A prenuptial agreement, also known as a prenup or premarital agreement, is a legal document for couples who are planning to live together either as a married couple or in a de facto relationship.
The agreement covers what will happen in the event the relationship breaks down through divorce or separation, with regards to the couple’s finances and property and how these will be divided.
Prenuptial agreements are becoming increasingly popular in Australia, particularly among high net worth individuals who wish to protect their assets and income.
Under South Australian law, prenuptial agreements are recognised as valid and enforceable, provided they meet certain requirements. For a prenuptial agreement to be valid, it must be in writing and signed by both parties. The agreement must also be entered into voluntarily, with both parties receiving independent legal advice.
Prenuptial agreements can be used successfully to cover a wide range of issues, such as property division, debts and liabilities, spousal support in the event of divorce, the treatment of inheritances and pension entitlements, parenting matters - they can even deal with pets.
A clause commonly found in prenuptial agreements is one that states that in the event of divorce, each party will keep their respective assets which they brought to the marriage, rather than dividing them equally.
Prenuptial agreements can be ineffective if the agreement is found to be unfair or unconscionable. A court may also find that the prenuptial agreement is unenforceable if one or both parties had not received independent legal advice, did not fully understand the terms of the agreement at the time it was entered into, or the agreement did not disclose all of the assets or liabilities.
In conclusion, prenuptial agreements are powerful and effective tools for any couple looking to kickstart a successful long-term relationship. However, it can be daunting to determine what you and your partner need to solidify your prenup. Specifically, what clauses should be included and what you need to consider when developing them.
It is essential to seek legal advice when drafting a prenuptial agreement to avoid uncertainty, potential hostility if the relationship fails, and costly litigation should the matter end up in court.
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*This information is current at the time of publication. For accurate legal advice, please contact Scammell & Co on 08 8440 270.
