There are some assets and debts which can remain "separate property" and don't need to be shared. These include money or assets which existed prior to the relationship, that are kept separate from any income earned during the relationship. Also, gifts and inheritance received during the relationship which are kept separate.
The property you acquire once you cease living together as a couple is also separate property. So, the money gifted by your parents for the deposit on your new home would be considered your separate property.
However, be aware that separate property may lose this status if it is "intermingled" with relationship property or is treated in a way that converts it to relationship property; for example, if your husband ended up living in the new property with you for a while and contributing to the property either financially or by helping you with renovations.
Your options
The first thing you should do is talk through the situation with your husband, and make sure he agrees that your new home will belong solely to you. If no intermingling occurs, then it should be classed as separate property.
However, this wouldn't stop your husband from bringing a claim against it if he chose to. It is unlikely he would be successful, but you would still incur the time, legal fees and stress to defend the claim.
To feel more secure, you could document it in writing. This can be done in a letter or email to your husband in which you should ask him to confirm this is his understanding. That is, your new home and your parents' gift remain yours. Having written documentation would provide clarity and add additional weight to your verbal agreement.
I also recommend you and your husband enter into a Separation Agreement. This can be a simple document which records that you and your husband are separated and the date of that separation. It would still be important to make sure you keep the deposit gifted by your parents and the property purchased separate from any of the property you jointly own with your husband.
Independent advice
You will each need to obtain independent legal advice prior to signing the agreement. This is crucial as the courts have consistently held that failure to get independent legal advice prior to signing an agreement will generally be fatal to the agreement.
It might be tempting not to risk upsetting your husband by requesting these formalities, but bear in mind that even if couples are on good terms after a separation, this can change once one of them starts to move on with their life, or there are disagreements over big decisions such as the sale price of the home.
Conclusion
It is good that you and your husband are still getting on well after deciding to separate. On the face of it, your new home would probably be considered your separate property. However, if you want to avoid any uncertainty, I advise you and your husband to sign a separation agreement.
Do you have a family law question? Email it to js@bastionchambers.co.nz. Questions should not exceed 200 words. Please provide a phone number. Your name will not be published. Jeremy cannot answer all questions, correspond directly with readers, or give legal advice. Jeremy's advice is of a general nature, and he is not responsible for any loss that any reader may suffer from following it.
Jeremy Sutton is a senior family lawyer, specialising in divorce cases where there are significant assets, including family trusts and complex business structures. www.jeremysutton.co.nz
