You may already have a Binding Financial Agreement that has been in place during your marriage, or you might want to enter into one before or after your marriage. In both these situations, it is important for you to know how your agreement could be set aside.
The Family Law Act sets out the different ways that a binding financial agreement can be set aside or terminated by the Family Court. These are:
- Fraud – one person not telling the other of a serious financial issue, or by two people making a financial agreement to prevent a de facto from having access to finances.
- Impracticality – something has happened that means the agreement cannot be carried out.
- Material Change – after the agreement has been signed something happens that makes a child or their main carer suffer significant hardship if the agreement is not changed.
Of these, Material change is the ‘silent killer.’ When making these agreements it is very easy for people to focus on the outcome and what they need to do to get there. What they do not do is go one step further – thinking about any future situations that could make it difficult for their outcome to stay the way they have agreed.
The Family Court has said that material change can be things like:
- The birth of a new child;
- A party to the Agreement receiving an inheritance;
- A court order about a situation which is not covered by the agreement.
Whatever the material change is, it must cause significant hardship to a child or their parent/carer if the agreement is not changed. For example, the birth of a new child could cause the mother to have to spend more money and time to raise the child compared to what was set out in the financial agreement. If there are other children that she has to look after, it could be very difficult for her to look after the new child as well as these children under the current terms of the agreement.
The best thing you can do to prevent a ‘material change’ from causing problems is to plan thoroughly from the start. Are you thinking of having children? Will you have a relative who will die soon? Are you thinking about changing work? Think about how these will change the outcome that you and your ex are wanting under the financial agreement, and think about what you can do to make sure that the change does not significantly alter your outcome.
Finally, make sure that you review your agreement every two years. Reviewing it regularly is the only way to properly protect your agreement.
Wayne Dawkins is a Perth Family Lawyer who can help you make sure that your financial agreement does what it is meant to. Give him a call on 9214 3887 if you have a concern about your binding financial agreement or submit your query through our website.
What can the Family Court do with my Superannuation?
When there is a marriage breakdown the parties are able to obtain orders in relation to eligible superannuation interests.
In Western Australia superannuation is treated as property in a marriage but not in a de facto relationship. This means that in a marriage separation the Family Court can decide on what should happen to your super during a property settlement.
For more information read our Blog or call and speak to a lawyer for legal advice on 9214 3887.