As family lawyers who are focused on achieving meaningful and cost-effective resolution for our clients, our goal is to resolve family law matters by Family Law Agreement wherever possible.
Family Law Agreements can be achieved in a variety of ways, including through negotiation or mediation.
At BHM, our goal is to support our clients in a negotiation process that is fair, transparent, and effective. When negotiations conclude successfully, we aim to draft Family Law Agreements that will continue to meet the needs of our clients and their children well into the future.
However, there are many reasons why a party to a Family Law Agreement might seek to change their agreement, including:
- – Changed circumstances of the parties, or their children, since the time the Family Law Agreement was entered into; or
- – Setting aside the agreement based on the law of contracts. For example, if the agreement was negotiated under duress or with a lack of financial disclosure.
- Amending Family Law Agreements
Where circumstances change, amendments to an existing Family Law Agreement may be required.
The parties can negotiate amendments between themselves, or with the assistance of a lawyer or a mediator.
If both parties are able to agree on the amendments, those amendments can be recorded in a later agreement, often called an “Amending Agreement,” which updates or clarifies the parties’ earlier agreement. Generally, the Amending Agreement will need to be signed by both parties, and witnessed by independent witnesses. Legal advice is always recommended.
- Dispute Resolution Clauses
At Brown Henderson Melbye, we understand that family circumstances, particularly if children are involved, require flexibility. When we draft Family Law Agreements, we usually encourage clients to consider including a “Dispute Resolution Clause” that provides direction for how future disputes will be resolved.
The Dispute Resolution Clause can include terms requiring the parties to negotiate, or mediate a dispute, before taking court proceedings. The Dispute Resolution Clause can also include terms about how the mediator will be selected and paid for, or that a party who refuses to mediate must pay an amount towards the other party’s legal fees.
- Applications to Court to Set Aside or Replace Agreements
If parties cannot agree on how to amend their Family Law Agreement based on changed circumstances, an application to court may be required.
A court cannot change or amend an agreement; what a court can do is set aside part of an agreement and make orders in its place.
Section 214 of the Family Law Act is the section that allows the court to set aside part of an agreement and replace it with a court order. Section 214 reads as follows:
- If an order is made to set aside part of an agreement, the part is deemed to be severed from the remainder of the agreement.
- A court may incorporate into an order all or part of a written agreement respecting a family law dispute made by the parties to the proceeding and, unless the court orders otherwise,
- (a) the order replaces that part of the agreement that is incorporated, and
- (b) the remainder of the agreement remains effective.
- Unless the court orders otherwise, if an agreement and an order made after the agreement provide differently for the same subject matter,
- (a) the order replaces the part of the agreement that provides differently for the same subject matter, and
- (b) the remainder of the agreement remains effective.
There are different legal test that the court must apply to set aside part of a Family Law Agreement, depending on the particular issue or subject matter.
- For Parenting Arrangements and Contact:
- Section 44(4) of the Family Law Act provides that a court “must set aside or replace with an order… all or part of an agreement respecting parenting arrangements if satisfied that the agreement is not in the best interests of the child.”
- For contact, which is the time that a non-guardian has with a child, section 58(4) provides that if an agreement for contact is found not to be in the best interests of a child, then the court must set aside the relevant parts of that agreement, or replace it with an Order.
- For Child Support:
- Section 148(3) of the Family Law Act provides that “On application by a party, the court may set aside or replace with an order made under this Division all or part of an agreement respecting child support if the court would make a different order on consideration of the matters set out in section 150.”
- Section 150 lists a variety of factors for the court to consider when determining child support. Changes in income of either party, or the parenting arrangements for the children, are all reasons that a court might consider varying the child support provided in an agreement.
- For Spousal Support:
- Section 164 of the Family Law Act provides two legal tests for the court to consider when determining if the parts of an agreement dealing with spousal support should be set aside.
- The first “test”, set out in section 164(3), provides a list of the factors that the court can consider for whether to set aside or replace with a court order all or parts of an agreement dealing with spousal support. Those factors include lack of disclosure, a spouse taking improper advantage of the other, or other circumstances that would make the agreement “voidable” under the principles of contract law. The principles of contract law will be discussed below.
- The second “test”, set out in section 164(5), provides that even if none of the factors listed in section 164(3) exist, but in the opinion of the court, the parts of the agreement dealing with spousal support are “significantly unfair,” the court cans set aside, or replace with an order, those parts.
- For Property and Debt:
- Section 93 of the Family Law Act provides two legal tests for when parts of an agreement dealing with property and debt division should be set aside or replaced with a court order. These two tests are similar to the tests for setting aside, or replacing with an order, all or part of an agreement about spousal support under section 164 of the Family Law Act.
- Section 93(3) lists a variety of factors, similar to those in section 164(3) that would permit the court to set aside or replace with an order parts of an agreement dealing with property and debt division.
- Section 93(5) provides a “significant unfairness” clause, similar to section 164(5).
- The Law of Contracts
Changed circumstances are not the only reason that a party may seek to change their Family Law Agreement.
Family Law Agreements, like a commercial contract, can be challenged for a variety of reasons based on “Common-Law” principles, including:
- –Duress: the agreement was not freely entered into;
- –Unconscionability: the agreement is unreasonable or unfair to a party;
- –Lack of Independent Legal Advice: a party signed the agreement without independent legal advice and did not fully understand what the agreement meant;
- –Lack of Disclosure: the agreement was signed without full disclosure having been made; or
- –Fraud: a party signed the agreement because misleading information was provided.
- Summary and Time Limits
If you have entered into a Family Law Agreement that you believe is not meeting the needs of you or your family, or that was negotiated in a manner that was contrary to the principles of contract law, we urge you to talk to a lawyer about your options.
All of the lawyers at Brown Henderson Melbye are experienced in guiding clients through the process of amending Family Law Agreement, either through negotiation or through litigation to set aside or replace with an order all or part of the Family Law Agreement.
Finally, as you consider your options for seeking changes to a Family Law Agreement, it is important to remember the time limits set out in section 198 of the Family Law Act.
Section 198(2) of the Family Law Act provides a general two year time limit from the date of separation, for un-married spouses, or divorce, for married spouses, for a spouse to start an action to divide property and debt, or for spousal support.
However, section 198(3) of the Family Law Act provides that “Despite subsection (2), a spouse may make an application for an order to set aside or replace with an order made under Part 5, 6 or 7, as applicable, all or part of an agreement respecting property or spousal support no later than 2 years after the spouse first discovered, or reasonably ought to have discovered, the grounds for making the application.”
What section 198(3) means in practice is that a spouse only has two years from the date that a problem in their Family Law Agreement was “discovered” to bring an application to set aside or replace with an order all or part of their Family Law Agreement.
If you believe there is a problem with your Family Law Agreement, it is incumbent on you to take timely steps to seek the court’s assistance, or you may end up out of time.