeking professional advice can help navigate these challenges.
• Updating Agreements: Circumstances may change over time, requiring updates to the financial agreement. It is important to review and update the agreement periodically to ensure it remains relevant and reflects your current financial situation.
• Enforcement: If one party fails to comply with the terms of the financial agreement, enforcement may be necessary. In such cases, legal action may be required to ensure the agreement is upheld.

Having an experienced family lawyer by your side can help address these common issues and provide you with the guidance needed to navigate the complexities of financial agreements.

Why Choose Wright Street Lawyers

At Wright Street Lawyers, we understand the importance of financial agreements and the impact they can have on your life. Here’s why you should choose us:

• client-focusedise: Our team of experienced family lawyers specialises in financial agreements. We have extensive knowledge of South Australian family law and can provide you with the best advice and solutions.
• Personalised Approach: We take the time to understand your unique circumstances and tailor our approach to meet your specific needs. We are committed to achieving the best possible outcome for you.
• Clear Communication: We believe in clear and open communication. We will explain the legal process, your rights, and obligations in plain language, ensuring you fully understand your options.
• Client-Centric Service: Our clients are at the heart of everything we do. We prioritise your needs and work diligently to provide timely and effective solutions.
• Local Adelaide client-focusedise: As a local Adelaide law firm, we have a deep understanding of the local legal landscape and can provide you with context-specific advice.

When it comes to financial agreements, trust Wright Street Lawyers to guide you through the process and protect your interests. Contact us today for a confidential consultation.

Frequently Asked Questions