Understanding Separation and Relationship Property Agreements
22 September 2024

Separation and relationship property agreements are crucial legal tools that can be made at any time - before, during, or after a relationship. 

These agreements help clarify who owns what during and after a relationship ensuring that each party knows who owns which assets.

The key law in this area in New Zealand is The Property (Relationships) Act 1976 (PRA). This law says that partners usually share ownership of:

·      the family home;

·      family belongings (like furniture); and

·      any property acquired during the relationship.


The PRA states that any property bought during the relationship is usually considered shared property and is typically split equally if the relationship ends. The family home is treated differently; it is usually shared equally, no matter who owned it before the relationship or how much each partner contributed.


Section 21 Agreements

To ensure a Section 21 agreement is valid, it must meet specific requirements:

·      The agreement must be in writing and signed by both parties.

·      Each party must receive independent legal advice before signing.

·      The signatures must be witnessed by a lawyer.

·      The witnessing lawyer must certify that they explained the agreement’s effects and implications to the signing party.


Even if an agreement satisfies these requirements, a court can set aside (cancel) an agreement if it considers that the agreement would cause serious injustice. For an agreement to be cancelled, this generally depends on whether the agreement was entered into freely and if the terms of the agreement are not fair.

 

Contracting Out Agreements

The couple in the relationship may choose to enter a Section 21 agreement.  This agreement is a legal contract that allows couples to decide how to divide their property if they separate, overriding the default rules set by the Property (Relationships) Act.


Commonly known as ‘pre-nups’, these agreements are essential if you’ve been in a de facto relationship for three years or more, are married, or in a civil union. The PRA applies here. A de facto relationship is defined as “living together as a couple,” which can include not physically living together but demonstrating a commitment to a shared life.


Why have one? If you have any concerns, it’s smart to create a contracting out agreement. These agreements are particularly important in second relationships. Recent legal cases show that putting a home in a trust before entering a PRA relationship won’t protect your assets. Agreements not signed and certified by lawyers won’t hold up in court. These agreements let you decide how to manage your assets and protect certain items if the relationship ends.

 

Post-Separation Agreements

These agreements clarify who keeps what after a separation and whether one person needs to pay out the other to achieve an equal division of the relationship property. It’s important to finalise a separation agreement quickly. Until it’s signed, all shared property remains shared. This means if you buy a house or pay off a mortgage alone, it’s still considered shared property, and your ex could claim it later. They might also have a claim to your estate if you pass away before finalising the agreement.



Separation and relationship property agreements provide important legal protection. Understanding the PRA and the requirements for these agreements helps ensure your assets are safe and ownership is clear. Whether starting a new relationship, currently in one, or recently separated, it’s wise to seek legal advice and consider these agreements to protect your interests.


Our team has experts in this area who are ready to help you navigate your options and make the best choices for your future.

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23 July 2025
When a relationship ends or circumstances change, untangling shared property can quickly become complex, emotionally, legally, and financially . R elationship property law provides a framework for dividing assets between partners. Whilst it is a legal process, it is also deeply personal. That’s why having an experienced and trusted advisor is essential. What is relationship property? The Property (Relationships) Act 1976 (the Act) governs how property is divided when a marriage, civil union, or de facto relationship ends, including when a partner passes away. In most cases, there is a presumption of a 50/50 split of shared property, but exactly what counts as “shared” can be more involved than people realise. Relationship property can include: the family home; vehicles and household contents; KiwiSaver and superannuation; income earned during the relationship; any assets acquired together; and any relationship debts. There are also important exceptions and nuances, especially if one partner has brought significant assets into the relationship, or if there are children involved. When the 50/50 rule doesn’t apply While equal sharing is the default, there are several situations where the law may allow for a different outcome: relationships of short duration (less than 3 years); significant economic disparity between partners; separate property, such as inheritance or pre-relationship assets (not intermingled); and contracting out agreements (previously known as prenups). Couples can choose to “contract out” of the default rules by signing a formal agreement. However, this must meet strict legal requirements in order to be valid and enforceable. One of these requirements is that both parties must have independent legal advice. When children are involved Children can significantly impact the division of relationship property. The law acknowledges the necessity of protecting a child’s wellbeing, particularly during family transitions. In these situations, the court may: postpone the sale of the family home if it would disrupt a child’s living situation; prioritise stability by ensuring that the primary caregiver can continue to provide a secure environment; acknowledge unpaid contributions, such as caregiving, as equal in value to financial contributions; and apply the Act to relationships of short duration if there’s a child of the relationship. Every family is different and when children are involved, the stakes are higher. That’s why it’s crucial to seek advice that combines legal clarity with compassion and care. Every situation is different While the law provides a general framework, no two families or relationships are exactly alike. That’s why having thoughtful and experienced legal support makes all the difference. Whether you're entering into a new relationship, separating, or simply planning for the future, clear advice from someone who understands the legal landscape and your personal one is essential. Why legacy matters Willis Legal has been advising Hawke’s Bay families for generations. That long history means we don’t just know the law, but also the community. We approach every situation with perspective, stability, and a practical mindset. Our clients trust us not only to get the paperwork right, but also to help them move forward with clarity and confidence. If you’re facing a separation, starting a new relationship, or looking to secure your future our team is here to help you understand your options in a way that works for you. Book a confidential consultation with us today and take the first step toward peace of mind.
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