Relationship Property in NZ: Complete Guide

The Property (Relationships) Act 1976 covers married couples, civil union partners and de facto couples when they separate, and also when one partner dies. Relationship property is what the Act divides. It includes:

• the family home and its contents (but not taonga or heirlooms)
• vehicles
• property you acquired during the relationship
• debts that aren't personal to one of you

The starting point is that relationship property is shared equally. A fair division also takes into account any economic advantages or disadvantages the relationship created for either of you.

Married and civil union couples

Covered by the Act. If the relationship lasted less than three years, it's a relationship of short duration and special rules apply, for example where one partner owned the home before or contributed much more.

De facto couples

A de facto relationship is two people aged over 18 who live together as a couple and aren't married to or in a civil union with each other. The court looks at things like how long you lived together, whether you shared a home and finances, and whether you cared for children together.

De facto couples together for at least three years are covered. A shorter de facto relationship usually isn't, unless there's a child of the relationship or one partner made a substantial contribution, and not making an order would cause serious injustice.

Separate property is property that isn't shared, and it usually stays with its owner. It includes:

• property you owned before the relationship began (the family home is the exception)
• gifts and inheritances given to only one of you
• heirlooms and taonga

Separate property can become relationship property if it's mixed with relationship property or used for the family. For example, an inheritance used to pay down the family home mortgage will likely become relationship property, and you couldn't claim it back as separate property later.

Equal sharing is the general rule, not an absolute one. Property may be divided differently when:

• the relationship lasted less than three years (see above)
• there are extraordinary circumstances that would make equal sharing repugnant to justice, which is a high bar
• one partner is left at an economic disadvantage, for example after years out of paid work raising children while the other built their career. A court can take this into account.
• you have a valid contracting out agreement that says something different

Most of the work is agreeing what's relationship property, what it's worth, and who keeps what.

Couples can agree their own way of dividing property instead of following the Act. These are contracting out agreements, also called section 21 agreements or prenups. You can make one before or during a relationship, or after you separate to settle things.

To be valid, the agreement must be in writing and signed by both of you. Each of you must get independent legal advice from a different lawyer, and the lawyer who witnesses your signature must certify that they explained what the agreement means for you.

An agreement that doesn't meet these requirements may not be enforced. Even a valid agreement can be set aside by the court if it would cause serious injustice.