A couple can agree that the Property (Relationship) Act 1976 will apply when they separate, regardless of whether either partner is usually resident in New Zealand.
The partners can also agree that the law of a different country will apply. So if the partners had a dispute, a court in New Zealand would have to apply the law specified in the partners’ agreement.
But rules apply when the partners want to choose the law of another country.
- The couple must enter the agreement at the start of the relationship. If they enter the agreement later, it will not be valid.
- The agreement must clearly state what country’s law will apply. It is not enough simply to say that New Zealand law will not apply.
- The agreement must also be in writing and be valid according to the law of the country the partners have chosen.
- The foreign law cannot be contrary to justice or public policy in the view of the New Zealand courts (for example, an agreement that left one partner with no property at all).
What are the problems with the law?
Sometimes a couple might think they have agreed that a different law will apply. But if the agreement does not comply with the rules it will be invalid. The partners may then have to divide their property in a way that neither partner intended.
That may mean the rules should be less strict.
For example, a couple should be able to make an agreement at any point in their relationship, not just at the start.
If the partners did not state which law was to apply to their agreement, it might be better to try work out which country’s law the partners expected would apply to their agreement rather than apply New Zealand law.