It can seem overwhelming when you’re separating from a long term partner especially when it comes to dealing with who gets what.
If you’re in this position, you might be wondering:
Seeing a real life example of a separation agreement will remove the mystery around the separation settlement process and hopefully provide some clarity.
Separation Agreements are defined in the Australian Family Law Act of 1975 (the Act) as Financial Agreements. Once the agreement has been executed in accordance with the Act they become binding and referred to as Binding Financial agreements.
So I don’t confuse you with all these different terms I will just refer to Separation agreements from here on.
When you make a Separation agreement there are certain elements you need to cover. When we look at the case law surrounding these types of agreements it becomes clear that very specific language should be used and certain topics covered.
When you make a binding separation agreement you essentially lock the door to the family court in relation to the issues you cover in the agreement. If your agreement fails to address certain issues for e.g. spousal maintenance then that issue is open to be dealt with by the court at some point in the future.
All of these issues may arise in the future after separation, that’s why the entitlements of each partner need to be set out in the agreement so they do not become a point of contention that may leave your financial agreement vulnerable.
The point we are trying to make is this, your separation agreement needs to cover all these elements and more.
It also needs to contain certain elements that are specific to Australian Law taking into account case law and references to specific sections of the Family Law Act otherwise it will be invalid.
If you omit certain information or fail to comply with certain sections of the Act you run the risk that your agreement could be set aside by the courts, so it’s crucial to start with a document from reputable Australian company who specialises in Binding Financial agreements.
Don’t be fooled into thinking you can simply download a free separation agreement template from any overseas site and any lawyer will sign off on it. They will not.
In this case, it’s a marital separation agreement where the couple have decided that one party will transfer their share in the family home to the other (usually for a lump sum payment).
The individual clauses for this situation are similar whether the couple is married, divorced or de facto.
Every contract, financial or otherwise, contains a section that identifies the parties to the agreement.
The recitals is a section that describes important facts.
We’re not going to show all of the different clauses you can include but our professionally drafted Separation Agreement template does include everything you need to legally document your property settlement.
This clause identifies the children of the union, when they were born and whether one or both parties are taking care of them.
The parties will declare their wages (if employed) or income if self employed or not employed.
The agreement includes a clause excluding the power of the court.
When transferring property the parties need to identify the property, state which party is retaining the property, which party is transferring the property and whether money is being exchanged.
The agreement includes an Assets and Liabilities Schedule. This is the section where the partners will document the assets they own and the liabilities they owe, both individually and jointly.
We’re showing a blank Assets and liabilities schedule for one party, but it’s pretty much the same for the other party and your joint property.
Every document needs a signature panel. In the case of financial separation agreements you would not execute (sign) the agreement until each partner had received the required Legal Advice.
As stated above each partner is required to obtain independent legal advice BEFORE they sign the agreement. The Certificates of Legal Advice are provided by the legal practitioner and form part of the agreement, that is, they should be attached to the agreement before you sign.
A Separation agreement , whether you’re dealing with marital separation or divorce, or de facto separation allows you to document privately (between yourselves) all issues of a financial nature. It’s a cost effective and less stressful alternative to involving the court.