Following a separation and division of relationship property, it is important to look to the future and consider how best you can protect your property, so that you can avoid a costly and time-consuming division process in the future. This is particularly important to consider before and when you enter a new relationship.

When considering asset protection, there are two common methods that can be implemented:


If you haven’t entered into a new relationship since your separation, a potentially effective way of protecting your assets is to set up, and transfer your assets into, a trust.

A trust is a legally binding arrangement that allows a person to transfer ownership of assets out of their name. As the Trust is not a person in a relationship, the property that it holds does not become relationship property.

Trusts are complex, and anyone considering setting up a trust should seek professional legal advice. There may also be tax issues involved.

Contracting out agreement

Contracting out agreements are commonly known as “pre-nuptial agreements”. The agreement can be signed by a couple in a relationship at any stage, and states the agreement on what will happen with relationship property in the event of a separation. They are particularly useful documents if you have already entered into a new relationship, or if a trust is not appropriate in the circumstances.

It is easier to put a contracting out agreement into place within the first three years of the start of the relationship, before it becomes a “qualifying relationship” under the law. Once the relationship is a qualifying one, the other person may already have an interest in your property as relationship property, and consider they have no reason to sign the agreement.

It is important that all of the legal requirements are strictly followed in order for a contracting out agreement to be valid and enforceable. They are:

  1. The agreement must be in writing;
  2. Both parties must sign the agreement;
  3. Signatures must be witnessed by a lawyer; and
  4. The parties must each receive independent legal advice.

If these requirements are not followed properly, the agreement may not be legally enforceable and any assets that it would have protected could be subject to relationship property laws (if the relationship was a qualifying one).

Although a financial investment is involved in either setting up a trust or entering into a contracting out agreement, the value of the protection that it provides your assets in the future will of course far exceed the initial costs.

Due to the significant impacts that either of these options have on your property, it is worth speaking with a professional experienced in the area about which may best suit your circumstances.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.


Please note that Rainey Collins is not contracted to provide Legal Aid, other than in the Treaty of Waitangi area.  We therefore are unable to take on any Civil or Family Legal Aid work. If you require Legal Aid in those areas, you can search the list of Legal Aid lawyers on the Ministry of Justice website.