Property settlement reforms to the Family Law Act and what they mean for you
10 June 2025 marks another significant milestone for the family law courts.
The Australian Parliament passed the Family Law Amendment Act 2024 (the Amendment Act) on 10 December 2024. The Amendment Act makes considerable amendments to the Family Law Act 1975 (FLA) in relation to how the family law courts will determine a property settlement and what it will consider when determining a property settlement. There will be a particular emphasis on the economic impact of family violence when resolving property and financial matters upon separation. These reforms come into effect on 10 June 2025.
These are the first significant changes to the family law legislation following sweeping property changes in March 2009 and parenting amendments in May 2024.
The changes
The key changes to the property settlement provisions in the family law legislation will impact couples seeking to resolve their property and financial matters following the breakdown of their relationship. The changes to the family law legislation include the following:
- Family violence will be a relevant consideration when determining the division of property and finances and spousal maintenance following the breakdown of a relationship;
- More clearly recognising economic or financial abuse (including dowry abuse) within the definition of family violence;
- Detailing the family law courts approach to determine the division of property;
- Recognising the importance of family pets by providing a framework for determining ownership of the pet in property settlements;
- Extending the family law courts discretion to use a less adversarial approach to property and financial matters to improve their ability to manage proceedings including evidence particularly where there may be allegations of family violence;
- Including the parties’ duties of financial disclosure from the family law rules into the FLA to ensure parties better understand their obligations and improve their compliance.
- The regulation of Children’s Contact Services to improve the safety of parents and children.
The approach the family law courts will take when making decisions about the division of property
When determining a property settlement between parties, the family law court must:
- Identify each party’s property (such as the family home, shares, bank accounts or superannuation) and their liabilities (such as mortgages, credit cards debts or personal loans).
- Consider each party’s financial or non-financial contributions to the build-up of the property pool before, during and after the relationship, and contributions to the welfare of the family. The family law courts will specifically consider the effect of any family violence, to which one party of the relationship has subjected or exposed the other party, on the ability of a party to contribute to the property pool or to the welfare of the family.
- Consider each party’s current and future circumstances. The family law courts will consider matters such as the party’s age and state of health, and the care and housing needs of any children;
- Only make orders that are, in all the circumstances, just and equitable (fair and reasonable).
The above approach can also be utilised by parties who are not in court but seeking to resolve their property and financial matters following the breakdown of their relationship out of court.
The Impact of Family Violence on Property Settlements
The Amendment Act betters recognises economic or financial abuse as family violence. It amends the definition of family violence to further identify forms of economic and financial abuse-related conduct.
Examples of behaviour that might constitute economic or financial abuse of a family member include (but are not limited to) the following:
- Unreasonably denying the family member financial autonomy;
- Forcibly controlling a family members money or assets including superannuation;
- Sabotaging the family member’s current ort potential employment or income;
- Forcing the family member to take on a financial or legal liability such as by entering a legal contract;
- Forcing or without their knowledge, accumulating debt in the family member’s name;
- Unreasonably withholding financial support from a family member that is needed to meet reasonable living expenses of that family member or a child;
- Forcing a family member to provide money or assets as a dowry or concealing actions of agreements in relation to a dowry;
From 10 June 2025, the family law courts must consider the economic effect of family violence when making decisions about property and finances after separation.
The impact of family violence may be relevant when assessing a party’s financial and non-financial contributions to the property pool and to the welfare of the family (for example, if they were not allowed to work), and when assessing their current and future circumstances (for example, if they have ongoing counselling or rehabilitation costs).
Companion Animals in Property Settlements
A companion animal is defined in the Amendment Act as an animal kept by the parties, primarily for the purpose of companionship. It does not include an assistance animal, an animal kept as part of a business, an animal kept for agricultural purposes or an animal kept for use in laboratory tests or experiments.
If separating couples cannot agree on arrangements for what happens to their companion animals (family pets), they can apply to the family law courts to make an order. From 10 June 2025, when considering what order, if any, to make about family pets, the family law courts must consider:
- the circumstances in which the companion animal was acquired;
- who has ownership or possession of the companion animal;
- the extent to which each party cared for, and paid for the maintenance of, the companion animal;
- any family violence to which one party has subjected or exposed the other party;
- any history of actual or threatened cruelty or abuse by a party towards the companion animal;
- any attachment by a party, or a child, to the companion animal;
- the demonstrated ability of each party to care for and maintain the companion animal in the future, without support or involvement from the other party;
- any other fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account.
Having considered the above, the family law courts can only make certain types of orders about family pets. This includes:
- that only one party to the marriage, or only one person who has been joined as a party to the proceedings, is to have ownership of the companion animal; or
- that the companion animal be transferred to another person who has consented to the transfer; or
- that the companion animal be sold.
The family law court cannot make orders for joint ownership or arrangements for sharing possession of family pets.
Less adversarial approach
The family law courts have previously only applied the less adversarial approach to trials in child-related proceedings. This meant that court proceedings could be more flexible and less costly than a traditional trial.
The Amendment Act extends this discretion to the family law courts to take a less adversarial approach to trials about property and financial matters also. This means that the family law court will have more flexibility in managing how proceedings are run, such as using technology to facilitate remote attendance where there are allegations of family violence or allowing evidence of the occurrence and effect of family violence which may not otherwise be admissible.
Duty of Disclosure
In family law (property) matters, parties are obligated to fully disclose all relevant financial information and documents to each other and to the court, in a timely manner.
The Amendment Act moves a parties’ duties of financial disclosure from the family law rules into the FLA to ensure parties better understand their obligations and improve their compliance.
The duty of disclosure is an ongoing obligation. It applies from the start of the proceedings and continues until the proceeding is finalised.
The family law court will have a range of powers that may be exercised to impose consequences when a person fails to comply with their duty of disclosure. For example, a court might take the failure into account when making an order to alter a party’s property interests, make any orders with respect to costs or security for costs against the person that the court considers just, having regard to the failure, make any orders with respect to disclosure that the court considers appropriate, impose sanctions, punish the person for contempt or stay or dismiss all or part of the proceedings. It is, therefore, imperative that parties to a proceeding comply with their disclosure obligations.
Impact on you
The changes to the family law legislation will impact both negotiated property settlements out of court and property settlements in the Court. It is therefore vital that your case is carefully prepared to address the new legislation, including setting out any history of family violence.
If you have any questions, or need assistance with your family law matter, please contact us to make an appointment via our website Contact Empower Family Law & Mediation, by phone on 7020 6542 or by email at info@empowerfamilylaw.com.au
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