What are they? A Pre-Nuptial Agreement is a document which sets out what happens on separation in relation to the property, superannuation or in some cases income of parties to a marriage or a de facto relationship. To be binding there are strict requirements including advice from an independent lawyer for each party. They can be entered into before, during and even after a couple live together. These types of agreements are referred to in the legislation as ‘Binding Financial Agreements’. However, they are most commonly known in Australia and internationally as Pre-Nuptial Agreements. They are very common in other countries and have become more popular in Australia in recent years.
Should I have one? Yes. If you can negotiate a Pre-Nuptial Agreement that has reasonable terms and in circumstances where it is not likely to be challenged, it is better to have one than not have one. While many people who separate can readily agree with their former spouse how to divide their property, for some the alternative is expensive, acrimonious and elongated litigation. Present delays in the Family Court system have seen many cases wait up to five years for an outcome. Any exercise which constructively turns spouses’ minds to what a financial settlement ought to be, long before any separation might occur, is beneficial.
Are they binding? If done properly and in the right circumstances, yes. Despite recent media reports the law in relation to Financial Agreements has become more certain and more reliable in recent years. Many Pre-Nuptial Agreements are enforced with no challenge. Even those that are challenged are often subsequently resolved by negotiation faster and with less expense than if no agreement was in place. There will still remain cases where Financial Agreements are vulnerable to being set aside by a Court. Careful attention needs to be afforded to the way an agreement is negotiated, the effect of the agreement and the terms intended to implement that effect.
When should I get one? It is important to enter into your Pre-Nuptial Agreement well in advance of any intended marriage. Starting the process too close to significant life events can create an environment in which a challenge to the Agreement may arise at a later date. It is also important that you obtain advice from a lawyer before you raise the concept of a Pre-Nuptial Agreement with your intended spouse. Challenges to Pre-Nuptial Agreements frequently scrutinise the language and tone of discussions leading up to the making of the Financial Agreement.
Jamie Burreket and Maya Sen advise and act in relation to the preparation of Pre-Nuptial Agreements. Care needs to be taken at every stage of the process, not the least of which with the conversation which often happens between couples about the desire for a Pre-Nuptial Agreement at the outset. Jamie and Maya can help advise about those difficult conversations, the form an agreement may take and the likely challenges that could be mounted against the agreement in the future. Jamie and Maya have also acted in conjunction with lawyers from other countries in Pre-Nuptial Agreements that are intended to operate in Australia and overseas. We also advise in relation to Pre-Nuptial Financial Agreements that are already on foot, most commonly where one party is seeking to set aside the agreement. Over the years, new judgments have given more guidance about what attitude the Court will take to the enforcement of these agreements. There have been changes in the law and movement in community attitudes. We have played an active role in shaping the evolving law about these agreements, having acted in a number of landmark cases interpreting these agreements in the Family Court of Australia. Jamie Burreket has presented frequently to other lawyers at national and local conferences about Financial Agreements.