Binding Financial Agreements: Are They Enforceable?

Joseph Maher • August 16, 2016

How Binding Are So-Called Binding Financial Agreements?

The Family Court's Recent Decision

A recent decision of the Family Court has put in doubt just how binding are the so-called 'binding financial agreements'.

While the intention of the law is to allow people to structure and plan for their financial affairs in the event of a separation, the Family Court, protective of its power to make overriding property adjustment orders, has in a very recent decision, taken a very strict approach in interpreting the formal requirements of such agreements.

Requirements for Binding Financial Agreements

The requirements of the Act must be strictly adhered to including:

That both parties receive independent legal advice before signing the agreement;
That each solicitor provide a certificate attesting to the very specific requirements of the Act;
That both parties sign the one agreement and not two counterpart;
Amendments, particularly handwritten amendments, should be avoided.

Importance of Reviewing Existing Agreements

All existing Binding Financial Agreements (pre-nuptial agreements) should be reviewed in light of such recent decisions so as to ensure that they are indeed binding.