what can prenuptial agreements cover?
Since December 2000, Australian law has enabled parties who are to be married, to enter into Prenuptial Agreements (known as A binding Financial Agreement) that provide for how assets will be divided if the marriage later breaks down.
Provided the legal requirements are met and the Agreement is not later set aside, Prenuptial Agreements are enforceable in Australia.
Prenuptial Agreements can deal with property division and also spouse maintenance. They can take into account anticipated changes such as children being born and the length of a marriage, by providing for different asset splits, depending on how long the marriage lasts, how big the asset pool is, or how many children are born to a couple.
You cannot, however, enter into a Prenuptial Agreement that purports to make arrangements for where children should live if a marriage breaks down, how often they will have contact with a parent, or how much child support will be paid. Parenting and child support matters depend on the best interests of a child. You cannot "contract out" of those matters.
What if we are already Married. Can we enter into a Financial Agreement now?
Yes. The Australian law is unique, in that it allows couples who are already married to enter into a binding Financial Agreement, that provides for how assets are to be divided if the marriage later breaks down. Both husband and wife must consent to the Financial Agreement's terms and be independently legally advised.
Can Prenuptial Agreements be set aside?
Yes. The Family Court has powers to set aside Prenuptial Agreements where either they do not comply with the Family Law Act or there has been some fraud, undue influence or non-disclosure at the time the Agreement was made.
The Court can also set aside a Prenuptial Agreement if there is a material change in the welfare of the children and it would cause a hardship to enforce the strict terms of a Prenuptial Agreement. For example, a Prenuptial Agreement might provide that on separation, a wife gets no assets and the husband keeps all assets in his name. If, at separation, the wife is caring for several children and has no income or assets, the Court is likely to set aside the Prenuptial Agreement as causing hardship to the wife and children.
If a Prenuptial Agreement is set aside, the Court's general powers to alter property interests and order spouse maintenance then applies. This could obviously result in Orders being made, far less favourable to a party than what the Prenuptial Agreement provided for.
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Disclaimer : This article provides basic information only and is not a substitute for a professional or legal advice. It is prudent to obtain legal advice from a family lawyer.