At the end of a marriage, civil union, or de facto relationship, parties often choose to enter into a relationship property agreement as a more flexible arrangement than applying to divide their property through the Family Court. 

It is important to remember that any relationship property agreement must meet the following requirements:

  1. It must be in writing and signed by both parties;
  2. Each party to the agreement must have had independent legal advice as to the effects and implications of the agreement before signing it;
  3. The signature of each party to the agreement must be witnessed by an independent lawyer of each party, and the lawyer must have given that party independent legal advice as to the effects and implications.

One instance a couple entered into a relationship property agreement upon their separation without obtaining independent legal advice. They thought that by not obtaining this independent legal advice they would save money and they would be able to maximise their settlement division. 

The agreement was drafted by the parties without any specialist legal advice and included a clause for a delayed settlement. 

A delayed settlement is when there are often one or more separation dates with the later date being the final day of separation when a certain event occurs, such as the sale of a family home, a child of the relationship leaving school or leaving home, or a significant change in circumstances for either party such as moving away out of the area or a change of employment.

By the time the delayed settlement occurred relationship property shares in a company that were held at the time the informal agreement was made were significantly devalued, and the party that was to take the shares lost tens of thousands of dollars.

Had the agreement been advised on by a lawyer in the first instance advice could have been given around the values of property, and how to divide that property, and loss minimised.

As most of the other valuable property had already been divided there was little remedy available to compensate the party who suffered the loss, other than to seek to declare the informal agreement invalid, and then spend significantly greater costs to try perfect the division through the Court.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.