March 2011

Relationship Property

De Facto Partner or Boyfriend/Girlfriend?

Attempting to ascertain whether two people are legally in a de facto relationship or are just friends, flatmates, boarders or boyfriend/girlfriend can be challenging. This is particularly so when the relationship (of whatever nature) fails and there are property issues outstanding.

Recently the High Court considered the definition of a "de facto relationship" under the Property (Relationships) Act 1976 ("the Act"), following an appeal from a decision of the Family Court. The Act defines a de facto relationship as follows:

"For the purposes of this Act, a de facto relationship is a relationship between 2 persons (whether a man and a woman, or a man and a man, or a woman and a woman) —

  • who are both aged 18 years or older; and
  • who live together as a couple; and
  • who are not married to, or in a civil union with, one another."

In determining whether two people live together as a couple a Court must have regard to a number of factors under the Act.

In this High Court case, Ms B had previously been married and living in Australia. Mr F was a family friend. Ms B returned to New Zealand in May 1991 when her marriage ended. A friendship developed between her and Mr F. The Court had to determine whether a de facto relationship existed between Ms B and Mr F. The Court took into account that:

  • Mr F would spend many nights at Ms B's property though his clothes and personal possessions remained at his parents' home.
  • Mr F would often shower and change at his parent's home.
  • Mr F's mother did his washing and ironing.
  • Ms B had two children for which Mr F provided significant financial support.
  • Mr F spent time with Ms B and the children at her address.
  • There was evidence that there was a degree of mutual commitment to a shared life;
  • Mr F arranged for a Property Sharing Agreement to be prepared;
  • Mr F provided financial support to Ms B.

In taking into account the factors required under the Act, the Court found that there was a de facto relationship between Ms B and Mr F. In reaching its decision the Court took into account evidence of friends and acquaintances that considered them to be a couple. The High Court stated that the Family Court in reaching its original decision should not have taken an "overly mechanical" approach regarding whether a de facto relationship existed.

Relationships can develop over a period of time. Initially, there is no doubt that it is NOT a de facto relationship. However, as time goes by, the relationship becomes closer in many various ways. You now have a de facto relationship. Our best advice is to identify the risks at the outset by signing a Contracting Out Agreement under the Act. This removes the whole issue of whether the relationship is or may become a de facto relationship.

If you would like to discuss your legal position regarding such issues please do not hesitate to contact a member of our Family Law team.

Our Family Law Team