Binding Financial Agreements (BFA)

Parties can enter into a BFA before marriage (s 90B), during the marriage (s 90c), after a divorce (s 90D), before entering into a de facto relationship (s 90UB), during a de facto relationship (S 90UC) or after the breakdown of a de facto relationship (s 90 UD). Both heterosexual and same-sex (LGBT) couples can enter into a BFA.

A Binding Financial Agreement (or BFA) is a written document signed by both parties to a relationship which contains provisions about the division of property in the event of a separation. It must comply with either Part VIIIA or Part VIIIAB of the Family Law Act 1975 and parties to the Agreement must obtain independent legal advice about the Agreement.

A Binding Financial Agreement is often referred to as Prenuptial Agreement (prenup or prenups), Cohabitation Agreement, Postnuptial Agreement (postnup or postnups), Property Settlement Agreement or Divorce Settlement Agreement.

Binding Financial Agreements entered into prior to or during a Marriage or De Facto Relationship

Advantages

1. It allows parties to protect assets and financial resources which existed prior to the relationship from a claim for division after separation.

2. It allows parties to protect an inheritance or gift they received prior to the relationship, during the relationship or after separation.

3. In some circumstances, it allows parties to remove their respective responsibilities towards the other to provide spousal maintenance.

4. It provides a degree of certainty to the parties as to how their assets, financial resources and liabilities will be treated in the event they separate and remove any anxieties they may have about entering into a relationship in the first place.

5. It allows parties to be clear about the responsibility of debts such as credit card debts, home loan, personal loans, business loans, etc.

6. In conjunction with a will, it allows parties to plan their estate and ensure that their children, especially any children from previous relationships, are not disadvantaged in the division of the estate.

7. It allows parties to determine their property settlement without the intervention of the Courts and costly legal disputes.

Examples of when a Binding Financial Agreement may be useful

1. When one party has significantly more assets and financial resources than the other, a BFA (whether entered into before or during the relationship) allows that party to keep those assets and financial resources safe from the other in the event that they separate.

2. When both parties have significant assets and financial resources and they both wish to quarantine those assets and financial resources from the other in the event that they separate.

3. When one or both parties have children from previous relationships and wish to protect all or part of their assets and financial resources for their children.

Binding Financial Agreements entered into after separation

Advantages

1. It allows parties to keep the terms of their settlement agreement away from the eyes of the Courts, the Australian Taxation Office (ATO) and other persons and organizations.

2. It allows the parties more flexibility in how they wish to determine their financial matters.

3. In some circumstances, it allows parties to remove their respective responsibilities towards the other to provide spousal maintenance.

Examples of when a Binding Financial Agreement may be useful

1. When parties have complex property, business or trust arrangements which they wish to keep as private as possible.

2. When the settlement terms are more in favour of one party and as a result may not be approved by a Court.

3. When the parties need a quick resolution to their financial affairs and wish to avoid an agreement which requires the review and approval of a Court (consent orders).

We have a competent and approachable team of family lawyers who is able to assist you in determining the right kind of Binding Financial Agreement for your circumstances. We recommend you contact us on 03 9614 7111, or email us out of hours on melbourne@nevettford.com.au.

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Preventing unlawful removal of children from Australia

Do you have concerns that your child may be removed from Australia against your permission? Have you agreed to your child traveling overseas with the other parent but there is a genuine fear that they may not return your child to Australia?

We understand that this would be a stressful situation for any parent.

If so, it may be important that you act immediately to prevent this. You will need to obtain a Family Law Watch List from the Family Law Courts preventing or limiting your child from travelling outside Australia. A Family Law Watch List is also otherwise known as an Airport Watch List. If the situation is urgent, the Courts may make an Order on an ex parte basis.

The Family Law Watch List directs the Australian Federal Police to put your child’s name on the Watch List which in effect, operates at all international departure points including sea ports until discharged by the Courts. It is crucial to note though that the Family Law Watch List does not restrict interstate travel. The Australian Federal Police will not place your child’s name on the Family Watch List without a Court Order, unless in very limited circumstances.

