Thorne & Kennedy [2017] HCA 49 is a decision of the High Court of Australia whereby a Binding Financial Agreement, or ‘pre-nup’, was set aside.

So what good are pre-nups if they can be set aside?

To answer this question, it is important to understand the background to Thorne & Kennedy.

In this case, the parties met on the internet in 2006. Ms Thorne was 36 years old, with no substantial assets, and at the time lived in the Middle East. By contrast, Mr Kennedy was 67 years old and held assets with a value of approximately $18 million.

In February 2007 Ms Thorne moved to Australia, and on 30 September 2007 the parties were married.

On 19 September 2007, Mr Kennedy informed his fiancé that they were going to see a lawyer to sign an agreement. Mr Kennedy informed his fiancé that if she did not sign the agreement, the wedding would not go ahead. Against independent legal advice, Ms Thorne signed the ‘pre-nuptial’ agreement pursuant to section 90B of the Family Law Act 1975 on 26 September; some four days prior to the wedding.

Shortly after the marriage the parties entered into a ‘post-nuptial’ agreement pursuant to section 90C of the Family Law Act. Ms Thorne again signed against independent legal advice.

The Agreements gave the wife a lump sum of $50,000 (CPI indexed) in the event of the parties’ relationship breakdown if they had been married for a minimum of three years.

After four years of marriage, the parties separated and Ms Thorne applied to the Federal Circuit Court for the agreements to be set aside. Ms Thorne was successful at first instance, with the primary judge setting aside both agreements for unconscionable conduct and undue influence.

The decision of the primary judge was based on a number of factors, including:

1. Ms Thorne had no permanent status in Australia at the time;
2. Ms Thorne did not have financial equality with Mr Kennedy;
3. Ms Thorne was entirely financially dependent on Mr Kennedy;
4. Ms Thorne’s emotional preparation for the marriage;
5. Ms Thorne’s emotional commitment to the relationship and the prospect of having a child; and
6. The ‘publicness’ of the marriage.

Mr Kennedy died during the proceedings and on his behalf his estate appealed the primary judge’s decision. This application to uphold the agreements was allowed.

Ms Thorne appealed successfully to the High Court of Australia, with the High Court unanimously restoring the primary judge’s decision.

So are Binding financial agreements enforceable?

The short answer is yes, subject to many conditions being met.

The Family Law Act 1975 (as amended) allows married and de facto couples to enter into a Binding Financial Agreement (‘BFA’) before marriage or cohabitation, during marriage or cohabitation, and after a relationship breakdown. BFAs provide a way for people to protect their assets before getting married or entering into a de facto relationship and set out the division of the couple’s assets should they separate.

Each party to the BFA must enter into the BFA of their own free will and be fully informed as to the advantages and disadvantages of entering into the agreement. Each party must receive independent legal advice about the BFA.

For couples getting married, the decision of the High Court in Thorne & Kennedy strongly enforces the considerations parties must contemplate when entering into a BFA including that the parties should (a) ensure that any contemplation of a BFA should be done many months in advance of the wedding to ensure that there is ample time to prepare the document and negotiate the terms, and (b) that the parties must enter into a BFA only in circumstances where unconscionable conduct of a party does not exist.

Want to travel with the children overseas?  If you have or are seeking parenting orders however, you might want to double-check a few things before making any sure-fire plans, otherwise you could find yourself in hot water and potentially facing a criminal charge.

Section 65Y of the Family Law Act 1975 makes it an offence to take or send a child from Australia if that child is subject to a parenting order dealing with:

• where a child lives;
• when a child spends time with a person;
• when a child communicates with a person; or
• when a person has parental responsibility for a child.

Similarly, section 65Z of the Act makes it an offence to take or send a child from Australia if there are proceedings before the Court for the making of a parenting order of the sort referred to above.

There are exceptions however, as the Act allows a child to be taken from Australia overseas in the circumstances outlined above, so long as it is done with:

1. the express written consent of each party; or
2. a Court Order providing for the overseas travel has been made.

