Most people have heard of the word “pre-nup” from American media.
It isn’t something that we have had in Australia until about 15 years ago.
Under the Family Law Act in Australia, a “pre-nup” is a kind of Binding Financial Agreement. They are a locked in “pre-plan” of how assets will be divided between parties to a relationship or marriage in the event it breaks down.
The intention is to avoid a dispute as to who gets what if a relationship or marriage ends, as well as avoid one party who has made less financial contributions or who has greater future financial needs from obtaining any of the other party’s assets or income.
These agreements can be made before, during or after getting married, and whether or not you marry. So they apply to defacto relationships which include same sex relationships.
The agreements are most popular amongst new relationships that follow a relationship that didn’t have an agreement and one or both of the parties have been through the negotiation or litigation process under the Family Law Act.
They give security and certainty about the outcome of a relationship breakdown and are great insurance against the high costs (emotionally and financially) of conflict.
The agreements not only protect what you have now, but also what you might have in assets down the track.
There are very strict rules as to the requirements to create a legally binding “pre-nup”. It is well worth obtaining legal advice about what these agreements need to contain. In any event, each party must have a separate lawyer sign a certificate of independent legal advice.
Raising the issue of wanting a “pre-nup” with your partner, fiancé or spouse can be difficult and must be dealt with delicately, as there must be no coercion or duress.
You should also obtain legal advice about the effect of having children after the signing of a “pre-nup”
Freedom Law can help you about “pre-nups” and financial agreements. Contact us anytime to arrange an in person or e-consultation for further information about how our family lawyers can help you.