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pre nuptial agreement

“Pet-Nups” - who keeps the pet?

Under Australian family law, pets are considered property. But for many people pets are more than property and often considered a member of the family.  One of the hardest problems to solve at the end of a relationship or marriage can be who gets to keep the pet cat, dog, fish, turtle, axylotl or snake.

 This may be able to be avoided at the start of the relationship or marriage with a legally enforceable agreement in place specifying who is to keep the pet.  A “pre-nup” or in this instance a “pet-nup” or “pup-nup” if it is a dog may be advisable.   

 Binding Financial Agreements under the Family Law Act 1975, allow to agree at the start of or during the relationship or marriage on how assets are to be divided if there is a separation.   One of the problems in enforcing a pre-nup after a long term relationship is that you are uncertain what the futures assets will be.   

You could have a “pet-nup” (a binding financial agreement) limited to just one asset which simply specifies who is going to own a specified pet.  Alternatively you could potentially say in the agreement that if a pet is purchased during the relationship/marriage then the person with proof of payment of purchase gets to own the pet.

It is important to remember that the law only specifies who gets to own a pet, the same way they would consider who gets to keep an asset, the law is not able to enforce "visitation" rights for pets.

If you do not enter into a “pet-nup” the Court has the power to make the orders with respect to property. This allows the Family Courts to make orders about who will have ownership and possession of a pet.  In determining which party is to retain the pet the Court may have regard to the following:

-       Which parties’ name the pet is registered in;

-       Which party undertakes the majority of the responsibilities in the care of the pet; and

-       Which party has appropriate housing for the pet.

A referendum was held in Switzerland in 2010 regarding a proposal by animal rights activists to appoint independent lawyers for pets as to time spent with each party representing the “best interests” of the pet. This proposal has not been adopted in Australia to date.  To talk to our animal-friendly family lawyers, call us on 03 9614 7111 or send an email to melbourne@nevettford.com.au

 

Would you sign a prenup if your fiance threatened to cancel the wedding?

Binding Financial Agreements (BFA’s) or prenups as they are commonly known are meant to be voluntary, and each party must enter into the agreement of their own free will, and not because they have been pressured into it by the other party.  The High Court will consider the issue of “duress” in the matter of Kennedy & Thorne [2016] FamCAFC 189 where Ms Thorne claims she was forced to sign the binding financial agreement — because her husband-to-be, “Mr Kennedy”, said he would cancel the wedding if she refused.  Her legal team argues that this meant she was “under duress”, and that the agreement should therefore be declared void by the court.

Mr Kennedy was a divorced, 67-year-old property developer worth between $18 million and $24 million, while Ms Thorne was half his age with no assets.   They met on a dating site and he organised to fly to her home country in the Middle East to meet in person, promising to marry her if they hit it off.  After a four-year marriage, she is contesting a BFA she signed on the eve of the wedding, which left her with just $50,000 of his fortune and she is now seeking a bigger slice of his wealth.

The High Court will examine the question of whether threatening to “cancel the caterers” amounted to “unlawful duress”.  Mr Kennedy has passed away while the trial was part heard and the case will be carried on by the husband’s estate.  The estate, it seems will counter that Ms Thorne willingly signed the agreement after obtaining independent legal advice, and was not concerned at the time about the amount of money she would be left with if the marriage ended. 

The High Court is due to hear the appeal on 8 August and will need to clarify issues around duress, undue influence and unconscionable conduct.

If your married, intending to marry, in a de-facto relationship, have assets or have been gifted an inheritance then it could be time to think about a BFA.  However please ensure that if you are considering if you want to have a BFA, don’t leave it until the day or two before the wedding, and don’t threaten to call the whole thing off if your beloved doesn’t sign. 

Binding Financial Agreements (BFA)

Parties can enter into a BFA before marriage (s 90B), during the marriage (s 90c), after a divorce (s 90D), before entering into a de facto relationship (s 90UB), during a de facto relationship (S 90UC) or after the breakdown of a de facto relationship (s 90 UD). Both heterosexual and same-sex (LGBT) couples can enter into a BFA.

