Where you and your former spouse have come to an agreement regarding your property settlement, you may turn that agreement into a legally binding document, in the form of either:
Consent Orders filed in the Family Court of Australia or a Binding Financial Agreement made under the Family Law Act 1975.
Both options are legally binding and enforceable at law, so which is right for you?
Consent Orders filed in the Family Court
Don’t be put off by the word “court”. If you decide Consent Orders are appropriate, you generally won’t be required to physically appear in front of a judge. Documents are filed in the court registry and then approved by the court registrar who will look over your agreement to consider if it is a just and equitable settlement pursuant to the Family Law Act 1975.
If the registrar is satisfied that the settlement is just and equitable, the Consent Orders will then be approved and sealed, making the agreement a court order.
This process offers you the added security of the court’s approval. It is extremely difficult to challenge or set aside Consent Orders once approved by the court.
Neither party needs to be legally represented to obtain Consent Orders, although it is prudent to seek legal advice. The documents may be complex and if not drafted exactly how the court requires, they may be returned for amending and re-filing.
Engaging a lawyer to draft the Consent Orders may save you time and money in the long run. Consent orders that are not drafted correctly may result in transfer duty being payable on property settlements when it may have been avoided.
The agreement is not binding until it is approved and sealed by the court, delays in this process may result in your former spouse changing their mind.
Consent Orders may include in the one document both a property settlement (including superannuation) and parenting arrangements.
Binding Financial Agreements
A Binding Financial Agreement is a private agreement that is not filed in the court, however, it is enforceable by the court.
Because a Binding Financial Agreement is not filed in the court registry it is not reviewed by a court registrar and the agreement does not necessarily have to be just and equitable pursuant to the Family Law Act 1975. You and your former spouse can agree to terms outside what the court may consider “fair” and formalise this agreement by way of a Binding Financial Agreement.
Both parties must seek independent legal advice and both parties’ solicitors must sign off on the agreement for it to be enforceable. There are very strict drafting conditions to ensure the Binding Financial Agreement is actually binding and enforceable. It is important that both parties seek the assistance of experienced family lawyers in drafting these often complex documents.
Binding Financial Agreements’s are often challenged and can be set aside for a variety of reasons so obtaining advice from an experienced family lawyer is imperative.
A Binding Financial Agreement deals with property settlement (including superannuation splits) and spouse maintenance matters only. It does not deal with parenting arrangements.
DBL Solicitors can assist you with your Consent Orders or Binding Financial Agreement, call us for a confidential discussion about your circumstances.