Binding Financial Agreement

The agreement sets out the terms and conditions that both parties agree to, and it becomes legally binding once both parties have signed it, and it has been witnessed by a lawyer. The agreement can cover a wide range of issues, including property, finances, debts, and spousal maintenance. It does not include parenting arrangements if there are children as a result of the marriage or de facto relationships. The purpose of a BFA is to provide certainty and predictability in the event of separation or divorce, as it removes the need for a court to make decisions about property and financial matters.

There are circumstances where a BFA can be overturned. For example, if it can be proven that one party did not disclose all of their assets or if the agreement was entered into under duress, is unconscionable conduct or undue influence. In addition, if the court finds that the agreement is unfair or does not provide for the needs of one of the parties, it may be set aside.

It is important to note that a BFA cannot determine matters relating to child support or child custody, as these issues are determined by the Family Law Act 1975.

Overall, binding financial agreements are enforceable in Australia, as long as they meet certain requirements and are entered into voluntarily by both parties. However, it is important to seek legal advice before entering into a BFA to ensure that the agreement is fair and legally binding.

A BFA does not need to go to court to be legally binding. As long as the BFA is prepared and executed properly, it can be a legally binding agreement that does not need to be enforced by a court to be legally binding.

However, there are some circumstances where a BFA may need to be reviewed by a court. For example, if one party alleges that the agreement was signed under duress or coercion, the court may need to review the agreement to ensure that it was entered into voluntarily. Similarly, if there has been a significant change in circumstances since the BFA was signed, such as the birth of a child or a significant increase in wealth, the court may need to review the agreement to ensure that it is still fair and equitable.

The Family Law Act outlines certain circumstances where a Binding Financial Agreement may be set aside by a family court. These circumstances include situations where the agreement was obtained fraudulently, such as through material non-disclosure of assets. Additionally, if a party entered into the agreement with the intent of defrauding a creditor, the agreement may be set aside. The BFA may also be deemed void or unenforceable if it was not prepared properly and fails to meet the legislative requirements set out in section 90G or section 90UJ.

The agreement may also be set aside if circumstances have arisen that make it impossible or impracticable to carry out, or if a material change in circumstances has occurred relating to the care, welfare, and development of a child of the relationship. In such cases, a party to the agreement may suffer hardship if the BFA is not set aside. Furthermore, if a party’s conduct in making the agreement was unconscionable, the agreement may be set aside.

A “payment flag” operating on a superannuation interest covered by the agreement may also result in the BFA being set aside, if there is no reasonable likelihood that the flag will be lifted. Finally, if the BFA covers an “unsplittable interest,” it may also be set aside. Accordingly, there are two methods to terminate a Binding Financial Agreement:

The first method is for the parties to enter into a new financial agreement that includes a specific provision stating that the former agreement is terminated.

The second method is for the parties to enter into a “termination agreement” under section 90J (for married couples) or section 90UL (for de facto couples). Similar to the original BFA, a termination agreement must be signed by all parties involved, and each party must obtain independent legal advice regarding the agreement’s termination in order for it to be binding and enforceable.

If you are considering entering into a BFA, it is important to have it prepared by a qualified family lawyer. A Binding Financial Agreement Template are available online, but it is better to have it tailored to your specific circumstances to ensure that it is enforceable.

The cost of a BFA will depend on the complexity of the agreement and the time involved in preparing and reviewing it. Our family lawyers at Lyons Law Group may offer a fixed fee for preparing a BFA. However, it is important to discuss the cost with us before proceeding with the agreement.