Family Law Act Amendments Update – Parenting arrangements and property settlements

Introduction

In the past, family lawyers often joked about the constancy of legislative reform, but it has been quiet recently. This is fairly unusual as family law is so tied up with societal changes – either leading them or following them. We have had nothing substantial since the commencement of the Federal Circuit and Family Court of Australia (FCFCOA) on 1 September 2021 which involved considerable, but largely procedural change.

More substantive legislative reform is both pending and proposed.

Relevant Legislation

The two pieces of legislation which deal with these extensive reforms are:

• Family Law Amendment Act 2023 (Cth) – broadly parenting
• Family Law Act Amendment Bill (No 2) 2023 – broadly property

The Family Law Amendment Act 2023 (Cth) was seemingly fast tracked by the Federal Government into Parliament on 29 March 2023, after a community consultation process over a period of only 28 days. However, in reality the FLAA 2023 is just the first tranche of legislative reform addressing the Australian Law Reform Commission’s Final Report No. 135: Family Law for the Future – An Inquiry into the Family Law System (ALRC report) and implementing elements of the Government Response to the Joint Select Committee on Australia’s Family Law System (Joint Select Committee). The ALRC report was tabled in Federal Parliament by the former Federal Government five years ago, on 10 April 2019.

How parenting arrangements are resolved by the court has been a relatively stable and predictable aspect of family law for some years, after a period of uncertainty after the last major reforms in 2006 (yes, almost 20 years ago), and to a lesser extent the 2012 family violence amendments. The playing cards are being thrown up in the air again and it is likely that it will be more difficult to predict outcomes when matters proceed to a final hearing, and therefore more difficult for lawyers to give legal advice with any degree of certainty as to what a court might do.

The Family Law Act Amendment Bill (No 2) 2023 was released for community consultation which is expected to lead to the Family Law Act Amendment Act 2024 being tabled in Parliament later in 2024.

FAMILY LAW AMENDMENT ACT 2023

Significant amendments are aimed at: –

1. Refining “best interests” factors
2. Changing the parenting pathway to protect victims of family violence
3. Strengthening compliance
4. Enhancing protections from harmful effects of litigation
5. Clarifying publication restrictions
6. Enhancing voices of children in proceedings
7. Establishing regulatory powers of Government re: family report writing

Best interests of children

Currently, s 60B sets out 4 objects and 5 underlying principles which apply to Pt VII of the FLA, the Part relating to children. The new s 60B has only 2 objects which are:

“(a)    to ensure that the best interests of children are met; and

(b)     to give effect to the Convention on the Rights of the Child done at New York on 20 November 1989.”

The ALRC recommended the abolition of s 60B FLA (Recommendation 4). The ALRC Report recommended the abolition of s 60B largely because it overlapped with the s 60CC, there was potential for confusion and the principles have limited legal effect (Recommendation 4). The retention of s 60B in a more limited form, which retains the reference to the Convention (the current s 60B(4)), arguably retains a degree of complexity.

The narrower s 60B removes the express references currently in s-s 60B(1) to ensure that the best interests of children are met by:

“(a)    ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with their best interests of the child; and

(b)     protecting children from physical or psychological harm and from being subjected to or exposed to abuse, neglect or family violence; and

(c) ensuring that children receive adequate and proper parenting to help them achieve their full potential; and

(d)ensuring that parents fulfil their duties and meet their responsibilities, concerning the care, welfare and development of their children.”

Objects can be used to resolve ambiguities in interpretation and it is arguable that the narrower list of objects will impact the operation of Pt VII.

The removal of the principles in s 60B(2) may be less controversial as principles do not have the same impact as objects and are not as readily relied upon for the interpretation of ambiguities. However, the removal reinforces the view that the FLAA 2023 changes the law with respect to parenting. In particular, 2 of the principles set out in the current s 60B(2) are noticeably removed by the FLAA:

“The principles underlying these objects are that (except when it is or would be contrary to a child‘s best interests):

(a) children have the right to know and be cared for by both their parents, regardless of whether their parents are married, separated, have never married or have never lived together; and

(b) children have a right to spend time on a regular basis with, and communicate on a regular basis with, both their parents and other people significant to their care, welfare and development (such as grandparents and other relatives)…”

I think there will be concerns amongst some parts of the community that the removal of an express reference to grandparents will change the law. The reference to grandparents in s 60CC was inserted after much lobbying by community organisations representing grandparents. Grandparents may also feel that their role has been diminished and the rights of children to have a relationship with their grandparents are disregarded with the simplification of s 60B. However, importantly, s 65C remains which means that grandparents still have standing to be parties to parenting proceedings.

