Home | Browse Topics | Family law | Relationships and break-ups | Making your own agreement to divide your property: “Contracting out”

Family law

Dividing your property when you split up (“Relationship property”)

Making your own agreement to divide your property: “Contracting out”

Can a couple contract out of the Property (Relationships) Act?

Property (Relationships) Act 1976, ss 21–21D

A couple can choose to share their property differently than how the Property (Relationships) Act sets out. You can do this by making a contracting out agreement (sometimes known as a “prenuptial” agreement – or “pre-nup”) which says how you want to share the property. Using a contracting out agreement is the only binding way of dividing property if a relationship ends, other than going to court and having court orders made.

When can a contracting out agreement be made?

Property (Relationships) Act 1976, s 21

A contracting out agreement can be made at any time: when you enter a relationship, during it, or at the end of the relationship. Agreements are often used by couples entering a second or subsequent relationship later in life, especially if they already have substantial property which they wish to keep as their own separate property.

If you make an agreement after you’ve been together for three years or more (see: “Short term relationships: When the Act applies”), you might be giving up what you’d be entitled to under the Property (Relationships) Act. Your agreement might not be enforceable if you’d be giving up so much that it became unjust (see below).

What requirements must be met for a contracting out agreement to be valid?

Property (Relationships) Act 1976, ss 21F, 21J

There are set requirements to follow to make sure a contracting out agreement is valid:

  • the agreement must be in writing and signed by both parties, and
  • you both have to get independent legal advice before signing the agreement, from separate lawyers, and
  • you both have to get your signatures witnessed by a lawyer, and
  • the lawyer who witnesses each signature must certify that, before the person signed the agreement, the lawyer explained the effect and implications of the agreement.

These requirements are designed to protect the people entering into a contracting out agreement, as an agreement has the same effect as a court order and can’t be easily set aside.

The court can only set aside a contracting out agreement if it would be very unfair (result in a “serious injustice”). For example, this might be where an agreement is very one-sided and doesn’t allow one partner to share in property acquired during the relationship.

Did this answer your question?

Relationships and break-ups

Where to go for more support

Community Law

Your local Community Law Centre can provide you with free initial legal advice.

Find your local Community Law Centre online: www.communitylaw.org.nz/our-law-centres

Family Court

This Family Court provides a range of information relevant to adult relationships, including information on separation, dissolution, relationship property and the relevant court processes.

Website: www.justice.govt.nz/family/separation-divorce
Application for a dissolution of marriage (divorce): www.justice.govt.nz/family/separation-divorce/apply-for-a-divorce

Births, Death & Marriages (Department of Internal Affairs)

Births, Death and Marriages have information about marriages and civil unions. You can also apply online for your marriage licence or download the application forms.

Website: www.govt.nz/organisations/births-deaths-and-marriages
Email: bdm@dia.govt.nz
Phone: 0800 22 52 52

New Zealand Law Society

The Law Society has helpful information on what happens when your relationship ends.

Information on separation, divorce, care of children and maintenance: www.lawsociety.org.nz/for-the-public/common-legal-issues/what-happens-when-your-relationship-breaks-up

Information on dividing up relationship property: www.lawsociety.org.nz/for-the-public/common-legal-issues/dividing-up-relationship-property

Ministry of Social Development – Work and Income (WINZ)

Relationships often have a significant impact on personal finances. For information on how your changing relationship status might affect what benefits you are entitled to, contact Work and Income.

Website: www.workandincome.govt.nz
Phone: 0800 559 009

Also available as a book

The Community Law Manual

The Manual contains over 1000 pages of easy-to-read legal info and comprehensive answers to common legal questions. From ACC to family law, health & disability, jobs, benefits & flats, Tāonga Māori, immigration and refugee law and much more, the Manual covers just about every area of community and personal life.

Buy The Community Law Manual

Help the manual

We’re a small team that relies on the generosity of all our supporters. You can make a one-off donation or become a supporter by sponsoring the Manual for a community organisation near you. Every contribution helps us to continue updating and improving our legal information, year after year.

Donate Become a Supporter

Find the Answer to your Legal Question

back to top