Unlike entering into a marriage or civil union, there is no clear legal line or date as to when a de facto relationship begins. This means that determining whether a couple is in a de facto relationship will be a matter of evidence.
The Property (Relationships) Act 1976 (the Act) defines a de facto relationship as a relationship between two people (irrespective of gender) who are both 18 years or older, who live together as a couple, and who are not married or in a civil union with each other. It is in the “living together as a couple” aspect of the definition where the waters can become murky as, while sharing a home together can be an important indicator of a de facto relationship, it is not essential.
In deciding whether two people are living together as a couple, the Court will consider a number of factors, including:
- The duration of the relationship;
- The nature and extent of the parties’ living arrangements;
- Whether or not a sexual relationship exists;
- The degree of financial dependence on each other for money, and whether one party supports the other;
- The ownership, use, and purchase of property;
- The degree of mutual commitment to a shared life;
- The care and support of children;
- The performance of household duties; and
- Whether they are viewed as a couple publicly.
The Court has the discretion to take any and all of the above factors into consideration to determine whether two people were living together as a couple but none of the factors are compulsory. Therefore, it can be found that two people were living together as a couple even if they did not live under the same roof. This means it can sometimes be difficult to know when property consequences can start flowing from a relationship.
Once a couple has been in a de facto couple relationship for three years, the provisions of the Act will apply to determine the division of assets and liabilities should that relationship end (through separation or death). Generally speaking, the presumption under the Act is that all relationship property will be divided equally between the couple. This means that the value of property put towards or acquired during the relationship, such as the family home, household chattels, vehicles, income and KiwiSaver, will be shared equally between the couple when the relationship ends. This can come as a shock to someone who believed that they were not (for varying reasons) in a de facto relationship.
If you have concerns about the classification of your relationship, we recommend you seek legal advice early to ensure your property is dealt with in the manner suited to you if your relationship ends. This can be achieved by entering into an agreement (often called a pre-nup agreement), which must comply with the requirements of the Act to be effective, with your partner to contract out of the presumption of equal sharing under the Act and determine how a division of assets would occur.
Franklin Law can help you with legal advice about your relationship and assist with protecting your assets.
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The information contained in this article is necessarily of a generalised nature and is correct as at October 2024. Specific advice should be sought in relation to any particular situation.
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