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Property (Relationships) Bill Report-Back Speech

Hon Margaret Wilson Speech Notes

Property (Relationships) Bill

Report-back speech notes

“I move that the House take note of the report of the Justice and Electoral Committee on the Matrimonial Property Amendment Bill incorporating Supplementary Order Paper No. 25”.

Mr Speaker, this Bill:

 extends the Matrimonial Property Act to de facto (including same sex) couples,
 renames it "the Property (Relationships) Act",
 includes measures to address economic disparities and
 contains other amendments introduced by the previous government (most notably, provisions applying the Act on death).

I would like to take this opportunity to provide some background to the Bill and outline the progress made by the Justice and Electoral Committee.

The Matrimonial Property Act was enacted over 20 years ago and has not been subject to significant amendment since.

When the Matrimonial Property Bill was introduced in 1975 it included provision for de facto couples. This was later dropped.

12 years ago a Working Group was set up to review the Act. It recommended:

 amendments to apply the Act on death as well as on marriage breakdown,
 measures to ensure a fairer division of matrimonial property; and
 reform of the law relating to de facto couples' property rights.

It was not until a decade later in 1998 that the previous government attempted to address some of these outstanding issues and introduced two bills into Parliament, a Matrimonial Property Amendment Bill and a De Facto Relationships (Property) Bill.

The Matrimonial Property Amendment Bill is largely based on the recommendations of the 1988 Working Group Report.

One of its main aims was to extend the application of the Matrimonial Property Act 1976 to marriages ended by the death of a partner. It also:

 strengthened provisions relating to trusts and companies
 provided the court with a power to defer sharing of property and
 gave the Family Court sole originating jurisdiction.

The De Facto Relationships (Property) Bill provided a separate property-sharing regime for opposite-sex de facto couples.

During 1998 the Government and Administration Select Committee heard submissions on both bills. Approximately 60% of submissions on the Matrimonial Property Amendment Bill expressed concern that it did not address the issue of economic disadvantage that can be suffered by the non-career partner on marriage breakdown.

Approximately 50% of submissions on the De Facto Relationships (Property) Bill also called for the inclusion of same-sex couples.

Despite these strong signals sent by the submitters, the Matrimonial Property Amendment Bill was reported back last year with no new measures to address economic disparities. Report back on the De Facto Relationships (Property) Bill was deferred.

This government is not prepared to put this issue in the too-hard basket.

Earlier this year I introduced an SOP with the intention of modernising matrimonial property law by providing inclusive protections not only for married couples but also for de facto including same-sex relationships. This reflects the reality of New Zealand society. Over 236,000 people live in de facto relationships.

Mr Speaker, the time has come to put an end to the injustice faced by the many people in de facto and same-sex relationships and to recognise that they must have the same legal right to a fair division of their property should their relationships end or one partner die.

People in de facto relationships do not enjoy the same protections as married couples under the current law. The Act does not apply to them. De facto couples are not treated fairly.

Under the current law they are treated as if they were strangers and their property rights are determined by the general law of contract or the law of trusts. In practice this has resulted in significant unfairness, particularly for women.

An analysis of de facto cases between 1986-1990 found that the average division of property for opposite-sex de facto relationships which lasted between 3 and 10 years ranged between 10 and 40 %.

Research indicated that obtaining more than a 20 to 30% division under the common law approach is extremely difficult. This is hardly a fair and just deal. There should be one set of rules for all New Zealanders.

This was clearly the message sent from my own home city of Tauranga.

A recent survey conducted by National's Justice spokesperson, Tony Ryall found that 58 per cent of respondents considered that when a de facto relationship ends, the division of property should be exactly the same as when a marriage ends. In the same survey 53 percent of respondents indicated that same-sex couples should have the same property rights as opposite sex de facto couples.

Fairness and equity between all our citizens is one of the aims of this government, and an aspiration, I believe, of the vast majority of New Zealanders.

For this reason we must also address economic disparities.

It is clear that the current law is not equipped to address economic disparities that arise upon the breakdown of a relationship, particularly those suffered by a non-career partner.

Research demonstrates that undeniable poverty results for many woman and, sadly, their children when relationships break down. The living standards of many women and children are inevitably lowered more than that of men when relationships end.

Mr Speaker I have received many case studies illustrating the serious injustices that have occurred under the current law.

Many also demonstrate a recurring pattern.

Women are left after long relationships, some as long as 35 years with few assets and employable skills. Typically they have contributed to farms, or businesses as well as devoting their time to the care and up-bringing of children and domestic duties. They are then left with few assets as often the business or the farm is in their husband’s name or is diverted into family trusts and therefore inaccessible. To add to their misery they are left with limited employable skills after having been out of the paid workforce for several decades.

Other inequities commonly occur where one partner contributes indirectly to the increases in value of the separate property of the other partner but seldom receives fair share at the end of the relationship.

Perhaps the greatest injustices are done where one partner ends up with custody of the children, few assets or capital or employable skills and is forced to survive on the Domestic Purposes Benefit while the other partner enjoys a much higher standard of living.

The SOP provides mechanisms which will empower the Court to address economic disparities of this nature.

It should also not be forgotten that this legislation applies equally to men as women. Men as well as women will be free to take time out of paid employment to undertake the care and upbringing of their children and domestic duties without fear that they will suffer economic disadvantage.

Mr Speaker, men and women will be treated equally under this legislation – and there will be many men and women who will have reason to thank this parliament for having passed these measures into law.

During the Select Committee process a large number of submissions expressed concerns that the SOP did not retain the terminology of marriage: husband, wife, and spouse. In response to these concerns, the terms “husband”, “wife”, “spouse” and “marriage” have been reinserted.

Another significant concern was that “de facto relationship” needed to be further defined for greater clarity and guidance. This concern has been taken on board and the SOP now includes a definition of de facto relationship modelled on the New South Wales Property (Relationships) Act 1984.

Some submissions suggested that it would be helpful to have principles to guide the achievement of the purpose of the Act. Principles have, accordingly, been incorporated. These will assist both the Court and those advising couples in the exercise of the discretions in the Act.

The Bill also now provides for the development of a specimen contract out forms by regulations with the aim of providing assistance and minimising legal costs.

Finally, I would like to thank the Justice and Electoral committee and especially its chair Tim Barnett for its work on the Bill.

Reform of matrimonial property law is a complex and challenging task. Over the last few months the Select Committee has worked hard to reconcile competing interests and to translate public submissions into practical recommendations. The SOP has benefited from the Committee’s painstaking effort.

Mr Speaker I am proud to say that this government has kept its election promise and has given priority to progressing legislation that promotes fairness for all New Zealanders. This Bill brings much awaited reform to out-dated matrimonial property law. I therefore consider it should proceed and commend this Bill to the House.


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