Legal principles in relation to parenting and property

124       The Family Law Act governs how decisions in family disputes over parenting and property matters will be made. In this section, the ALRC asks what changes might be made to the legislative provisions governing decisions about children’s care arrangements and the court’s welfare jurisdiction. It also asks whether and how the law in relation to parenting might be reformed to ensure a consistent approach to decision making about children’s care needs regardless of the structure of their family or how it was formed. The ALRC also asks about the need for changes to be made to the law governing property division, spousal maintenance and binding financial agreements.

Parenting

Parenting orders

125       Early consultations for this Inquiry revealed a number of concerns about Part VII of the Family Law Act (Part VII). Among other things, Part VII vests relevant courts with the power to make ‘parenting orders’ about the care of children. These may include orders about:

• who a child lives with;
• the time a child is to spend with another person or persons;
• the allocation of parental responsibility for a child;
• the communication a child is to have with another person or persons;
• the maintenance of a child, in limited circumstances;
• how disputes about the operation of the order may be resolved; and
• any aspect of the care, welfare or development of a child or any other aspect of parental responsibility for a child.

126       Part VII also contains a framework that governs decision making about these issues by the courts. This framework, introduced in 2006, provides that the best interests of the child must be the court’s ‘paramount consideration’ when deciding what orders to make. It also sets out a list of factors the courts must take into account when determining the child’s best interests. This list identifies two matters—the benefit to the child of having a meaningful relationship with both parents, and the need to protect the child from harm from being subjected to, or exposed to, abuse, neglect or family violence—as primary considerations. As a result of amendments to the Act in 2012, the courts are required to give greater weight to the second of the primary factors, the need to protect children from harm.

127       Additional factors that the courts must consider include:

• any views expressed by the child;
• the capacity of each parent to provide for the child’s needs;
• the attitude to the responsibilities of parenthood demonstrated by each parent;
• any family violence involving the child or a member of the child’s family; and
• the right of Aboriginal or Torres Strait Islander children to enjoy their culture.

128       The decision-making framework in Part VII also includes a presumption that it is in the best interests of the child for his or her parents to have equal shared parental responsibility for their care. This presumption does not apply in cases of family violence or child abuse, and it can be rebutted by evidence that it is not in the best interests of the particular child in the circumstances. If the court does make an order for equal shared parental responsibility, it is then required to consider whether an equal care-time arrangement is in the child’s best interests and reasonably practicable.

129       In the 2006 case of Goode & Goode,^[133] the Full Court of the Family Court held that this framework provides the courts with a multi-step decision-making pathway to follow. According to this pathway, a judicial officer should:

• consider each of the relevant matters in the best interests checklist and make findings about them if possible;
• decide whether the presumption of equal shared parental responsibility applies or is rebutted;
• if the presumption applies and is not rebutted, consider whether making an order that the child spend equal time with the parents is in the child’s best interests;
• if equal time is found not to be in the child’s best interests, consider making an order that the child spend substantial and significant time with each parent; and
• if neither equal time nor substantial and significant time is considered to be in the child’s best interests, make such orders as the court decides are in the best interests of the child.

130       Academic scholarship and preliminary consultations for this Inquiry indicate that this framework has been the subject of considerable critique. This has included concerns about:

• the effectiveness of the legislation in addressing safety concerns for children arising from family violence and child abuse;
• the complexity and repetition within the decision-making framework, and associated cost issues for clients and productivity issues for the courts;^[134]
• the confusion created by the presumption of equal shared parental responsibility, which many in the community have misunderstood as a requirement that children should spend equal amounts of time with each parent;
• the scope for escalation of conflict associated with the requirement that parents must jointly make decisions;^[135] and
• the lack of respect and weight given to the views of the child in parenting proceedings.^[136]

Family violence and parenting orders

131       The definition of family violence in the Family Law Act is integral to the application of the provisions designed to protect children from harm. The relevant section, introduced in 2012, defines family violence as ‘violent, threatening or other behaviour by a person that coerces or controls a member of the person’s family … or causes the family member to be fearful’.^[137] The section also provides a non-exhaustive list of examples of behaviour that may constitute family violence, including:

• assault;
• sexual assault or other sexually abusive behaviour;
• stalking;
• repeated derogatory taunts;
• intentionally damaging or destroying property;
• intentionally causing death or injury to an animal;
• financial abuse;
• social isolation from friends, family or culture; and
• deprivation of liberty.

