Changes to relationship property law wide-ranging but are still years away
The Government has responded to the Law Commission’s proposed changes for both relationship property and succession law, saying its work to update the laws will take years.
Under the Law Commission’s relationship property recommended changes, it has called for a replacement to the Property (Relationship) Act 1976.
What are some of the key changes?
Changes to the Act include the family home not automatically being deemed relationship property. This means the family home may not be divided equally between partners and spouses.
Other recommended changes include widening the Court’s power over trusts, meaning it will be able to make orders over trust property in some circumstances.
The Commission also concluded that succession law—which deals with the way a person’s property is distributed when they die—needs reform to be “simple, accessible and reflect New Zealanders’ reasonable expectations”.
Alongside a number of proposed key changes to achieve this, one option is that only those aged under 25 or disabled people would be able to make a claim against parents’ wills.
The Government’s plans to update the succession law comes after the Law Commission completed its review of New Zealand’s succession law in December 2021, following the review of relationship property laws which was released in July 2019.
Proposed key changes to the Property (Relationships) Act 1976 include:
- That the family home will not automatically be deemed to be relationship property.
- That the Court’s power over trusts is widened where Court can make orders over trust property in some circumstances. This is due to bringing in Section 182 of Family Proceedings Act.
- Section 182 of the Family Proceedings Act which allows the court to revisit the terms of settlements (including trusts) and which are considered “nuptial” in nature would be revoked.
- Introducing Family Income Sharing Arrangements (FISAs), where partners would share income for a specified period, taking into account the partners' incomes before separation and the length of the partners' relationship. This is replacing spousal maintenance.
- The existing express aim to encourage a “clean break” will not be carried on; this would be one factor to consider, to be balanced with other factors, particularly the best interests of any child.
You can read a rundown of the succession law recommendations here.
Disclaimer: The content of this article is general in nature and not intended as a substitute for specific professional advice on any matter and should not be relied upon for that purpose.