In today’s legal context the term ‘Binding Financial Agreement’ (“BFA”) encompasses agreements regarding the finances and assets of couples, both married and de-facto, including same sex couples, before, during or at the end of a relationship. A BFA is designed to set out what assets and liabilities each party brought in to the relationship, how they will share their finances during their relationship and how they will divide their finances if they separate, avoiding the need for the parties to go through the courts to resolve any disputes in the future.
Being able to clearly set out what assets exist between the parties at the commencement of the relationship and how these assets should be distributed should the relationship breakdown, may save a lot of grief and expense of having to negotiate a property settlement.
We have seen a rise of clients presenting us with a ‘Google’ based online Binding Financial Agreement and the popularity of these types of agreements is truly concerning. Most of these Agreements do not comply with the Family Law Act and are based on American laws and even use American terminology.
These online Agreements are sold as being a cheap alternative to having a solicitor prepare a BFA, costing only a few hundred dollars and that they can be ready in a matter of minutes. These online agreements are neither binding nor enforceable, therefore they are not worth the paper that they are printed on. BFAs are complex legal documents, and have strict legislative requirements that need to be satisfied before they are considered to be both binding and enforceable.
So, if you are considering whether or not a Binding Financial Agreement is suitable for your circumstances, it is imperative that you seek appropriate legal advice. You wouldn’t trust your health to “Doctor Google”, so do not trust your financial agreements to a “Google Lawyer” because any money you save now on a cheap BFA will almost certainly cost you a lot more in the future.