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Family Law Library

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Mathews Family Law & Mediation Specialists have created many detailed articles answering the most common questions people have in relation to their rights and Australian Family Law.


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Financial Abuse

financial abuse

Australian family law and the family law courts recognise the close connection between family breakdown and family violence, and the resultant impact this has on victims of family violence – both adults and children.

Often when we hear references to family violence, our minds instinctually think of ‘violence’ in the traditional sense and behaviours such as:

  • Physical abuse (such as hitting or pushing someone);
  • Sexual abuse; or
  • Emotional and/or psychological abuse (such as yelling or insulting someone, undermining their self-worth or humiliating a person).

Australian family law legislation provides a wide interpretation and definition of the term ‘family violence’ and The Family Law Act and the family law courts recognise financial abuse (or economic abuse) as a form of family and domestic violence.

Financial abuse (or economic abuse) occurs when you are unreasonably denied financial autonomy that you would otherwise have had, and are denied any control over your personal and/or the relationship’s finances. In many cases, this type of abuse is subtle and not obvious, and can be difficult to recognise. Financial abuse can also manifest slowly over the course of a relationship – steadily ‘creeping up’ until it becomes ‘the new normal’.

Some common examples of financial abuse include (but are not limited to):

  1. Being denied financial autonomy and control of your own finances (e.g. a spouse/domestic partner taking complete control of the relationship’s money and finances).
  2. Being provided with inadequate funds and having money withheld to meet your (and your children’s) reasonable living expenses. This is especially the case in circumstances where you are entirely or partially dependent on your spouse/domestic partner for that financial support.
  3. Being constantly monitored, harassed and questioned about what you spend money on.
  4. Having access to your bank accounts and credit/debit cards restricted or blocked.
  5. Being forbidden to work and earn income of your own.
  6. Having your pay taken from you and your access to it restricted.
  7. Being made to feel that you are irresponsible and incapable of handling money.
  8. Your spouse/domestic partner refusing to work or contribute to household expenses.
  9. Your spouse/domestic partner incurring debts in your name (this is related to identity theft).
  10. Being forced to sign financial documents (such as mortgage documents or personal loans) without being allowed to read or consider them.

Financial abuse is often accompanied by other forms of family violence, such as verbal abuse (e.g. angry outbursts and threats of violence), as well as physical abuse. Experiencing financial abuse can be just as damaging as physical abuse, and the affected family members often aren’t aware of how to seek and access support.

Our accredited family law specialists are available to assist in matters involving family violence and financial abuse, along with all other facets of your family law matter. If you would like to speak to one of our family law specialists about any of your family law issues, please contact us on (03) 9804 7991 or email enquiries@mflaw.com.au for a free telephone consultation.

FINANCIAL LOSS DURING A RELATIONSHIP – CASE NOTE

In the recent Family Court case of Anaya & Anaya [2019] FCCA 1048, the principle in the long established case of Kowaliw and Kowaliw was re-affirmed that:

As a statement of general principle, I am firmly of the view that financial losses incurred by parties or either of them in the course of a marriage whether such losses result from a joint or several liability, should be shared by them (although not necessarily equally) except in the following circumstances:

  1. 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
  2. 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.

In Anaya, the husband argued that investment funds (including an inheritance of $1,000,000) ‘lost’ by the wife should be ‘added back’ to the asset pool and treated as an advance on her property settlement. The wife argued that the losses were a matter to be taken into account generally and to have them ‘added back’ to the asset pool would likely result in hardship to her.

His Honour held that at the time the wife decided to enter into the high risk investment she was likely to have been depressed and angry at the husband about their separation but that her decision to do so was reckless and fell within the second category of Kowaliw. The wife’s awareness was exacerbated by the timing of her decisions – after Family Court proceedings had commenced and she had legal representation.

I often have clients ask me to seek redress for losses ‘caused’ by their former partner, for example, the reduced value of their share portfolio or investment in a now worthless time-share resort. For the majority, my answer is no, that these losses were incurred in the course of the marriage but for some however, the answer is ‘yes’, for example, money lost due to gambling.

It is important that each significant financial ‘win’ and ‘loss’ experienced during the marriage is objectively assessed in the context of its surrounding circumstances. An emotional assessment may be misguided and result in unrealistic expectations by the aggrieved client.

I am available to assist with this task – by offering an objective and realistic assessment of your client’s complex property settlements.

Please contact me on vanessam@mflaw.com.au or 9804 7991 if you would like to discuss your client’s situation.

Or have your client contact me to arrange a free initial 15 minute telephone consultation.

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