Do I need a Binding Financial Agreement or Consent Orders?
WHICH ONE IS RIGHT FOR ME?
Did you know our lawyers at David Tamanika Solicitors do Consent Orders and Binding Financial Agreements?
When a couple decides to separate or divorce, they will need to discuss and agree on how to divide their assets and liabilities. There are two main ways to formalise these agreements: through a Binding Financial Agreement or Consent Orders. Both legal documents can be used to achieve similar outcomes; however, there are some key differences between them.
CONSENT ORDERS
Consent Orders are legal documents filed with the Family Court of Australia. They are the formal agreement between the parties involved in a divorce or separation that outlines how their property, assets and liabilities will be divided. Consent orders are legally binding agreements and are enforceable by the Court.
To obtain Consent Orders, both parties must agree on how they will divide their assets and liabilities. All preliminary negotiations will usually be discussed through the parties’ lawyers. Once drafted and finalised, the agreement must be in writing and filed with the Family Court of Australia. The Court will then review the agreement and, if satisfied, will issue Consent Orders. Once the Consent Orders have been issued, they become legally binding and enforceable by the Court.
One of the advantages of Consent Orders is that they can cover a wide range of issues, including property settlement, parenting arrangements, and spousal maintenance. They are also flexible and can be amended by the parties involved if their circumstances change. However, obtaining Consent Orders can be time-consuming and expensive, as it requires the involvement of the Court.
BINDING FINANCIAL AGREEMENTS
A Binding Financial Agreement (‘BFA’) is a private agreement between the parties involved in a divorce or separation that outlines how their property will be divided. Unlike Consent Orders, BFAs do not need to be filed with the Court. However, they must still comply with certain legal requirements to be enforceable.
A BFA must be in writing, signed by both parties and witnessed by an independent lawyer to be valid. Before signing, each party must also receive independent legal advice about the agreement and its effect on their rights.
MAIN DIFFERENCES
One of the advantages of BFAs is that they are quicker and less expensive to obtain than Consent Orders. They can also cover various issues, including property settlement, parenting arrangements, and spousal maintenance. However, BFAs can be more difficult to enforce than Consent Orders, as the Court does not review them.
Another important difference between BFAs and Consent Orders is that BFAs can be set aside by the Court in certain circumstances, for example, if one party did not receive independent legal advice before signing the agreement or if the agreement was obtained by fraud, duress, or undue influence.
In conclusion, Consent Orders and Binding Financial Agreements are useful tools for separating couples to formalise their property settlement arrangements. While both legal documents can achieve similar outcomes, they have some key differences.
Please call the office at David Tamanika Solicitors on 03 5331 7944 to discuss your needs further.
