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What is a de facto relationship?
31 August, 2016 | Smith and Partners
Article updated April 2024
Are you already in a “de facto relationship” in the eyes of New Zealand law and you don’t realise?
The Property (Relationships) Act 1976 (“the Act”) defines a de facto relationship as being between two persons (whatever their gender), who are both aged 18 years or older, who are not married or in a civil union with each other and “who live together as a couple”.
The term “live together as a couple” encompasses many factors, not just how long you have been living together in the same home.
Why does it matter?
It is important to know whether or not you are in a de facto relationship, as this determines how property (assets/liabilities) are divided in the event that the relationship ends (either by separation or death). Owning an asset in your own name is not usually enough to prevent your de facto partner from having a claim to it.
If you have been in a de facto relationship for three years or more, then anything that is “relationship property” will be subject to equal division under the Act if the relationship ends. This includes the home you live in together, regardless of which de facto partner originally purchased it, or when.
Factors Indicating a De Facto Relationship
If there is a dispute between you over whether, or for how long, you have been in a de facto relationship, the Court can determine this based on the following factors (and these factors can also guide any discussion between you over the issue):
- How long you have been in a relationship;
- Whether you share a home and a bedroom;
- Whether a sexual relationship exists between you;
- Arrangements surrounding your financial affairs (e.g. are you financially dependent on each other, do you share bank accounts etc.);
- Whether you own, use, or have acquired any property together (assets or liabilities);
- Whether you have a mutual commitment to a shared life together;
- Whether you together care and support any children (even if not biologically yours);
- Whether you share household duties;
- How the public views your relationship (e.g. do your friends and family see you as a couple?).
The Court has a wide discretion to determine whether you are in a de facto relationship. Any combination of factors can be present, and the Court is free to decide how to weigh the factors against each other in the circumstances of each case.
De Facto Relationships of Short Duration
Even if you have not yet been in a de facto relationship for three years, the Act may still apply to your relationship if you have a child together, or one of you has made a substantial contribution to the relationship, and the Court is satisfied that failure to make an order would result in serious injustice. However, even if the Act applies, any property would be divided according to your respective contributions to the relationship (which would also need to be determined), rather than being subject to the equal sharing regime.
Polyamorous Relationships Can Also Qualify
Whilst the Act defines a de facto relationship as being between two persons, in 2023 the Supreme Court (New Zealand’s highest Court) ruled that the Act can also apply to polyamorous de facto relationships. This is because they can constitute a series of de facto relationships. In that particular case, there were 3 people, two de facto relationships, one marriage and significant property in Kumeu, West Auckland to which they each had an equal claim.
If you are in a de facto relationship, or wondering if you are, we strongly encourage you to enter into a Contracting Out Agreement. A Contracting Out Agreement can define:
- The assets which you each retain as your own;
- Any liabilities your partner has which you seek to be protected from;
- How property acquired by you and/or your partner after entering into the Agreement shall be defined (in terms of ownership and responsibility); and
- Expectations as to how assets/liabilities are to be divided in the event the relationship ends (by separation or death).