132       Some concerns have been expressed that this definition:

• may not adequately reflect the experiences of violence in Aboriginal and Torres Strait Islander communities;^[138]
• does not include misuse of process as a form of abuse;
• does not mention psychological abuse; and
• is not consistent with state and territory family violence legislation, whose definitions do not include a requirement of coercive and controlling behaviour.^[139]

133       Recent reports and early consultations for this Inquiry suggested a number of potential reforms to the decision-making framework in Part VII and to the Act’s definition of family violence. These include proposals to:

• include abuse of process as an example in the definition of family violence;^[140]
• remove the presumption of equal shared parental responsibility^[141] and the language of equal shared time from Part VII;^[142]
• amend the best interests of the child checklist to more clearly prioritise the protection of children from physical or psychological harm;^[143]
• provide a simplified decision-making framework for determining interim parenting matters;
• provide a separate dedicated pathway for decision making in cases involving family violence; and
• enact requirements that a risk assessment for family violence be undertaken upon a matter being filed and at each hearing or court event and that findings of fact be made about allegations of family violence as soon as practicable after proceedings are filed.^[144]

The welfare jurisdiction

134       Concerns have also been raised about the Family Law Act’s welfare jurisdiction, which gives the family courts a broad power to make orders relating to the welfare of children.^[145] This supervisory jurisdiction of the court is used to support a range of orders arising outside the context of a dispute between parents, although the scope of the court’s power under s 67ZC is uncertain.^[146] Recent reports and early consultations have revealed concerns about how the welfare jurisdiction operates in relation to people with disability (in particular in relation to the sterilisation of young women), and in relation to intersex children.

135       The sterilisation of a young person, including one with an intellectual disability, must usually be authorised by the Family Court pursuant to the exercise of its welfare jurisdiction.^[147] Scholarly critiques have suggested that, in these matters, the Court has tended to focus on the person’s disability, including assumptions about their lack of capacity, instead of looking at their social context and capabilities.^[148] Organisations such as Women with Disabilities Australia and the Australian Human Rights Commission have argued that forced sterilisation is a serious violation of human rights, and have called for a prohibition of the involuntary or coerced sterilisation of girls unless there is a serious threat to life.^[149] However, the Family Court has noted that it is increasingly rare for such applications to be brought.^[150] In 2013, the Senate Standing Committee on Community Affairs recommended the development of uniform model legislation to regulate the sterilisation of people with disability.^[151]

136       In relation to intersex children, concerns have been raised about the ability of intersex children to participate in decision making about their gender identity and the extent to which court scrutiny on decisions in relation to medical treatment is required to uphold human rights standards. In Re: Carla,^[152] the court held that its prior consent to the removal of gonads in a five year old child who was raised as a girl having been born with ‘the external appearance of a girl, but with male gonads not contained within a scrotum’ was not required.^[153] This approach has been criticised by human rights advocates, on the basis that significant risks can ensue from the treatment, including infertility and loss of sexual sensation.^[154] Intersex people have reported that it is common for medical procedures to be carried out on infants or young children, without their consent.^[155] Responding to concerns from intersex organisations, the Senate Community Affairs Reference Committee in 2013 recommended that all proposed intersex medical interventions for children and adults without the capacity to consent should require authorisation from a civil and administrative tribunal or the Family Court.^[156]

137       The ALRC also notes the recent appeal decision in Re Kelvin^[157] in which the requirement for family court approval was overturned for stage two of medical treatment where the young person was considered to be Gillick^[158]competent (of sufficient maturity to give informed consent) and their parents and treating medical practitioners agreed with the course of action.

138       The ALRC invites comment on whether changes should be made to Part VII, the definition of family violence, or any other provisions of the Family Law Act to produce best outcomes for children and better support decision making in relation to the safety of children and their families.

139       The ALRC is also interested in receiving feedback about other sections of the Family Law Act and Rules that affect arrangements for children, including:

• section 68LA, which defines the nature of the role of the Independent Children’s Lawyer;
• the principles in Division 12A for conducting child-related proceedings;
• the provisions of Division 13A which govern the courts’ powers in relation to non-compliance with orders that affect children; and
• the rules governing the making of consent orders.

