Financial proceedings under the Family Law Act

Family violence as a factor in property disputes

Part VIII of the Family Law Act deals with property and spousal maintenance orders, providing a mechanism for parties to alter property rights that would otherwise apply under common law and equity. Section 79 provides the court discretion to alter property rights to effect a just distribution between the parties. Generally, the court considers the contributions and future needs of the parties in making this assessment.

In the Marriage of Kennon^[5] (Kennon) provided clear authority that family violence is a relevant factor in determining a party’s contribution under s 79 of the Family Law Act. To satisfy the Kennon criteria, a party must prove, on the balance of probabilities, that he or she was subject to a violent ‘course of conduct’ during the marriage, which had a ‘significant adverse impact’ upon the party’s contributions or, in the alternative, which made those contributions ‘significantly more arduous’.

Existing or previous protection orders under state and territory family violence laws do not appear to have been accorded specific weight under Kennon or subsequent case law. Commentators, law reform bodies and others have raised strong arguments that the Family Law Act should be amended to recognise family violence expressly as a relevant factor in property disputes. The Commissions seek further stakeholder feedback on whether, in practice, protection order proceedings are considered in the context of property disputes—for example, whether evidence of family violence introduced in protection order proceedings is being used for the purpose of Kennon adjustments.

In ALRC 69, the ALRC recommended that the division of property under the Family Law Act should take into account the impact of family violence on past contributions and on future needs.^[6] The Commissions express their support for this recommendation.

The relevance of family violence to financial proceedings under the Family Law Act was not considered in the 2009 reviews of family violence in the federal family courts by Professor Chisholm and the Family Law Council. The Commissions’ preliminary view is that the Australian Government should undertake a separate inquiry into the manner in which federal family courts deal with allegations of family violence in property proceedings, with a view to proposing models for legislative reform.

Property conditions in protection orders

Family violence legislation in each of the states and territories makes provision for courts to issue protection orders which prohibit a person from entering or approaching the protected person’s residence. Most family violence laws provide for a court to make orders permitting an excluded person or victim of violence to gain access to the premises for the purpose of taking personal possessions, usually by an arrangement or in the company of police. For the purpose of the following discussion, these will be referred to as ‘personal property directions’.

In the Commissions’ preliminary view, most property disputes should be resolved in the federal family courts and other courts with the expertise, time and resources to address the issues comprehensively, including courts responsible for resolving property disputes under state and territory de-facto relationships legislation. Protection order proceedings should only deal with property issues to the extent necessary to give effect to the protective objectives of family violence legislation—for example, to ensure that excluded parties obtain access to personal possessions necessary for day-to-day living so as to preclude the need for any further access to the restricted premises. This is consistent with the policy stated by the NSWLRC in its Apprehended Violence Orders report—that is, a personal property direction

is not designed to ‘create a jurisdiction by stealth’ for the Local Court to intervene in family court property disputes, but is an attempt to address a ‘practical legal vacuum’ which arises almost everyday and can give rise to significant hardship.^[7]

The interactions between personal property directions and property proceedings under the Family Law Act are especially vexed where parties take possession of property which they do not own or have a right to possess, or wrongfully deny the other party access to property—which may be done as a part of coercive and controlling behaviour. The Commissions are interested in further feedback on the extent to which these scenarios arise in practice. This information will provide an important evidentiary basis for formulating proposals for reform.

Influencing federal family court proceedings

The availability of comprehensive personal property directions may influence property proceedings under the Family Law Act. In the Commissions’ preliminary view, this is only appropriate in very limited circumstances. The property that a person may recover pursuant to orders should be limited to that which is necessary for daily living. At this stage, the Commissions support recovery of the types of property listed under the Domestic and Family Violence Act 2007 (NT)—that is, clothes, tools of trade, personal documents and other personal effects. For recovery of all other property, it is preferable for parties to commence proceedings in, for example, the federal family courts. The Commissions are interested in stakeholder views about whether access to any other types of property should be available to excluded persons, for example, the personal property of a child of the excluded person—as in the Restraining Orders Act 1997 (WA).

The Commissions further consider that a court should decline to make a personal property direction if the property is ‘reasonably needed’ by the victim or a child of the victim. Recovery should not be allowed where title to the property is genuinely in dispute or other more appropriate means are available for the issue to be addressed—for example, if there are ongoing property proceedings in a federal family court. The workability of this provision depends upon a court having knowledge of family court proceedings. The Commissions propose that parties involved in protection order proceedings should have an obligation to inform the court of property orders made by a federal family court, or pending proceedings for such orders. This information should be sought in application forms for protection orders.

Inconsistent orders about property

Personal property directions may conflict with existing orders of a federal family court made under pt VIII of the Family Law Act. This is likely where a court is not informed about the existence of such orders. Accordingly, there should be clear strategies in place for courts making protection orders to obtain information about, and consider, property orders made under the Family Law Act. The South Australian family violence legislation, which requires applicants for a protection order to inform the court of any agreement or order for the division of property, or any pending application for such an order, may be instructive. Courts issuing personal property directions should take into account any such agreement or order, thereby avoiding the potential for inconsistency.

Family violence legislation may need to clarify the effect, if any, of inconsistent orders. The Victorian and NSW legislation include provisions to the effect that a personal property direction in a protection order is subject to any order to the contrary made by a federal family court. To the extent of any inconsistency, the order of the family court prevails.

Future federal family court proceedings

Personal property directions may have repercussions for subsequent property proceedings in a federal family court. For example, where an order provides for furniture belonging to an excluded person to remain with the victim, there is scope for this to be put forward as a victim’s ‘property’ for the purpose of a declaration under s 78 of the Family Law Act. In the Commissions’ view, it is inappropriate for protection order proceedings to take the place of dedicated processes for resolving property disputes, such as those set out in pt VIII of the Family Law Act. Accordingly, the Commissions support a clear legislative statement in the family violence laws of each state and territory that a condition relating to personal property in a protection order does not affect any rights the victim or person who has used violence may have in relation to the ownership of the property. Section 88 of the Family Violence Protection Act 2008 (Vic) should be referred to as a model in this regard.