Family violence will no longer be a primary best interests consideration, but is a general consideration along with a new but shorter list of factors in s 60CC. Family violence is given prominence under the amendments despite its removal as a primary consideration, but “safety” is now emphasised rather than “protection”. The consideration of “safety (including safety from family violence, abuse, neglect or other harm)” is referred to in the new s 60CC(2)(a), rather than the current s 60CC(2)(b), which refers to the primary consideration of “the need to protect the child from physical or psychological harm from being subjected to, or exposed to abuse, neglect or family violence”. The effect of this change, if any, will need to be considered by the courts.

There is still a catch-all provision which may catch what has been left out, but even the wording of that has changed.

The new s 60CC(2)(f) refers to “anything else that is relevant to the particular circumstances of the child”, whereas the current s 60CC(2)(m), at the end of a lorger shopping list of additional circumstances, refers to “any other fact or circumstances that the court thinks is relevant.”

The effect of this change is unclear, but it seems to be narrower.

The FLAA removes some of the more practical aspects of s 60CC, which are often not considered by family report writers but which may be relevant to the determination of the best interests of a child in a contested hearing after hearing the evidence of the parties, for example:

• Contributions to financial support of children (s 60CC(3)(ca))
• Practical difficulties and costs arising in relation to children spending time with both parents (s 60CC(3)(e))
• Participation in decision making (s 60CC(3)(c))
• Attitude and approach to responsibilities of parenthood (s 60CC(3)(i))

There is a risk that the practicalities of parenting and shared parenting arrangements may be given less weight by the parties, their lawyers and interim decision makers because they will no longer be explicitly stated in the FLA.

More generally, the likelihood is that the law has been intentionally changed by the amendments to ss 60B and 60CC. According to the Explanatory Memorandum, refining the list of “best interests” factors has the “aim of reducing complexity and repetition”, but also “enhancing the focus on the needs of individual children”.  It states that the current formula “can detract from the focus on the best interest of the child.” The redrafted s 60CC enables the court to focus on the individual best interest needs of each child. I am not sure this is exactly what the amendments say, but time will tell is said to provide the court:

“with the ability to consider the unique circumstances in each parenting matter in a way that places the best interests of a child at the forefront of decision making.”

The courts are likely to interpret the legislative changes as intending to effect a change in meaning and outcomes (albeit not significantly) by giving a different emphasis to the various factors considered in relation to best interests of children in their individual circumstances, rather than giving all factors the same weight in all cases.

The public and the legal profession may be concerned as to:

(a) Why it was considered important in 2006, when s 60B was inserted into the FLA, to give greater detail as to the objects of Pt VIII and the meaning of the best interests of the child. Why is it not so important now?; and

(b) What the new s 60B(b) (to give effect to the Convention) adds to the consideration of best interests, which is not already covered by the new s 60B(a), particularly given that the other aspects of the current s 60B are to be removed. The Convention now seems to have increased emphasis as it is only one of two objects.

In accordance with the recommendations of the ALRC, the FLAA also refines the list of ”best interests” factors in s 60CC with the aim of reducing complexity and repetition of the current hierarchical structure of s 60CC. The current 2 primary considerations and 14 additional considerations are replaced with a core list of 6 considerations, with an additional factor for Aboriginal or Torres Strait Islander children. Related to this amendment, the definition of “member of the family” is expanded for Aboriginal and Torres Strait Islander children to include persons who are related to the child in accordance with the child’s Aboriginal or Torres Strait Islander culture (Recommendation 9).

