FORMALISING YOUR FAMILY LAW PROPERTY SETTLEMENT
January 20, 2014
You have just reached an agreement with your former spouse or de facto partner in regards to the division of property following the breakdown of your relationship. Is a verbal agreement enough? Are your future interests protected? Should you formalise the agreement in writing? Would a statutory declaration be enough?
Some people that find themselves at this point in their lives believe that a simple verbal understanding between their former partner and themselves is enough and do not believe it is necessary to obtain legal advice from Family Law specialists. Unfortunately, it is human nature for relationships to go through many ups and downs even after separation, and where no formal written agreement has been entered into concerning property interests, the result can be expensive and complicated legal proceedings (especially where your new partner’s interests have now also been intertwined!).
Statutory declarations detailing family law property settlements are not legally enforceable much to the surprise of many clients. Furthermore, if there is no formal agreement in place, depending on your individual situation, your former partner may be able to make an application to the Court for the alteration of property interests years after separation. Accordingly, it is imperative that any one who is experiencing a relationship breakdown seeks advice from a Family Law lawyer to ensure that they are aware of not only their rights, but potential pitfalls.
There are only two methods under the Family Law Act 1975 (Cth) to formally finalise your property settlement and to protect your future financial interests. If you have reached an agreement, you can choose to enter into a Binding Financial Agreement or Consent Orders. The main differences between the two are as follows:-
Consent Orders require the completion and lodgement of documents with the Family Court of Australia. Parties are not required to attend Court personally, it is only the documents that are assessed and make their way through the Court system for approval.
Both parties are encouraged to obtain independent legal advice however it is not compulsory like Binding Financial Agreements. The Court however does have to be satisfied that the Orders before them are “just and equitable” (fair).
Binding Financial Agreements
Both parties are required to obtain independent legal advice before signing. This means that both parties have to instruct their own lawyers.
In contrast to Consent Orders, Binding Financial Agreements do not have to be “just and equitable” and they do not face the scrutiny of the Court (unless one party seeks to have the Agreement set aside). Accordingly, they are generally used in matters where there is an agreement for one party to retain the majority of the assets from the relationship which may not be considered to be fair by a Court.
To find out which option is right for you and if you wish to obtain specific advice in regard to your individual situation contact a specialist Family Law solicitor at Websters Lawyers who will be happy to provide you with further assistance.