Dividing relationship property: time for change coming soon
Justice Minister Andrew Little has on Tuesday, July 23, tabled the Law Commission’s final report on how relationship property should be divided in the event of a separation.
The Property (Relationships) Act 1976 (PRA) sets out how relationship property should be divided when a relationship ends by separation or death.
However, in this instance, the Law Commission had not considered relationships ending on death and recommended that these should be dealt with separately.
The report makes 140 recommendations and concludes that, while many of the existing rules within the Act are satisfactory, the Act is no longer fit for purpose, and recommends a new Act be introduced covering relationships ending by separation.
Helen McQueen, Deputy President and lead Commissioner on the review, said “New Zealand has undergone a significant period of social change since the Property (Relationships) Act 1976 was passed.
“It is important that the law keeps pace with social change and reflects the reasonable expectations of New Zealanders. In our view, the law for dividing property on separation is no longer fit for purpose in 21st century New Zealand.
“We think that some of the fundamental concepts of the law remain appropriate, such as the general rule of equal sharing and its application to marriages, civil unions and de facto relationships that last for three years or more.
“But we recommend other significant changes that will affect what property is shared. These recommendations are designed to make the law more responsive to the wide range of different family situations that exist today.”
Thanking the commission for its work Minister Little said, “I thank the Law Commission, and in particular Deputy President Helen McQueen, for their hard work over the past three years, and to those who took the time to provide considered submissions through the consultation process.
“I have tabled this report in accordance with my statutory responsibilities and the Coalition Government will now give further consideration to the report’s recommendations and the wider impact of its proposals.”
The process began in May 2016, when the Law Commission began a comprehensive review of the PRA. Just over a year later, the Commission released its issues paper, Dividing Relationship Property – Time for Change? Te matatoha rawa tokorau – Kua eke te wa? which explored whether or not the PRA is achieving a just division of property when a relationship ends.
The Commission received over 300 submissions on the issues paper and hosted 16 public consultation meetings throughout the country. Drawing on these submissions, the Commission released a preferred approach paper late last year and sought feedback. One hundred submissions were received in response to the proposed law reforms, which were factored into the final report.
Earlier last year, The Indian Weekender had published a story Divorce law and property separation rules: Is there enough awareness within Kiwi-Indian community? whereby speaking to many legal and social service experts within community who expressed concern about limited awareness on the important issue in the community.
The Commission’s Report presents a package of reforms. The key recommendations include:
- Changing how the family home is shared. If the family home was owned by one partner before the relationship began or was received as a gift or inheritance, only the increase in the value of the home during the relationship should be shared.
- Giving court greater powers to divide trust property. These powers should apply when a trust holds property that was produced, preserved or enhanced by the relationship.
- Introducing Family Income Sharing Arrangements or FISAs, which would require some partners to share income for a limited period following separation in order to ensure the economic advantages and disadvantages from a relationship are shared more fairly.
- Giving children's best interests a greater priority in relationship property matters. This should include greater rights to occupy the family home in the period immediately following separation.
- Improving the way relationship property matters are resolved in practice to address behaviour that causes delay and increases costs.
- These recommendations have been informed by the Law Commission’s consultation with the public and experts, together with survey evidence of public attitudes and values about property division on separation.
Justice Minister Andrew Little has on Tuesday, July 23, tabled the Law Commission’s final report on how relationship property should be divided in the event of a separation.
The Property (Relationships) Act 1976 (PRA) sets out how relationship property should be divided when a relationship ends by...
Justice Minister Andrew Little has on Tuesday, July 23, tabled the Law Commission’s final report on how relationship property should be divided in the event of a separation.
The Property (Relationships) Act 1976 (PRA) sets out how relationship property should be divided when a relationship ends by separation or death.
However, in this instance, the Law Commission had not considered relationships ending on death and recommended that these should be dealt with separately.
The report makes 140 recommendations and concludes that, while many of the existing rules within the Act are satisfactory, the Act is no longer fit for purpose, and recommends a new Act be introduced covering relationships ending by separation.
Helen McQueen, Deputy President and lead Commissioner on the review, said “New Zealand has undergone a significant period of social change since the Property (Relationships) Act 1976 was passed.
“It is important that the law keeps pace with social change and reflects the reasonable expectations of New Zealanders. In our view, the law for dividing property on separation is no longer fit for purpose in 21st century New Zealand.
“We think that some of the fundamental concepts of the law remain appropriate, such as the general rule of equal sharing and its application to marriages, civil unions and de facto relationships that last for three years or more.
“But we recommend other significant changes that will affect what property is shared. These recommendations are designed to make the law more responsive to the wide range of different family situations that exist today.”
Thanking the commission for its work Minister Little said, “I thank the Law Commission, and in particular Deputy President Helen McQueen, for their hard work over the past three years, and to those who took the time to provide considered submissions through the consultation process.
“I have tabled this report in accordance with my statutory responsibilities and the Coalition Government will now give further consideration to the report’s recommendations and the wider impact of its proposals.”
The process began in May 2016, when the Law Commission began a comprehensive review of the PRA. Just over a year later, the Commission released its issues paper, Dividing Relationship Property – Time for Change? Te matatoha rawa tokorau – Kua eke te wa? which explored whether or not the PRA is achieving a just division of property when a relationship ends.
The Commission received over 300 submissions on the issues paper and hosted 16 public consultation meetings throughout the country. Drawing on these submissions, the Commission released a preferred approach paper late last year and sought feedback. One hundred submissions were received in response to the proposed law reforms, which were factored into the final report.
Earlier last year, The Indian Weekender had published a story Divorce law and property separation rules: Is there enough awareness within Kiwi-Indian community? whereby speaking to many legal and social service experts within community who expressed concern about limited awareness on the important issue in the community.
The Commission’s Report presents a package of reforms. The key recommendations include:
- Changing how the family home is shared. If the family home was owned by one partner before the relationship began or was received as a gift or inheritance, only the increase in the value of the home during the relationship should be shared.
- Giving court greater powers to divide trust property. These powers should apply when a trust holds property that was produced, preserved or enhanced by the relationship.
- Introducing Family Income Sharing Arrangements or FISAs, which would require some partners to share income for a limited period following separation in order to ensure the economic advantages and disadvantages from a relationship are shared more fairly.
- Giving children's best interests a greater priority in relationship property matters. This should include greater rights to occupy the family home in the period immediately following separation.
- Improving the way relationship property matters are resolved in practice to address behaviour that causes delay and increases costs.
- These recommendations have been informed by the Law Commission’s consultation with the public and experts, together with survey evidence of public attitudes and values about property division on separation.
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