BFA case studies

Black & Black[2008] FamCAFC 7

Mr and Mrs Black were married for 18 months during which they entered into a BFA. Mr Black sought to have the BFA set aside on the basis that it did not comply with the statutory requirements for a BFA at the time. The trial Judge found the BFA to be binding. However, on appeal, it was found that the BFA did not meet the statutory requirements of s90G(1)(b) because it failed to include a statement that both Mr and Mrs Black had received independent legal advice in relation to all matter set out in the then s90G(1)(b). The BFA was set aside and a retrial of the parties’ property settlement claims was ordered. Following this case, in January 2010, The Amendment (Effi­ciency Measures) Act no 1 2009 was enacted to enable BFAs to be valid and binding even if there was not necessarily strict compliance. This legislation applies retrospectively for those agreements signed before 2009 and future agreements.

Thorne & Kennedy [2017] HCA 49

This matter was heard by the High Court of Australia and considered the signing of a prenuptial and post nuptial Agreement between a couple. Mr Kennedy told Ms Thorne that she had to sign a s90B prenuptial agreement prepared by his solicitor before they were due to get married. Ms Thorne signed the Agreement 4 days before the wedding despite receiving legal advice not to sign the Agreement. Following, the wedding, Mr Kennedy again told Ms Thorne to sign a s90C post- nuptial Agreement that was drafted in similar terms as the previous Agreement. Ms Thorne again signed the Agreement against legal advice. Following separation, Ms Thorne applied to the Federal Circuit Court of Australia for both Agreements to be set aside. The primary Judge set aside both agreements due to duress/undue influence. The husband appealed. The Full Court of the Family Court upheld the appeal. Ms Kennedy appealed to the High Court. 

The High Court set out the following list of risk factors in relation to Financial Agreements:

  1. Whether the agreement was offered on a basis that it was not subject to negotiation;
  2. The emotional circumstances in which the agreement was entered, including any explicit or implicit threat to end a marriage or engagement;
  3. Whether there was any time for careful reflection;
  4. The nature of the parties’ relationship;
  5. The relative financial positions of the parties; and
  6. The independent advice that was received and whether there was time to reflect on that advice.

So the Agreement was set aside after all, as it turns out Mr Kennedy had passed away by this stage. So Ms Kennedy had to battle it out with his estate.

Piper & Mueller [2015] FamCAFC 241 (Ryan, Murphy & Aldridge JJ) 

Financial agreements – Full Court holds that de facto partners who are also contemplating marriage can make a combined Part VIIIA and Part VIIIAB financial agreement – Validity of certificate of legal advice.

Parke [2015] FCCA 1692 (Judge Howard) 

Financial agreements – Husband’s misrepresentation of his assets held not to constitute fraud – Wife found to have been exploited by husband – Agreement set aside on the ground of unconscionable conduct .

The Pole dancer case

Wallce & Steizer is a landmark decision that has established that although wording in the Family Law Act before 2010 was relaxed in regards to the requirement for binding financial agreements to include statements that legal advice had been given to clients and signed by solicitors, BFAs created within those times are still valid.

Jonah & White [2011] FamCA 221 – Just a Mistress

Justice Murphy held that no de facto relationship was established for the reason that ‘absent from the relationship … was the ‘merger of two lives into one’, or the ‘coupledom’ as earlier referred to’, and thus that there was no de facto relationship. Justice Murphy explained, ‘In my opinion, the key to that definition [of being in a defacto relationship] is the manifestation of a relationship where ‘the parties have so merged their lives that they were, for all practical purposes, ‘living together’ as a couple on a genuine domestic basis’. It is the manifestation of ‘coupledom’, which involves the merger of two lives’.

 In this case:

  1. the parties kept their relationship, of 17 years, secret
  2. the parties did not socialize together as a couple,
  3. She had never met his kids.
  4. the parties lived in separate homes;
  5. the parties did not co-mingle assets,
  6. there was no joint bank accounts
  7. they did not have any joint expenses
  8. they didn’t know one another's friends or family
  9. they did not present as a 'couple to the world'

 Factors pointing towards a De Facto relationship were:

  1. That the two had engaged in a sexual relationship exclusive of other partners (excluding his wife and a few one night stands),
  2. Mr White supporting Ms Jonah financially up to $2,500 per month for 11 years; and
  3. Mr White contributing a lump sum of $24,000.00 to Ms Jonah’s home.
  4. They travelled overseas together

There is a fine line between "boyfriend/girlfriend" and ‘De Facto’ status. This is a discretionary area of law. That means it comes down to your Judge on the day.

 In Jonah and White, the trial judge held that the parties were ‘two people who each sought to, and did in fact, maintain separate lives’, even though they met regularly over a lengthy period of time.

Were this couple ‘living together’ as a couple on a genuine domestic basis’? Maybe. This Judge was of the view that Mr White was off the hook for a claim. Ms Jonah appealed the decision but she lost. The Full Court of the Family Court said this:

"His Honour’s conclusion that the proper focus of his determination was the nature and quality of the asserted relationship rather than a quantification of time spent together was, in our view, entirely correct".

Get in touch today for a fixed fee quote

Don't hesitate and regret it later! Remember your Binding Financial Agreement or pre nuptial agreement is a document that is negotiated and agreed between you and partner before you both sign it. That way both parties have a say about the content of the Agreement and the end result, and there are no hidden surprises. 

It is a fair way to protect the assets and wealth you both bring to the relationship and to document what happens if ever you break up in the future.

Fidan is a family lawyer with a difference

Family Law Accredited Specialist

Specialist accreditation is held by less than 6% of the profession in NSW

Fidan went on national television to talk about her own Financial Agreement and genuine belief that all things are not equal in family law. Fidan is a genuine divorce lawyer who is not shy to say what she really thinks about the importance of pre nups in a relationship. Based in Sydney NSW, Fidan can help you negotiate and draft a Financial Agreement of exceptional quality. What more can you ask for?

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Fidan is a family lawyer with a difference

Family Law Accredited Specialist

Specialist accreditation is held by less than 6% of the profession in NSW

Fidan went on national television to talk about her own Financial Agreement and genuine belief that all things are not equal in family law. Fidan is a genuine divorce lawyer who is not shy to say what she really thinks about the importance of pre nups in a relationship. Based in Sydney NSW, Fidan can help you negotiate and draft a Financial Agreement of exceptional quality. What more can you ask for?

Read More