The Ex-Files with Jeremy Sutton: My ex-partner secretly spent $200K on designer clothes - is it fair that we split our assets evenly?

The xx-partner spent hundreds of thousands of dollars on buying designer clothes. Photo / 123rf

OPINION

Q. My partner has recently decided to end our relationship and we are in the process of dividing our assets. Shortly after our separation, I realised that he has been spending tens of thousands a year on designer clothing and shoes.

I always knew he liked shopping but did not realise the extent of his obsession until now. He controlled our finances and I never looked at the credit card statements. I now see he has spent in the vicinity of $150,000 to $200,000 in the last three years in retail shops.

I was always under the impression that money was tight so I picked up extra hours at work when I could and I cooked all our food from scratch, making the most of specials at the supermarket when possible. Our total asset pool sits at about $1 million. It does not seem fair that he now gets an equal share of all our assets.

In New Zealand relationship property is generally divided equally and the Family Court will not revisit how a couple managed their finances during their relationship, nor pay any attention to misbehaviour generally (such as one party having an affair).

However, in some exceptional circumstances, the Court will consider misconduct by one party when it comes to whether the property is divided unequally, in one party’s favour. The threshold is high – the misconduct must have been:

1. “Gross and palpable;” and

2. It must have significantly affected the extent or value of the relationship property pool.

Neither the words gross or palpable are defined in the legislation but they suggest that the misconduct must have been significant for the Court to depart from the legislation’s general policy of equal sharing.

In a recent case involving a husband with an online gambling addiction, the Judge mentioned the following as being relevant:

1. The size of the relationship property pool. Presumably, larger property pools will require larger amounts to be wasted to reach the threshold of misconduct. In your case the funds spent on clothing and shoes represent between 15 per cent and 20 per cent. This is a sizeable portion of the relationship property pool.

2. Whether the misconduct is easily quantifiable. It appears from your comments above that you now have evidence of your husband’s spending from the bank accounts and therefore the misconduct is able to be quantified.

3. Whether the spending was with the other party’s knowledge or consent. You did not have full knowledge of the shopping sprees, nor did you consent to them.

The Court will only have jurisdiction to make an order in your favour if your lawyer makes an application under the specific sections of the legislation that govern misconduct.

Previous successful “misconduct” cases tend to be those where one party has gambled. The facts here are different but my view is that you would likely meet the threshold outlined in the legislation based on the information you have provided.

You would be wise to attempt to negotiate a settlement with your ex-partner, if possible, because of the high threshold that needs to be met for misconduct to be compensated by the Court.