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26 March 2024

Financial agreements and lifestyle clauses – beware the risk

Authored by: Craig Turvey

In this week’s video, special counsel Craig Turvey discusses financial agreements and lifestyle clauses in your family matter, and how not to put these agreements at risk of being set aside.

Video transcript

My name’s Craig Turvey and I’m a special counsel at the Cooper Grace Ward Family Law Team. And today, I’d like to talk about financial agreements and lifestyle clauses.

Lifestyle clauses

So, lifestyle clauses are personal, sometimes moral issues that people want to incorporate into a financial agreement sometimes. So, for example, the main one is usually infidelity. Or sometimes people will include things, or want to include things such as one partner can’t gain a certain amount of weight, or even sometimes that there needs to be a minimum level of intimacy each week or within a certain timeframe. Those specific sorts of lifestyle issues in and of themselves on binding or enforceable. So, you can’t include them in a financial agreement.

Tying lifestyle clauses to financial connection

However, it’s in theory possible to include them if you can tie them into a financial connection. So, for example, if you said that you wanted a clause that if a partner who committed an act of infidelity would receive a lower payment than they would otherwise receive under the agreement, that of itself seems okay. However, there’s a problem. One, in terms of proving these types of things. So, infidelity, what does that mean? Also, if a partner is likely to receive a penalty or a punishment in terms of a payment or a monetary outcome from something like that, they’re not usually very upfront about it.

Gathering evidence can be difficult

So, getting evidence about those sorts of things can be difficult. And the other issue is enforceability. Judges are generally loathed to enforce those sorts of clauses. One would open up a Pandora’s box, in terms of what sorts of things could be in agreements. And it’s also some of these types of things, a moral type lifestyle, ambiguous sorts of issues that the courts generally try to steer away from. So, we generally, when we’re recommending to clients and they bring up those types of things, we try to encourage people not to include those types of clauses in a financial agreement. Again, it might be possible that you can include it and it might be enforceable, but chances are it may also not be. And the issue is, if you include something in the agreement and it’s potentially not enforceable or binding, it might attack the integrity of the entire agreement itself. So, to try and include something like that, that possibly puts the entire agreement at risk of being set aside is generally not a sound idea.

If you’re looking at entering into a financial agreement or if you have any questions about financial agreements, please don’t hesitate to contact me or one of the other family lawyers at Cooper Grace Ward.

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This publication is for information only and is not legal advice. You should obtain advice that is specific to your circumstances and not rely on this publication as legal advice. If there are any issues you would like us to advise you on arising from this publication, please let us know.

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Craig Turvey
Special Counsel

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