Property Settlements

A financial Agreement is a formal legal contract entered into between two parties to a marriage. The agreement provides for how their property is to be divided following separation Parties can enter a financial agreement:

  1. before marriage (a prenuptial agreement),
  2. during the marriage, or
  3. following divorce.

Similarly, for de facto relationships, financial agreements can be entered into:

  1. prior to the parties living together,
  2. whilst the parties are living together (cohabitation), or
  3. after they separate.

Financial agreements, (especially prenuptial agreements) by their nature are speculative because they make arrangements for the division of property between the parties after separation, an event that may never happen or if it does occur, the circumstances of the parties may be very different at the time of separation compared to the time when the agreement was entered into.

Because the agreement is designed to finalise the property arrangements between the parties, it takes away the right of either party to apply to the Court for a financial settlement. Accordingly, there are a number of formal requirements that must be met prior to any agreement becoming enforceable. An informal agreement or contract is not enforceable under the Family Law Act. One of the principal requirements is that each of the parties to the agreement must have received independent legal advice as to the effect of the agreement on the rights of each party, the advantages and disadvantages of each party before entering the agreement. A solicitor's certificate must be attached to the financial agreement from each of the parties solicitor.

 

If there is a financial agreement, the terms of the agreement will determine how any property of the parties is to be divided.

 

Where there is no financial agreement, the Family Law Act provides the legislative framework to determine how the property of the parties is to be divided (whether the parties were married or in a de facto relationship).

 

Firstly, it is important to understand that the law provides the Court with the power to deal with all relevant property, including property which is in the sole name of either party and even property that is held by a third party.

 

Any property division may be achieved by way of a negotiated settlement and all parties should endeavour to resolve their property division by negotiated settlement wherever possible. Any agreement for property settlement should be formalised.

 

This may be achieved by way of a Binding Financial Agreement or Court Order. Court Orders can be made by agreement known as a consent Order.

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