Economic Abuse and Property Settlements
In 2025, the definition of family violence in the Family Law Act 1975 was expanded. The definition now includes economic and financial abuse, as well as coercive control. These changes will affect how property settlements and spousal maintenance applications are dealt with in matters that involve family violence. This page outlines the changes and how they will affect family law financial matters.
Definition of family violence
Section 4AB (2) of the Family Law Act contains the definition of family violence for the purposes of family law matters. That definition now includes:
- economic or financial abuse
- preventing a family member from making or keeping connections with family
- unlawfully depriving a family member of their liberty.
The addition of these forms of abuse to the definition of family violence means that courts deciding property matters must now consider the economic effects of family violence.
Contributions to the property pool
When a court decides a property settlement between separated partners, it considers the financial and non-financial contributions of both parties.
Financial contributions include income, property that was owned at the start of the relationship, inheritance received, money earned on investments, and winnings.
Non-financial contributions include raising children, caring for a partner, running a household, and emotional support.
After a court has calculated these contributions, it calculates the future needs of each party, and makes orders that are just in the circumstances.
Family violence and property divisions
In a situation where there has been serious family violence, the court may adjust its property orders in consideration of the presence of family violence in a relationship if:
- a course of violence can be established
- the violent conduct had a discernible impact on the victim
- the victim’s contributions to the relationship were significantly more arduous because of the violence.
This test was set out in the 1997 decision of Kennon and Kennon, and became known as the Kennon adjustment. It was a difficult test to fulfil as the court stressed in its decision that generalised allegations of violence were not sufficient. The victim must identify separate particulars for each instance of violence alleged.
The changes to the definition of family violence
The change to the definition of family violence to include financial and economic abuse will have a significant effect on the application and scope of the test in Kennon and Kennon, but they do not replace or overrule it.
Property settlements
Section 79 of the Family Law Act sets out the orders a court may make when deciding a property settlement. One of the matters listed is the effect of family violence that one party has subjected the other party to.
As family violence is now defined as including economic and financial abuse, a property settlement may now be adjusted on that basis – for example, because it was significantly harder for one party to make financial contributions because their partner forbade them to work.
Spousal maintenance
Section 75 of the Family Law Act sets out the matters that a court may consider when making a decision about spousal maintenance. One of those matters is the effect of any family violence that one party has subjected the other party to.
As family violence is now defined as including economic and financial abuse, an order for spousal maintenance may now be adjusted on that basis – for example, where an economically abusive relationship rendered it hard or impossible for one party to earn income.
Responses to the changes
The changes have been met with broad support, particularly from the legal profession and community sector, with many professionals believing that economic abuse has been under-recognised by the family law system and that the reforms were needed to improve fairness and equality.
Domestic violence advocates have said that prior legal standards failed to recognise the deep financial harm that survivors face, and that the changes represent a shift towards equitable property outcomes. However, it has also been pointed out that procedural support and improved access to legal aid are needed for the changes to have a genuine impact.
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Fernanda Dahlstrom is a writer, editor and lawyer. She holds a Bachelor of Laws (Latrobe University), a Graduate Diploma in Legal Practice (College of Law), a Bachelor of Arts (The University of Melbourne) and a Master of Arts (Deakin University). Fernanda practised law for eight years, working in criminal law, child protection and domestic violence law in the Northern Territory, and in family law in Queensland.