Author: Carol Pages, Pages Family Law.

What’s changed?

In relation to the law about property or asset division following the breakdown of a marriage or de facto relationship, there are changes to the Family Law Act 1975 coming later this year.  These include changes about what the Court will consider when deciding a property settlement. The main change includes the economic effect of family violence, where this is relevant in the case.

There was no family violence in our relationship – do I still need to be know about this?

The main change concerns cases where family violence is alleged by one party to a relationship breakdown.  If this is not relevant to your matter, the changes about family violence will not impact your case.

There are also procedural changes providing the Court, such as the option of using the ‘less adversarial’ approach to deciding property cases; and the update to including the duty of financial disclosure into the Family Law Act 1975, however the family violence changes are the focus of this article.

Who do the changes apply to?

The changes to the law mean that the impact of family violence is to be considered in deciding final property divisions. 

Where family violence is relevant to the matter, it will be relevant whether or not the matter is decided by the Court.

Most family law property settlements are negotiated and resolved prior to going to Court.  Of those cases that make an application to the Court for a property division, the vast majority of these also settle prior to a final hearing.

Part of the success rate for settlement is because lawyers and mediators use the process set out in the Family Law Act 1975 to negotiate the settlement.

This means now, these changes will need to be factored into consideration for all new family law property matters.  For you, it means even if you have only property matters between you and your ex, that your lawyer will be asking you if there was any family violence in your relationship when advising you about your property division.

When do the changes start?

These changes were passed by the Australian Parliament on 10 December 2024, so they come into effect on 10 June 2025.

Importantly, these changes will apply from 10 June 2025 to all new and existing cases in the Court, except if a final property trial has started before that date.  

Summary of the changes about property division

The changes include:

• – Including in the Act that the effect of family violence is relevant in deciding a property division after separation; and
• – Including ‘economic or financial abuse’ in the definition of family violence.

What are some examples of what will be covered by these changes?

Examples include denying a person financial independence, such as by controlling their money, or other assets, including superannuation, forcing them into taking out a loan, and even taking out a debt in their name without their knowledge.

It can also include withholding financial support needed to meet living expenses of that person or a child, when the person is dependent on the other person for financial support.

Relevant to the new law will be also be including consideration of one party wasting any property or financial resources of the parties.

Didn’t the law take any of this into consideration before?

Case law has recognised the impact of family violence and the effect on property settlement for some time.

Family lawyers are familiar with the 1997 case of Kennon, where the Court recognised that the violent conduct of one party to another could make that party’s ability to contribute significantly more arduous than it should have been, and that the Court is entitled to take that into consideration in deciding what the percentage property division should be between the parties.

In cases since, where family violence was relevant to a party’s contributions, there can be adjustments made in recognition of this.  In all cases there must be evidence of how the family violence made the party’s contributions more arduous.

In practice, it meant that lawyers had to decide if there was a cost/benefit to running a Kennon case.  For example, say one party alleges family violence, and the other denies it – would the adjustment achieved to the property division from a Kennon adjustment cover all of the extra legal costs that would be spent by preparing the case?  

From a pure numbers perspective, this could depend on the value of the overall assets available for division (the asset pool).  The adjustment based on the Kennon factors had to be weighed up against all of the contributions in a relationship, both financial and non-financial, made by each of the parties.  Some of the cases to provide an example of decisions made by the Courts about the Kennon adjustment and the size of the asset pool –one case had a 10% adjustment from a $1.3M pool, another 15% adjustment of a $600,000 pool and another had a 5% adjustment from a  $3.9M pool.  Like all family law matters, each case is decided (and more often negotiated) on its own facts.  Importantly here, these were cases that went all the way to a final trial and were decided by a judge, so the legal fees and time involved in running a case to a final trial has to also be considered.

What should we expect or look out for from these changes?

A full analysis of any changes to legislation is usually only available once the Courts have applied the new changes to several cases.  

Like the changes made to the parenting provisions that took effect back on 6 May 2024, these changes simplify the law, and maintain a focus on family violence, in a system where most applications filed with the Court make allegations of family violence.

These changes are significant for those needing the assistance of the family law system to resolve their property matters. The changes recognise the impacts of economic abuse of those experiencing family violence, often the person in the weaker financial position.  

It remains to be seen whether the changes will result in an increase of property matters filed in the Court citing family violence, and whether this means that less cases will be able to be resolved by agreement between the parties themselves, or with the assistance of a mediator and/or lawyer.  For example, how readily would a party agree to a settlement offer which includes an adjustment for family violence?  All lawyers will advise their client on the commercial benefits of accepting a settlement offer (saving legal fees, saving the time and stress of an ongoing dispute whether in the Court or not) – but what if agreeing to a settlement like this could be detrimental to a current or future parenting case?

We will also wait to see whether there will be any practical difference to litigants in the costs of running a matter alleging family violence.  Will the impact on costs be a consideration as they have been in Kennon cases, as discussed above?  Will there be a lot more cases filed in the Court, as it will become harder to negotiate settlements?  Will there be an impact on the availability or the costs of experts such as psychologists to give expert evidence and recommendations in matters re the impact of family violence? Will court cases take longer to hear?  For example will a one or two day property trial take another day based on more detailed evidence or more witnesses?  In practical terms, if the costs go higher and the process takes longer – what is the impact on the party impacted by family violence?

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The content of this article is provided for information purposes only and does not constitute legal advice.  We recommend that you seek legal advice relevant to your own circumstances and we would be happy to assist you.

Carol Pages is the Principal of Pages Family Law and an Accredited Specialist in Family Law and a Nationally Accredited Mediator. If you would like advice about your own separation, please contact Pages Family Law at info@pagesfamilylaw.com.au or on 03 9121 8077.