Key Differences between Consent Orders and Prenuptial/Binding Financial Agreements (BFAs)
Understanding the unique aspects of Binding Financial Agreements (BFAs) and Consent Orders is essential whether you’re leaning towards the definitive nature of BFAs or you prefer the scrutiny of the courts with Consent orders to ensure the agreement is fair. It's vital to comprehend their differences to make a choice that best suits your situation. With clear communication and detailed analysis of these complex legal issues, we aim to guide you with empathy and expertise through this challenging landscape.
The primary distinctions are as follows:
1. Court involvement
Consent Orders require an application to be filled with the court and are only issued if considered “just and equitable”, while Binding Financial Agreements (BFAs) are private contracts not overseen by or registered with the courts.
2. Fairness
Consent Orders can only be made in circumstances where the court deems the orders sought to be “just and equitable”. However, BFAs do not have fairness as a prerequisite which means one party can walk away with a more favourable outcome.
3. Involvement of Solicitors
Consent Orders can be drafted and filled without seeking independent legal advice, whereas BFAs necessitate independent legal advice for all parties, ensuring that each party understands their rights, obligations, and the implications of the agreement.
4. Property and Parenting matters
Consent Orders can cover both financial and parenting issues, but BFAs are limited to financial matters.
5. Financial Disclosure
The Family Court mandates that when proposing orders, all parties must exchange full and frank financial information, including pertinent documents. Failure to do so could lead to a miscarriage of justice and the potential overturning of the orders.
However, the requirement to disclosure financial information is not required for BFAs. Parties may choose to opt out of certain Family Law Act obligations, including the disclosure requirement. Nonetheless, it is important to note that a BFA can be set aside if there's nondisclosure of significant information involving fraud.
6. Enforcement
Both Consent orders and BFAs are court enforceable. Consent orders can be more easily varied or set aside by the court in circumstances where there has been a significant change of circumstances.
7. Costs
The fees for BFAs and Consent Orders can differ, especially if negotiation services are needed. If the parties have already reached an agreement, a set fee can be applied for document preparation. Typically, lawyers charge by the hour for negotiation. Unlike Consent Orders, BFAs don't incur a court filing fee because they aren't registered with the court. However, BFAs might end up costing more since independent legal advice is required for both parties, which isn't the case for Consent Orders.
Choosing between a BFA and Consent Orders is important, and understanding their differences is key. We're committed to guiding you clearly and carefully through these complex legal options with understanding and expertise. Contact us for tailored advice from one of our family law solicitors.
