Expert Prenuptial Agreements & Contracting Out Agreements

11 August 2020

Prenuptial Agreements – legally known as a Contracting Out Agreement

What is a prenuptial agreement?

Prenuptial Agreements are formally referred to as a contracting out agreement. A prenuptial agreement is used when a married couple, civil union or de facto relationship of more than three years separate, this will determine how the property will be distributed. It is always advised that if prior to the relationship one party had significantly higher assets than the other party that a prenuptial agreement is entered into. There is the hope that you will never have to use it, however, if this circumstance does arise it brings peace of mind. It is also important that current legislation makes the place where the parties live relationship property. Therefore, a prenuptial agreement is a way to protect the property that you bring to a relationship.

What happens if there is no prenuptial agreement?



If there is no prenuptial agreement, the relationship property will be distributed in accordance with the Property Relations Act 1976. The relationship has to be over three years and the couple has to have been married, in a civil union or in a de facto relationship. However, there are some circumstances where the three-year rule can be reduced. When a couple separate, all the property owned jointly together will be classed as relationship property. This includes;


-         The family home (whenever acquired);

-         Family chattels;

-         Property purchased in contemplation of the relationship and/or the benefit of the family;

-         Income earned or assets acquired during the relationship.


 There can be separate property;


-         Such as inheritance or a gift;

-         A business;

-         Or property owned prior to the relationship commencing.


The issue with separate property if it is “intermingled” and used for the common use and benefit of the relationship or the family, it may be deemed as relationship property. Another example is where one person owns a business and over the relationship the value of the business has increased. 

When should I get a prenuptial agreement?

At Weston Ward and Lascelles we advise that an agreement should be entered into when;

-         Where one party has significantly higher assets than the other, when entering the relationship;

-         Where one or both parties own a home at the start of the relationship;

-         Where the relationship is a second (or more) relationship for one or either party, especially when there are children from previous relationships.


For a valid agreement to be executed each party needs to receive independent legal advice.


Can a prenuptial agreement be overturned?

These agreements can only be overturned if the Court is satisfied that it would cause serious injustice to the other party involved or that they believe that either client was not advised clearly of the implications of the agreement. However, this is uncommon. 


What should I do from here?

 If you have any questions please contact our supportive family lawyers in our Christchurch office.

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