Commencing this month, amendments to the Family Law Act 1975 will redefine how property and financial settlements are handled, particularly in cases involving family violence.
These reforms focus on fairness, clarity, and addressing the real-world impact of abuse during and after relationships.
The Family Law Amendment Act 2024 came into effect this month. The changes aim to create a fairer and more transparent framework for property settlements and spousal maintenance and factor family violence in property divisions.
These changes reflect a growing recognition of the profound impact that family violence, including economic and financial abuse, can have on individuals during and after a relationship.
What Are the Key Changes to the Family Law Act?
1. Family Violence as a Central Consideration
Previously, the impact of family violence on property settlements was considered only in limited circumstances. The new reforms mandate that courts must now explicitly consider:
- Contributions Affected by Violence: Whether family violence has impaired a partner's ability to contribute financially or non-financially during the relationship.
- Future Circumstances: The ongoing effects of family violence on a partner's current and future financial situation.
This shift acknowledges the long-term repercussions of abuse and aims to ensure more equitable outcomes for survivors.
2. Expanded Definition of Economic and Financial Abuse
The amendment to the Act has a broader definition of family violence and includes various forms of economic and financial abuse, such as:
- Controlling a partner's access to financial resources.
- Forcing a partner to take on debts.
- Interfering with a partner's employment or education opportunities.
- Withholding financial support for necessities.
By explicitly recognising these behaviours, the family court can now more readily address and compensate victims of abuse and coercive control.
3. Consideration of Wastage, Liabilities, and Housing Needs
Courts will now specifically be required by the Family Law Act to assess:
- Wastage: Whether a party has intentionally or recklessly depleted assets. This has been an accepted concept in family law cases but is now codified in the Family Law Act.
- Liabilities: The nature and circumstances of debts incurred.
- Housing Needs: The need to provide housing for a child or children.
4. Pets & Companion Animals
Acknowledging the emotional significance of pets, the reforms introduce a framework for determining the ownership of companion animals in property settlements. Courts will consider factors such as the pet's welfare and the relationship between the pet and each party, as well as incidents of family violence to family members and pets.
The orders the court could make will include that one part have ownership of the pet, that ownership is transferred to a consenting third party or that the pet be sold. The court will not have the power to make any orders for "shared care" of the pet.
5. Four Step Property Settlement Process
The Act now outlines a clear four-step process for property settlements for defacto or divorcing couples:
- Identify and value all assets and liabilities.
- Assess the contributions of each party.
- Evaluate the future needs of each party.
- Ensure the proposed settlement is just and equitable.
This codification aims to provide consistency and clarity in property division.
6. Elevated Duty of Financial Disclosure
The obligation for parties to fully disclose their financial circumstances has been elevated from court rules to the legislation itself. This change underscores the importance of transparency and may lead to stricter enforcement and penalties for non-compliance.
A failure to make full and frank disclosure could result in a costs order against the defaulting party, and the court making an adverse inference against them e.g. if they have not fully disclosed what has happened to assets, the notional value of those assets could be added back into the asset pool and taken into account as part of the asset division.
Implications for Separating Couples
For individuals navigating separation or divorce, these reforms signify a more nuanced and empathetic approach to property and financial matters. Survivors of family violence will find that the courts are now better equipped to recognise and address the complexities of their relationships by taking family violence or financial abuse into account.
Seeking Legal Guidance on your divorce or separation
It's essential for separating couples to understand these changes may impact their property settlement and spousal maintenance arrangements. Seeking legal advice and expert representation will help to ensure that your rights and interests are adequately protected under the new framework.
Our experienced family lawyers are here to provide compassionate and informed guidance tailored to your unique circumstances. We can confidently navigate changes to the legislation and help you get favourable outcomes cost-effectively.
If you're facing a separation or have questions about how these reforms may affect you, please don't hesitate to contact us for a confidential consultation.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
