Part three: Dividing your property
At the end of a marriage, de facto or civil union relationship, property is classified as either relationship property or separate property and we outline this below.
Relationship property is acquired during the relationship and is divided equally between the parties at the end of the relationship. The value of relationship property is taken at the date it is divided, so if your property goes up or down in value between separation and division, this is accounted for. Relationship property will usually include:
· The family home (no matter how or when it was purchased);
· Family chattels (including family car, household furniture, art hanging in the family home);
· Family businesses and investments acquired during relationship
· Property owned jointly or that was acquired during the relationship;
· Contributions to superannuation, KiwiSaver and insurance policies after the relationship began; and
· Income earnt during the relationship.
A party’s separate property stays with them and is not available for division. Separate property is any of the following:
· Property owned prior to the relationship and kept separate;
· Property inherited (either under a Will or by survivorship);
· Gifts received from anyone, including the other party; and
· Distributions from a Trust settled by a third party.
It is important to note that debts are also part of the division. Relationship debts are those incurred jointly during the relationship i.e. a mortgage on the family home or household expenses. Separate debts are all other debts.
Relationship Property law is complex with various factors able to influence the outcome. There may be extraordinary circumstances involved which would make the equal division of relationship property unfair and different rules apply to property division if the relationship has lasted less than three years. We strongly recommend seeking legal advice, to understand the circumstances that are relevant to your specific situation.
