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Setting Aside a Binding Financial Agreement where Children are Involved

By November 24, 2016No Comments

By Sharla Stevens

Here in Australia a couple, whether married or de facto, can enter into a Binding Financial Agreement either before they enter into that relationship or during that relationship.

Although the intent of these Agreements is to specify how assets and liabilities will be divided if the couple separates in the future there are some circumstances in which an Agreement can be set aside. One of those circumstances is where there has been a material change in circumstances after the Agreement was signed relating to the care, welfare and development of a child of the marriage or de facto relationship and, as a result of that change, either the child or the party caring for the child will suffer hardship if the Court does not set the Agreement aside.

It’s important to note that the hardship must be because of the change in circumstances and not simply because one party thinks that the Agreement is now unfair. Essentially, this means that the Court must compare the child or parent’s position if the Agreement were to remain valid with their position if the Agreement was to be set aside.

If the Agreement was signed after the couple’s children were born then this will not be considered a change in circumstances. It will be assumed in that situation that the couple already considered the children’s needs when signing the Agreement. Alternatively, it may be a material change in circumstances where children were born after the Agreement was signed. Potentially, it could also be considered a material change if the couple had another child after the Agreement was signed, even if they already had one or more children prior to the Agreement.

If the Court does set the Agreement aside it can then make orders for division of property between the parties in accordance with the Family Law Act 1975. This means that the contributions of each party, including financial and non-financial, as well as the future needs of each party will be taken into consideration.

If you require any legal assistance with a Binding Financial Agreement or having one set aside please contact Cristina Huesch or one of our solicitors, Sharla Stevens or Angela Li on (02) 6223 2400.

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