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pre nups or binding financial agreements

Discussion in 'Legal Issues' started by lightbulbmoment, 31st Jul, 2015.

  1. lightbulbmoment

    lightbulbmoment Well-Known Member

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    Just looking to see who has actually gone through with one an do they really mean something in this day an age?

    Not trying to be a doom and gloomer just looking for the facts as I may have to deal with this soon.
     
  2. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    I suggest BFA's all the time to clients.

    I do this because purchasing properties under joints names (non spousal) can seriously hurt your servicing.

    Easy to do and will give you the outcome you want. Engage your solicitor and get them to explain the legalities.

    Its a deed so it definitely can be used in court and its one of the first things solicitor ask for when the proverbial has hit the fan.
     
  3. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Yes they are binding under the family law act and can be made before, during or after a marriage or a relationship.

    Man in the pub will tell you they don't work, but they are binding if certain conditions are met. They don't always work because of the way they are set up.
     
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  4. jaybean

    jaybean Well-Known Member

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    What's the difference between a prenup and a BFA?
     
  5. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    Anna nicole smith vs the legal term.

    BFA's can happen between any parties at any time.
     
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  6. thatbum

    thatbum Well-Known Member

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    The problem is that they don't work in the way that most people want them to work. ie. "I want all my stuff to be protected".

    And I think to appreciate how they work, you need to have at least a basic understanding of how family law works.
     
  7. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Fully agree Thatbum. Do you advise on BFAs? I don't because it is a specialised area and they are extremely risky. However I know lawyers who have no idea of how they work yet are drafting them and advising one of the parties for a few hundred dollars.

    "prenup" is an american term.
     
  8. jaybean

    jaybean Well-Known Member

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    Extremely risky how? Can you elaborate?
     
  9. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    If the client's BFA doesn't hold up the lawyer will be the one blamed. from a lawyers point of view if something wasn't explained to the client and this caused the BFA to fail the lawyer will be negligent. sometimes something is explained, but there is need to retain evidence that it is explained so that will mean the lawyer should prepare a written advice for the client to put absolutely everything down that they explained. This further leads to risk as if something is missed - then evidence will be there to show it wasn't explained.

    There are large specialist family law firms which refuse to do BFAs now.
     
  10. jaybean

    jaybean Well-Known Member

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    Oh, risky for the lawyer. I see. Thanks.
     
  11. thatbum

    thatbum Well-Known Member

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    No I don't do much family law property work full stop - mostly children's matters. But yeah, I agree that its quite a specialised area, and I don't know many firms in WA that actively do them.

    Ha I haven't heard of many family law "dabblers" (as we call them) in WA that are game enough to do BFAs on the cheap.
     
  12. lightbulbmoment

    lightbulbmoment Well-Known Member

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    So its the taboo area no one wants to discuss
     
  13. thatbum

    thatbum Well-Known Member

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    Basically, once you do a bit of research or get some advice on how family law property assets are dealt with in a separation, and I'd be quite surprised if you still think you need/want a BFA.

    But 95% of the people that come to me wanting a BFA do so because they heard from their mate down the pub that they're "gonna lose half their stuff once their girlfriend moves in for 2 years".

    Get real.
     
    Last edited: 1st Aug, 2015
  14. lightbulbmoment

    lightbulbmoment Well-Known Member

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    Work in the fifo industry so have spoke to alot of older guys who have lost everything some even twice so asking here how they work.
     
  15. jaybean

    jaybean Well-Known Member

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    I assume kids were involved. I think without kids it's generally not as bad.
     
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  16. lightbulbmoment

    lightbulbmoment Well-Known Member

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    Most times yes but not all of them.
     
  17. wylie

    wylie Moderator Staff Member

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    And... just for some balance, I know several women who have lost everything, even with kids to support. I don't know even one man personally who has lost everything. I've said on SS many times in these types of threads, that it is fairly normal for women to know women who have been done over and also normal for men to know other men who have been done over.

    So, let's please not let this turn into one of "those" threads. Let's keep it real.
     
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  18. thatbum

    thatbum Well-Known Member

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    Ah ok - yes fifo workers do typically tell the best "I got cleaned out by my missus" stories.

    There's quite a few reasons why - here's a few off the top of my head.

    1. They're probably wildly exaggerating or flat out making stuff up - as blokes sometimes do in groups of other blokes.

    2. They typically have high incomes - which means they are covered in terms of "future needs" usually when compared to their partners. This component gets weighted more heavily when we're talking longer relationships or ones with children.

    3. Coupled with point 2, they typically have low a "asset pool to income ratio". Which means they might get "cleaned out" by the missus to the tune of their commodore ute and jet ski, the value of which they will make back in like 3 months.

    4. Family law takes into account both financial and non-financial contributions, a fact which seems most people don't understand. So generally the family court will be factoring what the other partner has been doing back at home (basically everything else in the relationship). Couple this with point 3 also.
     
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  19. jaybean

    jaybean Well-Known Member

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    #2 seems a bit unfair. "hey you've been working your butt off for 10 years saving every penny...but you did well, so I suppose you wouldn't mind having to, oh I don't know, do it all again."

    What if there were no kids involved and the partner was employable but just lazy and only had the occasional part time job? The partner that worked his / her butt off would be penalised for it? I totally understand if there are kids, because one partner has sat on the sidelines for so long they would have lost any chances of rebuilding their career. But when there's no kids involved it seems a little unfair they could end up with everything...
     
    Last edited: 1st Aug, 2015
  20. thatbum

    thatbum Well-Known Member

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    If there's no kids, and the other partner has been lazy for 10 years, then it might go differently. Or then again, maybe not. If you were the hard worker, why would you put up with a lazy partner for 10 years?

    That's not a rhetorical question by the way - the answer would probably be relevant to how the assets get split.