If you have separated from your partner, or if you have divorced, you’ll know that dividing the property of the relationship is a crucial part of the financial separation process. Often, a key aspect of financial separation is making a binding financial agreement (BFA). Here’s what you need to know.
What is a BFA?
A BFA is a written legal document that is similar to a contract. It sets out the property to which you are entitled and may also specify the amount of spousal maintenance that is to be paid by one party to the other.
Like a contract, the parties to a BFA must intend that it will be legally binding and understand that there are legal consequences if any of its terms are breached. For a BFA to be legally binding, both parties must have signed the agreement. Before signing, they must have both received independent financial and legal advice.
What are the types of BFAs?
BFAs fall into three categories:
- BFAs before marriage or before a domestic partnership (also known as a de facto relationship). These types of agreements are commonly referred to as pre-nuptial agreements.
- BFAs during marriage or during a domestic partnership.
- BFAs after a divorce order is made or after the breakdown of a domestic partnership.
Breach of a BFA
If your ex-partner breaches a BFA, it is up to you to decide whether to take legal action. Because it is like a contract, you can advise your partner that is they don’t comply with the BFA, you will commence legal proceedings. If they still refuse to comply, you can commence legal action to try and recover whatever is owing to you. You can use the BFA as evidence of the agreement between you and your ex-partner. You will need legal advice before taking this action.
If you are worried that your partner won’t comply with a BFA, you should consider asking the court to make orders in the terms of the agreement that you have reached with your ex-partner. If your ex-partner agrees to these orders, they are known as “consent orders.” The orders formalise the agreement and this means that if they are breached, the court can intervene to sort it out. It will do so on the application of either party.
What if we can’t agree?
Sometimes, it may be impossible for parties to agree how their property should be divided. In these circumstances, it may be necessary to apply to the court for financial orders. It will then be up to the court to work out how to divide the property. It will do this by assessing the evidence, listening to witnesses and considering legal arguments. This is known as a trial. The process may take months or even years, depending on the complexities and the extent of the disagreements. It’s really important to have legal representation at trial to make sure that your interests are properly represented.
BFAs are an important part of the legal process in resolving your family dispute. Getting great advice from an experienced family lawyer is essential to protect your rights under Australian family law. Websters Lawyers has an outstanding team of family lawyers, making us one of the best family law firms in Adelaide. Contact us today for a free initial consultation.