A Financial Agreement is a contract between parties setting out how property is to be divided. They can be entered into at the start of a relationship or during a relationship to provide asset protection and certainty in case the relationship ends. Financial Agreements can also be entered into, at the end of the relationship.
Financial Agreements are complex documents that essentially contract parties out of applying to the Court for a property settlement or spousal maintenance determination. If they are not drafted correctly, full financial disclosure is exchanged or proper legal advice is not obtained, they can be set aside and not enforceable.
There are strict rules that apply to Financial Agreements and both parties must obtain legal advice before entering into them.
As long as the Financial Agreement has been properly drafted and processes have been followed, Financial Agreements are enforceable by the Court.
Consent Orders
Parties who reach an agreement about parenting arrangements and/or financial arrangements can apply to the Court for the agreement to be made a Court Order. Parties do not need to attend Court to consider making the Orders sought by the parties.
For parties who are involved in Court proceedings, if an agreement can be reached about matters, the Court can make Orders by Consent, which are Consent Orders.
Consent Orders are orders made when parties reach an agreement, rather than being imposed by the Court during or at the conclusion of a a Court hearing.
Financial Information
When parties are negotiating financial property settlement arrangements, parties must be open and honest about their financial situation. This is achieved by exchanging financial information, called financial disclosure. The following is the type of financial information that should be exchanged between parties:
- Your 3 most recent taxation returns and assessments.
- Your 3 most recent pay slips.
- Bank statements for each account held by you for the past twelve months, including cash accounts, investment accounts, savings accounts, and loan accounts.
The following superannuation documents:- A superannuation statement for the end of the most recent financial year for each of the superannuation account held by you.
- A MyGov statement (or screenshot) showing a list of your superannuation funds; and
- For self-managed superannuation funds, the trust deed and the last three financial statements.
- Two market appraisals of each real property owned by you and/or the party.
- A Redbook value search for each motor vehicle owned by you and/or the party.
For a corporation (business), trust or partnership where you are a Director, Trustee (or Appointor) or Partner of, the following:- Financial statements for each (including balance sheets, profit and loss accounts, depreciation schedules and taxation returns) for the last three financial years.
- Any Business Activity Statement for the 12 months ending immediately before the first Court date.
- For any corporation, the most recent annual return, listing Directors and Shareholders; and the corporation’s memorandum and articles of association.
- For any trust, the trust deed.
- For any partnership, the partnership agreement.
- All documents containing evidence about:
- The financial contributions made at the commencement of cohabitation.
- Any inheritances, gifts or compensation payments received during cohabitation.
- Any purchase or disposal of property in the 12 months prior to and since separation.
- Any increase or reduction of liabilities since separation.
- Written records of any investments including stocks and shares.
- Social Security pension information or payment details.
- Details / records of long service leave accrued.
- Details / records of overtime worked in the previous 12 months.
- Details / records of any life assurance or disability insurance.
- Medical or psychiatric reports, if you have a health condition that impacts upon your earning capacity.