It is crucial then that, if you have a parenting order or are a party to Court proceedings for a parenting order, any international travel involving a child subject to that order or those proceedings must not take place unless you have satisfied one of the above conditions.

If either of these requirements is not satisfied then you could be charged with committing an offence.  The penalty can be imprisonment for up to 3 years.

It is important that any final parenting orders therefore contemplate whether or not any provisions need to be made for international travel of a child or children.  These provisions can include (but are not limited to) addressing issues such as whether all parties must consent to such travel, how much notice the travelling party needs to provide the other and how children’s passports are to be handled.

It is possible to have a final parenting order that a child lives only with one party who has sole parental responsibility for that child, but unless that parenting order contains an order permitting that party to also arrange the international travel of the child without reference to the other party then section 65Y operates to still require both parties to consent to international travel of the child.  This highlights the importance of having properly drafted orders, and receiving Family Law advice with respect to same.

Blog post by Hayley Ellison

With the Christmas holidays fast approaching, it is important to make arrangements to spend time with your children in advance. If you are unable to reach an agreement regarding the upcoming Christmas school holidays then you may need to seek Family Court Orders.

Family Dispute Resolution

Prior to commencing Family Court Proceedings, the Family Law Act 1975 requires that parties attend Family Dispute Resolution (‘FDR’). There are exceptions to this requirement however; it is most likely that your matter will not fall under one of these exceptions. It is important to remember that you can experience delays in the FDR process therefore it is best to commence the process as early as possible. In the event that you are unable to reach an agreement through FDR, you are issued with a section 60I certificate or FDR certificate which allows you to commence proceedings.

Commencing Family Court Proceedings

In Australia, there are three Family Law Courts:

1. Family Court of Western Australia;
2. Family Court of Australia; and
3. Federal Circuit Court of Australia.

You can make applications regarding the care arrangements for your children during the upcoming 2016/2017 Christmas school holidays in these courts dependent on which jurisdiction is applicable. For more information regarding the appropriate jurisdiction and making an application to the Family Law Courts, please contact our offices to make an appointment with one of our family lawyers. Each court has separate requirements regarding the filing of applications for the 2016/2017 Christmas school holidays.

Family Court of Western Australia

In Western Australia, the Case Management Guidelines provide that “the cut off to file applications in the Family Court in time for Christmas is 4.00 pm on the second Friday of November each year.” In 2016, the cut-off date to file applications for the 2016/2017 Christmas school holidays is Friday 11 November 2016.

The Family Court advises in the Case Management Guidelines that “parties should be aware that applications filed prior to this date are not necessarily guaranteed to be listed or determined prior to the commencement of the relevant school holiday period. Such applications should be filed as early as practicable to ensure an appropriate listing date.”

Family Court of Australia and Federal Circuit Court

In the Family Court of Australia, the Rule 5.01A of the Family Law Rules 2004 provides that the cut off to file applications is “before 4:00pm on the second Friday in November of the application year”, therefore, the same deadline of 11 November 2016 applies. Following this deadline, the applications will be assessed in terms of urgency. In the event that the application is not assessed as being urgent it is unlikely that your matter will be listed until 2017. In the Federal Circuit Court, there is no specific filing deadline.

However, the Court’s Case Management Guidelines also state, “Parties should be aware that applications filed prior to this date are not necessarily guaranteed to be listed or determined prior to the commencement of the relevant school holiday period. Such applications should be filed as early as practicable to ensure an appropriate listing date.”

Overseas Travel

It is vital to note that pursuant to section 65Y of the Family Law Act 1975 and section 107 of the Family Court Act 1997 parties to proceedings must not take or send the child or children who is the subject of proceedings outside of Australia unless:

• It is done with the written consent of the other party/parties to the proceedings; or
• It is done in accordance with a Family Court Order.

If you wish to take your child or children on an overseas holiday you must obtain the written consent of the other party. In the event that you cannot obtain written consent, an application should be filed to obtain endorsement of the Family Court through Orders.

Please contact our offices to make an appointment if you require assistance to make arrangements for your child or children this holiday before the Christmas rush begins.