The new “best interests” factors in s 60CC are:

• what arrangements promote the safety of the child and the child’s carers, including safety from family violence, abuse, neglect or other harm
• any views expressed by the child
• the developmental, psychological, emotional and cultural needs of the child
• the capacity of each proposed carer of the child to provide for the child’s developmental, psychological, emotional and cultural needs
• the benefit of being able to have relationships with their parents and other people who are significant to them, where it is safe to do so
• anything else that is relevant to the particular circumstances of the child
• for an Aboriginal or Torres Strait Islander child, the child’s right to enjoy their Aboriginal or Torres Strait Islander culture

Presumption of equal shared parental responsibility and the consideration of equal time and significant and substantial time

The FLAA 2023 repeals the presumption of equal shared parental responsibility under s 61DA (Recommendation 7) and the related equal time and substantial and significant time provisions in the current s 65DAA (Recommendation 8).

The ALRC and other enquiries have found that this section is commonly misinterpreted as leading to a “right” to equal shared time with children.

The ALRC also recommended, as part of Recommendation 8, changing the term “parental responsibility” to “decision making responsibility” but this recommendation was not exactly adopted. Instead the new term is “long-term decision making responsibility”. This change removes the emotionally charged term “parental” which often makes it more difficult to negotiate sole parental responsibility orders even where there is considerable family violence and/or little or no positive communication between the parties.

There is a widely held view amongst lawyers and other professionals that the protection in s 61DA(2), which states that the presumption of equal shared parental responsibility in s 61DA(1) does not apply if there are reasonable grounds to believe that a parent of the child has engaged in child abuse or family violence, has been insufficient to prevent equal shared parental responsibility orders being made, where there has been significant family violence.

The removal of the presumption of equal shared responsibility will avoid the need for lawyers to reset parties’ expectations: that there is an “expectation” that orders will be made for equal time. In situations of family violence and child abuse, it should be easier to obtain sole long-term decision making orders because there will no longer be a presumption in the FLA. In addition, removing the presumption and the exceptions to the presumption may mean that a parent will feel more comfortable about consenting to the other parent having long-term decision making because they will not be self-labelling themselves as family violence perpetrators or child abusers.

However, currently, s 65DAA has a cascading (or descending) step-like structure. This means that if the parents have equal shared parental responsibility, and equal time is not in a child’s best interests and reasonably practicable, the court must consider whether “significant and substantial” time is “reasonably practicable”.

The removal of the reference to “substantial and significant time” (contained in the current s 65DAA(2)) will arguably make it more difficult for parents and other carers to reach agreement in relation to care arrangements outside of court. In practice, the concept and definition of substantial and significant time provides a useful standard of measurement for parties and professionals. There is a body of case law where courts have made orders which provide for this time. The phrase is a positive and descriptive one which reinforces that the time of the non-primary carer can still be consequential and meaningful, thus providing a degree of certainty and consistency in the determination of parenting cases, and therefore informs the advice which lawyers give to their clients who we are assisting to negotiate a settlement of their parenting matter.

It is likely that the removal of the “substantial and significant time” yardstick will make it harder to settle cases out of court. There will no longer be any starting point to assist with negotiations, advice and court determinations on the arrangements which are in a child’s best interests. The range of outcomes which could be found to be in the best interests of a child, and the negotiated possibilities, will now arguably be much broader.

This is likely to be a positive change for victims of family violence who may feel less pressure from the courts, their lawyers and the system generally to agree to parenting arrangements which give significant time to the abusive parent and do not provide for the safety of the primary carer and the child. However, for other families the removal of the “significant and substantial time” yardstick will create greater uncertainty, and perhaps fuel litigation.

Another matter which another lawyer raised with me is whether the removal of equal time and substantial and significant time will put more societal pressure on women to revert to traditional mothering roles and feel they need to push to be primary carer rather than a shared carer.

Consultation on long-term issues

The new s 61CA provides that, subject to court orders, and if it is safe to do so, parents who share long-term decision making are encouraged to consult each other about major long-term issues and, in doing so, to have regard to the best interests of the child. According to the Explanatory Memorandum, this provision is not enforceable but is intended to guide parents.

A revised s 61DAA sets out that if a parenting order provides for joint decision making by persons in relation to all or specific long-term issues, the order is taken to require each of the persons to consult each other and to make a genuine effort to come to a joint decision.

These amendments seem sensible, despite being platitudes rather than directives, and are often already included in parenting orders, reflecting the principles set out in s 60B(2)(c) and (d).

