Property & Financial Agreements in Family Relationships
PROTECT YOUR PROPERTY RIGHTS AND SECURE PEACE OF MIND
Clear property arrangements can protect assets, reduce uncertainty and give both parties confidence about their financial future. Whether you are planning a marriage or de facto relationship, already together or separating, clients from Victoria and any other Australian state (except West Australia, which has different rules) can formalise financial arrangements using a property financial agreement under the Family Law Act 1975 (Cth).
We use the term "Property and Financial Agreement" (PFA) to describe a financial agreement made under the Family Law Act 1975 (Cth). Although these agreements are often called “Binding Financial Agreements”, binding effect is not automatic: strict legal requirements must be satisfied, each party must receive independent legal advice, and the Court may set an agreement aside in specified circumstances.
Use a Property Financial Agreement (PFA) at Any Stage
A Property Financial Agreement (PFA) can set out how property, liabilities, superannuation and, where appropriate, spousal maintenance will be dealt with. A properly drafted PFA can help to keep the financial matters it covers outside the Federal Court’s property jurisdiction.
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Before a relationship or marriage — a prenuptial agreement can record agreed protections before living together or marrying.
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During a relationship or marriage — a postnuptial or relationship agreement can address changing assets, businesses, inheritances or family circumstances.
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After separation — a separation agreement can finalise agreed financial arrangements without contested property proceedings.
Each person must receive independent legal advice from a separate Australian legal practitioner before signing. A PFA can be set aside in circumstances allowed by the Act, so full disclosure, precise drafting and correct execution are essential.
Resolve Property Settlements Fairly
If an agreement cannot be reached between the parties, the Federal Circuit and Family Court of Australia can make property orders. A negotiated outcome may instead be formalised through consent orders or, where suitable, a PFA can be drafted at any time.
Broadly, if the Court gets involved in your property and financial affairs, it considers four linked questions:
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Identify and value the property pool. This includes assets, liabilities, financial resources and superannuation held by either or both parties.
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Assess contributions. The Court considers financial and non-financial contributions, including work as a homemaker or parent and the economic effect of family violence on contributions.
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Consider current and future circumstances. Relevant matters may include age, health, income, earning capacity, financial resources, care of children, housing needs and the economic effect of family violence.
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Decide whether the result is Just and Equitable. The Court must be satisfied that making orders—and the final division—are fair in all the circumstances.
Understand Your De Facto Rights
Under federal law, a de facto relationship exists when two people who are not legally married live together as a couple on a genuine domestic basis. It can include same-sex couples, and no single factor determines whether the relationship qualifies.
The Court may consider the relationship’s duration, shared residence, sexual relationship, finances and property, mutual commitment, children, registration and how the relationship was presented publicly. To seek property or maintenance orders, there must also be a relevant geographical connection—such as to Victoria—and usually at least one of the following:
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the relationship lasted at least two years in total
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the couple has a child
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the relationship was registered under applicable State or Territory law
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one party made a significant contribution and serious injustice would result if no order were made
Eligible de facto partners generally have access to the same Federal property-settlement framework as married couples.
Why Professional Advice Matters
An informal or ‘handshake’ arrangement may not be enforceable and may not prevent a later property claim by one party. Formalising an outcome through consent orders or a compliant Property Financial Agreement can help provide certainty and reduce future disputes.
Legal advice helps identify hidden risks, disclosure issues, tax and superannuation consequences, and whether the proposed outcome protects your interests. Where assets, income or business structures are complex, our experience in forensic accounting can also assist with tracing funds and testing financial evidence.
Do Not Miss the Time Limits
These time limits apply to applications for property-adjustment court orders—not to the making of a Property Financial Agreement:
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Married couples: Court proceedings must generally be commenced within 12 months after a Divorce Order becomes final.
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De facto couples: Court proceedings must generally be commenced within two years after separation.
Book a Free Initial Telephone Assessment
Whether you are planning ahead, restructuring your affairs or navigating separation, timely advice can help protect what matters and bring clarity to the next step. Contact our firm to book a confidential free telephone assesssment and help secure your financial future.
This information is general only and is not legal advice. Your rights and time limits depend on your circumstances.