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Relationship property claims

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Your rights on the death of a spouse or partner

If your spouse or partner has died, you have two options:

A. Apply under the Property (Relationships) Act – if the Act applies to your relationship, you can make an application to the Court for a half-share of the relationship property; or

B. Inherit under the will (or intestacy) – you can take what has been left to you by your partner in their will (or inherit under the intestacy rules if they died without a will).

In addition, you may have the right to claim against your partner’s estate under the Family Protection Act. A claim under the Family Protection Act can be made regardless of which of the above options you choose. Read about claims under the Family Protection Act here.

Does the Property (Relationships) Act apply to my relationship?

The Property (Relationships) Act will apply to your relationship if you and your partner were:

  • married or civil union partners; or

     

  • in a “de facto relationship” (as explained below).

Different rules apply where the total amount of time that the parties were married or in a de facto relationship was less than 3 years. Relationships of short duration are discussed further below.

Meaning of “de facto relationship”

A de facto relationship is a relationship between two people who are over 18 years old and living together as a couple, but who are not married to, or in a civil union with, each other. When deciding whether two people are living together as a couple, the Court will take into account:

(a)  the length of the relationship;

(b)  whether the parties are living in one house;

(c)  whether they have a sexual relationship;

(d)  the degree of financial dependence or interdependence;

(e)  how property is owned, used and obtained;

(f)  the degree of commitment to a shared life;

(g)  the care and support of children;

(h)  the performance of household duties; and

(i)  the public image of the relationship.

Relationships of short duration

Marriages of short duration

If you were married to your spouse, but the total amount of time that you and your spouse were married or in a de facto relationship was less than 3 years, you can still make a claim under the Act, but the family home and chattels are usually divided according to each party’s contribution to the relationship.

De facto relationships of short duration

De facto relationships of less than 3 years are not subject to the Property (Relationships) Act unless:

  • there is a child of the relationship, or one person has made a substantial contribution to the de facto relationship (including non-financial contributions); and

  • the court is satisfied that not making an order would result in serious injustice.

Even if both of these criteria are met, the relationship property is not divided equally, but instead in accordance with each partner’s contribution to the relationship.

Reconciliation and short relationships

When calculating the length of a relationship, the court may disregard a short period of reconciliation. This period can be up to 3 months.

Prenups / contracting out agreements

If you and your partner entered into a valid contracting out agreement (ie prenup), and that agreement was certified by a lawyer, you can still apply under the Property (Relationships) Act. However, you will only usually receive what you are entitled to under the terms of the contracting out agreement.

The court has the authority to invalidate a contracting out agreement only in cases where enforcing it would lead to “serious injustice.” An instance of such unfairness may arise, for example, if the agreement was made prior you and your partner having children, and you sacrificed your career to care for the children, allowing your partner to continue their professional advancement.

When the Property (Relationships) Act does not apply

If the Property (Relationships) Act does not apply to your relationship, you are unable to make a claim under the Act. The general rule is that you will take the property that you brought into the relationship and you will inherit under the will (or under the rules of intestacy if there is no will). You may have other claims against your partner’s estate, for example pursuant to a constructive trust. Read more about claims for broken promises or contributions here.

Your options if the Act applies: Option A & Option B 

If the Act applied to your relationship, and your spouse or partner has died, you have to choose between the following two options:

Option A

Option B

Apply under the Property (Relationships) Act
Inherit under the will (or intestacy)
  • You will usually receive a half share of all relationship property.  In rare cases, where extraordinary circumstances make equal sharing contrary to justice, the Court may award you more or less than half of the relationship property.

  • The will is interpreted as if you had died before your partner. This usually means that you forgo any gifts made to you under your partner’s will. This is the case unless the Court considers that it would cause injustice or the will expresses a different intention.

  • Relationship property usually includes:

    • the family home and chattels (including the family cars, household furniture, and anything else used for family purposes);

    • property you and your partner owned jointly or in equal shares;

    • property acquired during the relationship (or before the relationship with an intended common use or benefit);

    • contributions to superannuation and insurance policies (including Kiwisaver) made after the relationship began;

    • increases in the value of relationship property, or any income from it or any proceeds from selling it;

    • increases in the value of separate property, where that increase is as a result of the direct or indirect actions of the other spouse or the use of relationship property;

    • any property that you received from the deceased by survivorship (ie jointly owned property or bank accounts).

