We present a new method for simulating two-phase flows in complex geometries, taking into account contact lines separating immiscible incompressible components. We combine the diffuse domain method for solving PDEs in complex geometries with the diffuse-interface (phase-field) method for simulating multiphase flows. In this approach, the complex geometry is described implicitly by introducing a new phase-field variable, which is a smooth approximation of the characteristic function of the complex domain. The fluid and component concentration equations are reformulated and solved in larger regular domain with the boundary conditions being implicitly modeled using source terms. The method is straightforward to implement using standard software packages; we use adaptive finite elements here. We present numerical examples demonstrating the effectiveness of the algorithm. We simulate multiphase flow in a driven cavity on an extended domain and find very good agreement with results obtained by solving the equations and boundary conditions in the original domain. We then consider successively more complex geometries and simulate a droplet sliding down a rippled ramp in 2D and 3D, a droplet flowing through a Y-junction in a microfluidic network and finally chaotic mixing in a droplet flowing through a winding, serpentine channel. The latter example actually incorporates two different diffuse domains: one describes the evolving droplet where mixing occurs while the other describes the channel.