Insights | Bitcoins and blockchains Part 3 (cont.)

Family law and “pre-nup” agreements

Also in June 2016, a couple had reportedly encoded a prenuptial template into a Smart Contract on the Ethereum blockchain.

This lighthearted “pre-nup” included particular requirements such as mandatory date nights every 10 days and obligations to watch movie series in succession.

While we see this as a promising start to building mutual understanding in marital and de facto relations (perhaps one should be entitled to a marathon binge of Game of Thrones or agree to a shopping spree from time to time), the family law in Australia would be hard-pressed to accommodate Smart Contract technology under the existing framework for “binding financial agreements”.

Binding financial agreements – the Australian “pre-nup” paradigm

Binding financial agreements are, by their nature, tailored (or at least ought to be tailored) to the facts and circumstances of the parties.  In this regard, adopting a “one-size-fits-all” approach to draftsmanship is likely to result in an agreement being declared void, voidable or unenforceable.

The family law includes “safety mechanisms” in the form of a requirement of each party to a financial agreement to obtain independent legal and financial advice.  The end result is that the parties might contemplate that their relationship be governed by a particular rule set in the Smart Contract which may not be practical or enforceable.  In this context, the automation process is undermined by manual intervention required to mould the agreement into a form capable of enforcement in Court.

Further, in making any orders affecting property that the Court must be satisfied it is “just and equitable” to make the order; similarly, in making parenting orders, the Court must regard the “best interests of the child” as the paramount consideration.

Insight: a prenuptial Smart Contract (assuming it complies with the requirements set out in the Family Law Act) is unlikely to achieve the original objective of creating a non-interventionist self-executing framework to govern the parties’ relationship.

Click here to return to our analysis of Smart Contracts in the context of automating dividend distribution processes.


Given the unique circumstance of any particular marital or de facto relationship and the role of the Court in family law proceedings, it seems to us that there is little utility in seeking to press Smart Contract technology into use in Australian family law.  Nevertheless, the principles behind Smart Contracts could yield drastic benefits to relationships by promoting transparency and facilitating communication between parties to a relationship.


This article is intended to provide commentary and general information. It should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this article.

We hope you enjoyed our Insights | Bitcoins and blockhains series of articles.  We welcome your feedback on the series and other topics of interest. 


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