  • The following is usually separate property. If you own any of it, you will usually get to keep it. If your partner owned any of it, it will usually form part of their estate:

    • property that you or your spouse acquired before your relationship (except relationship property);

    • property you acquired after your spouses’ death (unless the Court considers it just to treat that property as relationship property);

    • property that you or your spouse acquired from a third person by gift, inheritance, or as a beneficiary under a trust settled by a third person (unless this property gets mixed with relationship property);

    • property acquired out of separate property and any proceeds of sale of separate property;

    • increases in value of separate property, and income, interest or dividends earned from separate property (with some exceptions).

  • All property owned by your partner at the date of their death is presumed to be relationship property. This is only a presumption that can be rebutted if someone puts forward evidence to the contrary.
  • If your partner died leaving a will, you inherit what you were left under the will.

  • If your partner died without a will, you inherit under the intestacy rules. Read about the intestacy rules here.

  • Any property that you and your partner owned jointly will pass to you by survivorship. This includes jointly owned real estate and bank accounts.

  • You keep any property that you own in your name. This usually includes any property that you brought into the relationship.

  • If the amount that you receive under the will or the intestacy rules is insufficient for your proper maintenance and support, you may be able to claim under the Family Protection Act. Read about claims under the Family Protection Act here.

How to make your election of option

To choose Option B, you do not need to do anything. After six months from the date of probate or letters of administration being granted (or from the date of death in the case of a small estate), you will be deemed to have chosen Option B.

To choose Option A, you need to complete a written notice in the required form. The notice needs to be accompanied by a certificate signed by a lawyer, certifying that they have explained to you the effects and implications of your choice. The notice must then be lodged with the executor or administrator of your partner’s estate (or with the Court if administration was granted outside of New Zealand). Unless you have complied with all of the requirements, your election of Option A will be invalid.

When deciding whether to choose Option A or Option B, you should take into account both your partner’s relationship property and your own relationship property, as you will only be entitled to half share of this combined pool of assets. The other half share of the relationship property pool goes into your partner’s estate.

What happens if you fail to make an election?

If you fail to make an election, you are deemed to have chosen Option B six months from the date of probate or letters of administration being granted (or from the date of death in the case of a small estate).

Time limit for election of option

If you wish to choose Option A, you must do so within 6 months from the date of probate or letters of administration being granted, or from the date of death in the case of a small estate. If you do not choose Option A within that time period, you will be deemed to have chosen Option B.

Changing your election of option

Once you have made your choice of option (either by notice or by default), that choice cannot be revoked. If you wish to change your election, you will need to apply to the court.

The court can set aside your choice of option only if:

  • your choice of option was not freely made; or

  • you did not fully understand the effect and implications of the choice; or

  • since the choice of option was made, new relevant information has come to light; or

  • since the choice of option was made, someone else has made a claim against your partner’s estate under the Family Protection Act or Testamentary Promises Act.

In each case, the court must also consider that, having regard to all the circumstances, it would be unjust to enforce your original choice of option.

In deciding whether or not to set aside a choice of option, the court must have regard to:

  • the circumstances in which the choice of option was made; and

  • the length of time since the choice was made; and

  • any other matters that the court considers relevant.

Court application for division of relationship property

Usually, you can only apply to the court for a division of relationship property if you have first chosen Option A. The only exceptions are where:

  • a separation order was already in force when your partner died; or

  • you were divorced from your partner, or a separation order had been made, when your partner was alive.

Where deceased had multiple relationships

In cases where the deceased had multiple relationships, the way relationship property is divided varies depending on the nature of the relationships.

Successive relationships

Where the deceased entered into a second relationship without having divided his or her relationship property with the first partner, then the relationship property claims are usually determined in chronological order based on when the relationships occurred.

Contemporaneous relationships

Where the deceased had more than one partner at the same time, then the Court will usually determine what relationship property is attributable to each of the relationships and divide the property accordingly.

Polyamorous relationships

Where the deceased was in a three-way (triangular) relationship, the triangular relationship is subdivided into three separate two-way relationships for the purpose of the Property (Relationships) Act. How relationship property is divided in such circumstances has yet to be determined by the court.

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