The ALRC Report recommended that the rule in Rice & Asplund (1979) FLC 90-725 be codified so that the FLA is clearer as to the circumstances when the court may discharge, vary or revive parenting orders under the current s 65D(2) (Recommendation 41). The rule reflects the view that constant re-litigation of parenting arrangements is generally not in the best interests of the child. Being in the Act, it is more likely that self-represented litigants will be aware of it.

The new section 65DAAA yes, you heard it correctly – they call it making the law more accessible to self-represented litigants, states that, in considering whether to allow a new application, consideration should be given as to whether:

• There has been a change of circumstances that, in the opinion of the court, is significant; and
• It is safe and in the best interests of the child for the order to be considered.

Uncertainties

Possible uncertainties include:

• Is the best interests test the same?
• How to reconcile Family Report writer recommendations based on social science vs factors in FLA?
• What is the impact of the removal of the “practical aspects” (if any) from ss 60B and 60CC?
• Will it be easier for relocation applications to succeed?
• Will there be a reduction in 7/7 and 5/9 orders?

Harmful proceedings

• The new harmful proceedings provision seeks to implement recommendation 32 of the ALRC Report
• Marsden & Winch (2013) FLC 93-560 is an example of a gap in the courts’ powers to scrutinise the institution of further proceedings.
• The case involved protracted and persistent litigation over many years, which a judge found substantially led to the mother developing post-traumatic stress disorder.

The current vexatious proceedings powers focus on the intent of the applicant rather than the effect that further proceedings may have on the respondent. The new harmful proceedings provision seeks to implement recommendation 32 of the ALRC Report, which referred to Marsden & Winch (2013) FLC 93-560 as an example of a gap in the courts’ powers to scrutinise the institution of further proceedings. There was protracted and persistent litigation over many years, which a judge found substantially led to the mother developing post-traumatic stress disorder.

The ALRC concluded that the courts’ existing vexatious proceedings and summary dismissal powers do not provide sufficient scope for courts to make appropriate orders in cases where one party oppresses the other by repeatedly filing new applications and serving those applications on the other party.

Currently, the power to prevent a party from instituting further proceedings is only exercisable where the court is satisfied that a person has frequently instituted or conducted vexatious proceedings in Australian courts or tribunals (s 102QB(1)). Section 102Q(1) specifies that vexatious proceedings include those that are conducted in a court in a way so as to harass, annoy, cause delay or detriment, or achieve another wrongful purpose (as well as a range of other considerations).

The new Div 13A of the FLA is intended to be simpler and easier to apply than the current provisions which deal with enforcement of parenting orders. Significantly, the definition of “reasonable excuse” for contravening a parenting order in s 4(1) will be repealed and replaced with a new definition of “reasonable excuse for contravening a child related order”. The definition refers to s 70NAD (which replaces the current s 70NAE) and expands it to include a defence of a reasonable belief that the contravention was necessary to protect the health and safety of the person, the child or any other person. This change should make family violence an easier defence to rely upon in answer to a contravention application.

Other changes include giving registrars greater power to make parenting orders. They can make orders that compensate for time lost with the child and new provisions for ordering make up time. The intent of these provisions is not to “compensate” a parent for lost time but to allow the court to order additional care time on a temporary basis to rebuild a relationship between a parent and a child.

In addition, there are revised cost provisions.

Independent Children’s Lawyers

The FLAA 2023 includes provisions which establish the duties of Independent Children’s Lawyers (ICLs) to seek the views of children by meeting with them before final orders are made, and the role of the courts in overseeing this process. However, there will be exceptions to this requirement because of certain circumstances (such as children under 5) or the impact on the child.

In proceedings under the Hague Convention on the Civil Aspects of International Child Abduction, there is currently a requirement that an ICL can only be appointed if there are exceptional circumstances to justify it (s 68L(3)). The FLAA 2023 removes this requirement.

Restriction on publication of family law proceedings

The ALRC Report recommended that s 121 be redrafted (Recommendation 56) to:

• improve the clarity of the provision; and
• ensure that it does not discourage communications about family law proceedings beyond its intended scope

In other words, the objective of the reforms is to ensure that the prohibition against publication does not have unintended consequences.

