A binding financial agreement is a private agreement, entered by consent, between parties to a marriage or a de facto relationship. They can be made prior to, known as pre-nuptial agreements, during or after separation or divorce in a marriage or de facto relationships.

Financial agreements can deal with all property, including superannuation, financial resources and/or maintenance of the parties and children. They do not deal with child custody matters. The main advantage of a financial agreement is that it requires no court appearance and no approval from the court. Indeed the purpose of the financial agreement is to exclude the court, with some very few exceptions. Further a financial agreement is effective upon signing the document by both parties, and as such there are no court delays, court costs or adhering to court timetables.

The main disadvantage of entering into a financial agreement is that the agreement does not have an independent third party, usually the Registrar of the Family Court of Australia, reviewing the agreement, as is the case with consent orders which are filed at the Family Court.

It is extremely important that if you are entering a financial agreement, that you fully understand the terms of the agreement and the effect of the agreement on your financial position and circumstances.

Once you have entered into a financial agreement, this agreement is final. It is often very difficult to terminate these agreements, without the consent of the other party. There are limited circumstances where the court will consider setting aside a financial agreement that was entered into after consideration and consent of the parties.

If you are considering entering a binding financial agreement, speak to us.