Articles by Matthew Gilligan
tIn case you missed it over the weekend, the NZ Herald article on a woman being awarded a share of her husband's 'inherited property' that pre-existed the relationship rewrote some relationship property rules.
The Supreme Court held that a woman who helped maintain an inherited farm property (that pre-existed the marriage) was entitled to 40% of the growth on the property that occurred during the relationship.
Because she contributed to the maintenance of the house by performing domestic chores and by earning income.
Why is this a change?
It was generally accepted before this case that inherited property that pre-existed a marriage is separate relationship property and not subject to 50/50 split on divorce.
Personally I think the case is fair - she did contribute to the relationship so why should it not be shared property, given she contributed to the property's upkeep? The plaintiff's counsel noted the farm would have likely been forced to be sold, but for her income being used to support bank payments.
If you wish to avoid this happening, - put your property in a trust and ask your spouse to sign a relationship property agreement. The latter (relationship property agreement or S21 agreement) makes it very clear that the property is not intended to be joint relationship property. Such agreement is much easier than an expensive fight later on, and perhaps easier to put in place earlier than later.
The trust is a great thing to do before the relationship commences, but is weakened as a defence to a claim if set up during the marriage and the property is transferred during the relationship. If you wish to do this during the marriage, the S21 agreement is essential to stop spouses 'tracing' their potential relationship property interest into the trust.
Salesh is the best CA I have ever met in New Zealand so far. Period! The reason that I had fired my previous accountants is that they are so cheap. And they offer cheap advice. You need good and solid advice that can make you more money in the long run. And Salesh is the man who can deliver real results for you. Cheers to your success, Kind Regards - George Guo - ANZ BANK Senior Personal Banker
If you're investing in residential property, seeking to maximise your ability to succeed and minimise risk, then this is a 'must read'.
Matthew Gilligan provides a fresh look at residential property investment from an experienced investor’s viewpoint. Written in easy to understand language and including many case studies, Matthew explains the ins and outs of successful property investment.