A prenup (called a “binding financial agreement” in Australia) is the only way a party in a relationship can seek to protect their assets in the event of divorce or separation. Of course, to read the tabloids, it would be easy to conclude that a prenup is the go-to for the rich & famous. In reality, a prenup can offer reasonable protection to one or both parties bringing significant wealth or assets into a relationship.
What is a Prenup? - A prenup is an agreement between two people planning to get married or live together in a de facto relationship. It sets out the various assets and liabilities that each person has when they enter into the relationship and their agreement on what will happen with those assets and liabilities if they separate. As you might expect, what people are really doing here is agreeing up front on things that might otherwise be the subject of negotiations or Court orders following separation.
Do Prenups Stand Up in Court?
A properly drafted prenup, where the processes are followed correctly, should usually stand up in Court. For a prenup to be legally binding:
* It must be in writing; * Each person must sign it voluntarily (free from undue pressure, coercion or threats); * It must contain full & frank disclosure of each person’s financial status; * Both parties must receive independent legal advice from an Australian lawyer before signing; and * It must otherwise comply with the Family Law Act 1975.
For more assistance call our family law team today.
