RECRUITMENT

BF
FAMILY
BUSINESS
WESTERN SYDNEY
WWW.WSBA.COM.AU
De-facto or marriage?
Do you know the
difference?
CIRCUMSTANCES
By Chelsea Winter
Solicitor Watts McCray
WE have previously discussed the important
business considerations that
are necessary and essential when first
commencing a business and the importance
of pre-planning should events such
as the death of the business owner occur.
Another important consideration must be
to consider your personal circumstances and
current relationships.
Most people are unaware that important
legal consequences could follow if you are
entering into a de facto relationship, getting
married, or having an affair.
It is clear to most that marriage creates
legal consequences but this is also true for de
facto relationships and even affairs.
When clients who are married or in a de
facto relationship, and have had an affair at
work, they may come to seek legal advice as
the relationship has broken down.
However, they have not been fully
informed of the consequences flowing from
their actions, and how that impact upon the
advice they may receive as a result of the
breakdown of the relationship.
What is a de facto relationship?
So, what is a de facto relationship?
In the past, what constitutes a de facto
relationship, and the legal implications which
arise as a result of being involved in a de facto
relationship, have been widely defined and
have varied between states and territories
within Australia.
These include definitions contained in
Commonwealth or territory legislation, including
but not limited to the Family Law Act
1975 (Cth) and the De Facto Relationships
Act 2011 (NT). However, most definitions include
that a de facto relationship is a relationship
between:
• Two adults (over the age of 18 years);
• Who are not legally married to each
other; and
• Are not related by family; and
• Having regard to all the circumstances
of their relationship, they have a relationship
as a couple living together
on a genuine domestic basis.
The law that currently applies to de facto
relationships has largely rectified these past
inconsistencies in the law. Under the current
law, certain persons leaving an unsuccessful
de facto relationship can pursue property
settlements in much the same way as married
couples who have separated, relying on the
same law and using the same court systems
“In the past, what
constitutes a de facto
relationship, and the legal
implications which arise as
a result of being involved
in a de facto relationship,
have been widely defined
and have varied between
states and territories within
Australia. “
(excluding Western Australia).
This includes same sex de facto couples
and couples who may not necessarily have
lived together during the relationship.
The family law court will consider the
tenure of the relationship, the financial dependency
on the parties and the public reputation
of the relationship.
Taking all the above into consideration,
you may in fact be in a de facto relationship
which can have legal and financial consequences.
What can you do to
protect yourself?
You may wish to enter into a binding
financial agreement (BFA) to prevent future
disputes and create certainty.
By entering into a BFA, more commonly
known as a prenuptial agreement or ‘pre-nup’,
you can determine before commence a relationship
(whether to marry, or to live together
as de facto couples) how your assets will be allocated
should your relationship break down,
and you prevent any financial or property
dispute from ending up in Court.
Prenuptial agreements law can be found
within the Family Law Act 1975 (Cth). If you
and your future partner/ spouse wish to make
a prenuptial agreement in Sydney, we can ensure
that it is binding and legal in accordance
with the law.
What are the consequences
if you commenced the
relationship without a BFA?
Binding financial agreements can also be
made during a relationship/ marriage, and
upon the breakdown of a relationship/ marriage.
At Watts McCray, we specialize in
prenuptial agreements and other financial
agreements for couples who want their individual
and shared interests to be similarly
protected.
Importance of considering a BFA
For those people who have been in
unsuccessful relationships before, or who
perhaps have significant wealth prior to entering
into a relationship/ marriage, or who
simply desire the certainty of knowing they
will not end up in Court fighting over the
division of assets if a relationship does not
work out, well drafted prenuptial agreements
by lawyers can be very useful and welcomed
legal documents.
If you are a business owner, a BFA is
something that you should consider entering
into as a relationship breakdown could have
significant consequences for your business.
The business may be an asset that has to be
divided in any property settlement following a
breakup of the relationship.
Therefore, it is essential owners to turn
their mind to considering whether a BFA
is something that they should enter into to
protect the future of their business.
22 WESTERN SYDNEY BUSINESS ACCESS SEPTEMBER 2015