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Law Commission proposes relationship property changes

01 November 2018

The Law Commission has released a preferred approach paper on the Property (Relationships) Act 1976, with the suggestion that the family home should no longer always be shared equally.

The paper says that if one partner owned the house before the relationship began, only the increase in value during the relationship should be shared.

The Law Commission is seeking feedback on the proposals before making its final recommendations to the Government in 2019.

The paper - Review of the Property (Relationships) Act 1976: Preferred Approach: Te Arotake i te Property (Relationships) Act 1976: He Aronga i Mariu ai - sets out the Commission's preferred approach on the key issues arising from its review of the Act.

The Law Commission presents a package of reforms designed to achieve a law that meets most New Zealanders’ expectations of fairness when a relationship ends.

Key proposals in the paper

Key proposals include:

1: The family home should no longer always be shared 50:50. Instead, if one partner owned the home before the relationship, only the increase in value during the relationship should be shared. Homes acquired during the relationship will still be shared equally.


2: People who have children, have been together for 10 years or more, or who have built or sacrificed careers because of the relationship should be eligible for Family Income Sharing Arrangements or “FISAs”. Under a FISA, the partners would be required to share their combined income for a limited period after they separate, to ensure the economic advantages and disadvantages from the relationship are shared more fairly.


3: A court should have greater powers to share trust property when a trust holds property that was produced, preserved or enhanced by the relationship.


4: The rules should continue to apply to all marriages, civil unions and de facto relationships lasting three years, unless the partners enter into a contracting out agreement.


5: Partners should still be entitled to share equally in all relationship property, subject to limited exceptions.


6: Children’s best interests should be given greater priority under the PRA. This includes giving the primary caregiver of children a default right to stay in the family home in the period immediately following separation.


7: A range of measures to promote the just and efficient resolution of PRA matters and to address behaviour that causes delay and increases costs. This includes making sure partners properly disclose to each other all relevant information about their property, whether or not they go to court.


8: Developing a comprehensive information guide for separating partners that explains the law and provides information about the different options available for resolving a dispute. Funding for community organisations to provide person to person support should also be considered.

Feedback

The Law Commission says feedback on its proposals can be made up to 14 December 2018. It plans to publish its final report in 2019.

Last updated on the 16th September 2019