Previous Binding Financial Agreement

When a client has previously entered into a Binding Financial Agreement (BFA) with another person regarding a prior relationship, it's important to understand its limitations. Generally, while a BFA can attempt to deal with the division of matrimonial property on death, the general position in most states of Australia is that a BFA cannot operate to bind or exclude a former spouse from making a family provision claim or challenging a person's Will. Most family provision laws throughout Australia deem a former wife or husband of a deceased person to be eligible to bring a family provision claim.

Action Items for Advisers:

• Review the client's existing Binding Financial Agreement (BFA)

• Understand the limitations of the BFA regarding exclusion from family provision claims

• Recognise that former spouses can challenge your client’s Will

• Consult with a lawyer about protecting your client’s estate from claims

• Consider advising the client to update their Will to address potential challenges

• Ensure all your client's legal documents are current and reflect their wishes

• Regularly review and update your client's estate plan as neededinding Financial Agreements