Arrangements for children and family diversity

140       As noted above in the section, ‘Objectives and principles’, a significant number of Australian families with children do not fit the traditional heterosexual nuclear family model. Since the passage of the Family Law Act, Australia has seen increasing numbers of stepfamilies, blended families, sole-parent families and same-sex families, as well as growing numbers of kinship-care arrangements.

141       Families in Australia also reflect a considerable diversity of cultural practices in relation to the care and raising of children, including among Aboriginal and Torres Strait Islander peoples and culturally and linguistically diverse communities. In many cases these practices incorporate approaches to family structure that are distinct from those of nuclear families.^[159] For example, it is not uncommon for Aboriginal children to have multiple caregivers drawn from their wider kinship networks,^[160] while many families in Australia’s new and emerging communities take a collectivist approach to child rearing.

142       In addition to this diversity, recent years have seen a growing use of assisted conception processes and surrogacy arrangements by Australian families, increasing the number of potential parents a child may have, including a mix of genetic, gestational, social and intending parents. Together, these developments suggest that for a significant number of Australian children, their family will include carers who are not their biological or legal parents.

143       Reflecting on this context, a number of stakeholders and reports have suggested that many of the provisions of Part VII, which are limited in their application to the child’s biological or adoptive parents, should be amended to better reflect the diversity of families in which children are cared for, and to better support decision making by the courts in cases where children are living in non-traditional families.

144       The ALRC seeks comment on whether Part VII of the Family Law Act should be amended to better reflect the diversity of families in Australia and support a consistent decision-making approach for all children regardless of their family structure.

Property adjustment

145       The Family Law Act provides the family courts with broad powers to adjust property interests and make orders for spousal maintenance between current or former married couples, and between former partners from unmarried relationships. The provisions relating to married and unmarried couples are very similar but are not identical.

146       The Act provides two key powers to judicial officers in relation to parties to a current or former marriage and parties to a former ‘de facto’ relationship: a power to declare the title or rights that a party has in respect of property,^[161] and a power to alter the interests of the parties in property.^[162] Orders may be made that affect third parties in certain circumstances.^[163] ‘Property’ is interpreted broadly to include all the property of the parties, and to include both legal and equitable interests, and tangible as well as intangible property such as shares or debts.^[164] The Act also provides detailed provisions allowing for the division of superannuation interests.^[165]

147       The power to alter property interests is broadly framed as a power to ‘make such order as [the court] considers appropriate’.^[166] However, this power may only be exercised where the court is satisfied ‘that, in all the circumstances, it is just and equitable to make the order’.^[167] The court’s discretion must also be exercised in accordance with legal principles, including those in the Act itself.^[168]

148       In considering an application to alter property interests, the court must:

• identify the existing legal and equitable interests of the parties in the property;
• consider whether it would be just and equitable to make an order altering those interests; and
• if it is just and equitable to do so, consider what orders should be made, taking into account the factors listed in s 79(4), which incorporate the ‘future needs’ factors set out in s 75(2).

149       The law in a number of overseas family law systems takes a less discretionary approach to this issue. For example, the legislation in some countries employs default rules, such as a presumption of equal sharing (for example, New Zealand),^[169] or uses a ‘community of property’ approach, where property acquired during the relationship is presumed to be jointly owned, but property acquired before or after the relationship belongs solely to the person who acquired it.^[170]

150       A survey of separating parents conducted by the AIFS indicates that key factors affecting the division of their property were the extent of the assets, liabilities, and financial resources of the parties, who initiated the separation and who left the family home, family violence, and care-time arrangements for children.^[171] The research found that a majority (62%) of respondents thought that their property arrangement was fair.^[172]

151       However, this research suggests that for those affected by family violence or other risk factors, there is a greater likelihood of an outcome in which the person who has experienced violence will not achieve a fair outcome and may suffer long-term financial disadvantage.^[173]

152       A number of suggestions have been made for changes to the Family Law Act’s property regime. These have included:

• proposed changes to the provisions guiding how property should be split including:
• adoption of a community of property regime;^[174] and
• a presumption of equal contributions,^[175] or other presumptions about how property should be split, such as a presumption of equal sharing;^[176]
• codification of the Full Court of the Family Court’s decision in Kennon & Kennon,^[177] or otherwise providing clearer guidance about how family violence will be taken into account in property matters;^[178]
• amendments to allow greater use of court orders for the split or transfer of unsecured joint debt and liabilities;^[179]
• suggestions that the requirement to regard the best interests of the child as the paramount consideration should also apply to adjustment of property;^[180]
• suggestions that the Act’s complex superannuation splitting provisions be simplified;^[181] and
• suggestions that the property provisions for married and unmarried couples be merged and any remaining inconsistencies resolved.

