Prenups and Power Imbalance

12 MAY 2021

 

Australia has an increasingly globalised population. The 2016 Census states that one-quarter of Australians are born overseas. Many overseas Australians migrated to Australia for love. In some instances, a practice for Australians sponsoring an overseas partner to migrate to Australia, is to ensure that they enter into a prenuptial agreement. On the surface level, the law surrounding pre-nuptial agreements seem simple enough. The parties draft an Agreement and sign the Agreement after receiving legal advice from their lawyer about the advantage and disadvantage of the agreement.  

Things are more complicated than what the Family Law Act says.  What if the migrating partner comes from different cultural background, with little English skills? What use would the advice about the advantage and disadvantages of a prenuptial agreement be to a migrating partner with no English skills? 

Marsdens Law Group acted in Beroni & Corelli [2021], a Full Court decision which dealt with the above issues. In Beroni & Corelli, both parties were migrant Austrlaias. Mr Beroni had been in Australia since the middle of the 20th century. Ms Corelli migrated to Australia in the 2009. They entered into a relationship in 2010. They signed an Agreement in 2011. Both of them had legal advice with a qualified solicitor about the Agreement. The Full Court set the Agreement aside.  

So what went wrong? Ms Corelli couldn’t speak English. She was of a different cultural background. Her solicitor only spoke English. Ms Corelli only had 30 minutes consultation with her solicitor. Having found this, the Family Court found that there was an inherent power imbalance here that Mr Beroni did not attempt to address.

This is a cautionary note to all who take a simplistic view of a Prenuptial Agreement by following the strict words of the Family Law Act. Even though the formalities were observed, the Full Court wants the ‘more powerful’ party to go further and make sure that the ‘less powerful’ person has a level playing field. A level playing field could be provided if Ms Corelli had an interpreter or had a longer consultation with her lawyer. If these were provided to Ms Corelli, things may have been different.

If you have questions regarding the above article, please contact our Family Law team on (02) 4626 5077). 

The contents of this publication are for reference purposes only. This publication does not constitute legal advice and should not be relied upon as legal advice. Specific legal advice should always be sought separately before taking any action based on this publication.

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