The use of open flame heaters in a home is tightly regulated, and requires compliance with a lot of Australian Standards to ensure your safety.
For example, every wood heater made since 1992 must comply with AS/NZS 4013 to ensure smoke emissions are within a reasonable and safe limit. The installation of wood heaters, however, is regulated by Australian Standard AS/NZS 2918. Australian Standard AS/NZS 2918:2001 requires a minimum flue height of 4.6 metres above the floor on which the wood heater is located.
The same Standard also states that the end of the flue cannot be near any windows or doors, so as to prevent expelled air from being pushed back into your home. Further, a flue must be exhausted in a vertical direction. A damper, if used, should not seal the flue shut.
A chimney or flue must clear your roofline by a minimum of 600mm, and it must be at least one metre taller than any neighbours within three metres of your property. (Three metres was the standard current at the time of publication; this may be increasing to six in the future, so double check the current standards). The flue and chimney must also be appropriate for the size of the fire heater, and needs to prevent excess smoke escaping back into your home.