A prenuptial agreement, also known as a ‘prenup’, can be a valuable tool for both parties to protect their assets and interests prior to marriage. However, the law requires that certain elements must be present for a prenuptial agreement to be valid, and so it’s important to understand what makes a pre-nuptial agreement invalid in Australia.
At Justice Family Lawyers, we are across the complexities involved in drafting a prenuptial agreement, and have many years of experience helping couples to create a document that meets their needs and stands up to the legal system. In this article, we’ll discuss what makes a prenuptial agreement invalid and offer advice on how best to proceed.
- A prenuptial agreement must be in writing and signed by both parties
- Both parties should receive independent legal advice before signing the prenuptial agreement
- A prenuptial agreement can be invalid if it is found to be unfair or if there is any duress or fraud
- Couples should seek advice from Justice Family Lawyers to ensure their prenuptial agreement is legally binding
What makes a pre-nuptial agreement invalid in Australia?
Under the Family Law Act 1975, the law clearly stipualtes when a prenuptial agreement is invalid if any of these circumstances are met:
(1) A court may make an order setting aside a financial agreement or a termination agreement if, and only if, the court is satisfied that:
(a) the agreement was obtained by fraud (including non-disclosure of a material matter); or
(b) the agreement is void, voidable or unenforceable; or
(c) in the circumstances that have arisen since the agreement was made it is impracticable for the agreement or a part of the agreement to be carried out; or
(d) since the making of the agreement, a material change in circumstances has occurred (being circumstances relating to the care, welfare and development of a child of the marriage) and, as a result of the change, the child or, if the applicant has caring responsibility for the child (as defined in subsection (2)), a party to the agreement will suffer hardship if the court does not set the agreement aside; or
(e) in respect of the making of a financial agreement–a party to the agreement engaged in conduct that was, in all the circumstances, unconscionable; or
(f) a payment flag is operating under Part VIIIB on a superannuation interest covered by the agreement and there is no reasonable likelihood that the operation of the flag will be terminated by a flag lifting agreement under that Part; or
(g) the agreement covers at least one superannuation interest that is an unsplittable interest for the purposes of Part VIIIB.
Some of these clauses are quite general and vague in anture, so we have specific case law that explains what the courts mean by words such as “obtained by fraud”.
For specific advice about your prenuptial agreement, it is best to speak to an experienced family lawyer.
Pre-nuptial Agreements in Australia
A prenuptial agreement is a contract between two people who are planning to wed that sets out how their assets and liabilities would be divided in the event of a divorce or separation. These agreements are binding and can cover a range of issues including property rights, spousal maintenance and even estate planning.
In Australia, a prenuptial agreement is regulated under the Family Law Act of 1975.
To be legally binding, it must be in writing, must be signed by both parties and, both parties must have received independent legal advice before signing the prenuptial agreement in order for it to be deemed valid.
Without these elements, the prenuptial agreement may be invalid, leaving couples without the legal protection they seek. What’s more, not all prenuptial agreements are given the same weight in the eyes of the court. Agreements must also be entered into fairly, and couples must ensure that there is no duress or undue influence present when signing a prenuptial agreement.
Dealing With Disputes and Prenuptial Agreements
In the event of a dispute, couples should seek legal advice to work out if the prenuptial agreement is enforceable. Couples should also be aware that the court has the power to make changes to a prenuptial agreement if they consider it to be unfair or outdated.
This is particularly common if circumstances have changed since the prenuptial agreement was drawn up, such as if one partner is unable to maintain employment or if children are added to the family.
In this situation, candidates can ask the court to modify or set aside the prenuptial agreement if circumstances have changed significantly. Courts may also invalidate an agreement for a number of reasons, such as if one party withheld information, or if there was any duress or fraud.
Drafting a Valid Pre-nuptial Agreement
At Justice Family Lawyers, we understand the complexity of prenuptial agreements and the various factors that must be considered for it to be legally binding. We specialise in providing advice to ensure couples are on the same page, understand their rights and obligations, and create a prenuptial agreement that meets their needs, both now and in the future.
We can provide advice on how to draft a prenuptial agreement in accordance with the law, help to identify any areas of dispute, and assist with negotiations to reach a fair settlement. That way, couples can feel confident that their agreement is valid and can provide peace of mind, should the worst happen.
Principal of Justice Family Lawyers, Hayder specialises in complex parenting and property family law matters. He is based in Sydney and holds a Bachelor of Law and Bachelor of Communications from UTS.