The FLAA 2023 repeals s 121 and inserts a new Pt XIVB into the FLA.

The new s 114N contains a simplified outline of Pt XIVB, including the following statement:

“A communication is not made to the public if the communication is made to a person with a significant and legitimate interest in the subject matter of the communication that is greater than the interest of members of the public generally.”

One of the most significant aspects of the new changes is the change of terminology. The prohibition will be on “communication” rather than on “publication” which seems a clearer term. It will be an offence to “communicate” an account of proceedings under the FLA to the public.

The new s 114P(1) defines “communicate”:

“communicate means communicate by any means, including by any of the following:

(a) publication in a book, newspaper, magazine or other written publication;

(b) broadcast by radio or television;

(c) public exhibition;

(d) broadcast or publication or other communication by means of the internet.”

If there was any doubt before, there will be no further doubt that the internet and social media are caught by the amendments.

Section 114S aims to implement the second aspect of the ALRC Report’s recommendation with respect to s 121, namely, to ensure that the prohibition does not have unintended consequences. The new s 114S precedes the exceptions in s 114S(2) (which largely reproduces s 121(9)). Section 114S(1) states that “a communication to a person or body is not a communication to the public if:

“(a) the person or body has a significant and legitimate interest in the subject matter of the communication; and

(b)   that interest is substantially greater than, or different from, the interests of members of the public generally.”

According to the Explanatory Memorandum, s 114S(1):

“is intended to apply to a range of circumstances, including in relation to communications with professional regulators and Government agencies or other organisations who provide services to families who are involved in family law proceedings. It only applies where there is a significant and legitimate interest in the subject matter of the communication and that interest is substantially greater than, or different from, the interests of members of the public generally. For example, a party may communicate with a child welfare organisation and include information that identifies the other party to proceedings.”

Section 114S(2)(a) contains an important and useful clarification of the prohibition on communication to ensure that Pt XIVB does not have unintended consequences. It does not extend to:

“a private communication between a party to proceedings and a person who is a member of the party’s family or a friend of the party;”

However, noticeably absent from the amendments are stronger enforcement mechanisms, which is one of the major problems with the current s 121. Parties are rarely, if ever, penalised because of a s 121 breach.

Overarching purpose

The FCFCOA Act of 2021 has an overarching purpose. The FLAA 2023  inserts an overarching purpose into the FLA. The new s 95(1) FLA states:

“The overarching purpose of the family law practice and procedure provisions is to facilitate the just resolution of disputes. Two aspects which are different to the FCFCOA:

(a) in a way that ensures the safety of families and children; and

(b) in relation to proceedings under this Act in which the best interests of a child are the paramount consideration — in a way that promotes the best interests of the child; and

The next two are the same as in the FCFCOA Act.

(c) according to law; and

(d) as quickly, inexpensively and efficiently as possible.”

The duties of parties and their lawyers to abide by the overarching purpose are contained in a new s 96 to be inserted into the FLA.

This overarching purpose is broader than the current overarching purpose in ss 67(1) and190(1) of the FCFCOA Act. Consequential amendments resolve the overlap between the existing overarching purpose and duties provisions of the FCFCOA Act and the FLA.

The objectives included in the overarching purpose will be set out in s 95(2) FLA, and are the same as the current ss 67(2) and 190(2) FCFCOA Act.

Review of operation of the FCFCOA Act

The review of the operation of the FCFCOA Act has been brought forward by 2 years and will occur between 1 September 2024 and 31 March 2025. More enquiries to look forward to.

Family Report Writers

Finally, there are new provisions to regulate family report writers and family reports. Recommendation 53 of ALRC Report was that a mandatory national accreditation scheme be developed for private family report writers. Standards and requirements for family report writers will be able to be set out in regulations and the regulations will apply regardless of whether they are appointed under the Family Law Regulations 1984 or are single expert witnesses appointed by the parties, and will apply regardless of the professional background of the family report writer. This is a very good thing.