If a child does not have a valid passport, Australia requires the other parent’s signature on the Passport Application form. If this is the case, and you suspect the other parent may fraudulently make an Application, you may, at first instance, consider whether a Child Alert Request will suffice. A Child Alert Request is a warning to the Department of Foreign Affairs and Trade not to issue an Australian Passport for a child without first making further enquiries (https://www.passports.gov.au/passportsexplained/childpassports/Pages/childalerts.aspx).

If the other parent has an international passport, you can make enquiries with embassies/consulates about the possibility of the other parent obtaining an international passport for your child. If there continues to be a real risk your child could travel on an international passport, you can make an application for your child’s name to be placed on the Family Law Watch List.

When facing with an application for a Family Law Watch List, or an application for the child to travel overseas, the Courts uphold its primary consideration being the child’s best interests – Will a travel abroad be in the child’s best interest? What is the time period and reason for the intended travel? Is there a real risk that the child will not be returned to Australia? Is the intended/likely travel destination a Hague Convention country? To find out whether a country is a Hague Convention country, go to https://www.ag.gov.au/FamiliesAndMarriage/Families/InternationalFamilyLaw/Pages/HagueConventionontheCivilAspectsofInternationalChildAbduction.aspx.

On the other hand, if you are a parent considering removing a child from Australia without the other parent’s consent, or relocating overseas, you should think twice as your actions may constitute an offence punishable with imprisonment up to three years. If you wish to relocate with your child, you should consult the other parent seeking an agreement in writing, or seek Court Orders allowing your child to travel or relocate.

If you have a pressing fear that your child may be removed from Australia unlawfully, or you simply wish to know more about international travel arrangements, you can contact our attentive Family Law team on 03 9614 7111 or Melbourne@nevettford.com.au.

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Protect Your Family’s Investment

Many people choose to invest in property in Australia for their retirement, as a source of income, or to assist their children with somewhere to live. This is true of both local buyers and overseas purchasers. When you do this however, you should turn your mind to how Australian family law will consider this type property in the event that there is a separation involving yourself or your children in the future.

If a parent buys a property for their child, their child marries and then divorces, it is not as simple for the parents as getting their money back out of the property ‘dollar for dollar’. Australian family law will usually consider this assistance from a parent a type of financial contribution, not a loan, and is not inclined to repay the money as if it were a normal debt. Often people will walk away from a relationship having lost not only a lot of money themselves, but also a lot of their family’s money, resulting in increased family tension.

At Nevett Ford Lawyers, our large and experienced team advise and assist with a range of solutions to help to protect you and your family in these situations. When you purchase a property, we recommend considering a Binding Financial Agreement under the Family Law Act to protect yourself and your children, as well as ensuring loan documents are drafted to assist in recovering money if necessary. We are also able to draft Inheritance Agreements to help to protect inheritances from family law disputes in the future. We can even draft Agreements that will operate for couples who are not yet married but may do so in the future and want to make just one document to cover these different situations.

It is important to look at these types of documents and have them prepared when everything is going well, to protect you in the event of future uncertainty. Determining the right kind of document for your circumstances is a skill at which our lawyers excel, and we recommend you contact us to enable you to make this important decision in an informed manner. Our number is 03 9614 7111, or email us out of hours on melbourne@nevettford.com.au

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What is urgency for parenting cases?

Parents in the heat of family law situations will often want to know if the Court can help them with their dispute urgently. To a parent in the middle of a dispute situation – they may not have seen their child for months, or they may want to change their current arrangements – their situation may appear genuinely urgent. However, this is not the test that the Court applies in determining whether a matter should be listed urgently in front of a Judge or Registrar.

In the matter of Fowler & Glover (http://www.austlii.edu.au/au/cases/cth/FCCA/2016/2595.html), the Court considered what test is, and should be, applied to determining whether something should be heard urgently when it is delivered to the Court Registry to file.

In that case, the Father had not seen the child concerned since separation, with there being a delay of some more than six years between separation and the Father seeking Orders. The Father was trying to get orders made in time for his planned visit to the area where the child lived. The visit was scheduled for only a month after the Court documents were being filed. The Court empathised with the situation, but emphasised that the reality of the Court’s resources were that the Court was already overlisted (above capacity) with other matters. Nevertheless, the Court clarified that it continued to overlist urgent matters, which were described as typically involving ‘allegations of serious and immediate risk of harm to children.’

