Although we consider marriage as a bond destined from heaven; however, the legal parameters are essential, and one must consider them while tying the final knot. Dissolution of a marital relationship is also an unfortunate yet probable event.
To ensure that both partners get their rights after the marital relationship ends and no one can use this social institution as an extortion tool, two partners should draft and sign a prenuptial agreement (shortly called prenup) between them. You should consult the best family lawyers Perth for their assistance in the drafting and signing of the prenuptial agreement.
Before we move on to further details, here’s a look at the aspects that you need to know about prenups and how they are made.
What is a prenuptial agreement?
In the Australian legal system, there is no mention of the term “prenuptial agreement.” This concept is American; however, one uses the word for ease of non-legal conversation. The correct legal representation is called a “binding financial agreement,” which a couple can enact before entering into a married and de facto relationship.
Incidentally, the laws are the same for marriages between the opposite and similar sexes. However, in this article, the term “prenuptial agreement” has been used.
The Legal Reach Of The Prenuptial Agreement
Australia’s legal system allows and discusses the drawing up, and establishment of a prenuptial agreement under section 90B of Family Law Act 1975, and usually discusses the division of properties in case of a marriage breakdown and often the child support rights. It sorts out the present and future financial property issues. In general, they mention the two parties planning a marriage, their current assets and liabilities, and how they will divide the present and future acquisitions if the marriage breaks down.
The law also specifies the correct legal consequence in any supplementary or auxiliary development regarding the spousal support, discrepancies in the partners’ wealth, and acknowledgment of children from a previous relationship and any possible child from this marriage. Therefore, it is better to be informed about certain aspects of the law before drafting an agreement. One can list some of the usual queries related to the legal influence of prenuptial agreement as:
Is a prenuptial agreement mandatory?
Under Australian Family law, a prenuptial agreement is not compulsory for entering into a married or de-facto relationship. Either party considering marriage or cohabitation must decide this according to their situation. However, you can know about some of the reasons people go into prenups as given below;
1. Either party own, co-own, or take control of a business or business.
2. They may get a considerable inheritance or may receive a license or degree for a profitable occupation.
3. They expect a significant increase in income.
4. One of the partners is wealthier than the other.
5. One of them may possess precious property, like real estate, stocks, or savings.
6. One of them has loved ones in need of a protected economic future and will contribute to that.
7. One of the partners has children from a previous relationship who will need provision.
So, if you would like to be legally secure about these matters after the wedding, it is better to complete a prenuptial agreement.
• Is a prenuptial agreement full and final? Can it be challenged later on?
No, a prenuptial agreement is not complete and final, and the court can change the whole deal, modify a specific clause or section, or set it aside subject to certain conditions. The two parties can enter into a new agreement, which will make the previous agreement null and void. In case of the following events, the court can set aside an effective prenup according to section 90K of the Family Law Act:
1. If one of the parties attained the agreement by fraud, including non-disclosure of a material matter, like a business or significant liability
2. Suppose one candidate signed the agreement specifically for defrauding or blocking a creditor. It is also applicable for any other person having a common-law relationship with that party.
3. If the parties were involved in ‘reckless disregard of the interests of a creditor.’
4. Suppose circumstances have changed significantly since the inception of the agreement, and it became unfeasible for the contract or parts of it to be approved.
5. If there were a ‘material change in circumstances relating to the maintenance of a child of the marriage, continuing the agreement would result in suffering for the party caring for that child.
Having a prenup does not guarantee exceptions from court cases. However, experienced Prenuptial Agreement Lawyer prefers it because it may expedite or limit either party’s time in the courts. However, a properly drafted prenuptial agreement can aid the parties to avoid the courts altogether.
• Who can enter into a prenup?
A prenuptial agreement is a private contract; so, only the two people contemplating a legal marriage or de-facto relationship can enter into a prenuptial agreement.
• What cannot a prenuptial agreement include?
A prenuptial agreement is a legal commitment between two individuals, and therefore they can include anything permissible under the law in the agreement. So, by definition, anything not permitted by the existing rules shouldn’t be included in the contract – unless you want it to be set aside by the court. Some examples of such matters are listed below:
1. Anything that affects the interest of a third party without the permission of the said party.
2. Issues relating to child custody and access.
For matters where the situation has changed over the years, the court will consider the parties’ decision and the current situation before reviewing. However, any agreement between the parties not examined by the courts will be outside of these restrictions.
• When is the best time to sign the agreement?
You should sign the prenup well before the marriage ceremony – the experts recommend doing it not less than 60 days before marriage. It ensures the court that either of the parties didn’t sign the agreement under duress, coercion, or undue influence and had enough time to consider everything before agreeing.
Utility of a prenup
In recent times, entering into a prenuptial agreement has been worthwhile. According to the available statistics, the court granted 49,116 divorces in 2019 alone, giving a crude rate of 1.9 divorces per 1000 expected resident population. Therefore, it is better to have certain factors cleared before taking the decision of spending your life with someone else; and for that, you should always consult the most proficient Financial Agreement lawyers of your choice.