In the landmark decision of Thorne v Kennedy  HCA 49 in late 2017, the High Court of Australia unanimously decided to set aside two financial agreements on the basis that one party unfairly influenced the other.
This decision has raised the simple question as to whether or not these agreements are worth the paper they are written on.
The short answer is “yes”. When drafting such agreements, care needs to be taken to avoid “grossly unreasonable” agreements suggesting one party may have unfairly influenced another or engaged in unfair conduct.
Independent lawyers must give each party to a financial agreement independent advice as to its terms and their effect.
It must be noted that in the case referred to one party was given strong independent legal advice to not sign the agreement as it was “entirely inappropriate” but they signed it in any event.
To be valid, financial agreements must be fair to all parties, especially one who is less wealthy than the other.
Financial agreements, if properly drafted, are an important way of protecting assets when entering into a new relationship.
We have experience in drafting financial agreements and invite you to contact us should you have any queries regarding family law matters.