In this edition of ‘It depends’, special counsel Craig Turvey talks about the timing of financial agreements: when you should sign them, and whether it makes a difference if you sign them before or after a wedding.
Welcome to this edition of It Depends. Today we’re talking about the timing of financial agreements and when you sign them. Does it make a difference whether you sign before a wedding? After a wedding? Let’s have a chat about it.
What is a financial agreement?
A financial agreement is a private agreement between at least two parties. They’re often called prenuptial agreements in more colloquial way. But really, financial agreements cover the entire spectrum of relationships. So, you can have a financial agreement before you start living with someone, while you’re living together, after you’ve separated from you de facto relationship, before you’ve married, during your marriage or after your marriage. So, it covers every category of relationships.
When should I sign my financial agreement?
It depends. There have been a series of cases where people have had a wedding coming up and one partner has presented the other with a financial agreement and essentially said, you need to sign this or the wedding’s off or there’s been some other threats in the background, whether it’s been intended to be conveyed that way or not, but the effect of which is that the marriage wouldn’t go ahead if these people didn’t sign the financial agreement. In those cases, the financial agreements are often set aside and it creates a practical problem for lawyers in terms of trying to enforce it when there’s these issues about duress and the timing. So, our advice to clients is often, if you have a big milestone event coming up and your financial agreement is sort of contingent on that event. So, whether it’s a wedding or something of that kind of significance, the advice is usually one, you should probably have tried to pre-plan ahead and not left it to the last minute. But if you have and you’re in that category, usually you’re better off not signing until after the wedding has occurred. That way there’s not an issue in terms of someone alleging that they were under duress to sign before the wedding, or there’s none of those categories, these of risk that there would be if the agreement is signed just before a wedding. If, however, you’re in one of the other categories of financial agreements where it’s not before a wedding, it might be, for example, that you’re already in a de facto relationship with someone, and you both are just wanting to formalise what will happen if you separate down the track. Then there may be no timing issues in that sense, so it might not really matter in terms of timing as to when you sign the financial agreement.
What should I do?
If you and your partner are thinking about entering into a financial agreement or you’d just like to know more about the document and how it might impact you if you sign one, please don’t hesitate to contact me or one of the other family lawyers at Cooper Grace Ward.