According to the Explanatory Memorandum, the requirements of a “family report” are:

“a report must follow a family assessment, which is a professional forensic assessment undertaken to assist a court and/or the parties decide on parenting arrangements for children of separated parents or caregivers. It is an independent, professional and comprehensive forensic appraisal of the family, done from a social science perspective. The assessment provides information about the needs of children and their relationships with their parents and other significant adults, and of the attitudes and parental capacities of the adults with regard to the children’s needs. The definition reflects and is consistent with the description and purpose of family assessments provided by the Australian Standards of Practice for Family Assessments and Reporting, that are intended to guide the preparation of family reports. Where possible and appropriate the report will also often, but not always, include obtaining and conveying the views of a child.”

Family Law Amendment Bill (No 2) 2023 – Proposed Property Amendments

Major changes to the property settlement pathway proposed include:

• Setting out a summary of s 79/s 90SM — But not steps or a pathway
• Codifying Stanford
• Inserting the duty of disclosure into the FLA. Currently only in the Rules
• Repeat of s 75(2) factors as part of s 79, to remove the cross-referencing between maintenance and property
• Will give greater emphasis when assessing contributions and needs to:
  • The effect of family violence
  • Wastage
  • Debts

Setting out the principles under s 79 is not done in steps or a pathway.  There is a concern amongst many lawyers, including the Law Council of Australia, that this will simply add to the confusion at a time when the law post-Stanford seems more settled.

Inserting the duty of disclosure into the FLA as well as it being in the Court Rules is intended to give the duty of disclosure greater emphasis, but there appear to be some difficulties due to inconsistencies in drafting – at least under the 2023 Exposure Draft.

The draft legislation which was circulated last year for comment will amend the FLA to expressly provide that the property settlement process take into account when considering s 75(2) factors (renamed more accurately as “current and future circumstances”:

• The effect of family violence to which one party to the relationship has subjected the other party;
• Financial and emotional abuse;
• Debt; and

Whilst these are matters which can be relevant under the current law, the proposals will arguably make this conduct far more relevant. So, I will explain the current position as well as the proposed new laws.

Wastage

Parties love to argue this one, but there is a strict test. The main case is Kowaliw & Kowaliw (1981) FLC 91-092; [1981] FamCA 70 where the husband had lost money and been left with certain liabilities as the result of the failure of the business from which he had derived his income during most of the marriage. The court held that these losses and liabilities should be borne by both of the parties but not equally. The husband had also lost money by permitting a prospective purchaser, who in fact did not finally purchase the property, to occupy the matrimonial home free of rent or contribution for approximately a year. It was held that this action was commercially and economically reckless and the husband should be solely responsible for the consequent loss.

Justice Baker’s classic statement in Kowaliw was (at 76,644):

“As a statement of general principle, I am firmly of the view that financial loss incurred by the parties in the course of the marriage … should be shared by them (although not necessarily equally) except in the following circumstances:

(a) where one of the parties has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets; or

(b) where one of the parties has acted recklessly, negligently or wantonly with matrimonial assets, the overall effect of which has reduced or minimised their value.”

It is a fairly high test and does not apply if someone has simply failed in a business or an unfortunate investment. This test was not in the Exposure Draft leading to concerns that there will be uncertainty as to the test, floodgates, and therefore fertile ground for disputes.

Wastage may be relevant under either:

1. The assessment of contributions
2. The future or needs factors:

s 75(2)(o)/s 90SF(3)(r):

“any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account”

Liability for debts – directly or indirectly

In determining an appropriate property settlement order, the court may consider debts in relation to:

1. The identification of the property to be divided between the parties
2. The assessment of contributions
3. The “future needs” factors: which look at the interests of creditors.

s 75(2)(ha)/(s 90SF(3)(i):

“the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant”.

s 75(2)(o)/s 90SF(3)(r):

“any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account”

Tax evasion, particularly if the other party was completely innocent and unaware of it, can result in the tax evader being solely liable for the debt, or at least solely liable for any interest and penalties. As the innocent party may have benefited from the tax evasion there is a delicate balance between holding the tax evader liable and letting the “innocent” party off so that they unfairly benefit from the tax evasion to the detriment of the Australian Taxation Office.

The interests of creditors under s 75(2)(ha) do not have any more or less weight than the other factors under s 75(2). They are only one factor among many, such as disparities in the incomes and earning capacities of the parties and the impact of the care of children.

