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Pros and Cons of Getting A Binding Financial Agreement - Havilah Legal
Pros and Cons of Getting A Binding Financial Agreement - Havilah Legal
Pros and Cons of Getting A Binding Financial Agreement - Havilah Legal
In Western Australia Part VIIIA of the Family Law Act deals with financial agreements for married
couples, and Part 5A Division 3 of the Family Court Act 1997 (WA) deals with financial agreements for de
facto couples. Part VIIIAB Division 4 of the Family Law Act 1975 contains similar provisions for de facto
couples in other States and Territories.
A couple can make a financial agreement before, during or after a marriage or de facto relationship. Such
agreements can cover:
the division of property and finances (including superannuation entitlements) after the
breakdown of a marriage or a de facto relationship;
financial support or maintenance of one party by the other after the breakdown of a marriage or a
de facto relationship; and
any incidental issues.
For a financial agreement to be legally binding, it must be signed by both parties and each of them must
have received independent legal advice from a lawyer before signing on the effect of the agreement and its
advantages and disadvantages to the party at the time. In addition, the agreement should attach a
certificate signed by the lawyers providing the independent legal advice stating that independent legal
advice was provided to that party.
The parties may also seek to reduce conflict and avoid a costly dispute and court proceedings if the
relationship fails. It is not unusual for a relationship to fail because the parties do not agree about finances
or financial management. Accordingly discussing these issues and resolving how to manage them can
avoid disagreement later.
A couple can always agree to the division of their property and assets and maintenance after the
relationship has broken down and the Family Law Act makes provision for the court to do so where they
cannot agree.
The Family Law Act does give the court power to declare a financial agreement invalid, and set it aside in
a number of circumstances. Such circumstances include:
Further, any provision in a financial agreement that seeks to exclude or limit maintenance payments can
be ineffective if at the time of the agreement coming into effect the proposed recipient is unable to
support himself or herself.
If a financial agreement is set aside the court can make orders for property settlement and maintenance in
accordance with the principles set out in the Family Law Act.
(Disclaimer: The material in this article is of a general nature and intended for information only. It is not
intended to be comprehensive and does not constitute legal advice. Any person with a specific legal issue
should consult a lawyer.)