Considering a prenuptial agreement in Queensland? Understanding the basics of Binding Financial Agreements (BFAs) will see you well-positioned to make an informed decision about protecting your financial interests. Queensland’s equivalent of prenuptial agreements, i.e., binding legal agreements, allow couples to make some financial planning before, during, or even after marriage.
What Are Binding Financial Agreements?
A Binding Financial Agreement is a contract between spouses specifying the division of property, debt, and financial obligations on breakdown or divorce of the relationship. Queensland agreements must meet strict criteria under the Family Law Act 1975 in order to be enforceable.
BFAs can be created at any of three points during a relationship: before marriage (prenuptial), while married, or following a separation. They share the same general goal of attaining economic security and reducing potential conflict.
Family Law Act Provisions
The Act has stringent requirements that have to be met by every BFA for it to be enforceable and valid. The agreements have to be in writing and signed by both parties. The agreement has to name all the parties and state whether it is a pre-marital, post-marital, or separation agreement.
Timing is crucial in signing a BFA. The document has to be properly signed, with witness signatures and accurately dated. Any modification to the contract after signing takes on the same level of formality as the original.
Independent Legal Advice
One of the most significant requirements of a binding BFA is that both parties must receive independent legal advice before they sign it. That is to say, they must each have their own lawyer who is not representing the other party.
Your lawyer should provide you with a signed certificate whereby they confirm that they have explained to you the effect of the agreement, and its advantages and disadvantages. This is to ensure both parties are well aware of their rights and obligations under the agreement.
Independent legal advice should consider the effect of the agreement on your rights under the Family Law Act and whether, or not, it is in your best interest to sign the agreement, based on your situation.
Complete Disclosure of Finance
There has to be proper disclosure of finances if a BFA is going to be effective. Full and frank disclosure of all of their financial situations, assets, liabilities, incomes, and financial resources must be made by both parties.
This disclosure needs to be accurate and comprehensive. Hidden debts or undeclared assets render the entire agreement void and unenforceable. Real property, business interests, investments, superannuation, and other financial matters that are likely to affect the fairness of the agreement need to be disclosed.
Financial disclosure is not just a matter of enumerating assets and liabilities. Disclosure of the nature and extent of items, where the parties have knowledge of the overall financial position, is part of financial disclosure.
Agreement Conditions and Enforceability
A prenuptial agreement in QLD, for example, can address general financial matters like property settlement, spousal maintenance, and dividing superannuation. They are not able to replace child support obligations because child support falls under other acts that safeguard children’s interests.
Your BFA terms have to be definite, precise, and not unfairly biased to either side. Undefined or indefinite terms may lead to disputes and can affect the enforceability under the agreement. Courts tend to invalidate BFAs that are deemed unconscionable, or where formality was not adhered to, in preparation.
Protecting Your Financial Future
Binding Financial Agreements are an effective way Queensland couples can resolve financial uncertainty in a relationship. Through knowing the key considerations—compliance with the Family Law Act, independent legal advice, full disclosure, and sufficient terms—you can make informed decisions regarding whether a BFA will work for your case.
Since family law is so intricate and the consequences of having a badly drafted agreement are disastrous, it makes sense to hire the expertise of a qualified family lawyer in considering a BFA.
