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Binding Financial Agreements can be a very useful way of protecting your assets and is commonly considered where the intending parties to the marriage or to a de facto relationship have previously been married and/or have acquired independent wealth.
Watson & Watson was asked to advise Paul in relation to the possibility of agreement to protect his assets if he married Mary.
Paul and Mary want to get married. Paul is 52 and Mary is 46. Both have been married before and have had property settlements with their former partners, both own their own house and have other assets including savings and shares. Paul has an investment property. Both have children from their first marriages.
Paul and Mary want to protect the assets that they bring into the relationship if things go wrong with the marriage or they decide that they simply do not want to go on with the marriage. They want peace of mind. They do not want to end up in Court if things do not work out.
Paul sought advice from Richard Watson of Watson & Watson about agreement to protect the assets of each of himself and Mary in the event that their proposed marriage was not successful. Richard Watson advised about the nature and benefit of a Binding Financial Agreement available under the Family Law Act 1975.
The Binding Financial Agreement should deal with all probable contingencies and make particular specific provisions as to what happens in the event of a breakdown of the relationship. Many people do not consider the possibilities and probabilities and the effect of what might occur.
Senior family law solicitor Dennis Grant has prepared many Binding Financial Agreements and after discussing the matter with Paul prepared the necessary Binding Financial Agreement to protect each of Paul and Mary and their assets in the event of a breakdown of their marriage.
A Binding Financial Agreement deals with not only the assets that each party had at the beginning of the relationship but assets acquired after the marriage. There are many issues to be considered for example, in this case how were the mortgage payments during the marriage to reduce the debt on the investment property owned by Paul at the commencement of the marriage to be dealt with in the circumstances of a breakdown of their marriage.
Each of Paul and Mary thereafter were able to and continued to have a relationship knowing what would happen in the event of a breakdown.
The Family Law Act does provide for the Court to be able to set aside a Binding Financial Agreement but the grounds upon which a Court may set aside an agreement are limited and very specific.
Each party must have a separate independent legal advice and the legal practitioners must comply with the technical requirements in relation to the Binding Financial Agreement so that it is enforceable. It does not have to occur prior to the marriage. However, experience suggests that the parties are likely to agree if matters are discussed at an early stage.
There are also other arrangements that can be made to clarify and assist the parties in the event that the relationship breaks down. These include consideration of appropriate insurances and other related matters.
If you wish to have a Binding Financial Agreement with your intending partner then contact Richard Watson or Dennis Grant to discuss the appropriate agreement and documentation to give effect to your intentions.
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