This reflects our experience. The Court will largely only overlist / list urgently parenting situations where there is the immediate risk of harm to a child. An immediate risk will usually be a threat to the safety of a child well above and beyond any harm that is suffered as a result of a delay in that child’s relationship with a parent.

A good family lawyer will be able to advise you on how to identify what are, and are not, good reasons to list urgently, and be able to make a compelling case to the Court for why urgency is justified. Our lawyers will advise you on this and other practical measures to take in relation to your situation, and are available to speak to you on 03 9614 7111 (tel:0396147111) or Melbourne@nevettford.com.au

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Consistency and Understanding the Key for Courts Dealing with Family Violence

In August 2016, TC Beirne School of Law and the Australasian Institute of Judicial Administration released (http://www.lawyersweekly.com.au/wig-chamber/19479-judges-draw-on-new-guide-for-family-and-domestic-violence) the initial version of their ‘bench book’ for Courts across Australia dealing with family violence. A bench book is a guide to Judges and Magistrates to assist them in applying risk assessment systems, case law, and making suggestions in coming to decisions.

It is a difficult task for lawyer, judges and people caught in the family violence systems to ensure they can assess situations with the impartiality, reality-testing and credibility required of them, and the guide aims to simplify this process for the judiciary, resulting in a more consistent framework that better protects those in need, and better recognises when people are not being genuine in their desire for, or opposition to, an order being made.

Clients will often speak of a Judge or Magistrates having taken a view about them personally and not treating them, in their view, fairly. This guide should help in ensuring that there is a consistent and clear approach and restore damaged confidence in aspects of the system. 

Of course our lawyers (http://www.nffamilylawyersmelbourne.com.au)  have many decades of experience dealing with family violence matters and providing clients with realistic and sensible advice in obtaining, opposing, or renewing orders and if you do have a concern about your situation, we encourage you to call us to discuss your situation. 

We are available on 03 9614 7111 or by email on melbourne@nevettford.com.au.

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What age can my child decide which parent they live with or spend time with?

There is no specific age at which a child can decide who they live with or whether they choose to exercise contact to the other parent.  Children are minors until they reach 18 years of age. 

A child can express a view generally in the context of a family report writer’s meeting with them about who they want to live with and whether they wish to spend time with the parent. However, any decision regarding children's living arrangements must be made in the best interests of the child.

If you require expert advice regarding parenting matters, please contact our family law department on 03 9614 7111.

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Two asset pools might not be better than one

Most family law property matters approach the division of parties’ assets by adding everything together into one ‘pool’ of assets and then dividing up the total value of that pool. However in certain circumstances, a Court may take a different approach where the facts support departing from the usual system.

One such case was the matter of Arthur and Arthur (http://www.austlii.edu.au/au/cases/cth/FamCA/2016/324.htm) , decided by Judge Rees in Sydney in May 2016. In that case, Ms Arthur was due to receive a sizeable - $535,000 – inheritance from her mother’s estate, her mother having passed away after the Arthurs’ marriage had broken down. The rest of the assets totalled approximately $800,000, meaning that this inheritance would have been a very significant factor in working out each party’s contributions, if it was included.

 

However Judge Rees determined that the inheritance should be kept separately and that Ms Arthur would be considered to have contributed 100% to that pool of assets, and that she should simply keep the inheritance. This was a practical way to deal with the matter, but had the effect of producing a note-worthy result in the rest of the assets.

 

Mr Arthur’s family had provided significant support to the parties during their relationship, transferring as much as 75% of a house to them without really expecting any payment back. In addition, the parties were allowed to live rent-free in the property for many years even though it was owned by family members of Mr Arthur.

 

Mr Arthur earnt significantly more than Ms Arthur, who had significant obligations as a carer and whose employment prospects were uncertain. Nevertheless, Mr Arthur received 80% of the non-inheritance asset pool. This is a high percentage of assets on a pool of this size, and Ms Arthur did not receive a larger percentage because she was going to have the benefit of the very large inheritance she had received and was going to retain, meaning the inheritance was a double-edged sword for her.

 

What does this mean for parties contemplating a separation? Look after your parents!

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