The Ex-Files: My husband is a big spender, why should he get half my assets?

My husband is a big spender. Photo / 123RF

The Ex-Files: My husband is a big spender, why should he get half my assets?

Q: After 15 years of marriage, my husband and I are separating. Throughout our relationship my husband has been financially irresponsible, and I have always had to take care of our expenses, contributing more (if not all) to the mortgage and bills. This has been particularly difficult over the last few years, and it has contributed to our separation.

I wouldn’t be so upset if he at least tried, but he has done more to deplete our assets than add to them. He spends lots of money on alcohol and luxury items like expensive watches. He has bought expensive cars on hire purchase that we can’t afford. I contribute my salary to KiwiSaver, he does not.

It doesn’t seem fair that he should get half of what I have worked hard to build. I am worried that he will just end up wasting anything he gets to keep.

No fault

A: New Zealand has a no-fault system. Generally, your property will be split 50:50 regardless of the reasons for your separation or the way spouses/partners have conducted themselves throughout their relationship.

There are limited exceptions; see my previous articles.

Each party are entitled to their half share of the property even if they have had an affair, have gambled and wasted money, have addictions, have been abusive or have otherwise misbehaved. Section 13 of the Property (Relationships) Act 1976 sets out the exception to equal sharing. Section 15 of the Property (Relationships) Act 1976 sets out the orders the court may make to address economic disparities.

When can conduct be considered?

The only express avenue for considering conduct is in s 18A of the Property (Relationships) Act 1976. Under that section, conduct can only be considered if it has been “gross and palpable” and has “significantly affected the extent or value of the relationship property”.

The section focuses on misconduct of a financial nature, such as the dissipation of property through gambling or fraud. These requirements present significant barriers to considering family violence.

This is a very high threshold, so there have only been a few cases where people have been successful in using that part of the law to get a greater than 50% share.

Cases

The behaviour must be extreme:

(a) Where a spouse/partner has run a meth lab in the home without the other party’s knowledge which has materially diminished the value of the home or where someone has a serious gambling problem and have gambled away a significant proportion of the parties’ assets.

(b) A husband went to prison during the marriage for an aggravated robbery conviction. The wife became unable to maintain outgoings on the mortgage, and she was compensated with a greater share of the relationship property.

Does your case meet the threshold?

Based on your description, your husband’s behaviour is unlikely to meet the threshold of s18A. His lavish spending would not be considered “gross and palpable” misconduct, and we would need more information to determine if it has “significantly” affected your property.

Your relationship property would be divided 50:50. This may not seem fair, but it’s the law.

There is a strong view that misconduct should be considered more often, but very few cases have challenged the use of the Property (Relationships) Act 1956.

Your KiwiSaver contributions are relationship property. You may review your KiwiSaver contributions.

You have been in a very frustrating situation and that the outcome for you, financially speaking, will be less than what you think is fair.

Conclusion

The best advice I can give is to try to keep your relationship amicable while you are separating. The more you can agree on between yourselves in terms of the house sale and how you will split your property, the less costly it will be and the quicker you can move forward with your new life.

You need to talk about finances from the very start of the relationship. Even if you keep your finances separate. It is highly advisable to know whether you are going to share your finances or not and what the financial habits are of each of you.