Menu
Click To Call: (07) 5575 2844

Family Law - Financial Agreements FAQs

We have included some helpful information on Financial Agreements in Family Law based on common questions we receive from our clients. For a more detailed explanation, or for legal advice about your specific situation, contact our experienced family lawyers on the Gold Coast. You can also check our FAQs on Divorce and Separation.

What is a Financial Agreement?

A Financial Agreement is a contract entered into by couples which provides how their property shall be divided in the event of the breakdown of their relationship, thus avoiding the need to go to Court.

In addition to property, Financial Agreements can also deal with spousal maintenance.

Do Financial Agreements apply only to married couples?

No. 

De facto partners can also enter into Financial Agreements, including same-sex couples.

When can I enter into a Financial Agreement?

 For married couples:

  • in contemplation of the  marriage

  • during the marriage (whether or not the parties have separated)

  • after a divorce order is made

For de facto partners:

  • in contemplation of entering into a de facto relationship

  • during the de facto relationship

  • after the breakdown of the de facto relationship

(Note: the date the de facto relationship broke down and/or the residence of the parties to the relationship may be relevant to the parties’ ability to enter into a Financial Agreement).

When is a Financial Agreement binding?

To be binding, a Financial Agreement must:

  • be in writing

  • be signed by all parties

  • deal with how all or any of the property or financial resources of either party or both of the parties is to be distributed and/or how the maintenance of either of the spouse parties is to be dealt with upon breakdown of the relationship

  • be expressed to be made under either section 90B, 90C, 90D (for married couples) or s90UB, 90UC or 90UD (for de facto couples) of the Family Law Act

  • be made when no other Agreement is in force between the parties with respect to the same matters

  • if made after 4 January 2010:
    • before signing the Agreement, each party must be provided with independent legal advice from a  lawyer about the effect of the Agreement on the rights of that party and about the advantages and disadvantages, at the time the advice is given, of that party making the agreement;

    • each party, either before or after signing the Agreement, must receive a signed statement by the lawyer stating that the advice referred to above was given to that party;

    •  a copy of the statement referred to above that was provided to a spouse party must be given to the other spouse party or to the lawyer for the other spouse party;

      (Note 1: an Agreement may still be binding if one or more of the above conditions are not met);

      (Note 2: different legal requirements apply if the Agreement was made prior to 4 January 2010)

  • have not been terminated or set aside by a Court

Learn more about Binding Financial Agreements here.

What are the circumstances in which the Court may set aside a Financial Agreement?

A Court may make an order setting aside a Financial Agreement or a Termination Agreement if, and only if, the Court is satisfied that:

  • the Agreement was obtained by fraud (including non-disclosure of a material matter);

  • a party to the Agreement entered into the Agreement:

    • for the purpose of defrauding a creditor of the party; or

    • with reckless disregard of the interests of a creditor of the party; or

    • for the purpose of defrauding or defeating  the interests of another person who is a party to a de facto relationship; or

    • for the purpose of defrauding a de facto partner’s spouse or partner from another relationship; or

    • with reckless disregard of the interests of that other person;

  • in the circumstances that have arisen since the Agreement was made it is impracticable for the Agreement or a part of it to be carried out;

  • since making the Agreement, there has been a material change in circumstances relating to the care, welfare and development of a child of the relationship  and the person who has the care of the child will suffer hardship if the Agreement is not set aside;

  • one of the party’s engaged in conduct that was unconscionable;

  • the Agreement covers a superannuation interest which is unsplittable.

(Note: the above list is not exhaustible).

Some of the advantages and disadvantages of entering into a Financial Agreement (this list is not exhaustive and the advantages and disadvantages will depend on the individual Agreement)

Advantages

  • it formalises the division of property and/or the parties spousal maintenance obligations without the need to go to Court

  • by formalising the division of property and/or spousal maintenance obligations, there is certainty and finality in what each party will receive

  • you may be eligible to apply for an exemption  from the payment of stamp duty if real property is being transferred pursuant to the Agreement

Disadvantages

  • the usefulness and enforceability of the Agreement and the advantages it provides, is entirely dependent upon it being valid and upheld at a later time

  • if the Agreement is later set aside then a party may be able to make a claim for property and/or spousal maintenance based on the circumstances as they exist at that time

  • the terms of the Agreement are unable to be varied and the Agreement can only be terminated by the parties agreeing to enter into a Termination Agreement terminating the Agreement or entering into a new Agreement which terminates the earlier Agreement

  • circumstances may arise after the Agreement was made which makes it impractical for part or all of the Agreement to be carried out

Related News