153       The ALRC invites comment on whether these or any other changes should be made to the provisions in the Family Law Act governing property division.

Spousal maintenance

154       The Family Law Act vests the family courts with power to order a party to a marriage or a ‘de facto’ relationship to pay spousal maintenance to the other party if that person is unable to support him or herself due to caring responsibilities for a child of the marriage, disability, or ‘any other adequate reason’.^[182] The court can make ‘such order as it considers proper’ for the provision of maintenance,^[183] having regard to the person’s capacity to pay.

155       The Act provides a list of 19 matters that may be taken account in determining what order to make, including the age and health of the parties, their income, property, financial resources and capacity for employment, and whether a party has the care and control of a child of the relationship who is under the age of 18. Orders for maintenance can either provide for lump sum maintenance, or for periodic payments.^[184]

156       There is limited data available on the incidence of maintenance orders. However, surveys of court judgments have indicated that orders for maintenance are rare and are generally limited to cases involving high income families and made on an interim basis or for a limited period of time.^[185]

157       Research suggests that this profile is in line with community attitudes in Australia, with one 1999 study indicating very limited community support for the payment of private spousal support after separation.^[186]

158       However, a number of the early consultations for this Inquiry and submissions to the SPLA Inquiry have suggested that there should be greater consideration of spousal maintenance orders in cases involving family violence. These include a suggestion that family violence be included as a relevant factor in determining needs for the purposes of spousal maintenance applications.^[187] Some stakeholders also proposed the development of a system of administrative determination of maintenance claims, in a similar fashion to child support.

159       The ALRC is interested in comment about whether changes are needed to the spousal maintenance provisions, particularly in relation to people who have experienced family violence.

Binding financial agreements

160       The Family Law Act provides for both married couples and unmarried cohabiting couples to settle their financial affairs by way of a binding financial agreement (BFA). A BFA may be entered into before, during or after a relationship,^[188] and may set out how part or all of the parties’ property or financial resources, and maintenance, should be dealt with in the event that the marriage or relationship ends.^[189]

161       Assuming a BFA is validly made, its effect is to ‘oust’ the jurisdiction of the family courts to make orders adjusting the parties’ property in accordance with the provisions of the Family Law Act.^[190] Because of this effect, the Act provides a number of safeguards to protect parties who enter into a BFA. These include:

• strict requirements for entry into the agreement, including a requirement that each party sign the agreement, receive independent legal advice about the effect of the agreement on their rights, and the advantages and disadvantages of entering into it, receive a statement stating that this advice has been received, and provide that statement to the other party;^[191] and
• provisions allowing the courts to set aside a BFA on certain grounds such as where a party’s agreement was obtained by fraud or there has been a material change of circumstances since the agreement was made.^[192]

162       Over the years, the courts have overturned a number of agreements because of failure to meet the Family Law Act’s entry requirements, or previous versions of them.^[193] In response to this, two sets of amendments^[194] have been enacted to strengthen the enforceability of BFAs, including by:

• reducing the number of matters about which parties must receive legal advice; and
• providing the courts with some flexibility to uphold an agreement where certain requirements were not met but it would be ‘unjust and inequitable’ if the agreement were not binding.^[195]

163       Despite these changes, members of the legal profession have expressed concerns about their exposure to professional negligence liability resulting from the continuing uncertainty about the advice they are required to give clients.^[196] Other issues that have been raised during consultations include concerns about:

• the use of BFAs to the disadvantage of the member of the couple in the weaker bargaining position;
• the extent to which the provisions governing BFAs sit comfortably with a discretionary approach to property adjustment;
• whether and how family violence should be taken into account where a couple has entered into a financial agreement, including family violence that commenced after the financial agreement was finalised;^[197] and
• the effect of the recent High Court decision in Thorne v Kennedy,^[198] which set aside an agreement on the basis of unconscionable conduct, on enforceability of agreements.

164       The ALRC is interested in comment on whether any further changes are needed to the provisions governing BFAs.