The new provision will emphasise the interests of non-debtor parties not creditors. I don’t know whether this will change outcomes. There is a concern about sexually transmitted debt, but I expect in the past this has been more problematic where a party cannot afford to litigate and/or the gross asset pool is modest. I don’t believe that the outcomes will necessarily be changed in litigated outcomes very much. In these cases the wastage argument usually assists those parties anyway.

Family violence

It is fairly rare for family violence to result in an adjustment in favour of the victim, but it does happen. Assessing the impact on the victim’s contributions is the approach taken by the courts. The leading case is Kennon & Kennon (1997) FLC 92-257; [1997] FamCA 27. The Kennon principle is that the effect of family violence can be relevant if there is a course of conduct that made the victim’s contributions within s 79 “significantly more arduous than they ought to have been” so there is a “discernible impact” upon the contributions (per Fogarty and Lindenmayer JJ). The conduct back in 1997 was expected to be sufficient to ground an adjustment only in “exceptional cases”.

One of the problems with assessing whether Kennon adjustments are given often or are given much weight is that it is an error for judges to make a mathematical assessment of contributions and s 75(2) factors and assign each aspect a different percentage weight. So, even with the changes we may not have good judicial guidance as to how family violence adjustments should be made in different circumstances.

The exact wording of the section will be highly relevant when considering the context of the proposed amendments, because it is not proposed that the Kennon test be reproduced. Their Honours said (at 84,294 – 84,295):

“Put shortly, our view is that where there is a course of violent conduct by one party towards the other during the marriage which is demonstrated to have had a significant adverse impact upon that party’s contributions to the marriage, or, put the other way, to have made his or her contributions significantly more arduous than they ought to have been, that is a fact which a trial judge is entitled to take into account in assessing the parties’ respective contributions within s 79. We prefer this approach to the concept of ”negative contributions” which is sometimes referred to in this discussion. …

However, it is important to consider the “floodgates” argument. That is, these principles, which should only apply to exceptional cases, may become common coinage in property cases and be used inappropriately as tactical weapons or for personal attacks and so return this Court to fault and misconduct in property matters — a circumstance which proved so debilitating in the past. In addition, there is the risk of substantial additional time and cost.”

The Full Court expressly ruled out conduct which does not have that effect and the principle did not encompass conduct solely related to the breakdown of the marriage, basically because it would not have had a sufficient duration for this impact to be relevant to contributions.

Recently, Justice Aldridge, sitting as the Full Court in Martell & Martell [2023] FedCFamC1A 71 expanded on the test in Kennon and pointed out that given the prevalence of family violence in today’s society, and most of the cases we see in the courts, the relevant conduct is not limited to “exceptional” cases. He said in Martell & Martell [2023] FedCFamC1A 71 (at [22]:

“…Unfortunately the prevalence of family violence is wide and artificial barriers to its recognition, such as trying to limit its recognition in property cases to exceptional or narrow cases, has no basis in principle. As I shall endeavour to explain shortly, the focus of the majority’s reasoning was on the nature and quality of the contributions themselves which were not limited by such qualifying adjectives…

There are likely to be unintended consequences for example, there will be more IVO applications and more hotly contested IVO proceedings. It may be more difficult to settle property cases if an accused party believes they are implicitly conceding their violent behaviour and the big question will be whether any extra costs incurred by a victim will have a net benefit. It is likely to continue to be difficult to assess the effect of a “family violence” adjustment because it is usually an error of law if the court puts separate percentage adjustments for different s 75(2) and contribution factors.

CONCLUSION

The new parenting changes are likely to result in (at least in the short to medium term):

• Increased uncertainty around the process and range of possible outcomes. The law will be uncertain for some time
• Better protection for victims of family violence – reduction in the number of equal shared parental responsibility orders or their new equivalent
• Greater difficulty negotiating settlements
• More litigation

In particular, the likelihood is that when courts are making parenting orders there will be increased uncertainty as to the process to be adopted and the range of possible outcomes. Whilst the primary consideration remains the best interests of the child, there is a change of focus. It is possible that the overall end result will be that the law has changed very little, but such a prediction cannot be made at this time. There will be, I can confidently predict, significant uncertainty, litigation and presumably a relocation dispute will again need to be decided by the High Court of Australia.

Some time later this year we can expect the proposed property amendments to be tabled in Parliament.