A Binding Financial Agreement (or BFA) is a written document signed by both parties to a relationship which contains provisions about the division of property in the event of a separation. It must comply with either Part VIIIA or Part VIIIAB of the Family Law Act 1975 and parties to the Agreement must obtain independent legal advice about the Agreement.

A Binding Financial Agreement is often referred to as Prenuptial Agreement (prenup or prenups), Cohabitation Agreement, Postnuptial Agreement (postnup or postnups), Property Settlement Agreement or Divorce Settlement Agreement.

Binding Financial Agreements entered into prior to or during a Marriage or De Facto Relationship

Advantages

  1. It allows parties to protect assets and financial resources which existed prior to the relationship from a claim for division after separation.
  2. It allows parties to protect an inheritance or gift they received prior to the relationship, during the relationship or after separation.
  3. In some circumstances, it allows parties to remove their respective responsibilities towards the other to provide spousal maintenance.
  4. It provides a degree of certainty to the parties as to how their assets, financial resources and liabilities will be treated in the event they separate and remove any anxieties they may have about entering into a relationship in the first place.
  5. It allows parties to be clear about the responsibility of debts such as credit card debts, home loan, personal loans, business loans, etc.
  6. In conjunction with a will, it allows parties to plan their estate and ensure that their children, especially any children from previous relationships, are not disadvantaged in the division of the estate.
  7. It allows parties to determine their property settlement without the intervention of the Courts and costly legal disputes.

Examples of when a Binding Financial Agreement may be useful

  1. When one party has significantly more assets and financial resources than the other, a BFA (whether entered into before or during the relationship) allows that party to keep those assets and financial resources safe from the other in the event that they separate.
  2. When both parties have significant assets and financial resources and they both wish to quarantine those assets and financial resources from the other in the event that they separate.
  3. When one or both parties have children from previous relationships and wish to protect all or part of their assets and financial resources for their children.

Binding Financial Agreements entered into after separation

Advantages

  1. It allows parties to keep the terms of their settlement agreement away from the eyes of the Courts, the Australian Taxation Office (ATO) and other persons and organizations.
  2. It allows the parties more flexibility in how they wish to determine their financial matters.
  3. In some circumstances, it allows parties to remove their respective responsibilities towards the other to provide spousal maintenance.

Examples of when a Binding Financial Agreement may be useful

  1. When parties have complex property, business or trust arrangements which they wish to keep as private as possible.
  2. When the settlement terms are more in favour of one party and as a result may not be approved by a Court.
  3. When the parties need a quick resolution to their financial affairs and wish to avoid an agreement which requires the review and approval of a Court (consent orders).

We have a competent and approachable team of family lawyers who is able to assist you in determining the right kind of Binding Financial Agreement for your circumstances. We recommend you contact us on 03 9614 7111, or email us out of hours on melbourne@nevettford.com.au.

Protect Your Family’s Investment

Many people choose to invest in property in Australia for their retirement, as a source of income, or to assist their children with somewhere to live. This is true of both local buyers and overseas purchasers. When you do this however, you should turn your mind to how Australian family law will consider this type property in the event that there is a separation involving yourself or your children in the future.

If a parent buys a property for their child, their child marries and then divorces, it is not as simple for the parents as getting their money back out of the property ‘dollar for dollar’. Australian family law will usually consider this assistance from a parent a type of financial contribution, not a loan, and is not inclined to repay the money as if it were a normal debt. Often people will walk away from a relationship having lost not only a lot of money themselves, but also a lot of their family’s money, resulting in increased family tension.

At Nevett Ford Lawyers, our large and experienced team advise and assist with a range of solutions to help to protect you and your family in these situations. When you purchase a property, we recommend considering a Binding Financial Agreement under the Family Law Act to protect yourself and your children, as well as ensuring loan documents are drafted to assist in recovering money if necessary. We are also able to draft Inheritance Agreements to help to protect inheritances from family law disputes in the future. We can even draft Agreements that will operate for couples who are not yet married but may do so in the future and want to make just one document to cover these different situations.

It is important to look at these types of documents and have them prepared when everything is going well, to protect you in the event of future uncertainty. Determining the right kind of document for your circumstances is a skill at which our lawyers excel, and we recommend you contact us to enable you to make this important decision in an informed manner. Our number is 03 9614 7111, or email us out of hours on melbourne@nevettford.com.au