Property Settlement: Formalizing the Parties' Agreement

When partners decide to separate one of the issues they inevitably face is the property split. An amicable agreement on property settlement is always the best way to go. However, is it enough to protect your financial interests?

An informal settlement reached between the parties will be neither legally binding on either of them, nor legally enforceable. Either party may seek court orders on entirely different terms in future. For that reason it is essential to formalize the agreement.

There are two ways to do this: Consent Orders made by court or a Binding Financial Agreement entered into between the parties. So, what’s the major difference between the two?

Consent Orders

1. Consent Orders are court orders entered into by agreement between separated parties. They can be made in relation to either of the following issues: 
   • Property (including super) and financial settlement;
   • Spousal support;
   • Parenting arrangements.
2. An Application for Consent Orders setting out the proposed orders and other relevant information is filed with the Family Court or the Federal Circuit Court. The court must be satisfied that the suggested property orders are just and equitable and the parenting orders are in the children’s best interests. Only then will the court grant the orders.
3. Consent Orders are enforceable. Grounds upon which Consent Orders can be appealed, set aside or varied are fairly limited.

Binding Financial Agreements (BFA)

1. BFA are not reviewed by court.
2. It is not mandatory for BFA provisions to be within the range of the likely outcomes of court orders in the given circumstances.
3. Each party must receive an independent legal advice in relation to the agreement and its implications.
4. BFA cannot cover parenting arrangements.
5. They can be entered into before, during or after a marriage or de facto relationship.
6. The grounds for setting aside a BFA are significantly wider than for Consent Orders.

So, if separation is something that you are considering or, perhaps, already going through, obtaining quality legal advice of from an experienced family lawyer is a wise starting point. Szabo & Associates Solicitors are committed to providing our clients with the best expert assistance in family law matters and producing the best results for them. Contact us on 02 9281 5088 or fill out our online form and we will be in touch.