In the recent 2025 Full Court Judgment Shinohara & Shinohara [2025] FedCFamC1A 126, the Court dealt with the issue of addbacks relating to property settlements in light of recent legislative amendments. At trial, the Court departed from its traditional approach of adding back assets in the parties’ property pool for division.
Prior to the s 79 amendments introduced by the Family Law Amendment Act 2024, if one party had spent or lost funds or property prior to the separation, the Court would sometimes treat the assets as if they still existed and would include them in the total pool of assets in the balance sheet as an “addback” to then be divided between the parties.
In the Shinohara case, it was held that the legislative amendments made the addback doctrine archaic and no longer consistent with s 79(3) of the Act. In its reasoning, the Court excluded from the asset pool any dissipated contributions, signalling a clear turning point in the Courts traditional addback procedure, clarifying that only existing and currently held funds and property are to be identified and considered in the asset pool on the balance sheet for the purposes of division or adjustment between the parties.
The Court may still consider the relevance of historical contributions that have been lost or spent which may be relevant to one or both of the parties present and future financial circumstances. This decision signals a significant evolution in Family Law jurisprudence. What was once the Court mechanically restoring dissipated assets to the balance sheet is now focusing on the real and existing assets and considering each party’s financial contributions in a more balanced and realistic way (as under s 79(5)).
At Matthews Folbigg Lawyers, our team of experts can provide advice on family law property proceedings. For more information, please contact our Family Law team on 02 9635 7966.
