When a de facto relationship ends, questions about money, property, and responsibilities can quickly become overwhelming. Unlike married couples, those in de facto relationships often wonder how their assets will be divided or whether they need to involve the courts. One of the most practical ways to resolve these issues is through a De Facto Separation Agreement, also known as a Binding Financial Agreement (BFA).
This legal document allows couples to determine how their finances and assets will be handled after separation, without the stress and expense of litigation. It provides structure, clarity, and peace of mind for both parties.
What is a De Facto Separation Agreement?
A De Facto Separation Agreement is a legally binding contract that sets out how a separating couple will divide their property, assets, and debts. It can also include arrangements for financial support and parenting responsibilities.
Unlike court orders, these agreements give couples the freedom to negotiate their own settlement terms. This flexibility helps minimise conflict and saves both time and legal costs. Many couples seek guidance from separation lawyers in Sydney to draft and formalise an agreement that reflects their unique circumstances while complying with the Family Law Act 1975.
The agreement can cover property distribution, superannuation, business interests, bank accounts, vehicles, personal items, and even the division of shared debts. It ensures that both parties understand their financial obligations moving forward, reducing the risk of future disputes.
Who Qualifies for a De Facto Separation?
To be considered de facto under Australian law, the couple must have lived together on a genuine domestic basis. This involves more than just sharing a home — it includes the way the couple presents themselves publicly, the level of commitment, shared finances, and the nature of their personal relationship.
Generally, couples who have been together for at least two years qualify for recognition under the Family Law Act. However, there are exceptions. You may still be recognised as being in a de facto relationship if:
- You and your partner have a child together.
- The relationship was formally registered under state or territory law.
- One partner made significant financial or non-financial contributions during the relationship.
- Not recognising the relationship would cause serious injustice to one partner.
When separation occurs, at least one partner must clearly communicate the decision to end the relationship. Actions such as moving out, notifying family and friends, or ceasing financial interdependence often serve as evidence of separation.
What Should Be Included in a De Facto Separation Agreement?
Every agreement will look different, depending on the couple’s assets and personal situation. However, most De Facto Separation Agreements address the division of assets and liabilities, such as homes, vehicles, savings, investments, and superannuation. They also outline who will be responsible for any outstanding loans, credit card debts, or mortgages.
If one partner requires ongoing financial assistance, the agreement can specify the amount and duration of spousal maintenance. For couples with children, it can also include parenting arrangements — where the children will live, how time is shared, and how key decisions will be made.
While some couples attempt to draft their agreements privately, it’s strongly recommended to seek legal advice from an experienced family lawyer to ensure the terms are fair and legally sound. For example, Melrose Keys Lawyers in Brisbane offer professional guidance to ensure both parties’ rights are protected and the agreement complies with Australian family law.
Is a De Facto Separation Agreement Legally Binding?
Yes. A De Facto Separation Agreement can be made legally binding under the Family Law Act when it meets specific requirements. Both parties must obtain independent legal advice before signing. Their respective lawyers must also sign certificates confirming that this advice was provided and understood.
The agreement must be written, signed by both parties, and witnessed appropriately. These formalities ensure the document is enforceable and helps prevent disputes about fairness or understanding later.
A properly drafted Binding Financial Agreement carries the same legal weight as a court order. If one party fails to comply, the other can take legal action to enforce its terms.
How Do You Formalise a De Facto Separation Agreement?
Finalising a De Facto Separation Agreement involves several key steps.
First, both partners should negotiate and agree on the terms of the separation, including how property, assets, and financial responsibilities will be divided. It’s vital to have open communication during this process to avoid misunderstandings later.
Next, each partner must seek independent legal advice. A family lawyer will review the agreement, explain the implications, and ensure that their client’s interests are fully understood and protected.
Once both sides are satisfied, the agreement must be signed by both parties and their lawyers. The legal certificates confirming independent advice are then attached, making the agreement valid under Australian law.
If the agreement is properly executed, there’s no need to file it with the court. However, if one party breaches the agreement in the future, legal steps can be taken to enforce it.
Can a De Facto Separation Agreement Be Revoked or Set Aside?
Although Binding Financial Agreements are designed to be final, there are situations where they can be revoked or set aside.
If both parties mutually agree to change or cancel the agreement, they can draft a new one with updated terms. Each person will need to obtain fresh legal advice before signing.
Courts can also set aside an agreement if it was made under unfair or unlawful circumstances. Examples include fraud, failure to disclose significant assets, undue influence, or coercion. If one party was pressured into signing, or if the terms cause severe hardship or injustice, the agreement may be invalidated.
In addition, a significant and unexpected change in circumstances — such as a serious illness or job loss — can prompt a court to reassess or adjust the terms of the agreement.
Moving Forward After Separation
Ending a de facto relationship is rarely easy, but having a clear and legally binding separation agreement can make the process smoother and more respectful. It allows both individuals to move forward with financial and emotional stability, knowing that their rights and responsibilities are clearly defined.
With professional guidance from experienced separation lawyers in Sydney, couples can reach fair outcomes without unnecessary conflict. Whether you are just beginning to discuss separation or finalising the terms, having expert legal support ensures your agreement stands up legally and protects both parties’ interests in the long term.
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