Binding financial agreements (BFAs) have to meet certain requirements to be legally binding. With our template, you can get an idea of a typical BFA layout and what’s often included. A PDF version of our binding financial agreement is also available to download. BFAs are tailored to the specific needs of each client, so it’s important to have a proposed agreement reviewed by a family lawyer.
Key takeaways
Why get independent legal advice?
Section 90G of the Family Law Act lists the criteria for a BFA between married partners to be recognised by the Federal Circuit and Family Court of Australia (FCFCOA). Section 90UJ sets out the equivalent criteria for de facto partners. De facto couples in Western Australia are covered by the Family Court Act 1997 (WA). One crucial point is that both parties must have their own lawyers. Our guide to binding financial agreements explains the full process.
Your lawyer will explain how the agreement may impact your circumstances, and what will be expected of you. Once you have received the necessary advice, you will receive a signed statement from your lawyer, a copy of which is given to the other party.
What a binding financial agreement template can include
Let’s look at a possible binding financial agreement template you can use as a starting point for your own written agreement. This isn’t a replacement for professional assistance, but it can show how your agreement could look.
Identify the parties
At the top of the agreement, introduce the document and list the parties. For example:
This document is made on (DATE) under section (90B, 90C or 90D) of the Family Law Act 1975 between:
(FULL NAME OF PARTY A) of (CURRENT RESIDENTIAL ADDRESS) and
(FULL NAME OF PARTY B) of (CURRENT RESIDENTIAL ADDRESS).
Recitals
Explain the purpose of the agreement and the nature of the parties’ relationship. Each sentence is usually labelled with a letter to make them easier to refer back to. Here’s how it may be laid out:
(a) The spouses were married on (MARRIAGE DATE) and separated on (SEPARATION DATE).
(b) (PARTY A) is aged (AGE) and is employed as (NATURE OF EMPLOYMENT).
(c) (PARTY B) is aged (AGE) and is employed as (NATURE OF EMPLOYMENT).
(d) The parties propose to enter into this agreement on how to divide property, financial resources, and debts of each party.
(e) The property, financial resources, and debts of (PARTY A) at the time of this agreement are listed in Annexure A.
(f) The property, financial resources, and debts of (PARTY B) at the time of this agreement are listed in Annexure B.
(g) There are (NUMBER) children under 18 of the marriage:
(NAME OF FIRST CHILD) is (AGE).
(NAME OF SECOND CHILD) is (AGE).
(NAME OF THIRD CHILD) is (AGE).
(h) All of the children live with (PARTY A).
(i) Both parties acknowledge that they are entering into this agreement of their own free will and without coercion or duress.
The provisions should reflect your specific relationship, your purpose for the agreement, and when the BFA will come into effect. Clarify whether the BFA is:
A separation agreement between a married couple or de facto couple (Western Australian de facto couples are covered by state law).
A pre-nuptial agreement being formed before a marriage.
A post-nuptial agreement being formed during a marriage.
Operative provisions
This section sets out the details of the asset division. Major assets that BFAs often handle include:
Superannuation interests. Include the name of the superannuation fund and the value of the interest at a specified date. The BFA may include a superannuation agreement that splits one party’s super interest. Any amount payable to the other party usually depends on the fund and on a condition of release, such as retirement, being met.
Family home. The BFA may specify that one party will continue residing at the house. If this is the case, that party often takes responsibility for the mortgage. Alternatively, the house may be sold and the proceeds divided by a particular percentage.
Spousal maintenance. You can organise financial support for one party through your BFA. This could be a lump sum or periodic payments. Specify when the payments will be terminated, such as when the party gains suitable employment.
Using this template for a prenuptial or postnuptial agreement
A prenuptial agreement is a BFA made before marriage (section 90B of the Family Law Act). A postnuptial agreement is made during a marriage (section 90C). An agreement made after separation or divorce falls under section 90D. The same template structure applies to each, and the same independent legal advice requirements apply. See our page on prenuptial agreements in Australia for more detail.
What to bring to your first meeting with a lawyer
Being prepared for your meeting can help matters move quicker and potentially save you legal costs. You can also read about how much a binding financial agreement costs before you book. Your lawyer can help with important issues, such as the financial disclosure process. If you’re not transparent about your financial circumstances, the BFA may be challenged by the other party in court.
Some key items you may want to have with you include:
Important financial documents, such as bank statements, superannuation information, tax returns, and mortgage documents.
Existing agreements, which could include child support agreements, parenting plans, and superannuation splitting agreements.
Your BFA proposal. It’s important that your lawyer has the opportunity to review the agreement so they can advise you on how it may affect your interests and what your rights and obligations will be.
If you don’t feel a BFA is right for you, a consent order may be better if you and your ex-partner agree. Our comparison of binding financial agreements vs consent orders sets out the differences. If you can’t agree, a contested financial order may be needed. Informal agreements are generally not recommended as you have limited recourse if the agreement is breached.
Do you need assistance with a property settlement?
Our binding financial agreement lawyers have helped married couples and parties in a de facto relationship manage their property settlement for over a decade. Contact us today if you want to set up a free initial consultation.
