Prenuptial and binding financial agreements

A distinct advantage of recording your property settlement in a binding financial agreement it that, unlike a court order, there is no requirement that a binding financial agreement severs financial ties on a final basis, avoiding the ‘clean break principle’.
The ‘clean break principle’ is codified in section 81 of the Family Law Act, and says that “the court shall, as far as practicable, make such orders as will finally determine the financial relationship between the parties to the marriage and avoid further proceedings between them”. This section applies to court order, but not to a binding financial agreement.
This makes this type of agreement particularly attractive where parties wish to continue to hold assets jointly, intend continuing in a business together, or have agreed to payment of instalments over several years.