Ordinarily, the most significant asset a couple has is the family home. The family home is the place that either or both parties to the relationship use as the principal family residence. The classification of a property as the ‘family home’ has a significant impact if the relationship comes to an end.

Under New Zealand law, the ‘family home’ is relationship property no matter when it is acquired. In one case, the family home was determined to be relationship property despite the fact that it had been purchased prior to the marriage and the mortgage was repaid using money that was gifted by the husband’s mother.

The result of a home being classified as the ‘family home’ is that it automatically falls under the equal sharing regime of the Property (Relationships) Act. This means that, unless one of the limited exceptions to equal sharing applies, each party is entitled to share equally in the value of the family home.

Sometimes a person will form a trust to ‘own’ the family home in an attempt to avoid it being classified as relationship property, however, this does not provide guaranteed protection from the powers of the Family Court to determine whether or not something is relationship property.

A Contracting Out Agreement often provides better protection because the family home can be ‘ring-fenced’ and classified as one party’s separate property. For a Contracting Out Agreement to be enforceable, it must be in writing, signed by the parties and both parties must receive independent legal advice from a lawyer.

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.