Separating couples often structure their property settlements on the basis that transfers required by court orders or financial agreements will be exempt from duty. The High Court proceedings in Agrinova Pty Ltd v Chief Commissioner of State Revenue (NSW) raise questions about the constitutional basis for some of those exemptions.
What is the case about?
Agrinova concerns property transferred to a company acting as trustee as part of a family law property settlement. The company claimed an exemption from duty, but the New South Wales revenue authority assessed the transfers as dutiable.
The proceedings began in the New South Wales Civil and Administrative Tribunal. The Senior Member held that he was bound by Gazzo v Comptroller of Stamps (Vic) (1981) 149 CLR 227, and that the current version of section 90(1)(a) of the Family Law Act 1975 (Cth) was not relevantly different from the provision the High Court struck down. In Gazzo, a court order required a husband to transfer land to his wife as trustee for their children. The High Court held that the earlier version of section 90 was invalid in its application to that transfer, so no exemption from state duty applied. The facts are close to those in Agrinova, where the transfers were made to a company acting as trustee.
Section 90 was re-enacted in 1983, after Gazzo. The High Court is now considering whether section 90(1)(a) validly exempts relevant instruments from state duty. That requires it to decide whether the re-enacted provision differs in any relevant way from the one held invalid in Gazzo and whether Gazzo should be revisited.
The High Court heard the case on 13 and 14 October 2026. Judgment is reserved.
Could completed settlements be affected?
If the company is unsuccessful, the consequences will depend on the Court’s reasons and the scope of its decision. An unfavourable result would not necessarily mean that every family law duty exemption is unavailable.
For example, financial agreements between married couples have a separate exemption under section 90L of the Family Law Act. The Court’s reasoning may have implications for that provision (given this exemption operates similarly to section 90), but the case does not directly determine every exemption under the Act. A transfer may also qualify for an independent state exemption.
The same issue may arise for de facto couples. Section 90WA of the Family Law Act provides a parallel exemption for financial agreements and court orders made under Part VIIIAB, and the Queensland Revenue Office treats sections 90, 90L and 90WA as three related exemptions. Whether the Court’s reasoning reaches section 90WA will depend on the constitutional basis for the de facto provisions, which differs from that for marriage.
One concern is whether revenue authorities could revisit exemptions allowed for completed transfers, including transfers under court orders and, if other exemptions are affected, financial agreements.
However, there is no automatic five-year clawback. In Queensland, the usual reassessment period is five years after the original assessment notice, subject to exceptions (sections 21 and 22 of the Taxation Administration Act 2001 (Qld)). Section 20 of the Taxation Administration Act 2001 (Qld) also generally requires reassessment to follow the Commissioner’s interpretations and assessment practices at the time of the original assessment, subject to statutory exceptions. Because these exemptions are self-assessed in Queensland, how those provisions apply to a self-assessed claim would also need to be considered. These protections must be considered before concluding that an earlier exemption could be withdrawn.
Queensland’s separate exemption under section 424 of the Duties Act 2001 (Qld) may also assist, although its requirements are narrower than the federal exemptions.
Could the Queensland Revenue Office protect earlier transactions?
One possible response would be an administrative arrangement or other relief under which the Queensland Revenue Office does not disturb earlier exemption claims, but changes its treatment of affected transactions from a specified date, such as the judgment date.
That could protect completed settlements while leaving future transfers exposed to duty unless another exemption applies. The treatment of settlements already documented but not yet implemented would be particularly important.
This is a possible response, not an announced arrangement. Any relief would need an approved legal basis, and its wording would determine which transactions it protects.
Could legislation preserve the exemptions?
The Commonwealth could seek to enact a constitutionally valid replacement exemption, potentially with retrospective operation to protect earlier transactions. State governments could also legislate to preserve or extend their own exemptions.
However, a Commonwealth response would depend on the constitutional problem identified by the Court. Simply re-enacting the same exemption would not overcome a finding that Parliament lacked power to enact it.
Whether any legislation would protect completed transfers, pending settlements or both would depend on its terms. Retrospective protection should not be assumed.
What should separating couples do now?
Anyone negotiating or implementing a property settlement should obtain advice about the particular exemption being relied on, any alternative state exemption and how an unexpected duty liability would be allocated.
Transfers involving companies, trusts or other third parties warrant particular attention. There is no basis to assume that completing a transfer before judgment will necessarily protect it from the consequences of the decision.
If you have questions about how the Agrinova decision could affect your property settlement, please contact our family law team at Cooper Grace Ward, who can work with our colleagues specialising in duty to advise you on the implications.
